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
Annual Report 2010–11 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 Message from the Co-Chairs: 1 our country’s businesses and financial institutions.
Board of Advisors: 2
Message from the Dean: 4 he Institute’s programs have become increasingly relevant and important in this Message from the Co-Directors: 5 challenging economic climate, focusing on the issues that the academic, legal, and business communities care about. Today the Institute enjoys an outstanding Roundtable Programs: 7 T international reputation for the excellence of its programs, where leaders in Corporate Roundtable, Spring 2011: 8 business, financial management, legal practice, and academic scholarship candidly discuss the intersection of theory and practice on a host of significant issues. Your participation in Corporate Roundtable, Fall 2010: 10 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 Corporate Roundtable, Spring 2010: 12 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 Corporate Roundtable, Fall 2009: 12 is to broaden and diversify our foundation, and once again we have realized that goal. Off the Record, Spring 2009: 14 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: George A. Casey (Shearman Corporate Roundtable, Spring 2009: 14 & Sterling LLP); Scott C. Goebel (Fidelity Management & Research Company); Kenneth A. Lefkowitz (Hughes Hubbard & Reed LLP); John J. Suydam (Apollo Global Management, Panel Programs: 17 LLC); and Christopher Young (Credit Suisse). These accomplished individuals will greatly Chancery Court Programs, Spring 2011: 18 enhance the work of the Institute and broaden the composition of our Board. We would also like to welcome Seyfarth Shaw LLP as an ILE sponsor, through long-standing board Insights from Practice: 20 member, Marshall B. Babson. All of the members of our Board give graciously to the Institute, not just financially but also of their time Lectures: 23 and expertise, and we are grateful for their contributions. Very special thanks must be given to ILE Benefactors Bob Law and Entrepreneurship: 24 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 Distinguished Jurist: 28 sincere appreciation to each of them. Bill Bratton, Jill Fisch, and Michael Wachter continued to be truly outstanding as co-directors of the Past Lectures: 30 Institute. The co-directors’ dedication to all aspects of the Institute’s work and their ability to come up with timely Academic Events: 33 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 NYU/Penn Conference, Spring 2011: 34 advisors.
Penn/NYU Conference, Spring 2010: 34 Charles “Casey” Cogut ILE/Wharton Finance Seminars: 36 Simpson Thacher & Bartlett LLP
Publications and Papers: 38 Joseph B. Frumkin Sullivan & Cromwell LLP Associate Faculty: 41 September 2011 Institute Investors: 48
message from the co-chairs 1 board of advisors Corporate Roundtable 1 Bill Anderson 19 Dan O’Donnell
2 Marshall Babson 20 Mort Pierce
3 Lou Bevilacqua 21 Allan Rauch
4 George Casey 22 Martha Rees James H. Agger Robert L. Friedman Roy J. Katzovicz Peter G. Samuels Proskauer Rose LLP 5 Isaac Corré 23 Victoria Silbey Chair, 1994-2001 Chair, 2001-2007 Chief Legal Officer 1 2 3 4 Retired Senior Vice President, Senior Managing Director Pershing Square Capital Management, L.P. New York, NY General Counsel and Secretary The Blackstone Group L.P. New York, NY 6 Bob Friedman 24 David Silk Air Products and Chemicals, Inc. New York, NY Victoria E. Silbey 7 25 Allentown, PA Bruce N. Kuhlik Senior Vice President-Legal, Dennis Friedman Bruce Silverstein Joseph B. Frumkin Executive Vice President and Chief Legal Officer 8 26 Richard B. Aldridge Co-Chair, 2008- General Counsel SunGard Data Systems Inc. Eric Friedman Gil Sparks Morgan, Lewis & Bockius LLP Sullivan & Cromwell LLP Merck & Co., Inc. Wayne, PA 9 Joel Friedlander 27 Heidi Stam Philadelphia, PA New York, NY Whitehouse Station, NJ David M. Silk 10 Joe Gatto 28 John Suydam William D. Anderson, Jr. Joseph D. Gatto Mark Lebovitch Wachtell, Lipton, Rosen & Katz New York, NY Managing Director Chairman of Investment Banking Bernstein Litowitz Berger & 11 Scott Goebel 29 Marc Weingarten Goldman, Sachs & Co. Americas Grossmann LLP New York, NY Barclays Capital New York, NY Bruce L. Silverstein 12 Mark Greene 30 Chris Young New York, NY Young Conaway Stargatt 5 6 7 8 Marshall B. Babson Kenneth A. Lefkowitz & Taylor, LLP 13 Perry Golkin Seyfarth Shaw LLP Scott Goebel Hughes Hubbard & Reed LLP Wilmington, DE New York, NY Senior Vice President and General Counsel New York, NY 14 Paul Haaga Fidelity Management & Research A. Gilchrist Sparks III Louis J. Bevilacqua Company Simon M. Lorne Morris, Nichols, Arsht & 15 Cynthia Kane Cadwalader, Wickersham & Taft LLP Boston, MA Vice Chairman and Chief Legal Officer Tunnell LLP New York, NY Millennium Management LLC Wilmington, DE 16 Roy Katzovicz Perry Golkin New York, NY Fred Blume Advisory Partner Heidi Stam 17 Sy Lorne Chairman Emeritus Kohlberg Kravis Roberts & Co. Alan M. Miller Managing Director and Blank Rome LLP New York, NY Co-Chairman General Counsel 18 Alan Miller Philadelphia, PA Innisfree M&A Incorporated Vanguard Stuart M. Grant New York, NY Wayne, PA 9 10 11 12 Daniel H. Burch Grant & Eisenhofer P.A. Chairman & CEO Wilmington, DE G. Daniel O’Donnell Hon. Leo E. Strine, Jr. MacKenzie Partners, Inc. Dechert LLP Chancellor New York, NY Mark I. Greene Philadelphia, PA Delaware Court of Chancery Cravath, Swaine & Moore LLP Wilmington, DE George A. Casey New York, NY James E. Odell Shearman & Sterling LLP Managing Director John J. Suydam New York, NY Paul G. Haaga, Jr. The Depository Trust and Chief Legal Officer Chairman of the Board Clearing Corporation Apollo Global Management, LLC Charles I. Cogut Capital Research and Management New York, NY New York, NY Co-Chair, 2008- Company Simpson Thacher & Bartlett LLP Los Angeles, CA James A. Ounsworth Hon. E. Norman Veasey New York, NY Managing Director Chief Justice, Supreme Court of John G. Harkins, Jr. S Consulting Group Delaware, 1992-2004 13 14 15 16 17 18 Isaac D. Corré Chair, 1980-1990 Philadelphia, PA Weil, Gotshal & Manges LLP Senior Managing Director Harkins Cunningham LLP New York, NY, and Wilmington, DE Eton Park Capital Management Philadelphia, PA Morton A. Pierce New York, NY Dewey & LeBoeuf LLP Marc Weingarten Leon C. Holt, Jr. New York, NY Schulte Roth & Zabel LLP Stephen Fraidin Retired Vice Chairman and Chief New York, NY Kirkland & Ellis LLP Administrative Officer Allan N. Rauch New York, NY Air Products and Chemicals, Inc. Vice President – Legal and Gregory P. Williams Allentown, PA General Counsel Richards, Layton & Finger, P.A. Joel E. Friedlander Bed Bath & Beyond Inc. Wilmington, DE Bouchard Margules & Friedlander William B. Johnson Union, NJ Wilmington, DE Chairman Emeritus Donald J. Wolfe, Jr. Whitman Corporation Martha L. Rees Potter Anderson & Corroon LLP Dennis J. Friedman Chicago, IL Vice President and Wilmington, DE 19 20 21 22 23 24 Gibson, Dunn & Crutcher LLP Assistant General Counsel New York, NY Brendan R. Kalb E. I. du Pont de Nemours Christopher Young General Counsel & Company, Inc. Managing Director and Head of the Eric J. Friedman AQR Capital Management, LLC Wilmington, DE Contested Situations Practice Executive Partner Greenwich, CT Credit Suisse Skadden, Arps, Slate, Meagher & Myron J. Resnick New York, NY Flom LLP Cynthia B. Kane Retired Senior Vice President and New York, NY Special Assistant to the Secretary of State Chief Investment Officer Delaware Department of State Allstate Insurance Company Wilmington, DE Northbrook, IL
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2 institute for law and economics board of advisors 3 message from the dean message from the co-directors
For over twenty years, the Institute for Law and Economics has successfully The Institute for Law and Economics continues to be the legal academy’s demonstrated the benefits of a cross-disciplinary perspective. most dynamic corporate law program.
ts programs provide a model for how to build bridges between disciplines by creating ties between schools, his year we renewed our commitment to making ILE a leading venue for encounters among prominent between faculty members, between students, and between experts in the field from around the world. ILE corporate practitioners, lawmakers, and academics, and for conversations across academic disciplines. combines Penn’s greatest strengths in the Law School, the Wharton School, and the Department of Economics O ur Fall Corporate Roundtable investigated a range of questions concerning hedge funds—their investment to focus on complex questions that concern all of these fields.T he Institute proves that when you bring the T policies, contractual structures, and regulatory challenges. Our Spring Roundtable returned to bankruptcy I to cover developments under Chapter 11 and financial company resolution under recent financial reform legislation. right people—judges, deal-makers, regulators, business leaders, lawyers, bankers, policymakers, academics, and more—to convene outside of their own niches, remarkably original insights are generated. the financial crisis loomed large in this year’s public programs. H. Rodgin Cohen of As our world grows more complex every day, the topics the Institute addresses are both exciting and relevant. Sullivan & Cromwell, the Fall Law and Entrepreneurship lecturer, reviewed his experiences It is no longer enough to approach complicated questions such as the regulation of hedge funds, the responsibilities during the crisis and offered insightful commentary on Dodd-Frank.O ur Distinguished Jurist of boards of directors, or new developments in bankruptcy and resolution solely from a legal, economic, or business lecture came from Kenneth R. Feinberg, who spoke about his term as Special Master for TARP perspective. Indeed, no significant business issue can be addressed without paying attention to the underlying Executive Compensation. economic trends and legal regulations. All of ILE’s participants contribute to and benefit from the profound Corporate governance retained a place at the top of our agenda as well. Our Fall Insights understanding such analysis affords. from Practice program showcased public company directors—their duties and responsibilities, In addition to its unique focus, another of the Institute’s strengths is the variety of and the impact of recent regulation. One of our Spring Chancery Court programs explored the programs it offers. The roundtables—ILE’s signature events—bring together distinguished role Institutional Shareholder Services plays in contested corporate elections. The second members of the bar, judiciary, government, business world, and academia for open discus- program took a comparative turn, addressing the Kraft takeover of Cadbury and the ongoing sion and intellectual exploration. ILE’s public lectures by leading jurists, executives, and debate over takeovers that resulted in the UK. entrepreneurs attract participants from all sectors of the University and from the wider our remaining public programs looked at the role of financial markets in enhancing community. During the past year the outstanding talks, panels, and conferences organized social welfare. Jeremy Nowak, President and Chief Executive Officer forT he Reinvestment by the Institute covered a wide range of topics and programs, from corporate finance and Fund, delivered our Spring Law and Entrepreneurship lecture, explaining how his organiza- corporate governance to private equity, hedge funds, and mutual funds, as well as large-scale tion became a leader in urban development. We also hosted a special International Program entrepreneurship and management. with KP Krishnan, Economic Advisory Council of the Prime Minister of India, who spoke on Since my cross-disciplinary vision for the Law School and the purposes of the Institute financial sector regulation in India. for Law and Economics are so similar, it is personally gratifying to me that the Institute is We successfully continued our cross-disciplinary academic initiatives. The Law and Finance generously supported by contributors who understand the importance of what we do and the unique position the series, produced in cooperation with Wharton’s Finance Department as a regular part of its Finance Institute holds. Many of these contributors also serve as members of the Institute’s Board of Advisors, helping to plan workshop schedule, featured presentations by Merritt B. Fox, Michael E. Patterson Professor of the direction and focus of the programs and lending their expertise as panelists and commentators for Institute Law and NASDAQ Professor for Law and Economics of Capital Markets at Columbia Law School, events. and Oliver Hart, the Andrew E. Furer Professor of Economics in Harvard University’s Department ILE’s extraordinary co-chairs, Casey Cogut and Joe Frumkin, have my particular thanks for their many of Economics. In February, we co-hosted the seventh annual NYU/Penn Law and Finance exceptional contributions. Like all who serve as advisors for ILE, Casey and Joe contribute their very valuable time Conference, a joint venture of the Institute for Law and Economics, the Wharton Financial and expertise, in addition to their numerous contacts in the legal and business communities. ILE has benefited Institutions Center, and the Pollack Center for Law and Business at New York University. substantially from their leadership. As in the past, our Institute’s greatest strength lies in the quality of our supporters and their I must also thank the three eminent professors who lead the Institute for Law and Economics—Michael Wachter, active participation in our programs. Our board members and sponsors make our programs Jill Fisch, and Bill Bratton. It is because of their commitment and enthusiasm that ILE ranks among the premier possible, not only as financial supporters but as key participants and co-organizers. We are institutions of its kind. especially grateful for the dedicated and enthusiastic work of our board chairs, Casey Cogut I extend the deepest appreciation to all ILE supporters and participants for their commitment and investment of Simpson Thacher & Bartlett LLP and Joseph Frumkin of Sullivan & Cromwell LLP. during the past year. With the proper support and sponsorship, the Institute for Law and Economics has limitless We are delighted to have added five new members to the board, and we welcome them: George A. Casey (Shearman potential for growth and expansion in the future. We welcome others to join in backing and participating in this & Sterling LLP); Scott C. Goebel (Fidelity Management & Research Company); Kenneth A. Lefkowitz (Hughes extremely worthwhile endeavor. Hubbard & Reed LLP); John J. Suydam (Apollo Global Management, LLC); and Christopher Young (Credit Suisse). We are also delighted to welcome Seyfarth Shaw LLP as a sponsor to ILE, thanks to our dedicated board member, Marshall B. Babson. Michael A. Fitts, Dean and Bernard G. Segal Professor of Law, University of Pennsylvania Law School William W. Bratton, Co-Director, Institute for Law and Economics September 2011 Professor of Law Jill E. Fisch, Co-Director, Institute for Law and Economics Perry Golkin Professor of Law Michael L. Wachter, Co-Director, Institute for Law and Economics William B. Johnson Professor of Law and Economics September 2011
4 institute for law and economics message from the co-directors 5 Roundtable Programs
At the heart of the Institute’s work is the round- table series, which brings members of the Institute’s associate faculty and other academics together with corporate executives, practicing attorneys, judges, public policymakers, and students. Each roundtable takes up current issues that emerge from the research and teaching of the Institute and provides a forum for lively discussion.
