Law Commons^™

Lawyers And Trust In Business Alliances, George W. Dent

Faculty Publications

This Article attempts a first step in filling the gap in the legal literature about lawyers and strategic business alliances. Part I describes the distinctive nature of strategic alliances. Part II discusses why strategic alliances pose unique problems for lawyers. Part III considers how lawyers' negotiation tactics can enhance rather than erode trust between the parties in alliances. Part IV suggests how lawyers can draft substantive contract terms that foster trust and cooperation in alliances. Part V explores how law schools and continuing legal education can train lawyers to perform better not only in strategic business alliances but in all …

Gap Fillers And Fiduciary Duties In Strategic Alliances, George W. Dent

Faculty Publications

This Article describes the evolution of strategic alliances and their dependence on trust between the allies. It then discusses the general theory of gap fillers and fiduciary duties and the inevitability of major gaps in strategic alliance contracts. Finally, it combines these elements to derive conclusions about the proper role of gap fillers and fiduciary duties in strategic alliances.

The Role Of Convertible Securities In Corporate Finance, George W. Dent

Faculty Publications

This Article examines theories supporting the use of convertible secyrutues and finds them insufficient even for public companies, to which they are supposed to apply. They fare worse yet for private firms which use convertibles even more frequently. Indeed, no one theory explains all uses of convertibles. Convertibles can reduce agency costs by reconciling differences in risk aversion and diminishing managers' exploitation of investors, but they can also promote managers' interests at the expense of shareholders. The mix of factors varies from case to case. Thus, the role of convertibles proves complex and diverse. After describing convertible securities (part II) …

Toward Unifying Ownership And Control In The Public Corporation, George W. Dent

Faculty Publications

In 1932, Adolf Berle and Gardiner Means published the seminal book, The Modern Corporation and Private Property. This work set forth the thesis that corporate law's central dilemma has been the separation of ownership and control in publicly held corporations. Over the years, the Berle-Means thesis has been tossed aside by critics who argue that economic forces compel managers to act as if the shareholders were in control and by those who welcome the idea that managers are able to exercise their more enlightened business acumen. On the other hand, those who share concerns over the separation of ownership and …

Proxy Regulation In Search Of A Purpose, George W. Dent

Faculty Publications

Changing conditions often force us to rethink the role of a law. Professor Ryan's scholarly article, Rule 14a-8, Institutional Shareholder Proposals, and Corporate Democracy,underscores this need. His article is useful for both its successes and its failures. Its principal failure is its inability to identify a general justification for the rule. This is helpful; the failure of an intelligent and deter- mined advocate to find a persuasive defense of the rule confirms that no defense is possible. The article succeeds principally in showing how institutional investors have recently used the rule in ways that put the rule in a new …

Dual Class Capitalization: A Reply To Professor Seligman, George W. Dent

Faculty Publications

Professor Joel Seligman's article, Equal Protection in Share- holder Voting Rights: The One Common Share, One Vote Contro- versy,' is an impressive accomplishment in many respects. It confirms his status as premier historian of our securities laws and markets.2 It also provides a powerful analysis of, and the first se- rious argument against, dual class capitalization, and proposes a thoughtful solution to the problems it raises. Despite these formi- dable assets, some of Professor Seligman's conclusions are debata- ble. First, Professor Seligman argues that the Securities and Exchange Commission (SEC) can impose on the National Associa- tion of Securities Dealers …

Unprofitable Mergers: Toward A Market-Based Legal Response, George W. Dent

Faculty Publications

The reams of commentary on corporate mergers, acquisitions, and tender offers have focused largely on protection of shareholders of acquired (or target) companies from both the depredations of acquiring (or raider) companies and the cupidity of their own managements in either negotiating the terms or obstructing the accomplishment of transactions. Virtually no attention has been paid to the plight of shareholders of acquiring companies devastated by unwise acquisitions. This oversight is surprising: some acquisitions have been spectacular disasters, destroying hundreds of millions of dollars in the value of the acquiring company's stock.1 Nor are these isolated cases: on average, acquisitions …

Ancillary Relief In Federal Securities Law: A Study In Federal Remedies, George W. Dent

Faculty Publications

After describing the history and current practice of ancillary relief in federal securities law, this Article analyzes the general law of federal remedies and ancillary relief, including ancillary relief in other areas of administrative law, recent developments in federal equity, statutory interpretation, and federal common law, and implied statutory remedies. The Article then examines pertinent aspects of the federal securities laws, including their legislative history and recent judicial interpretations. On this basis the Article recommends both a general approach to ancillary relief in federal securities law and responses to problems of specific remedies. Finally, the Article discusses ancillary relief under …

The Revolution In Corporate Governance, The Monitoring Board, And The Director's Duty Of Care, George W. Dent

Faculty Publications

The theory of corporate governance underwent a revolution in the 1970's. Theorists finally abandoned the myth that a public corporation' is managed by its board of directors, and constructed a new model under which the corporation is managed by its executive officers, and the board, dominated by outside directors, monitors management's performance. This new "monitoring model" has gained wide acceptance among commentators, and several of its elements have been adopted by many public corporations. Even those commentators who do not enthusiastically embrace the entire monitoring model tend to agree that monitoring management is a significant board function.

But expositions of …

The Power Of Directors To Terminate Shareholder Litigation: The Death Of The Derivative Suit?, George W. Dent

Faculty Publications

This article will analyze the problems raised by the board's attempt to terminate shareholder suits and will advance proposals to deal with those problems.