5 - Investment Reprisal and Post-Establishment Illegality

Summary

Chapter 5 looks at the other form of contributory fault: a defence called investment reprisal. Aside from the different causal relation that an instance of investment reprisal has to the relevant loss in comparison to mismanagement, the former involves wrongful conduct on the part of the investor, rather than risky conduct. For this reason, investment reprisal is a form of investor misconduct, which brings it close to another defence: post-establishment illegality. In establishing their doctrinal foundations, special attention is paid to how the circumstances that activate them differ from similar circumstances that relate to different rules, such as the legality requirement for jurisdiction. The bulk of this chapter is dedicated to detailing these defences’ legal content and traversing the difficult questions on jurisdiction and admissibility that they raise. Again, the opportunity is taken to propose a reason-based method for apportioning liability when these defences apply, and the concluding sections distinguish them from other related legal concepts.