Over the years, the Institute has sponsored roundtables on a broad range of topics—including labor law and bankruptcy, as well as corporate law, governance, and finance—engaging the interest and participation not only of scholars but also of leaders in the business and public sectors. The high caliber of the participants guarantees that each affair is intense and informative. ILE’s longstanding off-the-record policy for the roundtables is often the impetus for an energetic and wide-ranging exchange of ideas among some of the nation’s most accomplished scholars, attorneys, and business people.
roundtable programs 7 2 Corporate Roundtable 2 1 Front row: Hon. Christopher S. Sontchi, U.S. Bankruptcy Court, District of Delaware; Robert L. Friedman, The Blackstone Group L.P.; Hon. Jean K. FitzSimon, United States Bankruptcy Transaction Consistency and the New Finance in April 8, 2011 Court, Eastern District of Pennsylvania. Bankruptcy Middle row: Edward B. Rock, University of Thomas H. Jackson, Distinguished University Professor Pennsylvania Law School; Mark J. Roe, Harvard in Political Science and Business Administration and Welcome President Emeritus, University of Rochester Law School; Richard K. Kim, Wachtell, Lipton, Michael A. Fitts, Dean and Bernard G. Segal Professor of Law, David A. Skeel, Jr., S. Samuel Arsht Professor of Corporate Law, Rosen & Katz. Back row: John C. Coffee, Jr., University of Pennsylvania Law School University of Pennsylvania Law School Columbia Law School; Richard J. Herring, The 1 2 One of the few areas of American finance that the financial Wharton School. reforms of 2010 did not dramatically restructure was Morning Session 2 bankruptcy. Although the Dodd-Frank Act will have Transaction Consistency and the New Finance in Bankruptcy Richard J. Herring, The Wharton School. important indirect effects on bankruptcy, lawmakers left 3 Martin J. Bienenstock, Dewey & LeBoeuf LLP. derivatives, repos and other financial innovations largely Thomas H. Jackson, Distinguished University Professor in Political Science and unregulated in bankruptcy. In this Article, the authors offer Business Administration and President Emeritus, University of Rochester 4 Harvey R. Miller, Weil, Gotshal & Manges LLP; a new perspective on the implications of this special David A. Skeel, Jr., S. Samuel Arsht Professor of Corporate Law, treatment. To motivate the analysis, they identify four Richard Levin, Cravath, Swaine & Moore LLP. different distortions caused by the special rules for repos University of Pennsylvania Law School 5 and swaps. First, the special treatment diminishes Front row: Harvey R. Miller, Weil, Gotshal & 3 counterparties’ incentive to screen and monitor the debtor, commentators Manges LLP; Richard Levin, Cravath, Swaine & particularly with the systemically important firms that Moore LLP; Donald S. Bernstein, Davis Polk & dominate the derivatives industry and are likely to be Richard K. Kim, Wachtell, Lipton, Rosen & Katz Wardwell LLP. Middle row: Gary Sultan, bailed out if they fall into financial distress. Second, the Mark J. Roe, David Berg Professor of Law, Harvard Law School special treatment functions as a credit subsidy for the new Barclays Capital; Moshe A. Cohen, Columbia finance.D ebtors favor the new finance over traditional 1 Business School; Randall D. Guynn, Davis Polk sources of funding, and creditors do not limit their Systemic Risk After Dodd-Frank: Contingent Capital & Wardwell LLP. Back row: Gustav Sigurdsson, exposure to a potentially vulnerable debtor. Third, and the Need for Regulatory Strategies Beyond Oversight insulation from bankruptcy’s core policies exacerbates the The Wharton School; Frederick Tung, Boston risk of runs by removing the debtor’s ability to temporarily John C. Coffee, Jr.,Adolf A. Berle Professor of Law, Columbia Law School University School of Law; Martin Gelter, 3 4 3 halt them. Finally, the absence of a stay and the prospect of Fordham University School of Law. a mass termination of the debtor’s derivatives hampers a commentators debtor’s ability to effectively resolve its financial distress in 6 Donald S. Bernstein, Davis Polk & Wardwell LLP. bankruptcy. Barry E. Adler, Charles Seligson Professor of Law, New York University School of Law Randall D. Guynn, Davis Polk & Wardwell LLP 7 James Millstein, formerly of the U.S. Department of the Treasury. Systemic Risk After Dodd-Frank: Contingent Capital and the Need for Regulatory Strategies Beyond Oversight Afternoon Session John C. Coffee, Jr., Adolf A. Berle Professor of Law, Columbia Law School Panel on Issues in Bankruptcy and Resolution
Because the quickest, simplest way for a financial institution moderators to increase its profitability is to increase its leverage, an enduring tension will exist between regulators and William W. Bratton, Professor of Law systemically significant financial institutions over the issues Michael L. Wachter, William B. Johnson Professor of Law and Economics, of risk and leverage. Many have suggested that the 2008 University of Pennsylvania Law School financial crisis erupted because flawed systems of executive compensation induced financial institutions to increase leverage and accept undue risk. But that begs the question panelists 4 why such compensation formulas were adopted. Growing evidence suggests that shareholders favored these formulas Donald S. Bernstein, Davis Polk & Wardwell LLP 5 to induce managers to accept higher risk and leverage. Martin J. Bienenstock, Dewey & LeBoeuf LLP Shareholder pressure, then, is a factor that could cause the Richard J. Herring, Jacob Safra Professor of International Banking and failure of a systemically significant financial institution. what then can be done to prevent future such failures? Professor of Finance, The Wharton School The Dodd-Frank Act invests heavily in preventive control and William F. Kroener, III, Sullivan & Cromwell LLP regulatory oversight, but this Article argues that the political Richard Levin, Cravath, Swaine & Moore LLP economy of financial regulation ensures that there will be an eventual relaxation of regulatory oversight (“the Harvey R. Miller, Weil, Gotshal & Manges LLP regulatory sine curve”). James Millstein, Former Chief Restructuring Officer, U.S. Department of the Treasury Because financial institutions are inherently fragile and liquidity crises predictable, this Article proposes a “bail-in” alternative: namely, a system of “contingent capital” under which, at predefined points, a significant percentage of a major financial institution’s debt securities would convert into an equity security. However, unlike earlier proposals for contingent capital, the conversion would be on a gradual, incremental basis, and the debt would convert to a senior, nonconvertible preferred stock with cumulative dividends and voting rights.
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8 institute for law and economics roundtable programs 9 2 Corporate Roundtable 2 1 Isaac D. Corré, Eton Park Capital Management
2 Front row: Louis J. Bevilacqua, Cadwalader, Wickersham & Taft LLP; Hon. Jack B. Jacobs, High Water Marks in Competitive Capital Markets Supreme Court of Delaware; Marc Weingarten, Susan Kerr Christoffersen, Associate Professor of Finance, December 10, 2010 Rotman School of Management, University of Toronto Schulte Roth & Zabel LLP. Middle row: David K. Musto, Ronald O. Perelman Professor in Finance, Welcome Christopher Young, Credit Suisse Holdings The Wharton School Michael A. Fitts, Dean and Bernard G. Segal Professor of Law, (USA), Inc.; David K. Musto, The Wharton The authors model the effect of the standard high-water- University of Pennsylvania Law School School; Joseph A. McCahery, Tilburg University. 1 2 mark provision of hedge funds when the supply of capital Back row: Christopher Foulds, Skadden, Arps, is competitive and managerial ability is uncertain. They Slate, Meagher & Flom, LLP; Kent S. Hughes, find that confidence in a manager’s ability is crucial to the Morning Session provision’s effect, and this effect is to boost the initial fund High Water Marks in Competitive Capital Markets Egan-Jones Group, Ltd.; April Klein, NYU Stern size, and to depress initial expected returns while School of Business. increasing subsequent expected returns. They also find Susan Kerr Christoffersen, Associate Professor of Finance, that expected returns can be non-monotonic in past Rotman School of Management, University of Toronto 3 Front row: Roy J. Katzovicz, Pershing Square returns, higher for somewhat poor returns than above or David K. Musto, Ronald O. Perelman Professor in Finance, Capital Management, L.P.; Faiza J. Saeed, below, that flows can be unresponsive to performance, and Cravath, Swaine & Moore LLP; Bruce L. that fund size decreases with the manager’s effort cost. The Wharton School Silverstein, Young Conaway Stargatt & Taylor, Unfulfilled Expectations? The Returns to International commentators LLP. Middle row: Ronald J. Gilson, Columbia Law Hedge Fund Activism School; James E. Odell, UBS Investment Bank; Marco Becht, Professor, University of Brussels Steven J. Fredman, Schulte Roth & Zabel LLP Daniel M. Hawke, Philadelphia Regional Office, Julian Franks, Professor of Finance, London Business School Ronald J. Gilson, Marc and Eva Stern Professor of Law and Business, SEC; Roberta Romano, Yale Law School. Back Jeremy Grant , Ph.D. Candidate, University of Cambridge Columbia Law School row: Christine Hurt, University of Illinois This paper analyzes 362 European and 210 Asian activist College of Law; James C. Spindler, The interventions by hedge funds, focus funds and other Unfulfilled Expectations? The Returns to activist investors from 2000 to 2009. The European sample University of Texas at Austin School of Law; includes both public and private interventions. The private International Hedge Fund Activism David G. Clarke, The Griffing Group, Inc.; interventions are based upon proprietary data collected Marco Becht, Professor, University of Brussels Robert C. Clark, Harvard Law School. from five activist funds.A lthough there are large abnormal 3 Julian Franks, Professor of Finance, London Business School returns to shareholder activism those returns are strongly 4 John J. Suydam, Apollo Global associated with outcomes from the engagements such as Jeremy Grant , Ph.D. Candidate, University of Cambridge Management, LLC. takeovers, asset sales, board changes, and increases in payout. Without observable outcomes from engagements 5 William W. Bratton, University of there is little evidence of abnormal returns to activism. commentators Private activism is extensive and profitable but less so than Isaac Corré, Senior Managing Director, Eton Park Capital Management Pennsylvania Law School. public activism, but the difference is entirely explained by Joseph A. McCahery, Professor of Financial Market Regulation and the higher incidence of takeovers in public activism. The 6 Front row: Hon. Leo E. Strine, Jr., Delaware returns from hostile activist interventions are more Professor of International Economic Law, Tilberg University - Tilburg Law Court of Chancery; Roy J. Katzovicz, Pershing profitable than for co-operative ones, and returns for and Economics Center Square Capital Management, L.P. Middle row: specialist activist funds are substantially larger than for other investors particularly in Europe. In both Europe and Julian Franks, London Business School; Ronald Asia there are significant abnormal returns on disclosure of Afternoon Session J. Gilson, Columbia Law School. the share stake which anticipates successful outcomes Panel on Hedge Funds Under Fire? from the engagement; however, whereas these expecta- tions are not disappointed in European activism they are in Asian activism. The latter result reflects the inability of moderators activists in Asia to achieve their engagement objectives. William W. Bratton, Professor of Law Michael L. Wachter, William B. Johnson Professor of Law and Economics, University of Pennsylvania Law School 4
panelists Brian Breheny, Skadden, Arps, Slate, Meagher & Flom LLP Roy Katzovicz, Chief Legal Officer, Pershing Square Capital Management, L.P. Faiza J. Saeed, Cravath, Swaine & Moore LLP Bruce Silverstein, Young Conaway Stargatt & Taylor, LLP Hon. Leo E. Strine, Jr., Vice Chancellor, Delaware Court of Chancery John Suydam, Chief Legal Officer, Apollo Global Management, LLC Gregory V. Varallo, Richards, Layton & Finger, P. A.
