Law & Economics
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Annual Report 2009–2010 institute for law & economics ..... A Joint Research Center of the Law School, the Wharton School, and the Department of Economics in the School of Arts and Sciences at the University of Pennsylvania Message from the Co-Chairs 1 Insights from Practice 20 Board of Advisors 2 Delaware Chancery Program 20 Message from the Dean 4 Lectures 22 Message from the Co-Directors 5 Law and Entrepreneurship 24 Roundtable Programs 6 Distinguished Jurist 28 Corporate Roundtable, Spring 2010 8 Past Lectures 30 Corporate Roundtable, Fall 2009 10 Academic Events 32 Off the Record, Spring 2009 12 Penn/NYU Conference, Spring 2010 34 Corporate Roundtable, Spring 2009 12 NYU/Penn Conference, Spring 2009 34 Corporate Roundtable, Fall 2008 14 ILE/Wharton Finance Seminars 36 Corporate Roundtable, Spring 2008 14 Publications and Papers 38 Panel Programs 16 Associate Faculty 40 Chancery Court Programs, Spring 2010 18 Institute Investors 49 FOUNDED IN 1980, the Institute for Law and Economics at the University of Pennsylvania has an ambitious agenda that is timelier than ever. The study of law and economics remains the most rapidly growing movement in legal scholarship and jurisprudence. Under the sponsorship of the Law School, the Wharton School, and the Department of Economics in Penn’s School of Arts and Sciences, the Institute has played a leading role in this expanding field. Cross-disciplinary research, the cornerstone of ILE, seeks to influence the national policy debate by analyzing the impact of law on the global economy, spotlighting the significant role that economics plays in fashioning legal policy. Our innovative roundtables and conferences, launched in 1985, complement these goals by provoking in-depth and frequently groundbreaking examinations of critical issues. These and other programs highlighted in this Annual Report have helped the Institute stay on the leading edge of this cross-discipline. The Institute for Law and Economics has unique advantages. We draw on the research and teaching strengths of the Law School, the Wharton School, and the Department of Economics. Our geographic location is optimal, allowing us to bring together participants from Washington and New York for full-day meetings and still get everyone home in time for dinner. We have been able to call on the expertise of Penn Law School alumni who occupy key positions in law, business, and government. And, critically, we have an extraordinarily distinguished cadre of board members and sponsors who are willing to give of their time and expertise to make our programming a success. In each area, from our public lectures and panels through our closed-door roundtables to our more academically- oriented faculty workshops, we are driven by the same mission: to use the tools of economics to understand the law. In a world in which complex legal rules govern economic relationships, the tools of economics provide a way of asking whether the law creates appropriate incentives to encourage actors to maximize social welfare. Funding for ILE comes from a diverse group of corporations, law firms, foundations, and individuals who endorse our work each year. Over the past decade, the Institute has more than tripled its donor base to provide ongoing support for the programs discussed in this Annual Report. A list of Institute Investors for 2009–2010 appears on page 49. Cover Captions Top: Joseph D. Gatto, Barclays Capital Americas. Left: Hon. Leo E. Strine, Jr., Delaware Court of Chancery. Right: Roy J. Katzovicz, Pershing Square Capital Management, L.P. Message from the Co-Chairs for almost three decades, penn’s institute for law and economics has contributed to scholarship, policy, and practice on relevant issues of law and economics that affect our country’s businesses and financial institutions. THE Institute’S programs have become increasingly relevant and important in this challenging economic climate, focusing on the issues that the academic, legal, and business communities care about. Today the Institute enjoys an outstanding international reputation for the excellence of its programs, where leaders in business, financial management, legal practice, and academic scholarship candidly discuss the intersec- tion of theory and practice on a host of significant issues. Your participation in these programs is a vital component of their success. On behalf of the Institute’s Board of Advisors, we want to express our gratitude to everyone who has helped the Institute during this past year, whether through financial contributions or by participation in ILE programs. One of the foremost goals of the Institute is to broaden and diversify our foundation, and once again we have realized that goal. We are delighted to report