As businesses and financial institutions engage in transactions with increasingly international scope, U.S. regulatory agencies follow closely behind, investigating potential violations of the securities and exchange laws. Of all the investigative powers of the Securities and Exchange Commission, one of the more feared is the ability to issue administrative subpoenas and have them enforced by a Federal court. What is troubling, however, is the SEC’s recent foray into investigating possible misconduct across U.S. borders through subpoenaing foreign employees conducting business overseas. This article argues that in certain circumstances, the SEC does not have the authority to issue or enforce an extraterritorial administrative subpoena. In other situations, while the SEC may clearly exercise its subpoena power, there are certain precautions that may be put in place to help minimize a financial services firm’s risk profile.
随着企业和金融机构从事的交易越来越国际化，美国监管机构也在密切关注，调查可能违反证券和交易法的行为。在美国证券交易委员会(Securities and Exchange Commission)的所有调查权力中，最令人担忧的一项权力是发出行政传票并由联邦法院强制执行的权力。然而，令人不安的是，SEC最近通过传唤在海外开展业务的外国雇员，对美国境内可能存在的不当行为展开调查。本文认为，在某些情况下，SEC无权发出或执行域外行政传票。在其他情况下，虽然证交会可能会明确行使其传讯权，但可能会采取某些预防措施，以帮助将金融服务公司的风险状况降至最低。
{"title":"The (Too) Long Arm of the S.E.C.: When a Foreign Employee of a U.S.-Based Multinational Financial Services Client is Threatened with a Subpoena","authors":"Ronald S. Betman, J. R. Law","doi":"10.15779/Z38DC6T","DOIUrl":"https://doi.org/10.15779/Z38DC6T","url":null,"abstract":"As businesses and financial institutions engage in transactions with increasingly international scope, U.S. regulatory agencies follow closely behind, investigating potential violations of the securities and exchange laws. Of all the investigative powers of the Securities and Exchange Commission, one of the more feared is the ability to issue administrative subpoenas and have them enforced by a Federal court. What is troubling, however, is the SEC’s recent foray into investigating possible misconduct across U.S. borders through subpoenaing foreign employees conducting business overseas. This article argues that in certain circumstances, the SEC does not have the authority to issue or enforce an extraterritorial administrative subpoena. In other situations, while the SEC may clearly exercise its subpoena power, there are certain precautions that may be put in place to help minimize a financial services firm’s risk profile.","PeriodicalId":326069,"journal":{"name":"Berkeley Business Law Journal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2012-09-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"128794764","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In re Caremark Int’l Inc. Derivative Litig. is commonly held out as the iconic corporate law case on liability for a failure of legal compliance, but the true source of corporate law as to legal compliance is the higher standard established by other sources of law. The expected cost of liability, both criminal and civil, for violations of federal healthcare regulations, for example, is a far stronger determinant of corporate compliance systems than potential liability under Caremark. Other areas of industry-specific regulation, such as for financial services, telecommunications and energy, similarly play a greater role than state corporate law in the design and operation of corporate compliance systems, as do regulations in the form of federal sentencing guidelines and employment and environmental law. The common exaggeration of Caremark’s significance illustrates a flawed pedagogical overemphasis on state corporate law as a legal determinant of corporate compliance and a broader misconception about the influence of regulatory law in corporate affairs. This article shows that federal regulatory law is a far more determinative source of law than Caremark in the design and operation of corporate compliance systems. Part II of this article compares Caremark to the parallel federal criminal prosecution of the firm to illustrate the influence of federal law in the design and operation of corporate compliance systems. Part III further discusses the determinative role of healthcare regulation in corporate compliance systems and regulatory trends, and uses recent litigation involving Pfizer Inc. to further elucidate the role of healthcare regulation. Part IV broadens the discussion by considering the role of prosecutorial and sentencing guidelines in corporate compliance generally. Part V suggests that corporate law pedagogy would be well-served by reducing its focus on state corporate law and giving greater prominence to the actual legal determinants of corporate conduct. Part VII concludes.