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10 institute for law and economics roundtable programs 11 2 Corporate Roundtable 2 1 Front row: John E. Baumgardner, Jr., Sullivan & Cromwell LLP; Scott Goebel, Fidelity Management & Research Company; David M. Silk, Wachtell, Lipton, Rosen & Katz. Back row: April 9, 2010 Martin S. Lessner, Young Conaway Stargatt & Taylor, LLP; Tamar Frankel, Boston University School of Law; Alan R. Palmiter, Wake Forest commentators Welcome School of Law; Eric D. Roiter, Boston University Michael A. Fitts, Dean and Bernard G. Segal Professor of Law, Donald G. Bennyhoff,Senior Investment Analyst, Vanguard School of Law. University of Pennsylvania Law School Eric Zitzewitz, Associate Professor of Economics, Dartmouth College 2 Susan B. Kerley, Strategic Management Morning Session Afternoon Session Advisors, LLC. Panel on the Governance of Mutual Funds 3 Rethinking the Regulation of Securities 1 Front row: Jeffrey W. Bullock, Delaware Intermediaries Department of State; Marcy Engel, Eton Park Jill E. Fisch, Perry Golkin Professor of Law, moderators Capital Management. Middle row: John C. University of Pennsylvania Law School Jill E. Fisch, Perry Golkin Professor of Law, Wilcox, Sodali Ltd.; Jennifer Shotwell, Innisfree University of Pennsylvania Law School M&A Incorporated. commentators Michael L. Wachter, William B. Johnson Professor of Law 4 Hon. Travis Laster, Delaware Court of Tamar Frankel, Michaels Faculty Research Scholar and and Economics, University of Pennsylvania Law School Chancery; Charles I. Cogut, Simpson Thacher Professor of Law, Boston University School of Law & Bartlett LLP. Eric D. Roiter, Former General Counsel, Fidelity Management panelists 5 Front row: Edwin J. Elton, Stern School of & Research John E. Baumgardner, Jr., Sullivan & Cromwell LLP Business, New York University. Middle row: Edwin J. Elton, Nomura Professor of Finance, Gérard Hertig, Swiss Institute of Technology; NYU Stern School of Business Mutual Fund Performance Advertising: Eric Zitzewitz, Dartmouth College; Matthew R. Scott Goebel, Senior Vice President and General Counsel, Inherently and Materially Misleading? Clark, Morris, Nichols, Arsht & Tunnell LLP; Jill Fidelity Management & Research Company 2 3 Alan R. Palmiter, Professor of Law, Wake Forest University E. Fisch, University of Pennsylvania Law School; School of Law Susan B. Kerley, Strategic Management Advisors, LLC Donald G. Bennyhoff, Vanguard; Randall S. Ahmed Taha, Professor of Law, Wake Forest University School of Law Ryan Leggio, Mutual Fund Analyst, Morningstar, Inc. Thomas, Vanderbilt University Law School; Jeffrey S. Puretz,Dechert LLP Sarah E. Cogan, Simpson Thacher & Bartlett LLP; Glenn Booraem, Vanguard; William W. December 11, 2009 Bratton, Georgetown University Law Center. Back row: Mary K. Stokes, Blank Rome LLP; William A. Birdthistle, Chicago-Kent College of commentators Welcome Law, Illinois Institute of Technology; Talyana T. Michael A. Fitts, Dean and Bernard G. Segal Professor of Law, William D. Anderson, Jr., Managing Director, Goldman, Sachs & Co. Bromberg, Grant & Eisenhofer P.A. University of Pennsylvania Law School Roberta Romano, Oscar M. Ruebhausen Professor of Law, Yale Law School 6 Front row: Scott Goebel, Fidelity Management Morning Session Afternoon Session & Research Company; Robert McCormick, Embattled CEOs Panel on the Reform Agenda Glass Lewis & Co, LLC; Glenn Booraem, Vanguard. Middle row: Merritt B. Fox, Columbia Law Marcel Kahan, George T. Lowy Professor of Law, School. New York University School of Law moderators 4 Edward B. Rock, Saul A. Fox Distinguished Professor Jill E. Fisch, Perry Golkin Professor of Law, of Business Law, University of Pennsylvania Law School University of Pennsylvania Law School Edward B. Rock, Saul A. Fox Distinguished Professor of commentators Business Law, University of Pennsylvania Law School Roy J. Katzovicz, Chief Legal Officer, Pershing Square Capital Management panelists Reinier H. Kraakman, Ezra Ripley Thayer Professor of Law, Hon. Jeffrey W. Bullock,Secretary of State, Delaware Department of State Harvard Law School Lucian A. Bebchuk, William J. Friedman and Alicia Townsend Friedman Professor of Law, Economics, and Finance, The Case Against Shareholder Empowerment Harvard Law School William W. Bratton, Peter P. Weidenbruch, Jr. Professor of Glenn Booraem, Principal and Assistant Fund Controller, Vanguard Business Law, Georgetown University Law Center Marcy Engel, Chief Operating Officer and General Counsel, Michael L. Wachter, William B. Johnson Professor of Law Eton Park Capital Management and Economics, University of Pennsylvania Law School Scott Goebel, Senior Vice President and General Counsel, Fidelity Management & Research Company
Robert McCormick, Chief Policy Officer, Glass, Lewis & Co., LLC 5 6
12 institute for law and economics roundtable programs 13 2 Corporate Roundtable 2 1 Robert L. Friedman, The Blackstone Group L.P.; Alan L. Beller, Cleary Gottlieb Steen & Hamilton LLP; Hon. Leo E. Strine, Jr., Delaware Court of Chancery.
Off the Record: A Board Discussion 2 Perry Golkin, Kohlberg Kravis Roberts & Co.; of the Financial Crisis Lee A. Meyerson, Simpson Thacher & Bartlett LLP; Hon. E. Norman Veasey, Weil, Gotshal & May 26, 2009 Manges LLP 1 2 3 Front row: Heidi Stam, Vanguard; Hon. Eton Park Capital Management, New York City moderators Donald F. Parsons, Jr., Delaware Court of Isaac D. Corré, Senior Managing Director, Chancery; Gerald Rosenfeld, Rothschild North The Off the Record program was created as a forum for the ILE Eton Park Capital Management America. Middle Row: Eric D. Roiter, Boston Board of Advisors and a select group of invitees to discuss Jill E. Fisch, Perry Golkin Professor of Law, University School of Law. University of Pennsylvania Law School candidly the current financial crisis in an informal setting.T he 4 Perry Golkin, Kohlberg Kravis Roberts & Co.; Michael L. Wachter, William B. Johnson Professor of Law presentation by Richard Herring provided the context explain- Gerald Rosenfeld, Rothschild North America; and Economics, University of Pennsylvania Law School ing how the crisis came about. Edward Rock’s presentation Charles I. Cogut, Simpson Thacher & Bartlett detailed several different plans for recovery and suggestions for LLP; Jill E. Fisch, University of Pennsylvania Law presentations by reform moving forward. The program was hosted at the offices School; Isaac D. Corré, Eton Park Capital of Eton Park Capital Management in New York City. Richard J. Herring, Jacob Safra Professor of International Management; Michael L. Wachter, University of Banking; Professor of Finance, The Wharton School Pennsylvania Law School; Joseph D. Gatto, Edward B. Rock, Saul A. Fox Distinguished Professor of Barclays Capital Americas; Joseph B. Frumkin, Business Law, University of Pennsylvania Law School Sullivan & Cromwell LLP; G. Daniel O’Donnell, 3 Dechert LLP; Marcy Engel, Eton Park Capital Management; Robert H. Mundheim, Shearman & Sterling LLP. May 8, 2009 5 Marcy Engel, Eton Park Capital Management; Welcome Afternoon Session Robert H. Mundheim, Shearman & Sterling LLP. Michael A. Fitts, Dean and Bernard G. Segal Professor of Law, Panel on the Government as Shareholder 6 William W. Bratton, Georgetown University University of Pennsylvania Law School Law Center; Martha L. Rees, DuPont. Middle row: moderators Stephen L. Brown, TIAA-CREF; Martin S. Lessner, Morning Session Edward B. Rock, Saul A. Fox Distinguished Professor of Business Law Young Conaway Stargatt & Taylor, LLP. Shareholder Primacy in a Corporatist Michael L. Wachter, William B. Johnson Professor of Law and Political Economy Economics, University of Pennsylvania Law School William W. Bratton, Peter P. Weidenbruch, Jr. Professor of Business Law, Georgetown University Law Center panelists Michael L. Wachter, William B. Johnson Professor of Law Alan Beller, Cleary Gottlieb Steen & Hamilton LLP and Economics, University of Pennsylvania Law School Robert F. Hoyt, Department of the Treasury 4 Roberta Romano, Oscar M. Ruebhausen Professor of Law, commentators Yale Law School Joseph B. Frumkin, Sullivan & Cromwell LLP Hon. Leo E. Strine, Jr., Vice Chancellor, Delaware Court of Chancery Mark J. Roe, David Berg Professor of Law, Harvard Law School
Big Deal: The Government’s Response to the Financial Crisis Steven M. Davidoff,Associate Professor of Law, University of Connecticut School of Law David Zaring, Assistant Professor of Legal Studies, The Wharton School
commentators Isaac D. Corré, Senior Managing Director, Eton Park Capital Management Andrew Metrick, Professor of Finance, Yale School of Management
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14 institute for law and economics roundtable programs 15 Panel Programs
In addition to the roundtable series, the Institute hosts several panel programs each year that explore important topics in the areas of law and finance. The panelists on these programs provide students and other attendees with real-world examples of the complex situations they face in their professional careers.
These programs are usually followed by Corporate Governance Dinners with further commentary and discussion. The Corporate Governance Dinners provide an opportunity for off-the-record conversation among presenters and members of the board of advisors, their invited colleagues, and the Institute’s associate faculty.
p anel programs 17 2 chancery court programs 2 1 Hon. Leo E. Strine, Jr., Delaware Court of Chancery; Scott V. Simpson, Skadden, Arps, Slate, Meagher & Flom (UK) LLP; Sarah Jones, Clifford Chance LLP; Creighton O'M. Condon, March 29, 2011 Shearman & Sterling LLP; Noel Hinton, formerly of The Takeover Panel; Michael L. Wachter, University of Pennsylvania Law Illegitimate Kingmaker or Effective Voice of moderators School. Genuine Stockholder Sentiment?: Hon. Leo E. Strine, Jr., Vice Chancellor, Chancery Court of Delaware The Role of Institutional Shareholder Services in Michael L. Wachter, William B. Johnson Professor of Law and 2 Hon. Leo E. Strine, Jr., Delaware Court of Contested Corporate Elections Economics, University of Pennsylvania Law School Chancery; Christopher Young, Credit Suisse 1 Holdings (USA), Inc.; Alan Miller, Innisfree This program examined the role and influence of Institutional panelists M&A Incorporated; Jill E. Fisch, University of Pennsylvania Law School; Glenn Booraem, Shareholder Services in making recommendations and voting Glenn Booraem, Principal and Fund Controller, The Vanguard Group Vanguard; Daniel H. Burch, MacKenzie shareholder proxies for institutional investors. Proxy services Daniel H. Burch, Chairman & CEO, MacKenzie Partners, Inc. Partners, Inc., Michael L. Wachter, University such as ISS play a key role in the voting process because Jill Fisch, Perry Golkin Professor of Law, of Pennsylvania Law School. institutional shareholders turn to them for advice when voting University of Pennsylvania Law School billions of shares at annual meetings. The panel explored the Alan Miller, Co-Chairman, Innisfree M&A Incorporated 3 Joel E. Friedlander, Bouchard Margules inner workings of ISS and how it views its own influence on the Christopher Young, Managing Director and Head of the Takeover & Friedlander. voting process. The panel discussed ISS’s role and influence from Defense Practice, Credit Suisse 4 Sarah Jones, Clifford Chance LLP; Creighton the perspectives of a large mutual fund company and several O'M. Condon, Shearman & Sterling LLP. proxy solicitation firms. The panelists also considered the 5 overarching questions of what should a proxy advisor’s role be, Richard Hall, Cravath, Swaine & Moore LLP. how much influence they should exercise, and what kind of regulation is needed for them. 2
March 1, 2011
England Goes All 1980s Constituency Soft? moderators Cadbury & England’s Commitment to the Hon. Leo E. Strine, Jr., Vice Chancellor, Chancery Court of Delaware Non-Frustration Rule Michael L. Wachter, William B. Johnson Professor of Law and Economics, University of Pennsylvania Law School This program explored the international takeover of Cadbury by Kraft in 2010, from the perspective of participants involved in panelists the case. As a multinational, US-based firm, Kraft’s acquisition Creighton O'M. Condon, Shearman & Sterling LLP of British-owned Cadbury faced widespread disapproval from Noel Hinton, Former Deputy Director General, The Takeover Panel the British public. As a result of the Cadbury takeover and the Sarah Jones, Clifford Chance LLP public outcry against it, the UK government considered making Scott V. Simpdon, Skadden, Arps, Slate, Meagher & Flom (UK) LLP 3 changes to the takeover rules then in effect. This panel discussed the takeover of Cadbury by Kraft in depth, the reaction to the deal in the U.S. and the U.K., and the rule changes proposed in the U.K. in the aftermath of the takeover.
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18 institute for law and economics Panel Programs 19 2 insights from practice 2 1 Howard L. Meyers, Morgan, Lewis & Bockius LLP; Kenneth A. Lefkowitz, Hughes Hubbard & Reed LLP; Joseph B. Frumkin, Sullivan & Cromwell LLP. 2 G. Daniel O’Donnell, Dechert LLP.
October 21, 2010 2 Peter G. Samuels, Proskauer Rose LLP.
