Michigan Law Review Volume 105 Issue 8 2007 The Use of Efficient Market Hypothesis: Beyond SOX Dana M. Muir University of Michigan Cindy A. Schipani University of Michigan Follow this and additional works at: https://repository.law.umich.edu/mlr Part of the Business Organizations Law Commons, Law and Economics Commons, and the Retirement Security Law Commons Recommended Citation Dana M. Muir & Cindy A. Schipani, The Use of Efficient Market Hypothesis: Beyond SOX, 105 MICH. L. REV. 1941 (2007). Available at: https://repository.law.umich.edu/mlr/vol105/iss8/10 This Article is brought to you for free and open access by the Michigan Law Review at University of Michigan Law School Scholarship Repository. It has been accepted for inclusion in Michigan Law Review by an authorized editor of University of Michigan Law School Scholarship Repository. For more information, please contact
[email protected]. THE USE OF EFFICIENT MARKET HYPOTHESIS: BEYOND SOX Dana M. Muir* Cindy A. Schipani** This Article focuses on the regulatory use offinance theory, particularly the efficient market hypothesis ("EMH"), in two areas where securities pricing is at issue: shareholder appraisal cases and the use of employer stock in benefit plans. Regarding shareholderappraisal cases, the Article finds that the Delaware courts seem to implicitly respect the principles of EMH when ascertaining the fair value of stock, but recognize that markets cannot operate efficiently if information is withheld. Regarding employer stock in benefit plans, it concentrates on the explicit adoption of EMH by the Department of Labor to exempt directed trustees from traditional duties of inquiry regarding the prudence of investment directions.