Business Organizations Law Commons^™

Failed Anti-Activist Legislation: The Curious Case Of The Brokaw Act, Alon Brav, J.B. Heaton, Jonathan Zandberg

The Journal of Business, Entrepreneurship & the Law

The Brokaw Act was proposed legislation aimed at “financial abuses being carried out by activist hedge funds who promote short-term gains at the expense of long-term growth . . . .” Sponsoring Senators named it after a small town in Wisconsin that, according to the Act’s sponsors, was decimated by the actions of a hedge fund activist in shutting down the local paper mill with a loss of hundreds of jobs. The Brokaw Act represented the first attempt at federal legislation aimed at restricting hedge fund activism. Since then, new and similar bipartisan proposals have appeared as have threats of …