Corporate & Securities Law

Nicole Gelinas on Criminalizing Capitalism

Posted on February 12, 2008
From the latest City Journal comes an article arguing that “Six years after Enron, executives face greater risks—but investors are no safer.” … in the end, Sarbanes-Oxley has just made it easier for ambitious government attorneys to criminalize bad business judgment and complex accounting in hindsight...

Congratulations to John Coates

Posted on February 12, 2008
Kudos to John Coates, who has been named the John F. Cogan, Jr. Professor of Law and Economics at HLS. His inaugural lecture can be viewed here. [continued on site]

The Shifting Balance of Power between Shareholders and the Board

Posted on February 12, 2008
I commend to your attention Jennifer Hill’s new article, The Shifting Balance of Power between Shareholders and the Board: News Corp’s Exodus to Delaware and Other Antipodean Tales, which contrasts the policy arguments of shareholder primacists (like Lucian Benchuk) to those of director primacists (like yours truly)...

A Fun New Efficient Capital Markets Anomaly

Posted on February 12, 2008
Dealbreaker: The markets have been off to a rocky start this year but maybe the bulls can breath a sigh of relief now that the Sports Illustrated Swimsuit issue is on the newsstands with Marisa Miller on the cover. The folks over at Bespoke Investment have run the numbers and created a Sports Illustrated Swimsuit Issue Indicator...

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Hostile Takeovers by the Numbers

Posted on February 12, 2008
Dealbook reports: Since 1998, there have been 44 bids valued at more than $10 billion that were initially considered hostile by the board of the target company. Of those, 18 bids, or 41 percent, led to a completed transaction. But 20 of them, or 45 percent, were withdrawn without a deal...

Too many law reviews? With thoughts on the interdisciplinary demographic trend

Posted on February 11, 2008
From the Law Blog: The institution of law reviews has always been a great source of puzzlement to the Law Blog. As a 2L, the sunny afternoons we labored away blue-booking articles were — we’re pretty certain — among the most ill-spent hours of our law-school career...

Lerach Gets 2 Years

Posted on February 11, 2008
From the WSJ Law Blog: Famed plaintiffs lawyer Bill Lerach received a two-year sentence today for his role in the alleged kickback scheme at Milberg Weiss. Lerach, 61, was also sentenced to two years probation, fined $250,000 and ordered to complete 1,000 hours of community service...

Governance and Performance: The Direction of the Causation Arrow

Posted on February 11, 2008
Here is a provocative paper that argues the causation arrow runs in the opposite direction of what one might assume: A common view, seemingly supported by empirical findings, is that better corporate governance leads to better corporate performance...

Feeds and Other Site News

Posted on February 11, 2008
I am in the process of joining a new (to me) blogger advertising network, whose contract requires me to offer truncated feeds. Hence the change that some of you have already noted with disapprobation. Sorry! Anyway, there will be some minor changes to the sites to accomodate the newtork’s preferred formats...

Does Dodge v Ford Motor Co Remain Canon?

Posted on February 11, 2008
My friend and UCLAW colleague Lynn Stout has posted to SSRN a provocative paper: Why We Should Stop Teaching Dodge v. Ford: Among non-experts, conventional wisdom holds that corporate law requires boards of directors to maximize shareholder wealth. This common but mistaken belief is almost invariably supported by reference to the Michigan Supreme Court’s 1919 opinion in Dodge v...

The Faculty Lounge

Posted on February 11, 2008
The Faculty Lounge is a new law professor blog: A little over six months ago I took a break from blogging, leaving Concurring Opinions and focusing on my job as an associate dean of Drexel University’s new law school.  We’ve had a hectic fall, working relentlessly on hiring while remaining focused on the essential task of earning provisional accreditation from the ABA...

Jensen on Professorial Dress Codes Redux

Posted on February 10, 2008
I have never met Case Western Law Professor Erik Jensen. For all I know, he may be the greatest guy in the world. With that disclaimer out of the way, however, the dude is seriously bugging me. Regular readers of this space will recall that I have had occasion to call out Jensen in the past...

Setting the professorial bar low

Posted on February 09, 2008
The next time your law students complain that you or one of your colleagues is just mailing it in, tell them this story about former University of Tennessee law professor and dean John Randolph Neal: Neal never spent much time on campus — often arriving late, if at all, for class, devoting class time to rambling lectures about current political issues rather than to the course subject matter, and giving all his law students a grade of 95 without reading their exams...

Fiduciary Duties of Officers

Posted on February 09, 2008
Lyman Johnson has posted Having the Fiduciary Duty Talk: Model Advice for Corporate Officers (and Other Senior Agents), a paper that will be very useful to both academics but also, and perhaps especially, practitioners: Countless legal materials address the fiduciary duties of corporate directors...