3 Robert L. Friedman, The Blackstone Group L.P.; This Insights from Practice panel program focused on what it panel co-chairs Roger Kimmel, Rothschild Inc.; Charles I. Cogut, means to be a director of a public company in 2010. The panelists Charles I. Cogut, Simpson Thacher & Bartlett LLP Simpson Thacher & Bartlett LLP; Hon. Myron T. shared their perspectives on the fiduciary duties of directors and Hon. Myron T. Steele, Chief Justice, Supreme Court of Delaware Steele, Supreme Court of Delaware; David M. how these might differ depending on the type of director and Silk, Wachtell, Lipton, Rosen & Katz; Douglas M. how they were appointed. The composition and leadership of panelists Steenland, formerly of Northwest Airlines. boards of directors was also discussed. The panel then reviewed Robert L. Friedman, Senior Managing Director, The Blackstone Group L.P., provisions in the Doff-Frank legislation that affected boards of Director of Axis Capital Holdings Limited, TRW Automotive directors and talked about their impact so far on the activities of Holdings Corp., FGIC Corporation and The India Fund, Inc. boards. The panelists also discussed several hypothetical cases Roger Kimmel, Vice Chairman, Rothschild Inc., Non-Executive drawn from the business news headlines on how directors should Chairman of the Board of Endo Pharmaceuticals Inc.; Director react in crisis situations affecting the corporation. of PG&E Corporation and Schiff Nutrition International David M. Silk, Wachtell, Lipton, Rosen & Katz Douglas Steenland, Former CEO, Northwest Airlines, Director of Delta Air Lines, American International Group, Digital River Corp., Chrysler Group, Hilton Worldwide, and Performance Food Group
October 13, 2009
The new Insights from Practice series showcases cutting-edge panel co-chairs 3 issues in corporate practice. For this panel, five distinguished Joseph B. Frumkin, Sullivan & Cromwell LLP 11 corporate lawyers shared their career paths and recent experi- G. Daniel O’Donnell, Dechert LLP ences with the audience. The discussion centered on three topics, viewed against the backdrop of the financial crisis that began in panelists 2007: the current state of the mergers and acquisitions market, Kenneth A. Lefkowitz, Hughes Hubbard & Reed LLP since it was most immediately and directly affected by the crisis; Howard L. Meyers, Morgan, Lewis & Bockius LLP changes in compensatory practices that have emerged as a result Peter G. Samuels, Proskauer Rose LLP of the crisis; and the impact of the crisis on what a corporate lawyer does day-to-day. For the students in the audience, the panelists emphasized the necessity of following your interests and being nimble in response to changes in the profession, since different business environments require different skills from corporate lawyers.
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20 institute for law and economics Panel Programs 21 Lectures
The Law and Entrepreneurship Lecture and the Distinguished Jurist Lecture are the Institute's principal public programs. In sponsoring these events, the Institute aims to spotlight and honor lawyers who have led noteworthy careers and made significant contributions as corporate executives and entrepreneurs, or as jurists at the state and federal levels. This year, we also sponsored a lecture in cooperation with Penn Law’s International Program.
Audiences are drawn from all sectors of the University and the legal and business communities. These eminent speakers hold particular appeal and inspiration for students of Penn’s Law School and the Wharton School, with whom they talk informally at receptions following each lecture. The Law and Entrepreneurship lecture is supported in part by the Ronald N. Rutenberg Fund.
lectures 23 2 lectures 2
International Program April 13, 2011
Financial Sector Regulation in India: fundamental reforms in the regulatory architecture, preparing Evolution and the Road Ahead legislation on reform of securities markets including putting in KP Krishnan, Secretary, Economic Advisory Council of the place arrangements for financial stability, leading the success- Prime Minister of India ful effort for introduction of new products like Exchange Traded Currency Futures, Interest Rate Futures, Credit Default Dr. KP Krishnan serves as Secretary of the Economic Advisory Swaps and Corporate Repos, and carrying out preparatory Council of the Prime Minister of India, a position he took up in work for the setting up of an independent Public Debt July 2010. For the preceding five years, Dr. Krishnan served as Management Office. Joint Secretary of the Capital Markets Division of the Indian He has also held positions in Karnataka state government Department of Economic Affairs, where he was responsible for and worked as an advisor to the Executive Director of World securing approval of Parliament for a new legal framework for Bank in Washington DC. Dr. Krishnan belongs to the Indian securitization, placing for parliamentary approval a new legal Administrative Service, Karnataka Cadre, 1983 batch. He received and regulatory framework for pension sector reforms, preparing his Ph.D. (Eco) from Indian Institute of Management in a blueprint for Indian financial sector reforms including Bangalore and M.A. (Eco) from University of Mysore.
Law and Entrepreneurship Lecture March 2, 2011
Competitive Places and Inner City Opportunities: He was the founding Chair of the Board of Mastery Charter Reflections on 52 Years of Community Investment Schools, a network of inner city schools recognized as the most Jeremy Nowak, President and Chief Executive Officer, effective management organization in the nation for turning The Reinvestment Fund around low performing schools. And he was the founding Board Chair of Alex’s Lemonade Stand, a charity that supports Jeremy Nowak is the President of The Reinvestment Fund, a pediatric cancer research and in six years has raised more than community development financial institution that manages $35 million from lemonade stands held by thousands of families $700 million. The Reinvestment Fund (TRF) provides financing and children. in support of affordable housing, small businesses, commercial Mr. Nowak is the author of numerous reports and articles real estate and community facilities. TRF has allocated more including recent work on creativity and neighborhood develop- than $1 billion, leveraging $3.5 billion in development capital. ment. He holds an undergraduate degree in philosophy tRF is a thought leader in the creative use of geo-spatial (Pennsylvania State University, Phi Beta Kappa, 1973) and a data to facilitate investments into distressed communities. Its Ph.D. in cultural anthropology (New School for Social proprietary mapping tool, PolicyMap, is the most comprehensive Research, 1986). He was a Fellow at the Aspen Institute’s web-enabled data base for location-based intelligence. program for leaders in education and is a member of Harvard tRF led the movement to finance supermarkets in low University’s roundtable on social enterprise and poverty. income communities, first as manager of the Pennsylvania Fresh Mr. Nowak has received numerous awards including the Food Financing Initiative and today as one of the architects of Philadelphia Award (1995), the city’s highest civic honor; as the White House’s Healthy Food Financing Initiative. well as honorary doctorates from Villanova University (2000) Mr. Nowak is the Vice Chair of the Federal Reserve Bank and La Salle University (2008). of Philadelphia and a member of the Fed’s Council of Chairs. He is also a board member of the Pennsylvania Housing Finance Agency, the agency responsible for billions of dollars of annual bond and tax credit financing.
24 institute for law and economics lectures 25 2 law and entrepreneurship Lectures 2
November 2, 2010
The Financial Crisis: Aftermath and Implications and banking today.” Mr. Cohen was the only lawyer on the list H. Rodgin Cohen, Sullivan & Cromwell LLP recognized for his work during the banking crisis of 2008- 2009. He was also presented with an FT Special Achievement H. Rodgin Cohen is a partner at Sullivan & Cromwell LLP. He Award in recognition of his work on nearly 20 substantial credit was Chairman of the Firm from July 1, 2000 through December crisis-related transactions by the Financial Times in October 2009. 31, 2009 and has served as its Senior Chairman since January 1, Mr. Cohen recently served on the task force supported by 2010. The primary focus of his practice is regulatory, acquisition, The Pew Financial Reform Project, which was launched by corporate governance and securities law matters for major U.S. The Pew Charitable Trusts in May 2009 to provide objective, and non-U.S. banking and other financial institutions. fact-based analysis for the debates in Congress over establish- Mr. Cohen has acted in most of the major U.S. bank ing a new framework for financial regulation. He also is or has acquisitions and recent government-sponsored and capital- been a member of the IIF Special Committee for a Strategic raising efforts and provides corporate governance advice to Dialogue for Effective Regulation, the Treasury Advisory a large number of financial and non-financial institutions. Committee on the Auditing Profession, The New York State He has played a singular role in the market events that have Commission to Modernize the Regulation of Financial changed the face of the financial services industry and Services and The Financial Services Roundtable’s Blue Ribbon economy, for which The American Lawyer ranked Mr. Cohen Commission on Enhancing Competitiveness. #1 among its 25 “Dealmakers of the Year” in 2009, noting that Mr. Cohen is a trustee of New York Presbyterian Hospital, “he was Wall Street’s go-to lawyer during the most important the Hackley School, Deerfield Academy, Hampton University, months for the American banking industry since the Great Lincoln Center Theater and, formerly, the Economic Club of Depression.” New York, and is a member of the advisory boards of United In March 2010, Mr. Cohen was recognized as one of the Way of Westchester-Putnam, the University of Charleston and “Decade’s Most Influential Lawyers” byT he National Law Wall Street Rising, which in 2005 honored him with its annual Journal. The publication noted that he has been “a superstar Leadership Award for his “steadfast commitment to Lower in the legal industry for years.” In late 2009, he was among the Manhattan” in the aftermath of the attacks of September 11, top 25 people named to Institutional Investor’s “The Power 25: 2001. In May 2010, Mr. Cohen was honored with the Servant Leaders in Finance.” In its first-ever ranking, the publication of Justice Award at the Legal Aid Society’s 33rd Annual Dinner. named “the most influential people in the world of investment
March 3, 2010
Managing Through Change, Managing Through Before joining Lehman Brothers in 2005, Mr. Gatto spent 21 Crisis in Financial Services years at Goldman, Sachs & Co. becoming a partner in that firm Joseph D. Gatto, Chairman of Investment Banking, in 1994 and serving as Chairman of Consumer Products Barclays Capital Americas Banking. Over the course of the last ten years, he has advised clients on over $300 billion of transactions, primarily in the Joseph D. Gatto is Chairman of Investment Banking of Barclays consumer, industrial and retail sectors. Capital Americas. He is also a member of the Barclays Capital Mr. Gatto earned his AB (magna cum laude) from Princeton Investment Banking Executive Committee. In his March ILE University, his MBA from the University of Pennsylvania’s lecture, he talked about the challenges of managing at Lehman Wharton School and his JD (cum laude) from the University Brothers during the financial crisis and Lehman’s subsequent of Pennsylvania Law School. filing for bankruptcy. Prior to joining Barclays Capital in 2008, Mr. Gatto was Vice Chairman of Lehman Brothers and Co-Head of Corporate Finance and was a member of the firm’s Investment Banking Executive Committee and Senior Client Council. At Lehman, he had also served as Global Chairman of Mergers and Acquisitions.
26 institute for law and economics lectures 27 2 distinguished jurist Lectures 2
March 23, 2011
Treasury’s Performance as Pay Tsar: Mr. Feinberg is an attorney and one of the nation’s leading Precedent or Aberration? experts in mediation and alternative dispute resolution. He is the Kenneth R. Feinberg, Feinberg Rozen, LLP managing partner of Feinberg Rozen, LLP. Mr. Feinberg received his B.A. cum laude from the University of Massachusetts in 1967 Mr. Feinberg was designated by the Obama Administration and and his J.D. from New York University School of Law in 1970, British Petroleum to serve as Administrator, Gulf Coast Claims where he was Articles Editor of the Law Review. He was a Law Facility in 2010. Clerk for Chief Judge Stanley H. Fuld, New York State Court He was appointed by the Secretary of the Treasury in 2009 of Appeals from 1970 to 1972; Assistant United States Attorney, to serve as the Special Master for TARP Executive Compensation. Southern District of New York from 1972 to 1975; Special In this capacity, he was responsible for determining annual Counsel, United States Senate Committee on the Judiciary from compensation packages for senior corporate officials at companies 1975 to 1980; Administrative Assistant to Senator Edward M. that received the most taxpayer financial assistance. Kennedy from 1977 to 1979; Partner at Kaye, Scholer, Fierman, He was also appointed by the Attorney General of the United Hays & Handler from 1980 to 1993; and founded The Feinberg States to serve as the Special Master of the Federal September Group, LLP in 1993. 11th Victim Compensation Fund of 2001. In this capacity, he Mr. Feinberg was designated “Lawyer of the Year” by the developed and promulgated the Regulations governing the National Law Journal (December, 2004). He is listed in “Profiles administration of the Fund and administered all aspects of the in Power: The 100 Most Influential Lawyers in America” program, including evaluating applications, determining (National Law Journal, May 2, 1988; March 25, 1991; April 4, appropriate compensation and disseminating awards. 1994; June 12, 2000; June 19, 2006). He is the author of numerous articles and essays on mediation, mass torts and other matters and is the author of, What is Life Worth? The Unprecedented Effort to Compensate the Victims of 9/11 (Public Affairs 2005).
October 29, 2009
Private Securities Litigation— Holdings, Inc. and Christie’s and the companion criminal Time for a Fresh Start? antitrust case against Sotheby’s. He is presiding over multidistrict Hon. Lewis A. Kaplan, United States District Judge, litigations relating to the failed Italian company, Parmalat, and to Southern District of New York Lehman Brothers Holdings. He has been the trial judge in such intellectual property cases as Universal City Studios, Inc. v. Judge Kaplan was appointed United States District Judge for the Reimerdes, in which he held that dissemination of a computer Southern District of New York on August 9, 1994 and entered on program that decrypts copyrighted motion pictures stored on duty August 22, 1994. He received his A.B. with high honors in DVDs violated the Digital Millenium Copyright Act, and Larson political science from the University of Rochester in 1966 and his v. Thomson, which dealt with a claim of joint copyright owner- J.D. cum laude from Harvard Law School in 1969. He then served ship in the show Rent by a dramaturg who worked on the script. as law clerk to Honorable Edward M. McEntee of the United Other noteworthy decisions include his 1998 ruling enjoining the States Court of Appeals for the First Circuit. City of New York from interfering with the so-called Million Judge Kaplan joined the New York law firm of Paul, Weiss, Youth March in Harlem on the ground that the regulations relied Rifkind, Wharton & Garrison in 1970 and was a partner in the upon by the City in banning the march violated the First firm from 1977 until joining the bench. Since his appointment to Amendment as well as a 1997 decision upholding the Welfare the bench, Judge Kaplan has handled a number of well known Reform Act of 1996 against constitutional challenge. cases. He now is presiding over the first criminal prosecution in In 2009, Judge Kaplan received the Federal Bar Council’s a federal district court of a Guantanamo detainee. He tried what Learned Hand Medal for excellence in federal jurisprudence and the government called the largest criminal tax case in U.S. the Judicial Recognition Award of the National Association of history, the prosecution of many former members of the Criminal Defense Lawyers. The New York State Bar Association accounting firm, KPMG, and others, for conspiracy to defraud Section on Commercial and Federal Litigation in 2007 awarded the United States and for tax evasion. He was responsible for the him its Stanley H. Fuld Award for “outstanding contributions civil antitrust price-fixing cases brought against Sotheby’s to commercial law and litigation.”