some superb additions to our Board of Advisors during the past year. We are pleased to welcome the following new members: Louis J. Bevilacqua (Cadwalader, Wickersham & Taft LLP); Stephen Fraidin (Kirkland & Ellis LLP); Dennis J. Friedman (Gibson, Dunn & Crutcher LLP); Mark I. Greene (Cravath, Swaine & Moore LLP); Brendan R. Kalb (AQR Capital Management, LLC); Jeffrey D. Marell (Paul, Weiss, Rifkind, Wharton & Garrison LLP); Allan N. Rauch (Bed Bath & Beyond); and one returning member, Joel E. Friedlander (Bouchard Margules & Friedlander). These accomplished individuals will greatly enhance the work of the Institute and broaden the composition of our Board. All of the members of our Board give graciously to the Institute, not just financially but also of their time and expertise, and we are very grateful for their contributions. Very special thanks must be given to ILE Benefactors Bob Friedman, Paul G. Haaga, Jr., and Skadden, Arps, Slate, Meagher & Flom LLP (through Eric Friedman). Their extraordinary level of financial support enables the Institute to continue to lead the field, and we want to express our sincere appreciation to each of them. Jill Fisch, Ed Rock, and Michael Wachter have continued to be truly outstanding as co-directors of the Institute. We look forward to welcoming Bill Bratton as a co-director in the upcoming year, as Ed Rock will be stepping down. The co-directors’ dedication to all aspects of the Institute’s work and their ability to come up with timely programs and attract the ideal participants to make every program an unqualified success are why ILE is world-renowned as the forum for interesting dialogue on topical issues for corporations and their financial and legal advisors. Charles “Casey” Cogut Simpson Thacher & Bartlett LLP Joseph B. Frumkin Sullivan & Cromwell LLP September 2010 institute for law and economics 1 message from the co-chairs Board of advisorsAdvisors JamesBarry M. H. AbelsonAgger RobertJoel E. L.Friedlander Friedman PaulRoy G. J.Haaga, Katzovicz Jr. SimonNew M. York, Lorne NY PeterWayne, G. SamuelsPA Chair,Pepper 1994–2001 Hamilton LLP Chair,Bouchard 2001–2007 Margules & ViceGeneral Chairman Counsel Vice Chairman and Chief Proskauer Rose LLP RetiredPhiladelphia, Senior PA Vice SeniorFriedlander Managing Director andCapital Pershing Research Square and Capital LegalJames Officer A. Ounsworth NewDavid York, M. Silk NY President, General ChiefWilmington, Legal Officer DE ManagementManagement, Company L.P. MillenniumManaging Director Wachtell, Lipton, CounselJames H. and Agger Secretary The Blackstone Group L.P. LosNew Angeles, York, CANY ManagementThe Musser ConsultingLLC Group VictoriaRosen & E. Katz Silbey AirChair, Products 1994–2001 and NewDennis York, J. NYFriedman NewWayne, York, PANY SeniorNew York,Vice President—NY Chemicals,Retired Senior Inc. Vice Gibson, Dunn & JohnBruce G. Harkins, N. Kuhlik Jr. Legal and General Counsel Allentown,President, General PA Counsel JosephCrutcher B. FrumkinLLP Chair,Executive 1980–1990 Vice President andJeffrey Morton D. MarellA. Pierce SunGardBruce L. DataSilverstein Systems Inc. and Secretary Co-Chair,New York, 2008– NY HarkinsGeneral Cunningham Counsel LLP Paul,Dewey Weiss, & LeBoeuf Rifkind, LLP Wayne,Young Conaway PA Stargatt RichardAir Products B. Aldridge and Sullivan & Cromwell LLP Philadelphia,Merck & Co., PA Inc. WhartonNew York, & Garrison NY LLP & Taylor, LLP MorganChemicals, Lewis Inc. & Bockius LLP NewEric J.York, Friedman NY Whitehouse Station, NJ New York, NY DavidWilmington, M. Silk DE Philadelphia,Allentown, PA PA Executive Partner Leon C. Holt, Jr. Martha L. Rees Wachtell, Lipton, JosephSkadden, D. GattoArps, Slate, RetiredMark Vice Lebovitch Chairman and AlanVice Miller President and Assistant RosenA. Gilchrist & Katz Sparks III WilliamRichard B.D. Aldridge Anderson, Jr. ViceMeagher Chairman & Flom LLP ChiefBernstein Administrative Litowitz OfficerBerger &Co-Chairman General Counsel NewMorris, York, Nichols, NY Arsht ManagingMorgan Lewis Director & Bockius LLP LehmanNew York, Brothers NY Inc. Air GrossmannProducts and LLP InnisfreeE. I. du M&A Pont deIncorporated Nemours & Tunnell LLP Goldman,Philadelphia, Sachs PA & Co. New York, NY Chemicals,New York, Inc. NY New& Company,York, NY Inc. BruceWilmington, L. Silverstein DE New York, NY Robert L. Friedman Allentown, PA Wilmington, DE Young Conaway Stargatt William D. Anderson, Jr. JosephChair, 2001–2007Glatt Paul S. Levy G. Daniel O’Donnell &Hon. Taylor, Leo LLP E. Strine, Jr. MarshallManaging B.Director Babson PrincipalSenior Managing Counsel Director WilliamFounder B. Johnson DechertMyron LLP J. Resnick Wilmington,Vice Chancellor DE HughesGoldman, Hubbard Sachs & Co. Apolloand Chief Capital Legal Officer ChairmanJLL Partners Emeritus Philadelphia,Retired Senior PA Vice President Delaware Court