{"title":"Caremark's Irrelevance","authors":"Mercer E. Bullard","doi":"10.2139/SSRN.2123649","DOIUrl":"https://doi.org/10.2139/SSRN.2123649","url":null,"abstract":"In re Caremark Int’l Inc. Derivative Litig. is commonly held out as the iconic corporate law case on liability for a failure of legal compliance, but the true source of corporate law as to legal compliance is the higher standard established by other sources of law. The expected cost of liability, both criminal and civil, for violations of federal healthcare regulations, for example, is a far stronger determinant of corporate compliance systems than potential liability under Caremark. Other areas of industry-specific regulation, such as for financial services, telecommunications and energy, similarly play a greater role than state corporate law in the design and operation of corporate compliance systems, as do regulations in the form of federal sentencing guidelines and employment and environmental law. The common exaggeration of Caremark’s significance illustrates a flawed pedagogical overemphasis on state corporate law as a legal determinant of corporate compliance and a broader misconception about the influence of regulatory law in corporate affairs. This article shows that federal regulatory law is a far more determinative source of law than Caremark in the design and operation of corporate compliance systems. Part II of this article compares Caremark to the parallel federal criminal prosecution of the firm to illustrate the influence of federal law in the design and operation of corporate compliance systems. Part III further discusses the determinative role of healthcare regulation in corporate compliance systems and regulatory trends, and uses recent litigation involving Pfizer Inc. to further elucidate the role of healthcare regulation. Part IV broadens the discussion by considering the role of prosecutorial and sentencing guidelines in corporate compliance generally. Part V suggests that corporate law pedagogy would be well-served by reducing its focus on state corporate law and giving greater prominence to the actual legal determinants of corporate conduct. Part VII concludes.","PeriodicalId":326069,"journal":{"name":"Berkeley Business Law Journal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2012-08-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132620580","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Business clients sometimes refer derogatorily to their 'two-handed' lawyers, implicitly distinguishing between the thinking that leads up to a decision and the decision itself. A 'two-handed lawyer' is one who can analyze a problem on one hand and on the other hand, but tosses the actual decision back to the client. The observation invokes something fundamental about objective information, subjective judgment making, and the commitment to action. 'Thinking like a lawyer' is a prototype of the rationally analytical mindset residing at one end of the mental continuum, and the entrepreneur’s impatience with allocating the risk of failure is a prototype of the commitment to action residing at the opposite end. If leaping is the metaphor for the business decision, then the systematic and dispassionate 'two-handed' assimilation of data through rational analysis – the lawyer’s stock in trade – plays a crucial role. The leaper uses that analysis to assess distances and capabilities. But the decision to leap is something quite different. The leaper’s subjective experience of the “aha” moment of a business decision (or any decision, even when made by lawyers) defies scientific reduction. It is really only accessible through the subjective lived experience of the decision-maker. Deciding is more like action than thought. In his iconic The Reflective Practitioner, the late Donald Schon criticized a mode of thinking he called Technical Rationality. Prototypical legal analysis is an exemplar of Schon’s Technical Rationality, applied methodically and systematically as a means of helping others to understand their circumstances and to optimize their positions in light of risk and uncertainty. Prototypical entrepreneurs and investors, however, are obliged to decide and to act. The mental process that leads to action is deeply subjective, personal, intuitive, and often ad hoc. Understanding that in difficult cases it is possible to offer as many reasons for as against the proposed action, the most effective business lawyers do not merely analyze and offer 'two-handed' alternatives. Instead, they put themselves in the position of the decider and understand what it means to take the leap of a business decision. This article is a reflection on the reasons for lawyerly 'two-handedness' and some preliminary thoughts on overcoming it. The affective toolkit for getting beyond rational analysis to action includes attributes such as epistemic humility, epistemic courage, self-awareness, and the willingness to accept responsibility for the consequences of one’s decisions. The practical toolkit will follow in another essay.
