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Series

SSRN

Business Organizations Law

2007

Articles 1 - 12 of 12

Full-Text Articles in Law

Law And Capitalism: What Corporate Crises Reveal About Legal Systems And Economic Development Around The World, Curtis J. Milhaupt, Katharina Pistor Jan 2007

Law And Capitalism: What Corporate Crises Reveal About Legal Systems And Economic Development Around The World, Curtis J. Milhaupt, Katharina Pistor

Faculty Scholarship

This book explores the relationship between legal systems and economic development by examining, through a methodology we call the institutional autopsy, a series of high profile corporate governance crises around the world over the past six years. We begin by exposing hidden assumptions in the prevailing view on the relationship between law and markets, and provide a new analytical framework for understanding this question. Our framework moves away from the canonical distinction between common law and civil law regimes. It emphasizes the constant, iterative, rolling relationship between law and markets, and suggests that how a given country's legal system ...


Controlling Family Shareholders In Developing Countries: Anchoring Relational Exchange, Ronald J. Gilson Jan 2007

Controlling Family Shareholders In Developing Countries: Anchoring Relational Exchange, Ronald J. Gilson

Faculty Scholarship

The Law and Finance account of the ubiquity of controlling shareholders in developing markets is based on conditions in the capital market: poor shareholder protection law prevents controlling shareholders from parting with control out of fear of exploitation by a new controlling shareholder who acquires a controlling position in the market. This explanation, however, does not address why we observe any minority shareholders in such markets, or why controlling shareholders in developing markets are most often family-based. This paper looks at the impact of bad law on shareholder distribution in a very different way. Developing countries typically provide not only ...


Decisions About Coercion: The Corporate Attorney-Client Privilege Waiver Problem, Daniel C. Richman Jan 2007

Decisions About Coercion: The Corporate Attorney-Client Privilege Waiver Problem, Daniel C. Richman

Faculty Scholarship

This symposium essay explores the contestable empirical and normative assumptions that underlie criticisms of the Justice Department's policies with respect to the waiver of corporate attorney-client and work-product privileges. And it considers how authority with respect to prosecutorial decisionmaking in this area ought to be allocated.


We Are All Entrepreneurs Now, David Pozen Jan 2007

We Are All Entrepreneurs Now, David Pozen

Faculty Scholarship

A funny thing happened to the entrepreneur in legal, business, and social science scholarship. She strayed from her capitalist roots, took on more and more functions that have little to do with starting or running a business, and became wildly popular in the process. Nowadays, "social entrepreneurs" tackle civic problems through innovative methods, "policy entrepreneurs" promote new forms of government action, "norm entrepreneurs" seek to change the way society thinks or behaves, and "moral entrepreneurs" try to alter the boundaries of duty or compassion. "Ethnification entrepreneurs," "polarization entrepreneurs," and other newfangled spinoffs pursue more discrete objectives. Entrepreneurial rhetoric has never ...


Just One Click: The Reality Of Internet Retail Contracting, Ronald J. Mann, Travis Siebeneicher Jan 2007

Just One Click: The Reality Of Internet Retail Contracting, Ronald J. Mann, Travis Siebeneicher

Faculty Scholarship

Scholars for decades have noted the possibility that standard-form contracts disadvantage consumers. For many years, that literature focused on the idea that sellers with market power draft contracts that are disadvantageous to consumers. Law and economics scholars, however, have been skeptical about that hypothesis, pointing out that a strategy of inefficient terms rarely would be the optimal technique for exploiting market power. In recent years, however, the debate has shifted as new product distribution channels have changed the technology of contracting. Now, even firms without market power can exploit the cognitive failures of their customers through "shrouding" of terms and ...


Deconstructing Equity: Public Ownership, Agency Costs, And Complete Capital Markets, Ronald J. Gilson, Charles K. Whitehead Jan 2007

Deconstructing Equity: Public Ownership, Agency Costs, And Complete Capital Markets, Ronald J. Gilson, Charles K. Whitehead

Faculty Scholarship

The traditional law and finance focus on agency costs presumes, without acknowledgement, that the premise that diversified public shareholders are the cheapest risk-bearers is immutable. In this Essay, we raise the possibility that changes in the capital markets have called this premise into question, drawn into sharp relief by the recent private equity buying wave in which the size and range of public companies being taken private expanded significantly. In brief, we argue that private owners, in increasingly complete markets, can transfer risk in discrete slices to counterparties who, in turn, can manage or otherwise diversify away those risks they ...


