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A couple of days ago, the SEC announced that it had filed a settled administrative action against former Deutsche Bank research analyst Charles Grom. The administrative order is interesting because it gives a little glimpse into the lives of sell-side research analysts in the wake of early 2000s reforms. It also serves as an object lesson in the failures of attempts to “level the playing field” regarding access to inside information.

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Time for a rant. Some of you may not notice the difference; I’m told that almost everything I write seems like a rant, even when I think I’m being restrained.

Today’s topic is misleading comparisons—in common parlance, comparing apples and oranges—and today’s example comes from the Delaware Supreme Court in the famous case of Weinberger v. UOP, Inc., 457 A.2d 701 (1983).

Weinberger, for those of you who may not remember, involved a challenge to a cash-out merger between UOP and its controlling shareholder, Signal. The merger price was $21 a share, but a report prepared by Signal (not disclosed to UOP and its shareholders) indicated that any price up to $24 a share would be a good investment for Signal. The Supreme Court reversed the Chancery Court’s determination that the transaction met the fairness test.

I have no quarrel with either the result or the general analysis in Weinberger. It’s a good opinion, and it makes several important contributions to Delaware corporate law. It expounds on the meaning of “fairness” in duty-of-loyalty situations and lays out a roadmap for controlling shareholders to follow to avoid duty-of-loyalty challenges. It eliminates the “business purpose” requirement in cash-out mergers. And…

In recent years, and particularly since the Supreme Court’s decision in Citizens United v. FEC, 558 U.S. 310 (2010), there have been increasing calls for the SEC to require public companies to disclose their spending on political activities.

The situation is complex because while there may be many reasons for transparency on the subject, it is difficult to tie disclosure specifically to the needs of investors as investors.  Most political spending is likely undertaken by companies to benefit the firm itself – that is, in fact, precisely why people find it objectionable – and it is difficult to articulate why investors as investors (rather than, say, as employees or as citizens) should care about political spending any more than any other ordinary business decision for which we have no required disclosures.

The SEC has resisted increasingly loud calls that it regulate in this area, likely due to this precise problem.  In December, Congress passed a budget that actually forbade the SEC from using funds to regulate political spending in the following year, though that has not ended the matter for Democrats.  (Interestingly, I note that it was only after the budget had passed both Houses that there…

Call for Papers
Vol. 7, No. 1
(Spring 2017)

Special Issue –
The Ethics of Social Entrepreneurship
Donald W. Caudill, Executive Editor (Godbold School of Business, Gardner-Webb University), invites authors to submitpapers for a special issue of the Journal of Ethics & Entrepreneurship  on The Ethics of Social Entrepreneurship (Vol. 7 No. 1, Spring 2017).
 
Mission of the Journal of Ethics and Entrepreneurship
The mission of the JEE is to publish (double-blind, peer reviewed) interdisciplinary scholarly research (conceptual, theoretical, empirical) or teaching cases that connect entrepreneurship and ethics and appeal to both the academic and the practitioner.
Special Issue Call for Papers
This Special Issue is being offered in conjunction with the Special Interest Group in Social Entrepreneurship of the United States Association of Small Business and Entrepreneurship (USASBE) and the issue will be celebrated at the January 2017 USASBE Annual Meeting in Philadelphia, PA.
Social entrepreneurship has become a dynamic force in positively addressing market and institutional social and economic failures as well as providing beneficial solutions for those living on the margins of society.  At the heart of this growing field are the promotion of the social good and the rectifying of

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Every year, the Corporate Practice Commentator publishes an annual list of each year’s best corporate and securities law articles. Bob Thompson, a law professor at Georgetown, is currently the curator of that list. Each year, he circulates a ballot to corporate and securities scholars with a list of articles for them to vote on.

I’ve always been a little skeptical of this list, and not just because I’ve never been on it (I don’t think). There are over 500 articles on the list and, unless most professors have more time on their hands than I do, they haven’t read most of those articles. Even if they had, I’m not sure a popular vote, even one limited to law professors, is the best way to measure quality. And quality often becomes apparent only over time, when one can see the effect the article has had.

Having said that, I have nothing against Professor Thompson’s poll, even though I don’t participate. But his recent solicitation to participate in this year’s balloting prompted me to think about the other side of things: what are the worst corporate and securities law articles of the year?

We should probably exclude student-written notes and comments in…

For those of you who just can’t get enough of Halliburton Co. v. Erica P. John Fund, Inc., 134 S. Ct. 2398 (2014) (“Halliburton II”), developments, there have recently been a couple of doozies.

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