April 20, 2013
What a week
Gawd, what a week. Wait, the week isn't over. Today (Sat) is Friday for teaching purposes since yesterday was such a mess around here. Hopefully, things will settle down into something like a normal routine next week.
March 22, 2013
Take it outside boys
Sounds like the judicial fireworks are flying in Tulane (note to self: go next year). At a panel discussion Chief Justice Myron Steele apparently continued his crusade to get the Chancery Court to shut up (via WSJ Deal Journal:
“Every time they open their mouth they make the law,” Steele said Thursday, discussing how he would love to get that idea into the heads of judges. Steele said it was inappropriate to force lawyers to read transcripts in order to determine the law.
Steele didn’t name names.
But we know. It's funny. The Supreme Court would like the Chancery Court to say less and only speak through its opinions and only on issues that are directly before the court. All of this other stuff is just dicta. It forces lawyers to read transcript hearings and search speeches for hints at what the law is. As an aside - if the court were really worried about closing off access to knowledge of the state of the law, it would reconsider its Chancery Arbitration procedures. Just saying.
Anyway, those things that Steele thinks are bugs, are considered features by the Chancery Court. In a paper (forthcoming in W&L Law Review) by Vice Chancellor Donald Parsons and his former clerk Jason Tyler, the authors point to dicta and judicial asides as an important component of the law making/dealmaking function of Delaware law:
To give just one small example of the organic nature of this process, in December 2011, Vice Chancellor Laster issued an opinion in In re Compellent Technologies. In dicta, he questioned the wording of a provision of a merger agreement requiring the target company’s board to give notice to the acquirer if any subsequent, superior offers arose. The Vice Chancellor did not question the general validity of this relatively common information rights provision, just the particular verbiage used to express it in the merger agreement at issue in that case. Less than two months later, another case—In re Micromet—challenged a merger agreement containing a nearly identical provision, except for a revision in the language the court had questioned in Compellent. The court in Micromet found the revised provision unobjectionable. More important than the outcomes of those two cases, however, is what one reasonably can infer from their facts and sequence. Apparently, within a matter of weeks, transactional attorneys had read the Compellent opinion and advised their clients accordingly in connection with a later transaction that, when challenged, survived judicial scrutiny.
So, it's a bit of a judicial tug of war that will no doubt continue to play out.
August 19, 2011
June 03, 2011
OK, so let me get this straight. Last year, Groupon turned down a $6 billion acquistition offer from Google. Now the company is planning an IPO that values the company at $30 billion. The company also lost more than $400 million last year. And, insiders plan to sell up to $345 million worth of their own stock as part of the planned $750 million IPO. What do they know that we don't?
Did I miss something? Are sock-puppets back in fashion again? Aren't companies supposed to have profits before going public? Didn't we resolve that question already? Maybe this is why I did get rich during the dot com bubble. None of it made any sense back then and it still doesn't the second time around.
Here's the Groupon S-1. Have fun.
March 11, 2011
Book talk on D&O insurance and shareholder litigation
At Fordham Law in NYC there's an interesting book talk on March 30 (5-6:30p). Profs. Sean Griffith (Fordham) and Tom Baker (UPenn) have a new book - Ensuring Corporate Misconduct: How Liability Insurance Undermines Shareholder Litigation. Get more info on the event here. And here's the book squib:
Shareholder litigation and class action suits play a key role in protecting investors and regulating big businesses. But Directors and Officers liability insurance shields corporations and their managers from the financial consequences of many illegal acts, as evidenced by the recent Enron scandal and many of last year’s corporate financial meltdowns. Ensuring Corporate Misconduct demonstrates for the first time how corporations use insurance to avoid responsibility for corporate misconduct, dangerously undermining the impact of securities laws.
Looks like a good read. When's summer?!
December 17, 2010
Glengarry Glen Christmas
In a nod to one of the best business movies ever, Santa's emissary (Alec Baldwin) makes it clear that this sad group of elves must "Always Be Closing Cobbling." Merry Christmas!
October 08, 2010
Ted MIrvis argued before the Chancery Court in the Airgas/Air Products case this morning that countless law professors have gotten tenure by writing articles that assume a staggered board has a term of 3 years. "Can they all have been barking up the wrong tree?!" he asked. Help me! I'm rolling on the floor laughing.
Ted Mirvis pulls a "Miracle on 34th St." moment by dumping a pile of definitions from dictionaries for the word "annual" on Chancellor Chandler's desk. Chuckles all around.
[Sorry - it's academic, corporate-geek humor.]
Update: Prior to April 7, Airgas had a bylaw that permitted the board to set the date of the annual meeting at anytime up to five months following the end of the fiscal year. That was changed by the board to permit the calling of an annual meeting at any point. That was then changed (by shareholder vote) to set a specific date in January. Hmm.
Chandler: Isn't there a common understanding that a Congressman or Senator will serve a full "term" and that term won't be cut short?
>> Except that unlike Airgas' charter, the US Constitution specifically lays out the length in years of terms for both Congressmen and Senators. It doesn't use mushy talk like "Congressmen will serve until they are replaced" or "Congressman's term will expire in the second year following the year of their election" ...
September 24, 2010
There's an App for That
Just the other day one of my students dropped by my office and made an embarrassing admission. Seems he will be joining the corporate department of a big law firm after graduation and ... well ... he said that when the associates were talking "shop" over lunch during the summer that it all sounded like Japanese to him. He is afraid that being an English major in college is just about to catch with him.
Well, don't worry, cause there's an app for that -- Latham & Watkins "Book of Jargon." Download it now so you never have to guess what a "Macaroni Defense" is or what "KFC" stands for. I'll admit I wracked my brain for minutes and then gave up. I had never heard of the KFC acronym before. I looked it up in the Book of Jargon and apparently it means "Kentucky Fried Chicken." Is that a new deal structure?
April 17, 2010
Kabletown Buys NBC
... or something like that. I don't know, I just saw it on the TV.
Happy Patriot's Day (that's a holiday here in Massachusetts).
January 08, 2010
Worst Deals of the Century?
Hot on the heels of Gerald Levin's claiming the mantle of the "worst deal of the century", the Telegraph (UK) helpfully puts together its own shortlist of "worst deals" of this century. Given that the century started in 2000, that's only about a decade's worth of bad deals to choose from. Here's their list (with an obvious European bias):
1. AOL - Time Warner
2. Vodaphone - Mannesmann
3. France Telecom - Orange
4. Vivendi - Seagram
5. RBS - ABN Amro
September 18, 2009
Colbert on Corporate Speech
And here's the thing - he's right on Santa Clara County v Southern Pacific Railway! Hooray for smart corporate/constitutional comedy.
August 31, 2007
Three Plus One Equals Billions: The Bendix-Martin Marietta War
Today's Friday M&A culture is pure candy/beach reading and the story of one of the seminal ''80s takeovers, Three Plus One Equals Billions: The Bendix-Martin Marietta War by Allan Sloan. Pac-man anyone? Enjoy your labor day weekend; and rest up for what should be an active Fall.
August 24, 2007
Friday Culture: Lombard Street
Today's Friday culture is Bagehot's Lombard Street: A Description of the Money Market. Lombard Street is a collection of essays written by the famed Bagehot for the Economist during the 1850s. The book is a classic description of the market at that time and an enduring look at market psychology. Highly relevant for our times, Bagehot also analyzes and dissects market crises, offering monetary prescriptions that remain to this day the preferred route for stemming and avoiding financial crises. In particular, his prescriptions for the injection of mass liquidity to stem market panic is, in fact, one that the central banks of the World are following today. Enjoy your weekend!