Securities Law Commons^™

When The Government Attempts To Change The Board, Investors Should Know, William O. Fisher

Law Faculty Publications

In 2008 and 2009, the federal government effectively hired and fired directors at American International Group and Bank of America. At AIG, the government exercised its power through the ownership of voting stock, which meant that the company’s public securities filings revealed the government influence, though at times slowly and at times only by inference. At BofA, by contrast, the government imposed its will through an unpublished bank regulatory action, and no securities filing provided even a hint of the federal role. The fact that current law allows the government to secretly reconstitute the governing bodies of multi-billion-dollar, publicly traded …

Nullifying The Debt Ceiling Threat Once And For All: Why The President Should Embrace The Least Unconstitutional Option, Neil H. Buchanan, Michael C. Dorf

Cornell Law Faculty Publications

In August 2011, Congress and the President narrowly averted economic and political catastrophe, agreeing at the last possible moment to authorize a series of increases in the national debt ceiling. This respite, unfortunately, was merely temporary. The amounts of the increases in the debt ceiling that Congress authorized in 2011 were only sufficient to accommodate the additional borrowing that would be necessary through the end of 2012. In an economy that continued to show chronic weakness -- weakness that continues to this day -- the federal government would predictably continue to collect lower-than-normal tax revenues and to make higher-than-normal expenditures, …

Choosing Among Innocents: Should Donations To Charities Be Protected From Avoidance As Fraudulent Transfers, Jeffrey Davis

UF Law Faculty Publications

In recent years, the nation has experienced the most severe recession since the Great Depression of the 1930s. A recession is like a low tide. When the water recedes, the crabs, slugs, and urchins appear. Similarly, when the economy recedes, Ponzi schemes appear. People cut back on saving and investing, and many are forced to draw on savings and investments. Deprived of its life's blood, a positive cash flow, a Ponzi scheme dies. This explains why so many Ponzi schemes have failed recently, including the schemes of Bernard Madoff in New York, Tom Petters in Minneapolis, Robert Allen Stanford in …

The Twilight Of Equity Liquidity, Jeff Schwartz

Cardozo Law Review

This Article argues that U.S. equity markets fail to offer a satisfactory listing venue for emerging firms. I contend that this lacuna is a manifestation of a flawed structure of equity-market regulation and that this void undermines entrepreneurship, jeopardizes the future of U.S. equity markets, and weakens the broader U.S. economy. To close this gap and respond to these concerns, I recommend a new theoretical structure for regulating equity markets. Under the "lifecycle model" I propose, regulations would adapt to firms as they age. The key change would be to establish a market specifically for newly-public young firms, where they …

The Misappropriation Theory In Light Of Carpenter And The Insider Trading And Securities Fraud Enforcement Act Of 1988, Mark A. Clayton

Pepperdine Law Review

No abstract provided.

Legal Framework For Soviet Privatization, Olga Floroff, Susan Tiefenbrun

Pepperdine Law Review

No abstract provided.

Fair Funds And The Sec's Compensation Of Injured Investors, Verity Winship

Florida Law Review

The Fair Fund provision of Sarbanes-Oxley allows the SEC to distribute money penalties to injured investors, heralding a new compensatory role for the agency. The SEC has announced that it will direct money to injured investors whenever possible, but has not articulated clear priorities. This Article fills the gap by introducing terms of debate and proposing a framework for the SEC’s exercise of its discretion.

The Article introduces the concept of “public class counsel,” a public actor that has the dual function of deterrence and victim compensation. The concept describes—and suggests limits to—the SEC’s role in a system in which …

Interpreting I.R.C. § 67(E): The Supreme Court's Attempt To Nail Investment Advisory Fees To The "Floor", Lindsay Roshkind

Florida Law Review

No abstract provided.

The Ubiquity Of Greed: A Contextual Model For Analysis Of Scienter, Ann Morales Olazábal, Patricia Sanchez Abril

Florida Law Review

Some securities fraud plaintiffs contend that greed—in the form of perpetuating a prestigious executive position, ensuring a gainful bonus, or maintaining the appearance of corporate profitability—is a bona fide motive evidencing scienter. But currently, no single judicial standard or analytical rubric guides the analysis of whether allegations of greed indicate scienter in these cases. The Private Securities Litigation Reform Act of 1995 (PSLRA) requires that the complaint state “with particularity” facts giving rise to a “strong inference” that the defendant acted with the scienter required for the cause of action. Plaintiffs have long established scienter through “motive and opportunity” pleading: …

The Elephant In The Room: Dangers Of Hedge Funds In Our Financial Markets, Dustin G. Hall

Florida Law Review

This Note argues that the current judicial and regulatory stances on hedge funds fail to appreciate and account for the tremendous dangers that hedge funds pose not only to the security of our financial markets but also to the individual investors that securities regulations are designed to protect. To appreciate fully these failures, it is necessary to understand better the history of hedge funds and their recent explosion in popularity and in market power. To aid in this understanding, Part II of this Note discusses the four principal acts that regulate the securities markets and how hedge funds exist and …

Sec Investigations And Securities Class Actions: An Empirical Comparison, Stephen Choi, Adam Pritchard

Law & Economics Working Papers

We compare investigations by the SEC with securities fraud class action filings involving public companies. Using actions with both an SEC investigation and a class action as our baseline, we compare SEC-only investigations with class action-only lawsuits. We find evidence that the stock market reacts more negatively to the class actions relative to SEC investigations. We also find that institutional ownership and stock turnover decline more for class actions compared with SEC investigations. Lastly, the incidence and magnitude of settlements, as well as the incidence of top officer resignation, are greater for class actions relative to SEC investigations. This evidence …

The Supreme Court's Theory Of The Fund, William Birdthistle

All Faculty Scholarship

Just as the firm has long served as the foundational molecule of the U.S. capitalist economy, theories of the firm have for more than a century dominated legal and economic discourse. Ever since Ronald Coase published The Nature of the Firm in 1937 and asked why firms should exist in an efficient market, classicists and neoclassicists have competed to develop theories — predominantly managerialist and contractual — that best explain the structure and behavior of business organizations.

The investment fund, by contrast, has languished at the margins of corporate theory, relegated as simply a minor, if somewhat curious, example of …

Symposium Transcript, Selina K. Hewitt

Pepperdine Law Review

No abstract provided.

Revising Federal Securityholder Communication Rules To Respond To Pension Funds' Increasing Market Presence, Kenneth R. Lehman

Pepperdine Law Review

No abstract provided.

Reves Revisited, Janet Kerr, Karen M. Eisenhauer

Pepperdine Law Review

No abstract provided.

The Limited Liability Company As A Security, Mark I. Steinberg, Karen L. Conway

Pepperdine Law Review

No abstract provided.

Are Limited Liability Company Interests Securities?, Mark A. Sargent

Pepperdine Law Review

No abstract provided.

Collateral Participant Liability Under State Securities Laws, Douglas M. Branson

Pepperdine Law Review

No abstract provided.

Interpreting Nonshareholder Constituency Statutes, Stephen M. Bainbridge

Pepperdine Law Review

No abstract provided.

Regulatory Conflicts: International Tender And Exchange Offers In The 1990s, John C. Maguire

Pepperdine Law Review

No abstract provided.