28 institute for law and economics lectures 29 2 past Lectures 2 Past Law and Entrepreneurship Lectures
1 William A. Ackman
2 Safra Catz Past Law and Entrepreneurship 28 February 2007 24 March 2004 21 February 2001 Lectures Law, Legal Risks, and the Financial The WNBA and Women’s Team Sports: Private Equity: 3 Isaac D. Corré Markets A New Sports Marketing Proposition for Difficult Investing in a Difficult Time 1 2 3 4 30 September 2009 Isaac D. Corré, Senior Managing Director, the New Millennium Paul S. Levy, Senior Managing Director, 4 Pamela Daley The ‘Ten Points’ for Maintaining a Eton Park Capital Management Val Ackerman, President, Women’s National Joseph Littlejohn & Levy Risk-Taking Entrepreneurial Spirit in Basketball Association 5 Robert L. Friedman a Large Corporation 29 November 2006 2 March 2000 J.P. Suarez, Senior Vice President and Large-Scale Entrepreneurship: Business 30 October 2003 Perspectives on the Health Care 6 Marcia Greenberger General Counsel, Wal-Mart Stores Development at GE The Role of Entrepreneurship in Urban Revolution International Division Pamela Daley, Senior Vice President for Education: Past, Present and Future Charles A. Heimbold, Jr., Chairman and 7 James E. Nevels Corporate Business Development, General James E. Nevels, Chairman and CEO, CEO, Bristol-Myers Squibb Company 31 March 2009 Electric Company The Swarthmore Group, Inc.; Chairman, The PeopleSoft Deal Philadelphia School Reform Commission 18 November 1999 Safra Catz, President, Oracle Corporation 26 October 2006 Ethics in Sports: Deciding the Game Past Distinguished Jurist Lectures Managing in the 21st Century 6 November 2002 Anita DeFrantz, Vice President, 3 March 2009 Henry R. Silverman, Chairman & CEO, Public Trust—and Distrust— in American International Olympic Committee; 8 Brian G. Cartwright Defining the 21st Century Campus: Realogy Corporation Business: What Needs to Be Done President, Amateur Athletic Foundation 5 6 7 8 9 The Intersection of Education and Peter G. Peterson, Chairman, The Hon. Myron T. Steele Community 16 February 2006 Blackstone Group; Chairman, Federal 23 October 1997 10 Hon. Carolyn Berger Hon. Michael Nutter, Mayor, City of The Banker as Entrepreneur Reserve Bank of New York; Co-Chair, How to Maintain Entrepreneurial Philadelphia Michael J. Biondi, Co-Chairman, Investment Conference Board Commission on Public Values While Your Company Climbs 11 Hon. William B. Chandler III Banking, Lazard Frères & Co. LLC Trust and Private Enterprise into the Fortune 500 17 September 2008 Brian L. Roberts, President, Comcast 12 Hon. E. Norman Veasey Retailers in a Recession: A Fireside 26 October 2005 26 September 2002 Corporation Chat on Investing with Bill Ackman Founding and Building a New Venture: What They Did Not Teach Me in Law School 13 Hon. Jack B. Jacobs William A. Ackman, Managing The Story of the National Women’s Law Robert M. Potamkin, Co-Chairman and 27 March 1997 Member, Pershing Square Capital Center Co-CEO, Planet Automotive Group, Inc. The Unique Impact of the Law on the 14 Hon. Harry T. Edwards Management, L.P. Marcia Greenberger, Founder and Leveraged Buyout Business Co-President, National Women’s Law Center 19 April 2002 Saul A. Fox, Fox Paine & Company, LLC Smart People Making and Losing Money: 31 March 2008 9 10 11 12 Making Every Mistake Once 7 April 2005 Some Recent Examples Safra Catz, President, Oracle Corporation A Swing of the Pendulum: 20 Years in M&A Perry Golkin, Kohlberg Kravis Roberts & Co. Joseph D. Gatto, Managing Director, 19 September 2007 Goldman, Sachs & Co. 25 October 2001 Tales from Blackstone’s IPO The Economics of Sports Team Franchises Robert L. Friedman, Senior Managing for Cities Director and Chief Legal Officer, The Hon. Edward G. Rendell, Governor, Blackstone Group L.P Commonwealth of Pennsylvania
Past Distinguished Jurist Lectures 28 October 2004 24 February 2000 22 March 1995 A Twelve-Year Retrospective on Delaware The Court of Chancery as Teacher Accountability: Popular Will, Interest 11 November 2008 Corporate Jurisprudence and Governance of Corporate Law Groups, or the Invisible Hand 13 14 Delaware Directors’ Fiduciary Issues Hon. William B. Chandler III, Chancellor, Hon. Stephen F. Williams, U.S. Court Duties: The Focus on Loyalty Hon. E. Norman Veasey, Chief Justice, Delaware Court of Chancery of Appeals for the District of Columbia Hon. Randy Holland, Justice, Delaware Supreme Court Supreme Court of Delaware 11 February 1999 13 April 1994 4 March 2004 Why Do People Bring Employment On the Constitution 24 October 2007 Corporate Decision-Making Discrimination Cases When They Hon. Antonin Scalia, Associate Justice, The Future of Securities Regulation in Delaware Courts Usually Lose? U.S. Supreme Court Brian G. Cartwright, General Counsel, Hon. Carolyn Berger, Justice, Delaware Hon. Diane Wood, U.S. Court of Appeals Securities and Exchange Commission Supreme Court for the Seventh Circuit 14 October 1992 Nonprice Competition 11 October 2006 27 February 2003 12 February 1998 Hon. Douglas H. Ginsberg, U.S. Court The Embattled Corporation The Effects of Collegiality The Value of Predictability in Corporate Law of Appeals for the District of Columbia Hon. Richard A. Posner, U.S. Seventh on Judicial Decision Making Hon. E. Norman Veasey, Chief Justice, Circuit Court of Appeals and Hon. Harry T. Edwards, Circuit Judge, Delaware Supreme Court 3 December 1991 University of Chicago Law School U.S. Court of Appeals for the D.C. Circuit Corporate Takeovers and Our 11 February 1997 Schizophrenic Conception of the 16 March 2006 29 November 2001 What Economics of Law Must Address Corporation Technology Mergers in a Shrinking Fee Shifting as a Control Next: Some Thoughts on Theory Hon. William T. Allen, Chancellor, World Against the Rogue Litigant Hon. Guido Calabresi, U.S. Court of Appeals Delaware Court of Chancery Hon. Vaughn R. Walker, Chief Judge, Hon. Jack B. Jacobs, Justice, Supreme for the Second Circuit U.S. District Court for the Northern Court of Delaware 1990 District of California 7 February 1996 The Constitution and the Spirit of 6 March 2001 The MTV Constitution Freedom 3 March 2005 Administering Capital Punishment: Hon. Alex Kozinski, U.S. Court of Appeals Hon. Anthony M. Kennedy, Associate Corporate Federalism: Is Texas Different? for the Ninth Circuit Justice, U.S. Supreme Court Event Horizons in Corporate Hon. Patrick E. Higginbotham, U.S. Court Governance of Appeals for the Fifth Circuit Hon. Myron T. Steele, Chief Justice, Delaware Supreme Court
30 institute for law and economics lectures 31 Academic Events
Major one-and two-day symposia are organized under the sole sponsorship of the Institute for Law and Economics, and in cooperation with other organizations.
In February 2005 we launched an annual conference on Law and Finance, jointly sponsored by ILE, the Wharton School’s Financial Institutions Center, and NYU’s Pollack Center for Law and Business. The conference location alternates between Penn and NYU.
In October 2002 ILE started the ILE/Wharton Finance series, providing an opportunity for faculty and advanced students from the Law School, the Wharton School, and the Department of Economics to come together around an area of common interest and strengthening the Institute’s core academic relationships. A dinner follows each presentation, with commentary presented by members of ILE’s Associate Faculty from Law, Wharton Finance, and the Department of Economics and a general discussion.
academic events 33 Penn/2 NYU Conference on Law and finance2 1 Simon M. Lorne, Millennium Management LLC
2 Yakov Amihud, NYU Stern School of Business
3 Todd Gormley, The Wharton School Commentator Moderator 25-26 February 2011 Moderator 4 Simi Kedia, Rutgers Business School. Jill Fisch, University of Pennsylvania Michal Barzuza, University of Virginia William T. Allen, NYU Stern School of New York University Law School School of Law Business and NYU School of Law, 5 Theodore Eisenberg, Cornell University Law School of Law New York University Session II Moderator School Jointly sponsored by Information Disclosure and Michael Roberts, The Wharton School, Session VII Institute for Law and Economics Corporate Governance University of Pennsylvania Securitization and Moral Hazard: 6 Klaus Hopt, Max-Planck-Institut für ausl. und University of Pennsylvania Michael Weisbach, The Ohio State Evidence from a Lender Cutoff Rule 1 2 intern. Privatrecht. Financial Institutions Center University Session V Ryan Bubb, New York University The Wharton School Corporate Governance and School of Law 7 Alan Schwartz, Yale Law School; Michael A. Center for Law & Business Commentator Corporate Political Activity: Fitts, University of Pennsylvania Law School. New York University Merritt Fox, Columbia Law School What Effect Will Citizens United Commentator Vikrant Vig, London Business School Have on Shareholder Wealth? 8 Hon. Jack B. Jacobs, Supreme Court of Organized by Moderator John C. Coates, Harvard Law School William T. Allen, NYU Stern School of Michael Wachter, University of Moderator Delaware; Stewart C. Myers, MIT Sloan School Business and NYU School of Law, Pennsylvania Law School Commentator Kose John, NYU Stern School of Management. New York University Andrew Metrick, Yale School of of Business Yakov Amihud, Stern School of Session III Management Business, New York University Does Delaware Entrench Management? Session VIII William W. Bratton, University of Adam C. Pritchard, University of Michigan Moderator Competition for Managers, Pennsylvania Law School Law School Barry Adler, New York University Corporate Governance and Michael Roberts, The Wharton School of Law Incentive Compensation School, University of Pennsylvania Commentator Viral V. Acharya, NYU Stern School Yaniv Grinstein, Cornell University Session VI of Business Session I Fiduciary Duties and Equity — The Political Economy of Fraud on Moderator Debtholder Conflicts Commentator Richard E. Kihlstrom, The Wharton School, the Market Bo Becker, Harvard Business School Alan Schwartz, Yale Law School William W. Bratton, University of University of Pennsylvania Pennsylvania Law School Commentator Moderator Session IV Michael Wachter, University of Henry T. Hu, University of Texas Jennifer Arlen, New York University CEO Compensation and Corporate 3 4 Pennsylvania Law School School of Law School of Law Risk-Taking: Evidence from a Natural Commentator Experiment Chester S. Spatt, Carnegie Mellon Todd A. Gormley, The Wharton School, University of Pennsylvania
26–27 February 2010 Commentator Session IV Session VI Robert M. Daines, Stanford Law School The Impact of Investor Protection Law on A Lintner Model of Dividends and University of Pennsylvania Corporate Policy: Evidence from the Blue Managerial Rents Law School Moderator Sky Laws Bart M. Lambrecht, Lancaster Hon. Jack B. Jacobs, Supreme Court Ashwini K. Agrawal, Stern School of University Management School Jointly sponsored by of Delaware Business, New York University Stewart C. Myers, MIT Sloan School Institute for Law and Economics of Management University of Pennsylvania Session II Commentator Financial Institutions Center Asset Fire Sales and Credit Easing Allen Ferrell, Harvard Law School Commentator The Wharton School Andrei Shleifer, Harvard University Alan Schwartz, Yale Law School Center for Law & Business Department of Economics Moderator New York University Robert W. Vishny, Booth School of William T. Allen, NYU Stern School of Moderator Business, University of Chicago Business and NYU School of Law, Richard E. Kihlstrom, The Wharton Organized by New York University School, University of Pennsylvania 5 6 William T. Allen, NYU Stern School of Commentator Business and NYU School of Law, Jonathan R. Macey, Yale Law School Session V Session VII New York University When the Government Is the The Price of Pay To Play in Securities Yakov Amihud, Stern School of Moderator Controlling Shareholder Class Actions Business, New York University Michael Roberts, The Wharton School, Marcel Kahan, New York University Stephen J. Choi, New York University Jill E. Fisch, University of Pennsylvania University of Pennsylvania School of Law Law School Law School Edward B. Rock, University of Pennsylvania Drew T. Johnson-Skinner, Law Clerk Michael Roberts, The Wharton Session III Law School to Judge John G. Koeltl of the School, University of Pennsylvania Are Securities Class Actions United States, District Court for the ‘Supplemental’ to SEC Enforcement? Commentator Southern District of New York Session I An Empirical Analysis Heitor V. Almeida, University of Illinois A.C. Pritchard, University of Michigan Is Delaware’s Antitakeover Statute Michael Klausner, Stanford Law School at Urbana-Champaign Law School Unconstitutional? Evidence from 1988–2008 Commentator Moderator Commentator Guhan Subramanian, Harvard Simi Kedia, Rutgers Business School Hon. Travis Laster, Delaware Court Sanjai Bhagat, Leeds School of Law School of Chancery Business, University of Colorado Moderator Steven Herscovici, Analysis Group, Inc. at Boulder William T. Allen, NYU Stern School of Brian Barbetta, Analysis Group, Inc. Business and NYU School of Law, Moderator New York University Richard E. Kihlstrom, The Wharton School, University of Pennsylvania 7 8
34 institute for law and economics academic events 35 2 ILE/wharton finance seminars 2 1 Louis J. Bevilacqua, Cadwalader, Wickersham & Taft LLP
2 Oliver Hart, Harvard University Department of Economics March 24, 2011 3 David K. Musto, The Wharton School Inefficient Provision of Inside Money by Banks co-sponsored by institute for law and 4 Merritt B. Fox, Columbia Law School (co-authored with Luigi Zingales) economics and department of finance, the wharton school Oliver Hart, Andrew E. Furer Professor of Economics, Harvard University, Department of Economics commentators
David Abrams, Penn Law The authors study the role of banks in creating inside money. Itay Goldstein, Wharton Finance They show that, even in the absence of asymmetric information Jonathan Klick, Penn Law or an agency problem, the private provision of inside money is inefficient. The reason is that inside money affects prices and the welfare of non-bank customers, and banks do not internalize this. Under competition, banks tend to generate too much money 1 relative to what is socially efficient, while a monopolistic bank chooses too little money. The authors argue that a regulator can eliminate these inefficiencies by promoting competition and imposing a ceiling on the loan-to-deposit ratio of each bank.