{"title":"Dissecting the Two-Handed Lawyer: Thinking Versus Action in Business Lawyering","authors":"Jeffrey M. Lipshaw","doi":"10.2139/SSRN.2095357","DOIUrl":"https://doi.org/10.2139/SSRN.2095357","url":null,"abstract":"Business clients sometimes refer derogatorily to their 'two-handed' lawyers, implicitly distinguishing between the thinking that leads up to a decision and the decision itself. A 'two-handed lawyer' is one who can analyze a problem on one hand and on the other hand, but tosses the actual decision back to the client. The observation invokes something fundamental about objective information, subjective judgment making, and the commitment to action. 'Thinking like a lawyer' is a prototype of the rationally analytical mindset residing at one end of the mental continuum, and the entrepreneur’s impatience with allocating the risk of failure is a prototype of the commitment to action residing at the opposite end. If leaping is the metaphor for the business decision, then the systematic and dispassionate 'two-handed' assimilation of data through rational analysis – the lawyer’s stock in trade – plays a crucial role. The leaper uses that analysis to assess distances and capabilities. But the decision to leap is something quite different. The leaper’s subjective experience of the “aha” moment of a business decision (or any decision, even when made by lawyers) defies scientific reduction. It is really only accessible through the subjective lived experience of the decision-maker. Deciding is more like action than thought. In his iconic The Reflective Practitioner, the late Donald Schon criticized a mode of thinking he called Technical Rationality. Prototypical legal analysis is an exemplar of Schon’s Technical Rationality, applied methodically and systematically as a means of helping others to understand their circumstances and to optimize their positions in light of risk and uncertainty. Prototypical entrepreneurs and investors, however, are obliged to decide and to act. The mental process that leads to action is deeply subjective, personal, intuitive, and often ad hoc. Understanding that in difficult cases it is possible to offer as many reasons for as against the proposed action, the most effective business lawyers do not merely analyze and offer 'two-handed' alternatives. Instead, they put themselves in the position of the decider and understand what it means to take the leap of a business decision. This article is a reflection on the reasons for lawyerly 'two-handedness' and some preliminary thoughts on overcoming it. The affective toolkit for getting beyond rational analysis to action includes attributes such as epistemic humility, epistemic courage, self-awareness, and the willingness to accept responsibility for the consequences of one’s decisions. The practical toolkit will follow in another essay.","PeriodicalId":326069,"journal":{"name":"Berkeley Business Law Journal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2012-06-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"121693869","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
A recent movement in contracts scholarship - the so-called New Formalism - seeks to justify limitations on the introduction of extrinsic evidence to interpret contracts on the instrumental grounds of efficiency and empirical observation. There has not, as yet, been a concerted attempt to develop an instrumental argument for the more contextual types of interpretation observed in the Uniform Commercial Code and the Restatement (Second) of Contracts. This Article begins that task by arguing that the relative ability of transactors to draft complete contracts is likely to be an important determinant of their preferred interpretive regime. Where low contracting costs allow commercial parties to draft relatively complete contracts, it is understandable that these parties would have a strong preference for formal contract rules because such rules help to ensure the interpretation of these contracts in accordance with their express terms. Where, however, contracts are more difficult to write - and hence contain more gaps - transactors may prefer interpretive rules that allow courts to fill in contractual gaps based on extrinsic evidence such as industry custom, unexecuted drafts, and other indications of the parties' understanding of their obligations under the contract. At least in some instances, the use of this ex post evidence may be more cost effective relative to the ex ante investments that would be necessary to draft more complete contracts.To explore this problem, this Article adapts the framework used to predict vertical integration in the New Institutional Economics literature to identify the variables that are likely to affect the ability to draft complete contracts. This adapted model argues that the frequency and uncertainty of a transaction are the key variables that will determine the amount that parties are likely to invest in filling contractual gaps. The predictions generated by this model help to explain why some transactors, such as the grain, cotton, and diamond merchants studied by Lisa Bernstein, have strong preferences for formal interpretation. The model also suggests why industries that involve infrequent and uncertain transactions - such as construction, tailored software, and the market for mergers and acquisitions - do not share the preference for formal interpretation advocated and observed by the New Formalists.
