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The Coming Shift In Shareholder Activism: From "Firm-Specific" To "Systematic Risk" Proxy Campaigns (And How To Enable Them), John C. Coffee Jr.
The Coming Shift In Shareholder Activism: From "Firm-Specific" To "Systematic Risk" Proxy Campaigns (And How To Enable Them), John C. Coffee Jr.
Faculty Scholarship
This article distinguishes two types of shareholder activism: (1) firm-specific activism, which has a long history and focuses on changes at a specific target company, and (2) systematic risk activism, which seeks to reduce the systematic risk in a portfolio and thereby benefit diversified investors. Typically, such a systematic risk campaign may force a portfolio company to internalize negative externalities to benefit the other companies in the portfolio (such as by reducing carbon emissions or undertaking climate risk reforms). But, systematic risk activism faces an inherent difficulty: the party that leads this campaign and invests in the target company may …
Extraterritorial Avoidance Actions: Lessons From Madoff, Edward R. Morrison
Extraterritorial Avoidance Actions: Lessons From Madoff, Edward R. Morrison
Faculty Scholarship
The Madoff case continues to provide fertile ground for testing boundaries of the U.S. Bankruptcy Code (Code). In July 2014, Judge Rakoff issued an important decision regarding the extraterritorial scope of the Code’s avoidance rules. The Trustee for the Madoff Estate, Irving Picard, sought to recover cash withdrawn by “feeder funds.” These funds pooled customer assets, invested them in Bernard L. Madoff Investment Securities (Madoff Securities), withdrew proceeds from the investment prior to Madoff’s SIPA filing, and distributed the proceeds to customers before the funds themselves collapsed. The funds are located abroad: one, Fairfield Sentry, is a British Virgin Islands …