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Full-Text Articles in Law
The Independent Board Of Directors And Governance In The United States: Where Is This Heading?, Florence Shu-Acquaye
The Independent Board Of Directors And Governance In The United States: Where Is This Heading?, Florence Shu-Acquaye
Faculty Scholarship
No abstract provided.
Overvalued Equity And The Case For An Asymmetric Insider Trading Regime, Thom Lambert
Overvalued Equity And The Case For An Asymmetric Insider Trading Regime, Thom Lambert
Faculty Publications
This article argues for an asymmetric insider trading policy under which insider trading that decreases the price of an overvalued stock is generally permitted, but insider trading that increases the price of an undervalued stock is generally prohibited. Concluding that the net investor benefits of price-decreasing insider trading exceed those of price-enhancing insider trading, the article argues that an asymmetric insider trading regime likely represents the bargain that shareholders and corporate managers would strike if they were legally and practically able to negotiate an insider trading policy. Current insider trading doctrine would permit regulators to impose such an asymmetric insider …
The Next Epidemic: Bubbles And The Growth And Decay Of Securities Regulation, Erik F. Gerding
The Next Epidemic: Bubbles And The Growth And Decay Of Securities Regulation, Erik F. Gerding
Publications
This article explores how speculative bubbles undermine the effectiveness of securities regulations and spawn epidemics of securities fraud. A brief historical survey demonstrates that stock market bubbles almost invariably coincide with epidemics of securities fraud, and provides a compelling argument that the outbreak of fraud in the Enron era did not stem merely from factors unique to the 1990s, but from the dynamics of an asset price bubble as well.
Drawing on perspectives from securities law practice and economic theory, the article argues that bubbles dilute the deterrent effect of antifraud rules and promote deregulation. Both effects alter the calculus …
Merrill Lynch V. Dabit: Federal Preemption Of Holders' Class Actions, Mark J. Loewenstein
Merrill Lynch V. Dabit: Federal Preemption Of Holders' Class Actions, Mark J. Loewenstein
Publications
No abstract provided.
The "Duty" To Be A Rational Shareholder, David A. Hoffman
The "Duty" To Be A Rational Shareholder, David A. Hoffman
All Faculty Scholarship
How and when do courts determine that corporate disclosures are actionable under the federal securities laws? The applicable standard is materiality: would a (mythical) reasonable investor have considered a given disclosure important. As I establish through empirical and statistical testing of approximately 500 cases analyzing the materiality standard, judicial findings of immateriality are remarkably common, and have been stable over time. Materiality's scope results in the dismissal of a large number of claims, and creates a set of cases in which courts attempt to explain and defend their vision of who is, and is not, a reasonable investor. Thus, materiality …