{"id":4015,"date":"2015-06-16T16:19:20","date_gmt":"2015-06-16T20:19:20","guid":{"rendered":"http:\/\/journals.law.harvard.edu\/hblr\/?page_id=4015"},"modified":"2025-02-18T18:12:32","modified_gmt":"2025-02-18T23:12:32","slug":"volume-5-issue-2","status":"publish","type":"page","link":"https:\/\/journals.law.harvard.edu\/hblr\/volume-5-issue-2\/","title":{"rendered":"Volume 5, Issue 2 (2015)"},"content":{"rendered":"
BUSINESS & CORPORATIONS<\/h5>\n

FIFTY-YEARS OF CORPORATE LAW EVOLUTION: A DELAWARE JUDGE’S RETROSPECTIVE<\/a><\/h3>\n
Jack B. Jacobs<\/strong><\/em><\/h6>\n

It may surprise you to learn that fifty years ago, many of the topics you have covered in this and your business organizations course did not even exist. Moreover, and critically important, what has been presented as the current state of corporation and M&A law was not preordained and, but for some historical accidents, could easily have come out very differently from how it actually did.<\/p>\n

\n
HUMAN RIGHTS & LABOR \u2022 CONSUMER PROTECTION<\/h5>\n

CORPORATE PIETY AND IMPROPRIETY: HOBBY LOBBY<\/em>‘S EXTENSION OF RFRA RIGHTS TO THE FOR-PROFIT CORPORATION<\/a><\/h3>\n
Amy J. Sepinwall<\/strong><\/em><\/h6>\n

In Burwell v. Hobby Lobby, Inc., the Supreme Court held, for the first time, that the Religious Freedom Restoration Act (RFRA) applied to for-profit corporations and, on that basis, it allowed Hobby Lobby to omit otherwise mandated contraceptive coverage from its employee healthcare package. Critics argue that the Court\u2019s novel expansion of corporate rights is fundamentally inconsistent with the basic principles of corporate law. In particular, they contend that the decision ignores the fact that the corporation, as an artificial entity, cannot exercise religion in its own right, and they decry the notion that the law might look through the corporate veil to protect the corporate owners\u2019 rights even while having the veil shield the owners from liability for the corporation\u2019s wrongs.<\/p>\n

\n
MERGERS & ACQUISITIONS \u2022 CORPORATE LAW & GOVERNANCE<\/h5>\n

THE EFFECT OF DELAWARE DOCTRINE ON FREEZEOUT STRUCTURE & OUTCOMES: EVIDENCE ON THE UNIFED APPROACH<\/a><\/h3>\n
Fern\u00e1n Restrepo and Guhan Subramanian<\/strong><\/em><\/h6>\n

Historically, Delaware corporate law provided different standards of judicial review for buyouts by controlling shareholders (also known as \u201cfreezeouts\u201d). The standards were based on what transactional form was used: deferential business judgment review for freezeouts executed as tender offers and stringent \u201centire fairness\u201d review for transactions structured as mergers. Subramanian (2005), Subramanian (2007), and Restrepo (2013) provide doctrinal and empirical evidence that (1) transactional planners responded to these differences in standards of judicial review; (2) these differences in judicial scrutiny created differences in outcomes for the minority shareholders; and (3) differences in outcomes created a social welfare loss, not just a wealth transfer from minority shareholders to the controlling shareholder. Over the past decade, in a series of important decisions, Delaware law has migrated toward a unified approach to freezeouts regardless of transactional form. In this Article we present empirical evidence on all freezeouts of Delaware targets during this period of doctrinal evolution. In general, we find that deal outcomes converged after the Delaware Chancery Court\u2019s decision in In re Cox Communications, Inc. Shareholders Litigation. Our findings suggest that: (1) transactional planners seem to respond to even dicta in the Delaware case law; and (2) the social welfare loss identified in Subramanian (2005) seems no longer to be present. This result in turn suggests that the Delaware Supreme Court seems to have adopted the correct policy by endorsing the unified approach for merger freezeouts in Kahn v. M&F Worldwide Corp., and moreover, that the court should also explicitly endorse this approach in the context of tender offer freezeouts when presented with such facts.<\/p>\n

\n
MERGERS & ACQUISITIONS \u2022 CORPORATE LAW & GOVERNANCE<\/h5>\n

CORPORATE LEGACY<\/a><\/h3>\n
Andrew A. Schwartz<\/strong><\/em><\/h6>\n

Many public companies have shed takeover defenses in recent years, on the theory that such defenses reduce share price. Yet new data presented here shows that practically all new public companies\u2014those launching their initial public offering (IPO)\u2014go public with powerful takeover defenses in place. This behavior is puzzling because the adoption of takeover defenses presumably lowers the price at which the pre-IPO shareholders can sell their own shares in and after the IPO. Why would founders and early investors engage in this seemingly counterproductive behavior? Building on prior attempts to solve this mystery, this Article claims that IPO firms adopt takeover defenses, at least in part, so that they can remain independent indefinitely and create corporate legacies that last for generations.<\/p>\n

\n
CORPORATE LAW & GOVERNANCE \u2022 TECHNOLOGY & INNOVATION<\/h5>\n

PROTECTING PUBLIC SHAREHOLDERS: THE CASE OF GOOGLE’S RECAPITALIZATION<\/a><\/h3>\n
Paul Lee<\/strong><\/em><\/h6>\n

The recent mid-stream recapitalization of Google introducing a class of non-voting shares raises certain questions about controlling shareholder opportunism and the adequacy of our current system in protecting the rights of public shareholders. This Note argues that the settlement of the class action suit on behalf of Google\u2019s public shareholders did not do enough to address the harm they suffered, and examines options for how the law in Delaware may be adapted to provide adequate protection for public shareholders.<\/p>\n","protected":false},"excerpt":{"rendered":"

BUSINESS & CORPORATIONS FIFTY-YEARS OF CORPORATE LAW EVOLUTION: A DELAWARE JUDGE’S RETROSPECTIVE Jack B. Jacobs It may surprise you to […]<\/p>\n","protected":false},"author":117,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"jetpack_post_was_ever_published":false,"footnotes":""},"class_list":["post-4015","page","type-page","status-publish","hentry"],"jetpack_shortlink":"https:\/\/wp.me\/PgKEUK-12L","jetpack-related-posts":[{"id":4740,"url":"https:\/\/journals.law.harvard.edu\/hblr\/volume-8-issue-2\/","url_meta":{"origin":4015,"position":0},"title":"Volume 8, Issue 2 (2018)","author":"wgu","date":"November 20, 2019","format":false,"excerpt":"SECURITIES & FINANCIAL REGULATION INVESTOR-DRIVEN FINANCIAL INNOVATION Kathryn Judge Financial regulations often encourage or require market participants to hold particular types of financial assets. 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