september 23, 2010
Fraud-on-the-Market co-sponsored by institute for law and Actions Against Foreign Issuers economics and department of finance, the wharton school Merritt B. Fox, Michael E. Patterson Professor of Law, NASDAQ Professor for Law and Economics of Capital Markets, commentators Columbia Law School William Bratton, Penn Law Jill Fisch, Penn Law This Article goes back to first principles to look at the basic Doron Levit, Wharton Finance policy concerns that are implicated by the reach of fraud-on- Christian Opp, Wharton Finance the-market class actions. The resulting analysis suggests a 2 3 simple, clear rule that can be shown likely to both maximize U.S. economic welfare and, by also promoting global economic welfare, foster good U.S. foreign relations as well. U.S. law based class action fraud-on-the-market claims, the author concludes, should not as a general matter be allowed against any genuinely foreign issuer, even where the purchaser making the claim is a U.S. investor purchasing the share in a U.S. market or where significant conduct contributing to the misstatement occurs in the United States. An issuer is genuinely foreign if it has its economic center of gravity as an operating firm outside the United States. The only exception would be a foreign issuer that has agreed, as a form of bonding, to be subject to the U.S. liability regime, in which case all such claims against the issuer should be allowed, regardless of the nationality and residence of the purchasing plaintiff, the place where she executes the transaction, and the place or places where conduct contributing to the misstatement occurs.
4
36 institute for law and economics academic events 37 Michael S. Knoll, Theodore K. Warner Private Law and the Regulation of Edward B. Rock, Saul A. Fox Distinguished Disparate Impact Realism, William Professor of Law, Professor of Real Securities Intermediaries: Perspectives Professor of Business Law and Mary Law Review, 2011. publications and papers Estate, The Wharton School; Co-Director, Under the Geneva Securities Convention 2 2 Center for Tax Law & Policy and United States Law, Uniform Law The Insignificance of Proxy Access Stereotype Threat: A Case of Review, 2010. (with Marcel Kahan), Virginia Law Review, Overclaim Syndrome?, in The Science The Corporate Income Tax and the forthcoming. on Women and Science (Christina Competitiveness of U.S. Industries, David K. Musto, Ronald O. Perelman Hoff Sommers, ed.), AEI Press, 2009. Tax Law Review, 2010. Professor in Finance, The Wharton School When the Government Is the Controlling Shareholder (with Marcel Kahan), Texas Bilge Yilmaz, Associate Professor of A Comprehensive Theory of Deal High Water Marks in Competitive Capital Law Review, forthcoming. Finance, The Wharton School Listed below is a sampling of recently published papers and work Cary Coglianese, Edward B. Shils Professor Richard J. Herring, Jacob Safra of Law and Professor of Political Science Professor of International Banking, Structure: Understanding How Markets (with Susan Christoffersen), in progress by members of the Associate Faculty of the Institute Professor of Finance, The Wharton Transactional Structure Creates Working Paper. Embattled CEOs (with Marcel Kahan), Adverse Selection and Convertible for Law and Economics. ILE maintains a series of research papers Business and Environmental Law (with School; Co-Director, Wharton Value (with Daniel M. G. Raff), Texas Law Review, 2010. Bonds (with Archishman Texas Law Review, 2010. The Economics of Mutual Funds, The Chakraborty), Review of Economic and provides copies—electronic or paper—to interested parties Ryan Anderson), in The Oxford Handbook Financial Institutions Center of Business and the Environment, 2011. Annual Review of Financial Economics, David A. Skeel, Jr., S. Samuel Arsht Studies, forthcoming. upon request to [email protected]. Credible Resolution Policy is Crucial The Taxation and Competitiveness forthcoming. Professor of Corporate Law the Institute is a member of the Legal Scholarship Network The Law and Economics of Risk for the Effective Regulation of of Sovereign Wealth Funds: Do Predatory Mortgage Lending (with Taxes Encourage Sovereign Wealth Predatory Mortgage Lending (with The New Financial Deal: Understanding Philip Bond and David Musto), (LSN), a subset of the Social Science Research Network. Current Regulation, in Wiley Encyclopedia of Systemically Important Financial Operations Research and Management Institutions, Stanford Resolution Funds to Invest in the United Philip Bond and Bilge Yilmaz), Journal the Dodd-Frank Act and its (Unintended) Journal of Financial Economics, 2009. ILE research papers are posted in the University of Pennsylvania Science, 2011. Project, 2011. States?, Southern California Law of Financial Economics, 2009. Consequences, Wiley, 2011. Law and Economics Research Paper Series on the LSN Web site. Review, 2009. Information and Efficiency inT ender Gideon Parchomovsky, Professor of Law Assessing the Chrysler Bankruptcy (with Offers (with Robert Marquez), Abstracts as well as complete papers can be downloaded The Politics of Regulation: From New After the Crash: The Future of Institutionalism to New Governance Finance (edited with Y. Fuchita and Friedrich K. Kübler, Professor and Mark Roe), Michigan Law Review, 2010. Econometrica, 2008. (www.ssrn.com/link/penn-lawecon. html). (with Chris Carrigan), Annual Review R. Litan), Brookings Press, 2010. Director of the Banking Law Institute Beyond Fair Use (with Phil Weiser), Faculty appointments are in the University of Pennsylvania of Political Science, 2011. Emeritus, University of Frankfurt, Cornell Law Review, 2011. Governance in the Ruins (essay review Germany; Professor of Law of Curtis Milhaupt & Katharina Pistor, Law School unless otherwise noted. Basel III: An UnofficialA merican Jill Fisch, Perry Golkin Professor of Law; View, Revue Banque, 2010. The Hidden Function of Takings Law and Capitalism), Harvard Law Review, Co-Director, Institute for Law and European Initiatives for the Compensation (with Abraham Bell), 2008. Economics Robert P. Inman, Richard King Mellon Regulation of Nonbank Financial Virginia Law Review, 2010. Institutions, International Monetary Michael L. Wachter, William B. Johnson Matthew D. Adler, Leon Meltzer Tom Baker, William Maul Measey Professor of Finance; Professor of Fund, 2010. The Distortionary Effect of Evidence Professor of Law and Economics; Professor of Law Professor of Law and Health Sciences The Destructive Ambiguity of Federal Finance and Economics, Business and Proxy Access, Emory Law Journal, Public Policy, Real Estate, The Wharton on Primary Behavior (with Alex Stein), Co-Director, Institute for Law and Medien, Menschenrechte und Harvard Law Review, 2010. Economics Well-Being and Fair Distribution: Health Insurance, Risk, and Responsibility forthcoming 2011. School Demokratie (Media, Human Rights, Beyond Cost-Benefit Analysis, Oxford after the Affordable Care Act, University and Democracy), 2008. Andrew W. Postlewaite, Harry P. Kamen The Political Economy of Fraud on the University Press, 2011. of Pennsylvania Law Review, forthcoming. The Overstated Promise of Corporate Federal Institutions and the Governance, University of Chicago Law Democratic Transition: Learning Professor of Economics, School of Arts and Market (with William W. Bratton), Recht und Sozialwissenschaften— Sciences; Professor of Finance, The University of Pennsylvania Law Review, Regulatory Theory, in A Companion Ensuring Corporate Misconduct: Review, 2010. from South Africa, Journal of Law, Herausforderungen und Chancen Wharton School forthcoming. to Philosophy of Law and Legal How Liability Insurance Undermines Economics, and Organizations, 2011. der Verhaltensökonomie (Law and Theory, 2010. Shareholder Litigation (with Sean Griffith), Rethinking the Regulation of Securities Social Sciences—the Challenge and Should Courts Always Enforce What The Case Against Shareholder University of Chicago Press, 2010. Intermediaries, University of Pennsylvania How Should Suburbs Help Their the Promise of Behavioral Economics) Contracting Parties Write? (with L. Empowerment (with William W. Bratton), Future Generations: A Prioritarian Law Review, 2010. Central Cities? Growth and Welfare (with Dorothea Kübler), Kritische Anderlini and L. Felli), Review of Law University of Pennsylvania Law Review, View, George Washington University Insurance in Sociolegal Research, Annual Enhancing Intra-Metropolitan Fiscal Vierteljahresschrift für Gesetzgebung and Economics, 2011. 2010. Law Review, 2009. Review of Law and Social Science, 2010. Itay Goldstein, Associate Professor of Distributions, Annals of the American Finance, The Wharton School Academy of Political and Social und Rechtswissenschaft, 2007. Political Reputations and Campaign Rationalizing Appraisal Standards in Franklin Allen, Nippon Life Professor William W. Bratton, Professor of Law; Sciences, 2009. George J. Mailath, Walter H. Promises (with E. Aragones and T. Compulsory Buyouts (with Lawrence A. of Finance and Professor of Economics, Co-Director, Institute for Law and The Real Effects of Financial Markets: Annenberg Professor in the Social Palfrey), Journal of the European Hamermesh), Boston College Law Review, The Wharton School Economics The Impact of Prices on Takeovers (with Making Cities Work: Prospects and Alex Edmans and Wei Jiang), Journal of Policies for Urban America, Princeton Sciences, Professor of Economics, Economic Association, 2007. 2009. School of Arts and Sciences Credit Market Competition and The Political Economy of Fraud on the Finance, forthcoming. University Press, 2009. Courts of Law and Unforeseen Susan M. Wachter, Richard B. Worley Capital Regulation (with E. Carletti Market (with Michael L. Wachter), Folk Theorems with Bounded Recall Contingencies (with L. Anderlini and Professor of Financial Management, and R. Marquez), Review of Financial University of Pennsylvania Law Review, Learning and Complementarities in Jonathan Klick, Professor of Law under (Almost) Perfect Monitoring L. Felli), Journal of Law, Economics and Professor of Real Estate and Finance, The Studies, 2011. forthcoming. Speculative Attacks (with Emre and Erasmus Chair of Empirical Legal Ozdenoren and Kathy Yuan), Review of Studies at Erasmus University (with Wojciech Olszewski), Games Organization, 2007. Wharton School; Co-Director, Institute and Economic Behavior, 2011. for Urban Research Interbank Market Liquidity and Heedless Globalism: The SEC’s Roadmap Economic Studies, 2011. Rotterdam Michael R. Roberts, Associate Professor Central Bank Intervention (with to Accounting Convergence, University of Common Learning (with Martin W. of Finance, The Wharton School Explaining the Housing Bubble E. Carletti and D. Gale), Journal of Cincinnati Law Review, 2011. Payoff Complementarities and Financial Abortion Liberalization and Sexual Cripps, Jeffrey C. Ely, and Larry (with Adam Levitin), Georgetown Law Monetary Economics, 2009. Fragility: Evidence from Mutual Fund Behavior: International Evidence Samuelson), Econometrica, 2008. Renegotiation of Financial Contracts: Review, forthcoming. The Case Against Shareholder Outflows (with Qi Chen and Wei Jiang), (with Sven Neelsen and Thomas Evidence from Private Credit Agreements Mark-to-Market Accounting and Empowerment (with Michael L. Wachter), Journal of Financial Economics, 2010. Stratmann), American Law and Purification in theI nfinitely-Repeated (with Amir Sufi), Journal of Financial Immigration and the Neighborhood Liquidity Pricing (with E. Carletti), University of Pennsylvania Law Review, Economics Review, forthcoming. Prisoners’ Dilemma (with V. Bhaskar Economics, 2009. (with Albert Saiz), American Economic Journal of Accounting and 2010. Lawrence A. Hamermesh, Ruby R. Vale and Stephen Morris), Review of Journal: Economic Policy, forthcoming. Economics, 2008. Professor of Corporate and Business Law, Recessions and the Social Safety Net: Economic Dynamics, 2008. How does Financing Impact Investment? Howard F. Chang, Earle Hepburn Professor Widener University School of Law The Alternative Minimum Tax as a The Role of Debt Covenants (with Subprime Lending and Real Estate Prices Aditi Bagchi, Assistant Professor of Law of Law (Attorney Fellow, Securities and Exchange Counter-Cyclical Fiscal Stabilizer Commission Division of Corporation (with Brian Galle), Stanford Law Charles W. Mooney, Jr., Charles A. Sudheer Chava), Journal of Finance, 2008. (with Andrey Pavlov), Real Estate Heimbold, Jr. Professor of Law Economics, 2011. Managing Moral Risk in Contract, The Effect of Allowing Pollution Offsets Finance, 2010–2011) Review, 2010. Back to the Beginning: Persistence and Columbia Law Review, forthcoming. with Imperfect Enforcement (with Hilary Security Interests in Personal the Cross-Section of Corporate Capital Amy Wax, Robert Mundheim Professor Sigman), American Economic Review, Loyalty’s Core Demand: The Defining Role Passive Discrimination: When Does Property (with S. Harris), 5th ed., Structure (with Michael Lemmon and of Law Who Should Talk? What Counts as forthcoming. of Good Faith in Corporate Law (with Leo It Make Sense to Pay Too Little? (with Foundation Press, forthcoming. Jaime Zender, Journal of Finance, 2008. Employee Voice and Who Stands to Strine, Jr., R. Franklin Balotti & Jeffrey Jonah Gelbach and Lesley Wexler), Diverging Family Structure and Rational Gain, Marquette Law Review, The Immigration Paradox: Alien Workers Gorris), Georgetown Law Journal, 2010. University of Chicago Law Review, Using First Principles of UCC Article Behavior: The Decline in Marriage as a forthcoming. and Distributive Justice, in Citizenship, 2009. 9 to Solve Statutory Puzzles in Disorder of Choice, in The Economics of Borders, and Human Needs, 2011. Rationalizing Appraisal Standards in Receivables Financing (with Steven the Family, Elgar Publishers, 2011. Unequal Promises, University of Compulsory Buyouts (with Michael Harris), Gonzaga Law Review, Pittsburgh Law Review, forthcoming. The Environment and Climate Change: Wachter), Boston College Law Review, 2009. forthcoming. Is International Migration Part of the Problem or Part of the Solution?, Fordham The Short and Puzzling Life of the “Implicit Environmental Law Review, 2010. Minority Discount” in Delaware Appraisal Law (with Michael Wachter), University of Pennsylvania Law Review, 2007.