{"title":"Interpretive Preferences and the Limits of the New Formalism","authors":"Adam B. Badawi","doi":"10.15779/Z38DG5J","DOIUrl":"https://doi.org/10.15779/Z38DG5J","url":null,"abstract":"A recent movement in contracts scholarship - the so-called New Formalism - seeks to justify limitations on the introduction of extrinsic evidence to interpret contracts on the instrumental grounds of efficiency and empirical observation. There has not, as yet, been a concerted attempt to develop an instrumental argument for the more contextual types of interpretation observed in the Uniform Commercial Code and the Restatement (Second) of Contracts. This Article begins that task by arguing that the relative ability of transactors to draft complete contracts is likely to be an important determinant of their preferred interpretive regime. Where low contracting costs allow commercial parties to draft relatively complete contracts, it is understandable that these parties would have a strong preference for formal contract rules because such rules help to ensure the interpretation of these contracts in accordance with their express terms. Where, however, contracts are more difficult to write - and hence contain more gaps - transactors may prefer interpretive rules that allow courts to fill in contractual gaps based on extrinsic evidence such as industry custom, unexecuted drafts, and other indications of the parties' understanding of their obligations under the contract. At least in some instances, the use of this ex post evidence may be more cost effective relative to the ex ante investments that would be necessary to draft more complete contracts.To explore this problem, this Article adapts the framework used to predict vertical integration in the New Institutional Economics literature to identify the variables that are likely to affect the ability to draft complete contracts. This adapted model argues that the frequency and uncertainty of a transaction are the key variables that will determine the amount that parties are likely to invest in filling contractual gaps. The predictions generated by this model help to explain why some transactors, such as the grain, cotton, and diamond merchants studied by Lisa Bernstein, have strong preferences for formal interpretation. The model also suggests why industries that involve infrequent and uncertain transactions - such as construction, tailored software, and the market for mergers and acquisitions - do not share the preference for formal interpretation advocated and observed by the New Formalists.","PeriodicalId":326069,"journal":{"name":"Berkeley Business Law Journal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2011-07-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"131108983","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The goal of this paper is precisely to consider how the banking regulation and mortgage market reforms could and should interact. In doing so, I take as the starting point, on one hand, the bank regulation initiatives already present in the Dodd-Frank Act and the Basel III proposal, and on the other hand, the mortgage market reform principles presented in the Treasury/HUD (2011) White paper. I then consider what additional reform elements should be considered in view of the interaction of bank regulations and mortgage market activity. The paper is organized as follows. In Section (2), I provide an overview of the failed U.S. bank regulation system that has been in place for approximately the last 20 years, and identify the key components of bank regulation that created the systemic dimensions of the subprime mortgage losses. In Section (3), I analyze the Treasury/HUD White Paper proposal and identify the primary issues it raises for regulatory reform. In Section (4), I compare securitization with covered bonds and analyzes the appropriate regulatory rules if mortgage-backed covered bonds are to become an important element of the U.S. mortgage markets. The positions I take on securitization and covered bonds are at variance with some parts of the Dodd-Frank Act and the current policy position of the Federal Deposit Insurance Corporation (FDIC). Section 5 summarizes the key components of bank regulation and mortgage market reform that must be in place if the full reform package is to be successful.
{"title":"Bank Regulation and Mortgage Market Reform","authors":"Dwight M. Jaffee","doi":"10.15779/Z38PK41","DOIUrl":"https://doi.org/10.15779/Z38PK41","url":null,"abstract":"The goal of this paper is precisely to consider how the banking regulation and mortgage market reforms could and should interact. In doing so, I take as the starting point, on one hand, the bank regulation initiatives already present in the Dodd-Frank Act and the Basel III proposal, and on the other hand, the mortgage market reform principles presented in the Treasury/HUD (2011) White paper. I then consider what additional reform elements should be considered in view of the interaction of bank regulations and mortgage market activity. The paper is organized as follows. In Section (2), I provide an overview of the failed U.S. bank regulation system that has been in place for approximately the last 20 years, and identify the key components of bank regulation that created the systemic dimensions of the subprime mortgage losses. In Section (3), I analyze the Treasury/HUD White Paper proposal and identify the primary issues it raises for regulatory reform. In Section (4), I compare securitization with covered bonds and analyzes the appropriate regulatory rules if mortgage-backed covered bonds are to become an important element of the U.S. mortgage markets. The positions I take on securitization and covered bonds are at variance with some parts of the Dodd-Frank Act and the current policy position of the Federal Deposit Insurance Corporation (FDIC). Section 5 summarizes the key components of bank regulation and mortgage market reform that must be in place if the full reform package is to be successful.","PeriodicalId":326069,"journal":{"name":"Berkeley Business Law Journal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2011-03-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"123217062","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Over the past fifteen years, Congress has twice attempted to curb frivolous securities class action lawsuits. It first passed the Private Securities Litigation Reform Act (“PSLRA”), which fell short of achieving Congress’s goal because plaintiffs were able to avoid the more stringent rules of federal courts by filing securities class action claims in state courts. Congress then sought to close this loophole by passing the Securities Litigation Uniform Standards Act (“SLUSA”), which amended the Securities Act of 1933 (“1933 Act”) to make federal court the exclusive venue for certain securities class actions. Congress’s effort has been complicated, though, by the multiple district court interpretations of the SLUSA amendments that have developed. This article argues that the correct answer lies in SLUSA’s revision to the 1933 Act’s jurisdictional clause. Unlike other approaches to interpreting the 1933 Act, what I call the “jurisdictional approach” to SLUSA finds strong support in both the text and the congressional intent underlying the statute. This reading leads to a harmonious interpretation of the rest of SLUSA’s revisions, and is therefore the approach judges should use when they apply the 1933 Act in cases involving “covered class actions” to keep federal claims in federal court.
