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The Cost Of Guilty Breach: Willful Breach In M&A Contracts, Theresa Arnold, Amanda Dixon, Madison Whalen Sherrill, Hadar Tanne, Mitu Gulati
The Cost Of Guilty Breach: Willful Breach In M&A Contracts, Theresa Arnold, Amanda Dixon, Madison Whalen Sherrill, Hadar Tanne, Mitu Gulati
Faculty Scholarship
The traditional framework of United States private law that every first-year student learns is that contracts and torts are different realms—contracts is the realm of strict liability and torts of fault. Contracts, we learn from the writings of Justice Holmes and Judge Posner, are best viewed as options; they give parties the option to perform or pay damages. The question we ask is whether, in the real world, that is indeed how contracting parties view things. Using a dataset made up of one thousand mergers and acquisitions (M&A) contracts and thirty in-depth interviews with M&A lawyers, we find that there …
Culpable Participation In Fiduciary Breach, Deborah A. Demott
Culpable Participation In Fiduciary Breach, Deborah A. Demott
Faculty Scholarship
This essay makes a case for the salience of tort law to fiduciary law, focusing on actors who culpably participate in a fiduciary's breach of duty, whether by inducing the breach or lending substantial assistance to it. Although the elements of this accessory tort are relatively settled in the United States, how the tort applies to particular categories of actors-most recently investment bankers who serve as M&A advisors-provokes controversy. The paper also explores the less developed terrain of primary actors who breach governance duties that are not fiduciary obligations because the entity's organizational documents eliminate fiduciary duties, as Delaware law …