Thursday, February 28, 2008
Tuesday, February 26, 2008
Monday, February 25, 2008
Friday, February 22, 2008
Thursday, February 21, 2008
Here is a nice Easterbrook opinion on fairness opinions just out of the Seventh Circuit. I am happy to say that he cites my article Fairness Opinions. There are also some good points/quotes in it. My favorite:
Much of the Trust’s brief reflects a view that fairness opinions are worthless (but expensive) paper, purchased by corporate managers at the urging of the Supreme Court of Delaware in decisions such as Smith v. Van Gorkom, 488 A.2d 858 (Del. 1985) (Trans Union). . . .
But why should it matter to this case who is right in that debate? If the Supreme Court of Delaware had held in a tort suit that all of HA-LO’s promotional mugs must be shipped in crates made of inch-thick steel, to prevent all risk that pottery shards from breakage in transit could escape and injure anyone, that would greatly increase the costs of doing business and injure HA-LO’s investors but would not support an award of damages against the sellers of steel crates. Like our hypothetical crate maker, CSFB is fulfilling a market demand. The possibility that judges, regulators, or legislators have caused “too much demand” for a particular service, inducing firms to buy something worth less than its price, is no reason to mulct the service’s provider.
In any event the opinion is a nice salve for investment banks and I think takes the common sense holding that, to the extent fairness opinions are required or given, they are not insurance policies. Rather they are to be assessed at the time they are given. Here, Easterbrook relies heavily on the engagement letter between CSFB and HA-LO to determine that CSFB's reliance on management numbers was appropriate since the engagement letter requires it. These engagement letters have always been quite favorable to the investment banks -- a policy which paid off here.
Sunday, February 17, 2008
Friday, February 15, 2008
Thursday, February 14, 2008
Order to Brief Justiciability Well -- you can see what is coming next . . . .
[Explanation -- she is pushing them to come up with an agreement on a lower price otherwise she will dismiss Finish Line's motion for her to determine a lower price at which the combined companies would be solvent]
Wednesday, February 13, 2008
Monday, February 11, 2008
I've posted to the SSRN a case study on material adverse change clauses. Here is the abstract:
This case study is based on the 2007 material adverse change dispute between Accredited Home Lenders and Lone Star Funds. It is designed to familiarize law and other students with the principles and case law governing material adverse change clauses as well as the structure and usage of these clauses.
You can access it here. Comments are welcome.
Thursday, February 7, 2008
Wednesday, February 6, 2008
Tuesday, February 5, 2008
Monday, February 4, 2008
Here it is. The first paragraph bears quoting: Defendants, affiliates of The Blackstone Group L.P. (“Blackstone”), have been attempting for many months to complete the acquisition of ADS. This is a transaction that they remain steadfastly committed to complete. This is not the
Here it is. The first paragraph bears quoting:
Defendants, affiliates of The Blackstone Group L.P. (“Blackstone”), have been attempting for many months to complete the acquisition of ADS. This is a transaction that they remain steadfastly committed to complete. This is not the
case or a case of “buyer’s remorse.” This is not a situation where a private equity buyer has been unable to obtain financing due to the current condition of the debt markets – Blackstone has all necessary committed financing to complete the transaction. This is not a situation where the buyer would like to negotiate a reduction in the purchase price – Blackstone remains committed to complete this transaction at the negotiated price of $81.75 per share if the approval of the transaction by the Office of the Comptroller of the Currency (the “OCC”) can be obtained on acceptable terms.