{"title":"(Mis)Interpreting SLUSA: Closing the Jurisdictional Loophole in FederalSecurities Class Actions","authors":"Michael Serota","doi":"10.15779/Z38GK4Z","DOIUrl":"https://doi.org/10.15779/Z38GK4Z","url":null,"abstract":"Over the past fifteen years, Congress has twice attempted to curb frivolous securities class action lawsuits. It first passed the Private Securities Litigation Reform Act (“PSLRA”), which fell short of achieving Congress’s goal because plaintiffs were able to avoid the more stringent rules of federal courts by filing securities class action claims in state courts. Congress then sought to close this loophole by passing the Securities Litigation Uniform Standards Act (“SLUSA”), which amended the Securities Act of 1933 (“1933 Act”) to make federal court the exclusive venue for certain securities class actions. Congress’s effort has been complicated, though, by the multiple district court interpretations of the SLUSA amendments that have developed. This article argues that the correct answer lies in SLUSA’s revision to the 1933 Act’s jurisdictional clause. Unlike other approaches to interpreting the 1933 Act, what I call the “jurisdictional approach” to SLUSA finds strong support in both the text and the congressional intent underlying the statute. This reading leads to a harmonious interpretation of the rest of SLUSA’s revisions, and is therefore the approach judges should use when they apply the 1933 Act in cases involving “covered class actions” to keep federal claims in federal court.","PeriodicalId":326069,"journal":{"name":"Berkeley Business Law Journal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2010-04-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"124504192","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The economic crisis has upended the divide between the public sector and the corporate world, as governments engage in mass intervention in the private sector. This crisis has exposed the need for new leadership in the corporate world. Gendered understandings of economic relations have surfaced – some argue that testosterone encourages excessive greed in boom cycles and fear in bust cycles, or that women can help clean up the mess. This Article explores capital’s Achilles heel – the exclusion of women from its leadership ranks – and one innovative remedy for this shortcoming. Despite a plethora of political representation quotas for women throughout the world, only Norway has instituted a quota to integrate women into corporate leadership. Passed in 2004, the Corporate Board Quota forces all publicly-listed companies to repopulate their boards to reflect a forty percent floor for either gender by the deadline of January 1, 2008, upon penalty of dissolution. This draconian penalty induced all covered corporations to comply. Norway’s dramatic intervention to feminize capital reflects a public/private symbiosis in which the public norm of gender equality infuses private efforts, even as private goals such as economic growth drive public policy. Relying on studies that showed the advantages of a broader pool of corporate leadership, Norway succeeded in transforming its corporate boards. Gender balance has increased and we await the results with regard to corporate performance. Such novel economically and socially optimal remedies for entrenched inequality support the rising purchase of a public/private symbiosis. Although U.S. jurisprudence eschews quotas, the economic crisis has begun to diminish free-market proponents’ fear of public intervention. The CBQ’s novel interaction between the public and private sectors heralds the beginning of a broader conversation about the relationship between effective corporate governance and gender.
