Is There Really Less Securities Fraud? And If So, Should We Thank the Feds?
Securities fraud class-actions are down. In an op-ed in yesterday’s WSJ, Joseph Grundfest observed that both the number of such actions and the dollar value of total damages claims have dropped...
View ArticleCoase, Penalty Defaults, and the Disgorgement Remedy for Breach of Fiduciary...
Law students, I have found, often have a hard time seeing how the Coase Theorem applies outside the context of land use conflicts. They also tend to think Coase’s insight is not so important because,...
View ArticleNew Paper on Majority Voting for the Election of Directors
A draft of my new paper entitled Majority Voting for the Election of Directors is now up on SSRN. I co-authored the piece with Young Kim, a finance professor at Northern Kentucky, so it has an...
View ArticleAALS Disney Panel Podcast
Podcasts from this year’s AALS conference are now available. Click here for the Business Associations panel on the Disney case. Recall that Justice Jacobs from the Delaware Supreme Court (author of the...
View ArticleLimited Liability Gets All the Love
Anything by Henry Hansmann is worth reading and then revisiting from time to time. Recently, I revisited Hansmann’s article with Reinier Kraakman The Essential Role of Organizational Law, 110 Yale...
View ArticleInsider Trading: Sin or Crime? (or None of the Above?)
R. Foster Winans knows insider trading. A former author of the Wall Street Journal‘s Heard on the Street column, Winans was a key figure in an insider trading case that went all the way to the U.S....
View ArticleAnnual Corporate Law Institute: "Everybody who is anybody is there."
I leave tomorrow for Tulane’s Annual Corporate Law Institute. This conference is viewed by many as the top annual deal conference, so I am expecting great things (this will be my first time...
View Article"Can you have angst without a soul?"– Delaware Vice Chancellor Leo Strine
As promised, I am reporting back from Tulane’s Corporate Law Institute qua “Who’s Who in the M&A World” gathering. Leo Strine did indeed query today: “can you have angst without a soul?” (He...
View ArticleDear Wal-Mart, Shareholders *own* the corporation.
Today’s WSJ had an article titled “Wal-Mart Apologizes to Groups That Were Focus of Surveillance,” which noted that Wal-Mart apologized for responding to large institutional shareholders as “threats.”Â...
View ArticleMickey Mouse Investment Banks
Last month, at Tulane’s Corporate Law Institute, Delaware Vice Chancellor Leo Strine suggested that it might not be prudent for directors to consult “Mickey Mouse†investment banks when assessing...
View ArticleNorth Dakota Publicly Traded Corporation Act
The governor of North Dakota recently signed into law the North Dakota Publicly Traded Corporation Act (ht: Broc Romanek). The Act resembles a shareholder activist wish list including majority voting...
View ArticleDow Jones Board Action: Nice exam question
Does a bid for Dow Jones implicate Revlon duties? Can a board “just say no”? What if the Board says nothing, b/c they know a majority of their s/h will not vote for the acquisition? This is the...
View ArticleProfessor Bainbridge's Complete Guide to Sarbanes-Oxley
Is available here. Here is the description: Congress passed the Sarbanes-Oxley Act in response to major corporate and accounting scandals–and many consider the act to be the most significant change in...
View ArticleSlopping Wordsmithing by the WSJ or Bad Corporate Governance?
As we know, News Corp. has made a bid for Dow Jone, offering $60/sh for the outstanding Dow Jones stock.  The Bancroft family, however, who controls at least a majority of the Dow Jones voting stock,...
View ArticleMy Take on Credit Suisse . . .
is here, over at eCCP, and differs somewhat from Thom’s. The takeway excerpt is: Credit Suisse has important implications for antitrust practice. The decision’s effect is to narrow the scope of...
View ArticleProfessor Trey Drury & Personal Liability for Directors
The Glom’s Junior Scholars Workshop, on Location, at TOTM.com: For the Conglomerate’s Annual Junior Scholars Workshop, I agreed to comment on a paper by Loyola University Professor Trey Drury that...
View ArticleAre Chimps Smarter than Humans?