ABA Stoneridge Panel Comments: Stoneridge and Capital Markets Policy

Posted on February 08, 2008
Stoneridge and Capital Markets Policy The text on which my remarks will be based: There is growing concern that American capital markets are becoming less competitive in the global economy.  Indeed, as both the Paulson Committee and the Schumer-Bloomberg reports documented, New York financial markets, stifled by stringent regulations and high litigation risks are in danger of losing business and highly skilled workers to overseas competitors, adversely impacting not only New York, but the entire US economy...

Defective Stock Issuances Under Delaware Law

Posted on February 07, 2008
Seth Tillman has co-authored a new article, Void or Voidable?—Curing Defects in Stock Issuances Under Delaware Law: It is not unusual for practitioners reviewing a Delaware corporation’s stock records to find omissions or procedural defects raising questions as to the valid authorization of some of the outstanding stock...

Lisa Fairfax on Say on Pay

Posted on February 07, 2008
Lisa Fairfax reviews where we stand on say on pay: According to riskmetrics’ most recent proxy report, by the first half of the 2007 proxy season, some 41 say on pay proposals had gone to vote, averaging about 42% shareholder support, and seven proposals received majority support...

The Passivity of Institutional Investors

Posted on February 07, 2008
Megan McArdle: I wish someone had a better answer to the question of why large institutional investors aren’t more active in corporate governance. I’m not entirely sure what she means by “better” answer, but there is a clear answer...

The Derminants of CEO Pay

Posted on February 07, 2008
Megan McArdle reviews the Logic of Life, by Tim Harford, focusing on the chapter dealing with CEO pay. She concisely tackles tournament theory, management power, and outrage as prime determinants of CEO pay. For my take, see Executive Compensation: Who Decides?

ABA Stoneridge Panel

Posted on February 05, 2008
This Friday at the ABA mid-year meeting here in Los Angeles, there will be a panel on the Stoneridge case, in which yours truly will be participating. The program is free to area law students and mine are encouraged to attend. The program registration form is here...

UCLA Gets $1.5 Million for Entertainment Law Chair

Posted on February 05, 2008
UCLA announces: The UCLA School of Law has received a $1.5 million commitment from the Shapiro Family Charitable Foundation to establish the Pete Kameron Endowed Chair in Law in honor of the long and distinguished career of Pete Kameron, a philanthropist and legendary music industry figure...

The Newest Corporate Governance Blogger is?.

Posted on February 05, 2008
... Carl Icahn. The Icahn Report’s website is up, but no blog posts yet.

Section 16(b) Quiz

Posted on February 05, 2008
I gave this to my class today as an exercise: 1. Shania is president of Acme, Inc. Her transactions were as follows: March 1: bought 100 shares at $10 April 1: sold 70 shares at $12 May 1: bought 50 shares on May 1 at $9 May 15: sold 25 shares at $13 December 31: sold 35 shares at $20 What liability does she have, if any? 2...

Behavioral Economics and Regulation

Posted on February 04, 2008
Dealbreaker.com: … calls for additional regulation often depend on a double standard under which market process are characterized by imperfect information and dominated by self-interest while regulatory processes are somehow viewed as well-informed and public-minded...

Pills, Proxies, and Notice: The Microsoft Bear Hug

Posted on February 01, 2008
Dealbook picked up an interesting wrinkle of Microsoft’s bear hug letter to yahoo’s board: Microsoft states in its letter that: Depending on the nature of your response, Microsoft reserves the right to pursue all necessary steps to ensure that Yahoo!’s shareholders are provided with the opportunity to realize the value inherent in our proposal...

The Arid CSR Debate

Posted on February 01, 2008
A couple of weeks ago, The Economist magazine ran a special report on corporate social responsibility.  I finally got around to reading it today and am struck very forcefully by the aridity of the debate.  And I say this as someone who has killed more than his fair share of trees contributing to that debate...

Exam Length and Grade

Posted on February 01, 2008
My friend and UCLA law colleague Eugene Volokh reports: Last semester, I for the first time recorded in my exam scoring spreadsheet the length of each answer. This let me figure out the correlation between the length and the grade. ... The correlation coefficient of the total score (which combined the essay score and the multiple choice score) and the essay word count was 0...

Blog Cite Counts

Posted on January 31, 2008
Orin Kerr: Volokh Conspiracy Citations in the Westlaw JLR Database: By year: 2004, 14 citations. 2005, 22 citations. 2006, 69 citations. 2007, 43 citations. Note that the high number of citations in 2006 resulted in part from the publication of papers from conferences about law blogs, and that the number of citations for 2007 will likely increase in the future because not all journals have posted their final 2007 issues to the database...

UCLA Business Law Program Newsletter

Posted on January 30, 2008
Sextonism on line. Seriously, my colleages are up to some interesting things and the newsletter summarizes some of the best recent work.

Stoneridge Roundup

Posted on January 30, 2008
Lyle Roberts collects and links to a comprehensive set of blawgosphere commentary on Stoneridge.

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