Sarbanes-Oxley's Effects On Small Firms: What Is The Evidence?, Ehud Kamar, Pinar Karaca-Mandic, Eric L. Talley Jan 2007

Sarbanes-Oxley's Effects On Small Firms: What Is The Evidence?, Ehud Kamar, Pinar Karaca-Mandic, Eric L. Talley

Faculty Scholarship

This article presents an overview of the regulatory regime created by the Sarbanes-Oxley Act of 2002 (SOX) and its implications for small firms. We review the available evidence in three distinct domains: compliance costs, stock price reactions, and firms' decisions to exit regulated securities markets.


Lawyers Asleep At The Wheel? The Gm-Fisher Body Contract, Victor P. Goldberg Jan 2007

Lawyers Asleep At The Wheel? The Gm-Fisher Body Contract, Victor P. Goldberg

Faculty Scholarship

In the analysis of vertical integration by contract versus ownership one event has dominated the discussion – General Motors' merger with Fisher Body in 1926. The debates have all been premised on the assumption that the ten-year contract between the parties signed in 1919 was a legally enforceable agreement. However, it was not. Because Fisher's promise was illusory the contract lacked consideration. This note suggests that GM's counsel must have known this. It raises a significant question in transactional engineering: what is the function of an agreement that is not legally enforceable.


Relational Tax Planning Under Risk-Based Rules, Alex Raskolnikov Jan 2007

Relational Tax Planning Under Risk-Based Rules, Alex Raskolnikov

Faculty Scholarship

Risk-based rules are the tax system's primary response to aggressive tax planning. They usually grant benefits only to those taxpayers who accept risk of changes in market prices (market risk) or business opportunities (business risk). Attempts to circumvent these rules by hedging, contractual safeguards, and diversification are well-understood. The same cannot be said about a very different type of tax planning. Instead of reducing risk directly, some taxpayers change the nature of risk. They enter into informal, legally unenforceable agreements with contractual counterparties that are designed to eliminate market or business risk entirely. The new uncertainty these tax planners ...


Law And The Market: The Impact Of Enforcement, John C. Coffee Jr. Jan 2007

Law And The Market: The Impact Of Enforcement, John C. Coffee Jr.

Faculty Scholarship

The intensity of enforcement efforts by securities regulators varies widely among financially developed nations, but countries with "common law origins" appear to systematically expend more on securities regulation than countries with "civil law origins." However, whether this variable of relative enforcement intensity explains the greater financial development of countries with common law origins or is instead the product of that differential in development remains open to question and depends on the direction of causality. This paper examines several explanations and prefers the hypothesis that enforcement intensity is a product of the level of retail ownership in the jurisdiction, with a ...


The Disputed Quality Of Software Patents, John R. Allison, Ronald J. Mann Jan 2007

The Disputed Quality Of Software Patents, John R. Allison, Ronald J. Mann

Faculty Scholarship

We analyze the characteristics of the patents held by firms in the software industry. Unlike prior researchers, we rely on examination of the individual patents to determine which patents involve software inventions. This method of identifying the relevant patents is more laborious than the methods that previous scholars have used, but it produces a dataset from which we can learn more about the role of patents in the software industry. In general, we find that the patents computer technology firms obtain on software inventions have more prior art references, claims, and forward citations than the patents the same firms obtain ...


Dividend Taxation In Europe: When The Ecj Makes Tax Policy, Alvin C. Warren, Michael J. Graetz Jan 2007

Dividend Taxation In Europe: When The Ecj Makes Tax Policy, Alvin C. Warren, Michael J. Graetz

Faculty Scholarship

This article analyzes a complex line of recent decisions in which the European Court of Justice has set forth its vision of a nondiscriminatory system for taxing corporate income distributed as dividends within the European Union. We begin by identifying the principal tax policy issues that arise in constructing a system for taxing cross-border dividends and then review the standard solutions found in national legislation and international tax treaties. Against that background, we examine in detail a dozen of the Court's decisions, half of which have been handed down since 2006. Our conclusion is that the ECJ is applying ...