I’ve previously hypothesized that the persistence of legal rules that lead to less overall wealth but seemingly more equitable distributions (rules such as the insider trading ban and Regulation FD)...
View ArticleUnited/Delta
Yet another major airline merger appears to be in the works: United and Delta. This calls for some antitrust analysis. A few months ago, Thom did a thorough job analyzing the antitrust aspects of...
View ArticleScrapping the Notion of Fiduciary Duties Owed to Shareholders
U of Chicago Law Professors Douglas Baird and M. Todd Henderson (my very smart, very tall law school classmate) recently posted a provocative paper on SSRN. The paper, Other People’s Money, contends...
View ArticleCorporate Governance Indices and Shareholder Value
Much discussion of corporate governance in the last few years has centered on reforms advocated by ISS and CII and indices of good corporate governance practice created and maintained by such groups. A...
View ArticleRibstein on Unincorporated Firms
Motivated by a slate of forthcoming articles, books, and various projects involving unincorporated firms, Professor Ribstein has announced his plans to begin blogging more extensively about...
View ArticleMicrosoft Bids for Yahoo – Yahoo’s Board Will Respond
Microsoft has made a bid for Yahoo, and the Yahoo board of directors is anticipated to use the Nancy Reagan “Just Say No†defense. I feel like I’m back in the 1980s merger boom. Several...
View ArticleTulane Corporate Law Institute
Tulane’s annual “Corporate Law Institute” is coming up! The conference – widely viewed as the must-attend deal conference of the year is April 3 and 4 (only two weeks away). The roster for this year’s...
View ArticleGE "Slashes" Earnings: Free Advice from Nowicki for GE Exec. Jeffrey Immelt!
The Financial Times reported yesterday that an embarrassed GE CEO Jeffrey Immelt had to tell GE shareholders that the 10% growth in earnings for 2008 that he had promised analysts in March was not...
View ArticleConference: The Economics and Law of the Entrepreneur
The Searle Center on Law, Regulation and Economic Growth at Northwestern University School of Law is continuing its excellent run of conferences with an event on June 18th-19th organized by Daniel...
View ArticleAALS Agency, Partnerships and LLCs Section Call for Papers
Larry Ribstein is organizing the upcoming AALS session of agency, partnerships and LLCs and has posted the following call for papers: The Section on Agency, Partnerships and Limited Liability Companies...
View ArticleWho Is Going to Jail For All of This?
David Zaring cuts to the chase.Posted in business, corporate law, economics, markets, regulation
View ArticleBainbridge on the Cuban Insider Trading Case
Professor Bainbridge offers a very detailed analysis of the complaint in the SEC’s case against Dallas Mavericks owner Mark Cuban. Posted in business, corporate governance, corporate law, securities...
View ArticleThe Law Market
The Law Market, Larry Ribstein’s new and important book with Erin O’Hara looks great and is available here from Oxford University Press. The book description from the website sets the stage: Today, a...
View ArticleSupreme Court Nominee Judge Sonia Sotomayor and Corporate and Securities Law
I have been asked a few times today to opine, as a corporate and securities law scholar, on President Obama’s nomination of Judge Sonia Sotomayor for the Supreme Court. (Cnn.com has a couple of quotes...
View ArticleA bright spot in the bleak financial industry regulatory firmament
Between the various power grabs and dubious regulatory proposals (each more dubious than the last!) from the likes of Geithner, Bernanke, Frank (.pdf), Dodd, etc., etc. you’d be excused for thinking...
View ArticleTOTM Welcomes New Permanent Blogger J.W. Verret
TOTM is very pleased to announce a new permanent member, J.W. Verret (George Mason). J.W. has been blogging at Volokh Conspiracy recently, but he’s been a guest over at The Conglomerate, and the...
View ArticleLearning to Love Insider Trading
Today’s Wall Street Journal includes a terrific article explaining why insider trading should be deregulated. Following up on last week’s high-profile insider trading charges, George Mason economist...
View ArticleThe Collected Works of Henry G. Manne
I’m delighted to report that the Liberty Fund has produced a three-volume collection of my dad’s oeuvre. Fred McChesney edits, Jon Macey writes a new biography and Henry Butler, Steve Bainbridge and...
