When a U.S. educator thinks of raising money, his first target is a U.S. corporation. But do corporations have the legal right to give away their stockholders' money? Last week, in a suit brought by a group of stockholders against A. P. Smith Manufacturing Co. (valves and fire hydrants) over a $1,500 gift to Princeton, a New Jersey court answered yes.
The stockholders charged that a company has no right to use its funds for any purpose but furthering the business; in giving money to Princeton, it was violating its contract with its stockholders and depriving them of their property rights in...
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