Law Commons^™

Barbarians Inside The Gates: Raiders, Activists, And The Risk Of Mistargeting, Zohar Goshen, Reilly S. Steel

Faculty Scholarship

This Article argues that the conventional wisdom about corporate raiders and activist hedge funds — raiders break things and activists fix them — is wrong. Because activists have a higher risk of mistargeting — mistakenly shaking things up at firms that only appear to be underperforming — they are much more likely than raiders to destroy value and, ultimately, social wealth.

As corporate outsiders who challenge the incompetence or disloyalty of incumbent management, raiders and activists play similar roles in reducing “agency costs” at target firms. The difference between them comes down to a simple observation about their business models: …

Tax Havens As Producers Of Corporate Law, William J. Moon

Faculty Scholarship

This Review Essay situates Christopher Bruner’s new book, Re-imagining Offshore Finance, within the literature examining the regulation of cross-border finance and highlights its import for thinking about the complicated (and contested) relationship between territorially-configured domestic laws and the increasingly liberal movement of capital. Part I sets out the book’s central thesis. In addition to highlighting Bruner’s novel framework identifying the factors that propel certain small jurisdictions into becoming magnets for cross-border finance, I outline the limits of the framework in accounting for the stability in the overall demand for the commercialization of sovereignty, only one of which is facilitating …

From Corporate Law To Corporate Governance, Ronald J. Gilson

Faculty Scholarship

In the 1960s and 1970s, corporate law and finance scholars gave up on their traditional approaches. Corporate law had become “towering skyscrapers of rusted girders, internally welded together and containing nothing but wind.” In finance, the theory of the firm was recognized as an “empty box.” This essay tracks how corporate law was reborn as corporate governance through three examples of how we have usefully complicated the inquiry into corporate behavior. Part I frames the first complication, defining governance broadly as the company’s operating system, a braided framework of legal and non-legal elements. Part II adds a second complication by …

A Machine Learning Classifier For Corporate Opportunity Waivers, Gabriel V. Rauterberg, Eric L. Talley

Faculty Scholarship

Rauterberg & Talley (2017) develop a data set of “corporate opportunity waivers” (COWs) – significant contractual modifications of fiduciary duties – sampled from SEC filings. Part of their analysis utilizes a machine learning (ML) classifier to extend their data set beyond the hand-coded sample. Because the ML approach is likely unfamiliar to some readers, and in the light of its great potential across other areas of law and finance research, this note explains the basic components using a simple example, and it demonstrates strategies for calibrating and evaluating the classifier.

Time To Lift The Veil Of Inequality In Health Care Coverage: Using Corporate Law To Defend The Affordable Care Act, Seema Mohapatra

Faculty Scholarship

No abstract provided.