View ArticleThe federalization of corporate governance marches on
Last month I noted that the Senate was about to repeat its SOX mistake with another ill-fated foray into regulating corporate governance. I focused on provisions for mandatory majority voting,...
View ArticleWilkes v. Springside and the Rise of the Uncorporation
As I noted last week I participated with several corporate law luminaries in a conference at Western New England College in Springfield, Massachusetts on the famous case of Wilkes v. Springside Nursing...
View ArticleStephen Bainbridge on Mandatory Disclosure: A Behavioral Analysis
Stephen Bainbridge is the William D. Warren Professor of Law at UCLA School of Law. Mandatory disclosure is a—maybe the—defining characteristic of U.S. securities regulation. Issuers selling securities...
View ArticleIn Defense of Delaware’s Business Judgment Rule
In a recent Dealbook post, Steven M. Davidoff complains that Delaware’s business judgment rule is too lenient. Davidoff contends that “[a] Delaware court is not going to find [directors] liable no...
View ArticleBanning Executives
From the WSJ: The Department of Health and Human Services this month notified Howard Solomon of Forest Laboratories Inc. that it intends to exclude him from doing business with the federal government....
View ArticleSEC Organizational Reform Hearing
The semester is off to a bang. I arrived at Stanford Monday to start teaching in the Law School and begin a research fellowship at the Hoover Institution. Yesterday I hiked in the mountains...
View ArticleDebating the business judgment rule
Alison Frankel gripes about a NJ judge’s ruling throwing out a shareholders’ derivative suit seeking to hold the J & J board accountable for problems concerning the company’s Rispardal drug....
View ArticleThe emerging venue battle in El Paso/Kinder Morgan
T-R’s Alison Frankel writes (HT Pileggi) about dueling suits in Texas and Delaware challenging the El Paso/Kinder Morgan merger: Three class actions in Texas state court and two class actions and a...
View ArticleThe jurisprudential significance of blogs
Gordon Smith notes that this issue came up at a Columbia conference on Delaware law and courts. He observes that the Glom gets a plug on a speaker’s slide. So I’ll mention that above the Glom on the...
View ArticleAbolishing corporate personhood: still stupid
Doug Mataconis criticizes efforts in Congress to overrule Citizens United by abolishing corporate personhood (HT Bainbridge). I’ve already addressed this issue, noting among other things that “the loss...
View ArticleUCLA Law’s Lowell Milken Institute Law Teaching Fellowship Now Accepting...
I’m pleased to pass along the following information from the Lowell Milken Institute for Business Law and Policy at UCLA School of Law: Introduction The Lowell Milken Institute for Business Law and...
View ArticleContemplating Disclosure-Based Insider Trading Regulation
TOTM friend Stephen Bainbridge is editing a new book on insider trading. He kindly invited me to contribute a chapter, which I’ve now posted to SSRN (download here). In the chapter, I consider...
View ArticleSo What’s Going to Happen to Securities Fraud Class Actions? Some Thoughts on...
On Wednesday, the U.S. Supreme Court heard oral argument in Halliburton v. Erica P. John Fund, a case that could drastically alter the securities fraud landscape. Here are a few thoughts on the issues...
View ArticleMeese and Oman Spank the Corporate Law Prof Amici in Hobby Lobby
The Religious Freedom Restoration Act (RFRA) subjects government-imposed burdens on religious exercise to strict scrutiny. In particular, the Act provides that “[g]overnment shall not substantially...
View ArticleSUPREMES PRESERVE FRAUD ON THE MARKET (AND BAIL OUT CLASS ACTION PLAINTIFFS)...
On June 23 the Supreme Court regrettably declined the chance to stem the abuses of private fraud-based class action securities litigation. In Halliburton v. EPJ Fund (June 23, 2014), a six-Justice...
View ArticleLynn Stout on “criminogenic” hedge funds and insider trading
Lynn Stout, writing in the Harvard Business Review’s blog, claims that hedge funds are uniquely “criminogenic” environments. (Not surprisingly, Frank Pasquale seems reflexively to approve): My...
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