The Enduring Distinction Between Business Entities and Security Interests

By Ofer Eldar and Andrew Verstein October 31, 2018 by renholding

Why are security interests and legal entities both widely used? The prevailing answer in legal scholarship is that both bodies of law exist to partition assets for the benefit of designated creditors.[1] This view is not merely an academic …

Shareholder Activism Through Say-on-Pay

By Konstantinos Stathopoulos and Georgios Voulgaris October 30, 2018 by renholding

Shareholder activism around the world has increased substantially over the last few years (see here and here for recent examples). Empowered shareholders seek to discipline management and voice their dissatisfaction with specific corporate decisions. A particular source of tension between …

Davis Polk Discusses the New Populist Movement in Antitrust

By Arthur Burke, Ronan Harty, Jon Leibowitz, Howard Shelanski and Jesse Solomon October 30, 2018 by renholding

In recent years, a new populist school of antitrust thinking has emerged, known as “Neo-Brandeisian” to its proponents and “hipster” to its detractors. There are varying formulations of this movement, but proponents generally point to the purported increase in economic …

Can Companies and M&A Law in Europe Adapt to the Market for Corporate Control?

By Matteo Gatti October 29, 2018 by renholding

Takeover regimes in Europe have been under persistent scrutiny by the public, politicians, and market participants. Sometimes, that is just the nature of the game: Takeovers create winners and losers, and the latter (with the help of their champions and …

Sullivan & Cromwell Offers Corporate Governance Updates

By Heather L. Coleman, Melissa Sawyer and Marc Treviño October 29, 2018 by renholding

On October 18, Institutional Shareholder Services Inc. (“ISS”) announced that the comment period for its 2019 benchmark voting policy is open until 5:00 PM ET on November 1, 2018. For U.S. companies, ISS is soliciting comments on proposed changes relating …

The Hollowed Out Common Law

By Samuel Issacharoff and Florencia Marotta-Wurgler October 26, 2018 by renholding

There are two striking features about the ways in which contracts stemming from the electronic marketplace are adjudicated today. The first is the steady decline in the number of cases litigated in state court as compared with the federal forum. …

SEC Commissioner Discusses Improving Information for Investors in the Digital Age

By Kara M. Stein October 26, 2018 by renholding

I last spoke to you in May 2014 about “Building Momentum.”[1] At the time, I was a rookie Commissioner. Now, I stand before you after five years as a Commissioner and over 5,700 votes under my belt. It has

…

The Underappreciated Dilemmas of Overlapping Financial Regulations

By Matthew C. Turk October 25, 2018 by renholding

Calls to dismantle the legal framework that was developed in response to the financial crisis have begun to multiply and gain momentum. Pursuant to a Trump Administration executive order, the Treasury Department has released a series of reports that undertakes …

Paul Weiss Discusses New Trends in Private Equity Transactions

By Paul, Weiss, Rifkind, Wharton & Garrison October 25, 2018 by renholding

The private equity market is more competitive than ever. Target company multiples have skyrocketed due to both a robust strategic acquisition market, and stiff competition from PE buyers as they vie with one another to deploy $1 trillion in dry …

The Role of Public Pension Funds in Governance

By Ying Duan, Yawen Jiao and Kunsun Tam October 24, 2018 by renholding

Public pension funds have great influence over corporate governance because of the size and nature of their portfolios: They manage more than $3 trillion in assets and often invest in a large number of companies. Besides largely unobservable private negotiations, …

Long-Term Economic Consequences of Hedge Fund Activist Interventions

By Ed deHaan, David. F. Larcker and Charles McClure October 23, 2018 by renholding

Our new academic study examines the long-term effects of interventions by activist hedge funds. Prior studies document positive equal-weighted long-term returns and operating performance improvements following activist interventions, and typically conclude that activism is beneficial to shareholders. We challenge and …

Debevoise Discusses UK’s Proposed National Security Review for M&A

By Simon Witney and Timothy McIver October 23, 2018 by renholding

Many countries have been looking again at their ability to block acquisitions when they threaten national security. For example, we reported on a change to German law in July last year, and a European Commission proposal (which would cover all …

Going Concern Opinions, Institutional Ownership, and CEO Compensation

By Ning Ren and Yun Zhu October 22, 2018 by renholding

Auditors issue going concern opinions when they have substantial doubts about a client’s ability to continue as a going concern for one year beyond the financial statement date. Abundant anecdotal evidence shows that companies that received these opinions went through …

Arnold & Porter Compares New California Privacy Law With the EU’s Privacy Regime

By Nancy L. Perkins, Anthony Raglani, Ronald D. Lee, Zoe V. Walkinshaw, Anthony Samson and Angel Tang Nakamura October 22, 2018 by renholding

On September 23, 2018, the governor of California signed into law an amended version of the California Consumer Privacy Act of 2018 (CCPA),[1] which was originally enacted in late June 2018. The amendments are a partial response to extensive …

Competition: The Forgotten Fourth Pillar of the SEC’s Mission

By Robert J. Jackson, Jr. October 19, 2018 by renholding

Thank you so much, Sarah [Miller], for that kind introduction. It’s a privilege to be here with you and the Open Markets Institute and Village Capital today. I’ve long admired the Institute’s leadership in putting the concentrated power choking our …

Proposed New Disclosures for Mutual Fund Advisers

By Bernard S. Sharfman October 19, 2018 by renholding

According to the Securities and Exchange Commission (SEC) release establishing the Proxy Voting Rule, an investment adviser “is a fiduciary that owes each of its clients duties of care and loyalty with respect to all services undertaken on the client’s …

How Institutional Ownership Affects Insider Trading

By Stephen A. Hillegeist and Liwei Weng October 18, 2018 by renholding

Institutional owners have traditionally been thought of as passive investors that have little concern for or influence on corporate policies and decisions. In contrast, recent literature shows that while many institutions are passive in terms of their investment choices and …

Debevoise Discusses the UK’s Proposed National Security Review for M&A Deals

By Simon Witney and Timothy McIver October 18, 2018 by abirvarma

Lame Duck CEOs

By Marc Gabarro, Sebastian Gryglewicz and Shuo Xia October 17, 2018 by renholding

The process of replacing key individuals is crucial to organizations’ performance. This is as true for presidents of countries as it is for CEOs. When a firm announces the departure of a CEO without announcing a successor, the incumbent CEO …

Gibson Dunn Discusses How Brexit Will Affect Financing and Documentation

By Amy Kennedy, Jeffrey Steiner and Alex Hillback October 17, 2018 by renholding

Since the result of the Brexit referendum was announced in June 2016, there has been significant commentary regarding the potential effects of the UK’s withdrawal from the EU on the financial services industry.

As long as the UK is negotiating …

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The CLS Blue Sky Blog

Columbia Law School's Blog on Corporations and the Capital Markets

October 2018