38 institute for law and economics academic events 39 1 Matthew Adler 21 Susan M. Wachter
2 Franklin Allen 22 Amy L. Wax
3 Aditi Bagchi 23 Bilge Yilmaz
4 Tom Baker 1 2 3 4 5 Howard F. Chang
6 Cary Coglianese
7 Itay Goldstein
8 Richard J. Herring
9 Robert W. Holthausen
10 Richard E. Kihlstrom
11 Jonathan Klick 5 6 7 8 12 Michael S. Knoll
13 Charles W. Mooney, Jr.
14 David K. Musto
15 Gideon Parchomovsky
16 Andrew Postlewaite Associate faculty 17 Michael R. Roberts 18 Edward B. Rock 9 10 11 12 19 Reed Shuldiner
20 David A. Skeel, Jr.
13 14 15 16
17 18 19 20
21 22 23
associate faculty 41 He was a Visiting Professor of Law at Stanford Law School in 1998, Jill Fisch associate faculty at Harvard Law School and at the New York University School of Perry Golkin Professor of Law; Co-Director, 2 2 Law in 2001, at the University of Michigan Law School in 2002, Institute for Law and Economics and at the University of Chicago Law School in 2007, and a Visiting Associate Professor of Law at the Georgetown University Law Professor Fisch received her J.D. from Yale Law School in 1985. Center from 1996 to 1997. He served as a law clerk for the Honorable Before joining the Penn faculty in 2008, she held the T.J. Maloney Ruth Bader Ginsburg on the U.S. Court of Appeals for the D.C. Chair in Business Law at Fordham Law School and served as Matthew D. Adler Tom Baker Circuit from 1988 to1989. He served on the Board of Directors of founding director of the Fordham Corporate Law Center. She has Leon Meltzer Professor of Law William Maul Measey Professor of Law and Health Sciences the American Law and Economics Association from 2004 to 2007. also been a visiting professor at Harvard Law School, Columbia He has written on a wide variety of subjects including environ- Law School and Georgetown University Law Center. Prior to Professor Adler is a graduate of Yale College, St. Antony’s College Tom Baker is the William Maul Measey Professor of Law and Health mental protection, international trade, immigration, intellectual entering academia, Professor Fisch practiced law with the United of Oxford University, and the Yale Law School. Prior to teaching Sciences at Penn Law School. His work explores insurance, risk, property, and the economics of litigation and settlement. States Department of Justice and the New York office of Cleary, at Penn, he worked as a law clerk for Judge Harry Edwards, U.S. and responsibility in a wide variety of settings, using methods and Gottlieb, Steen and Hamilton. Her research focuses on corporate perspectives drawn from economics, sociology, psychology, and Court of Appeals for the D.C. Circuit, and for Justice Sandra Day Cary Coglianese governance, business litigation, and securities regulation. history. He is the author of The Medical Malpractice Myth (U. O’Connor, U.S. Supreme Court, and practiced law at Paul, Weiss, Edward B. Shils Professor of Law and Professor of Political Science Rifkind, Wharton & Garrison in New York City. At the Penn Law Chicago P. 2005) and a contributing editor of Embracing Risk: The Michael A. Fitts School, Professor Adler teaches administrative law and constitutional Changing Culture of Insurance and Responsibility (U. Chicago P. 2002). Cary Coglianese is the Edward B. Shils Professor of Law at the Dean of the Law School and Bernard G. Segal Professor of Law law. His current research focuses on cost-benefit analysis and risk His latest book Ensuring Corporate Misconduct: How Liability University of Pennsylvania Law School, as well as Professor of regulation. Insurance Undermines Shareholder Litigation, co-authored with Sean Political Science and the director of the Penn Program on Regula- Michael A. Fitts was named Dean of the Law School in March Griffith, analyzes the relationship between D&O insurance and tion. Coglianese is the founder of the Law & Society Association’s 2000. Before joining the Penn Law faculty in 1985, Dean Fitts served as clerk to the Honorable A. Leon Higginbotham, Jr., U.S. Franklin Allen securities litigation based on in-depth interviews with underwriters, international collaborative research network on regulatory claims managers, plaintiffs and defense lawyers, actuaries, brokers Court of Appeals for the Third Circuit, and as attorney advisor in Nippon Life Professor of Finance and Professor of Economics, governance, a council member of the American Bar Association’s and others. He has a secondary appointment in the Insurance and the Office of Legal Counsel in the U.S. Department of Justice. At The Wharton School section on Administrative Law and Regulatory Practice, and a Risk Management Department at Wharton, where he teaches risk fellow of the American Bar Foundation. He is also a founder of the Penn he was appointed Associate Professor of Law in 1990, Franklin Allen is the Nippon Life Professor of Finance and Professor management. He was the Connecticut Mutual Professor and peer-reviewed journal Regulation & Governance, for which he now Professor of Law in 1992 and Robert G. Fuller, Jr. Professor of Law of Economics at the Wharton School of the University of Pennsylvania. Director of the Insurance Law Center at the University of serves on the editorial board. Coglianese received his J.D., M.P.P., in 1996. From 1996 to 1998 he served as Associate Dean for Academic He has been on the faculty since 1980. He is currently Co-Director Connecticut before joining the Penn Law faculty. He clerked for and Ph.D. in political science from the University of Michigan, and Affairs at the Law School and was active in establishing a variety of the Wharton Financial Institutions Center. He was formerly Vice United States Court of Appeals Judge Juan Torruella and practiced for twelve years served on the faculty of the John F. Kennedy of joint programs with other schools within the University. In 1999 Dean and Director of Wharton Doctoral Programs and Executive with the firm of Covington and Burling. School of Government at Harvard University. He has also been a he served as Visiting Professor in Political Science at Swarthmore Editor of the Review of Financial Studies, one of the leading academic visiting professor of law at Stanford University and Vanderbilt College. Dean Fitts’ research has focused on the effect of various finance journals. He is a past President of the American Finance William W. Bratton University and an affiliated scholar at the Harvard Law School. structural changes (e.g., stronger political parties, presidents or Association, the Western Finance Association, the Society of Professor of Law; Co-Director, Institute for Law and Economics centralized legal institutions) on government budgeting and Financial Studies, and the Financial Intermediation Research Patricia M. Danzon legislation. He has also written more recently on the structure of Professor Bratton joined the Penn Law faculty in 2010. He graduated Society. He is a Fellow of the Econometric Society. He received his Celia Z. Moh Professor of Health Care Systems, non-profit institutions and their leadership. in 1976 from Columbia Law School where he was articles editor doctorate from Oxford University. Dr. Allen’s main areas of Insurance and Risk Management, The Wharton School interest are corporate finance, asset pricing, comparative financial of the Law Review and a James Kent Scholar. He clerked for the Itay Goldstein systems, and financial crises. He is a co-author with Richard Honorable William H. Timbers on the U.S. Court of Appeals for the Patricia Danzon is the Celia Moh Professor of Health Care Associate Professor of Finance, The Wharton School Brealey and Stewart Myers of the eighth and ninth editions of Second Circuit and practiced for several years at Debevoise & Management at The Wharton School, University of Pennsylvania. Itay Goldstein is a tenured Associate Professor of Finance at the the textbook Principles of Corporate Finance. Plimpton in New York. He served on the Cardozo, Rutgers, and Professor Danzon received a B.A. from Oxford University, George Washington law faculties before joining the faculty of the England, and a Ph.D. in Economics from the University of Wharton School of the University of Pennsylvania. He has been on the faculty of the Wharton School since 2004. Professor Aditi Bagchi Georgetown University Law Center, where he was the Peter P. Chicago. She has held faculty positions at Duke University and the Weidenbruch, Jr., Professor of Business Law. He also has been the Goldstein earned his B.A. (Economics and Accounting, 1994), Assistant Professor of Law University of Chicago. Unilever Visiting Professor at the Faculty of Law of the University of Professor Danzon is an internationally recognized expert in M.A. (Economics, 1998), and Ph.D. (Economics, 2001) from Tel Professor Bagchi received a J.D. from Yale Law School in 2003 and a Leiden and a visiting professor at the Duke and Stanford law schools. the fields of health economics, pharmaceuticals and biotechnology, Aviv University. He is an expert in the areas of corporate finance, M.Sc. in economic and social history from Oxford University in 2000. He is a Research Associate of the European Corporate Governance and insurance. She is a member of the Institute of Medicine and financial institutions, and financial markets, focusing on financial She clerked for United States Court of Appeals Judge Julio Fuentes Institute and in 2010 was the Anton Philips Professor at the faculty the National Academy of Social Insurance. She has served as a fragility and crises and on the feedback effects between firms and and practiced law with Cravath, Swaine & Moore LLP in New York. of law of the University of Tilburg. He also has published many consultant to the World Bank, GAVI, the European Commission, financial markets. His research has been published in major She joined the Penn Law faculty in 2006 and currently teaches articles and book chapters on topics in corporate law, the theory the New Zealand Treasury, the Asian Development Bank, and academic journals, including the Review of Economic Studies, the contracts and labor law. Her areas of research include normative of the firm, law and economics, and legal history and is the editor of U.S. Agency for International Development, and others. Professor Journal of Finance, the Review of Financial Studies, the Journal of theories of private law and comparative political economy. the leading law school casebook on corporate finance. Danzon has served on the Board of Directors of Medarex, Inc., Financial Economics, and the Journal of Economic Theory. His research the Policy and Global Affairs Board of the National Academy of has also been featured in the popular press in the Financial Times, Howard F. Chang Sciences, and the Policy Board of the Office of Health Economics Bloomberg, Forbes, National Public Radio, and others. He has Earle Hepburn Professor of Law in London. She has been an Associate Editor of the Journal of taught undergraduate, M.B.A., Ph.D., and executive education Health Economics and the International Journal of Health Care Finance courses in finance and economics. Prior to joining Wharton, Professor Chang received a Ph.D. in economics from the Massachusetts and Economics. She has published widely in scholarly journals on Professor Goldstein has served on the faculty of Duke University’s Institute of Technology in 1992, a J.D. from Harvard Law School in a broad range of subjects related to medical care, pharmaceuticals, Fuqua School of Business. He had also worked in the research 1987, a Master in Public Affairs from Princeton University in 1985, biotechnology, insurance, and the economics of law. department of the bank of Israel, where he was in charge of the and an A.B. from Harvard College in 1982. Prior to joining the Penn analysis of the current account of Israel. faculty in 1999, he was a Professor of Law at the University of Southern California Law School, where he began teaching in 1992.