{"title":"Feminizing Capital: A Corporate Imperative","authors":"Darren Rosenblum","doi":"10.15779/Z388S0H","DOIUrl":"https://doi.org/10.15779/Z388S0H","url":null,"abstract":"The economic crisis has upended the divide between the public sector and the corporate world, as governments engage in mass intervention in the private sector. This crisis has exposed the need for new leadership in the corporate world. Gendered understandings of economic relations have surfaced – some argue that testosterone encourages excessive greed in boom cycles and fear in bust cycles, or that women can help clean up the mess. This Article explores capital’s Achilles heel – the exclusion of women from its leadership ranks – and one innovative remedy for this shortcoming. Despite a plethora of political representation quotas for women throughout the world, only Norway has instituted a quota to integrate women into corporate leadership. Passed in 2004, the Corporate Board Quota forces all publicly-listed companies to repopulate their boards to reflect a forty percent floor for either gender by the deadline of January 1, 2008, upon penalty of dissolution. This draconian penalty induced all covered corporations to comply. Norway’s dramatic intervention to feminize capital reflects a public/private symbiosis in which the public norm of gender equality infuses private efforts, even as private goals such as economic growth drive public policy. Relying on studies that showed the advantages of a broader pool of corporate leadership, Norway succeeded in transforming its corporate boards. Gender balance has increased and we await the results with regard to corporate performance. Such novel economically and socially optimal remedies for entrenched inequality support the rising purchase of a public/private symbiosis. Although U.S. jurisprudence eschews quotas, the economic crisis has begun to diminish free-market proponents’ fear of public intervention. The CBQ’s novel interaction between the public and private sectors heralds the beginning of a broader conversation about the relationship between effective corporate governance and gender.","PeriodicalId":326069,"journal":{"name":"Berkeley Business Law Journal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2009-07-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"116272474","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"The Nominating Process for Corporate Boards of Directors: A Decision-Making Analysis","authors":"Michael E. Murphy","doi":"10.15779/Z38XP2R","DOIUrl":"https://doi.org/10.15779/Z38XP2R","url":null,"abstract":"","PeriodicalId":326069,"journal":{"name":"Berkeley Business Law Journal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2008-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"114003615","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Ghouls and Godsends - A Critique of Reverse Merger Policy","authors":"Aden R. Pavkov","doi":"10.15779/Z38BP2W","DOIUrl":"https://doi.org/10.15779/Z38BP2W","url":null,"abstract":"TABLE OF CONTENTS","PeriodicalId":326069,"journal":{"name":"Berkeley Business Law Journal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2006-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"124773950","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This Article develops a theory that sheds light on recent evidence, which shows that high quality issuers are the ones that adopt defenses during an IPO, and keys this behavior to the existing literature on private benefits of control. The Article then analyzes the decision of the pre- IPO owners concerning takeover defenses. Their decision is shown to be influenced by the quality of the venture that goes public. High quality in firms that go public often means an abundance of growth and business opportunities, rather than sizeable existing assets. In such ventures, managers are unlikely to consume much harmful control benefits. Nevertheless, managers derive a great deal of non-monetary control benefits from their stint in the promising entity. Consequently, takeover defenses help the pre-IPO owners to preserve their non-monetary control benefits without causing too much harm to the value of the enterprise. The Article also shows that even if the conventional assumption that takeover defenses are harmful to shareholders is taken as given, then the inimical influence of takeover defenses is hard to trace, since the issuers that adopt them are those in which ATPs' influence is the least harmful. Finding a matching sample for the adopting issuers, as some tried before, may therefore be an impossible task. Finally, the Article considers possible extensions that result from complications of asymmetric information, and finally concludes with the perils of federal intervention.
{"title":"Private Benefits of Control, Antitakeover Defenses, and the Perils of Federal Intervention","authors":"Sharon Hannes","doi":"10.15779/Z38WP3T","DOIUrl":"https://doi.org/10.15779/Z38WP3T","url":null,"abstract":"This Article develops a theory that sheds light on recent evidence, which shows that high quality issuers are the ones that adopt defenses during an IPO, and keys this behavior to the existing literature on private benefits of control. The Article then analyzes the decision of the pre- IPO owners concerning takeover defenses. Their decision is shown to be influenced by the quality of the venture that goes public. High quality in firms that go public often means an abundance of growth and business opportunities, rather than sizeable existing assets. In such ventures, managers are unlikely to consume much harmful control benefits. Nevertheless, managers derive a great deal of non-monetary control benefits from their stint in the promising entity. Consequently, takeover defenses help the pre-IPO owners to preserve their non-monetary control benefits without causing too much harm to the value of the enterprise. The Article also shows that even if the conventional assumption that takeover defenses are harmful to shareholders is taken as given, then the inimical influence of takeover defenses is hard to trace, since the issuers that adopt them are those in which ATPs' influence is the least harmful. Finding a matching sample for the adopting issuers, as some tried before, may therefore be an impossible task. Finally, the Article considers possible extensions that result from complications of asymmetric information, and finally concludes with the perils of federal intervention.","PeriodicalId":326069,"journal":{"name":"Berkeley Business Law Journal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2006-08-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127706754","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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