42 institute for law and economics associate faculty 43 Robert P. Inman Network. Professor Knoll’s undergraduate and J.D. degrees are associate faculty Richard King Mellon Professor of Finance, Professor of Finance and from the University of Chicago. He also earned a Ph.D. in Economics 2 2 Economics, Business and Public Policy, Real Estate, The Wharton School at the University of Chicago. In 1990 he joined the USC Law faculty as an Assistant Professor, and in 1995 he was promoted to full Professor Inman received his Ph.D. in economics from Harvard Professor. He has been a Visiting Professor of Law at Georgetown University and joined the Penn faculty in 1972. He is a research (1999), Penn (1998–99), Virginia (2000), and Columbia (2009). associate of the National Bureau of Economic Research. He has Professor Knoll was also a John M. Olin Senior Research Scholar at Lawrence Hamermesh outside the university, he is co-chair of the US Shadow served as a consultant to the city of Philadelphia, the state of Columbia University School of Law (1996–97), a Visiting Scholar Ruby R. Vale Professor of Corporate and Business Law, Widener Financial Regulatory Committee and Executive Director of the Pennsylvania, CitiGroup, Chemical Bank, the U.S. Department of at New York University Law School (1996–97), and a John M. Olin University School of Law (Attorney Fellow, Securities and Exchange Financial Economist’s Roundtable, a member of the Advisory the Treasury, the Financial and Fiscal Commission of the Republic Distinguished Visiting Professor of Law at Toronto University. Commission Division of Corporation Finance, 2010–2011) Board of the European Banking Report in Rome, the Institute for of South Africa, the National Bank of Sri Lanka, the National Prior to entering teaching, he clerked for the Honorable Alex Financial Studies in Frankfurt, and the International Centre for Academy of Sciences, and numerous U.S. federal government Kozinski on the U.S. Court of Appeals, Ninth Circuit, and served as Professor Hamermesh received a B.A. from Haverford College in Financial Regulation in London. He served as co-chair of the agencies. His research is currently focused on fiscal federalism, the legal advisor to the Vice Chairman of the U.S. International Trade 1973, and a J.D. from Yale Law School in 1976. Professor Hamermesh Multinational Banking seminar from 1992–2004 and was a Fellow urban fiscal crisis, and the political and legal institutions of fiscal Commission. He has published extensively in the fields of corporate practiced law with Morris, Nichols, Arsht & Tunnell, Wilmington, of the World Economic Forum in Davos from 1992–95. He was a policymaking. Professor Inman held the Florence Chair in finance, taxation, economics, and real estate finance. Delaware, as an associate from 1976–84, and as a partner from member of the Group of 30 task force on the reinsurance industry, Economics at the European University Institute, Florence, Italy, 1985–94. Professor Hamermesh joined the faculty at Widener in as well as an earlier study group on international supervision and for the spring quarter of 2000. He was a Visiting Scholar at the Friedrich K. Kübler 1994, and teaches and writes in the areas of corporate finance, regulation. Currently, he is an independent director of the DWS Rockefeller Foundation’s Bellagio Study Center, Fall 2007. Professor and Director of the Banking Law Institute Emeritus, mergers and acquisitions, securities regulation, business organiza- Scudder mutual fund complex and has served on the predecessor University of Frankfurt, Germany; Emeritus Professor of Law tions, and professional responsibility. Since 1995, Professor Deutsche Asset Management and Bankers Trust boards since 1990. Richard E. Kihlstrom Hamermesh has been a member of the Council of the Corporation He is also an independent director of the Daiwa closed end funds Ervin Miller-Arthur M. Freedman Professor of Finance and After earning a Dr. iur. from the University of Tübingen in 1961, Law Section of the Delaware State Bar Association, which is and of Barclays Bank, Delaware. Economics, Chairman, Finance Department, The Wharton School Professor Kübler held appointments as teaching assistant in responsible for the annual review and modernization of the Herring received his undergraduate degree from Oberlin Tübingen and Paris; Professor of Law, University of Giessen Richard Kihlstrom holds a doctorate from the University of Delaware General Corporation Law, and served as Chair of the College in 1968 and his PhD from Princeton University in 1973. (1966–70); Visiting Lecturer, Harvard Law School (1968–69); Minnesota. He has been a member of the Wharton faculty since Council from 2002 to 2004. In 2002 and 2003 he also served as the He has been a member of the Finance Department since 1972. He is Professor of Law and Dean of the Graduate School of Social 1979, was named to the Miller-Freedman professorship in 1986, Reporter for the American Bar Association’s Task Force on married, with two children, and lives in Bryn Mawr, Pennsylvania. Sciences, University of Konstanz (1971–76); and Professor of Law, Corporate Responsibility. He served from 2001 to 2007 as a and previously served as Chair of the Finance Department from University of Frankfurt (1976–98). He first came to Penn in 1975 1988 to 1994. Before coming to Penn, he taught at Northwestern member of the Committee on Corporate Laws of the American Robert W. Holthausen and again in 1983 as a Visiting Professor of Law, and in 1985 he University, the University of Illinois, the State University of New Bar Association Section of Business Law, which supervises the The Nomura Securities Company Professor, Professor of Accounting and joined the faculty as Professor of Law. He has served on the board York at Stony Brook, and the University of Massachusetts. He is drafting of the Model Business Corporation Act. In 2007 Profes- Finance, and Chairman, Accounting Department, The Wharton School of the Deutscher Juristentag and is a member of the American Law sor Hamermesh was appointed as Chair of the Section of Business a Fellow of the Econometric Society. His areas of research interest Institute. He was one of the six commissioners regulating concen- Law’s Committee on Corporate Documents and Process. In 1999 Professor Holthausen earned his doctorate and his M.B.A. at the include information and uncertainty in economics, financial tration in the German television industry and is a member of the Professor Hamermesh was elected as a member of the American University of Rochester. Prior to his academic career, he was a market equilibrium, and corporate finance. European Shadow Financial Regulatory Committee, as well as of Law Institute. Professor Hamermesh is also a member of the Board C.P.A. He worked at Price Waterhouse and was also a financial the Frankfurt Academy of Arts and Sciences. Professor Kübler’s of Directors of ACLU Delaware, Inc. analyst with Mobil. He was on the accounting and finance faculty Jonathan Klick teaching interests are the European Union, corporations, interna- at the Graduate School of Business of the University of Chicago Professor of Law and Erasmus Chair of Empirical Legal Studies tional finance, and mass communication. His current (comparative) Richard J. Herring for ten years, joining the Penn faculty in 1989. During the at Erasmus University Rotterdam research interests are in the areas of corporate governance and Jacob Safra Professor of International Banking, Professor of Finance, 2001–2002 academic year, he was a visiting professor at Harvard finance, the supervision of transnational financial markets, and Professor Klick earned his Ph.D. in economics in 2002 and his J.D. The Wharton School; Co-Director, Wharton Financial Institutions Business School. Since 1998 he has served as the academic director broadcast regulation. in 2003 from George Mason University. He was the Jeffrey A. Center of Wharton’s Mergers and Acquisitions program. Professor Stoops Professor of Law and Economics at Florida State University Holthausen’s research interests include the effects of management from 2005-2008. He has been a visiting professor at Columbia George J. Mailath Richard J. Herring is Jacob Safra Professor of International compensation and governance structures on firm performance, University, Northwestern University, the University of Southern Walter H. Annenberg Professor in the Social Sciences, Professor of Banking and Professor of Finance at The Wharton School, the effects of information on volume and prices, corporate California, and the University of Hamburg, and he was an Erskine Economics, School of Arts and Sciences University of Pennsylvania, where he is also founding director restructuring and valuation, the effects of large block sales on Fellow in the Department of Finance and Economics at the of the Wharton Financial Institutions Center, one of Wharton’s common stock prices, and numerous other topics. He is widely Professor Mailath received his Ph.D. in economics from Princeton University of Canterbury in Christchurch, New Zealand. Klick’s largest research centers. From 2000 to 2006, he served as the published in both finance and accounting journals and is currently University in 1985. He is a Fellow of the Econometric Society, a work lies in the area of empirical law and economics, and every Director of the Lauder Institute of International Management an editor of the Journal of Accounting and Economics. His most member of the Council of the Game Theory Society, a co-founder year he thinks the Flyers will win the Stanley Cup. Studies and from 1995 to 2000, he served as Vice Dean and Director recent work is entitled “Accounting Standards, Financial Reporting of the journal Theoretical Economics, and is or has served as an of Wharton’s Undergraduate Division. During 2006, he was a Outcomes and Enforcement” and appears in the Journal of associate editor or editorial board member of Econometrica, the Professorial Fellow at the Reserve Bank of New Zealand and Accounting Research (May, 2009, pp. 447-458) as part of the Michael S. Knoll Review of Economic Studies, the Journal of Economic Theory, Games and Victoria University. Conference on the Regulation of Securities Markets: Perspectives Theodore K. Warner Professor of Law; Professor of Real Estate, Economic Behavior, the International Economic Review, and Economic He is the author of more than 100 articles, monographs and from Accounting, Law and Financial Economics. The Wharton School; Co-Director, Center for Tax Law & Policy Theory. He is co-editor of the Econometric Society Monograph books on various topics in financial regulation, international Series and has been a member of the Economics Advisory Panel of Professor Knoll joined the Penn Law and Wharton faculties from banking, and international finance. At various times his research the National Science Foundation. His research interests include the the University of Southern California Law School in 2000. He has been funded by grants from the National Science Foundation, organization of the firm, noncooperative game theory, evolution- teaches courses in corporate finance and taxation in the Law the Ford Foundation, the Brookings Institution, the Sloan Founda- ary game theory, social norms, and the foundations of reputations, School, the Wharton School, and the Wharton Executive Program. tion, and the Council on Foreign Relations. law, and authority. He is also an affiliate of the Zell/Lurie Real Estate Center at the Wharton School, and the editor of Forensic Economic Abstracts, an electronic journal published by the Social Science Research
44 institute for law and economics associate faculty 45 earned a number of teaching awards including the Daimler- David A. Skeel, Jr. associate faculty Chrysler Core Teaching Award at the Fuqua School of Business S. Samuel Arsht Professor of Corporate Law 2 2 and the David W. Hauk Award for Outstanding Teaching at the Wharton School. He has taught undergraduate, M.B.A., Ph.D., Professor Skeel joined the Penn faculty in 1999. He graduated in and executive education courses in corporate finance, economet- 1987 from the University of Virginia School of Law, where he was rics, and statistics. Prior to joining academia, Professor Roberts editor of the Virginia Law Review and a member of the Order of was a Financial Engineer at Financial Engineering Associates Inc. the Coif. He clerked for the Honorable Walter K. Stapleton on the Charles W. Mooney, Jr. of the Journal of Financial Services Research and an Associate Editor of and a Senior Analyst for Regional Economic Research Inc. U.S. Court of Appeals for the Third Circuit, and practiced for Charles A. Heimbold, Jr. Professor of Law the Journal of Finance. Most of his work, both theoretical and several years at Duane, Morris & Heckscher in Philadelphia, before empirical, is in the area of consumer financial services, mutual funds Edward B. Rock joining the Temple University School of Law in 1990. Professor Professor Mooney received his J.D. from Harvard Law School in and consumer credit in particular. He has also published work on Saul A. Fox Distinguished Professor of Business Law. Skeel has also held visiting appointments at the University of 1972. He practiced law with the Oklahoma firm of Crowe and corporate and political voting, option pricing, short selling, and Wisconsin Law School (1993–94), the University of Virginia School Dunlevy and as a partner of the New York firm of Shearman & cross-border taxation. Professor Rock received his J.D. from the University of Pennsylvania of Law (spring 1994), Georgetown University Law Center (fall Sterling. Professor Mooney joined the Penn faculty in 1986, and in 1983. He joined the Penn faculty in 1989 from the Philadelphia 2004), and the University of Pennsylvania Law School (fall 1997). during 1999 and 2000 he served as Interim Dean of the Law Gideon Parchomovsky law firm of Fine, Kaplan and Black, where he specialized in Professor Skeel specializes in corporate and commercial law and has School. From 1998 to 2000 and from 2008 to 2009 he served as Professor of Law antitrust, corporate, and securities litigation. He has written widely written widely on corporate law, bankruptcy, and sovereign debt. He Associate Dean for Academic Affairs. He is an active member of the in corporate law, on topics including: proxy access, corporate has also has written on law and religion, and poetry and law. American Law Institute and the American Bar Association. He Professor Parchomovsky received his LL.B. from the Hebrew University voting, government ownership, hedge funds and comparative served as a member of the Uniform Commercial Code Permanent of Jerusalem in 1993, his LL.M. from the University of California at corporate law. In 1994, Professor Rock was a Visiting Professor of Michael L. Wachter Editorial Board Article 2 (Sales) Study Committee and also served Berkeley in 1995, and his S.J.D. from Yale Law School in 1998. Prior International Banking and Capital Markets at the Institut für William B. Johnson Professor of Law and Economics; Co-Director, as a reporter for that Board’s Article 9 (Secured Transactions) to joining the Penn Law faculty in fall 2002, Professor Parchomovsky Arbeits-, Wirtschafts- und Zivil Recht, Johann Wolfgang Goethe- Institute for Law and Economics Study Committee and as a reporter for the Revised Article 9 served as an Associate Professor at Fordham Law School and a Universität, Frankfurt am Main, Germany. During the 1995–96 drafting committee. He served as a member of the U.S. Security Visiting Lecturer at Yale Law School. His research interests include academic year, he was a Fulbright Senior Scholar and Visiting Professor Wachter received his Ph.D. in economics from Harvard and Exchange Commission’s Advisory Committee on Market intellectual property law and property theory. His recent work focuses Professor of Law at the Law Faculty of the Hebrew University of University and joined the Penn faculty in 1970. He has held full pro- Transactions. Mooney was awarded the Distinguished Service on unlocking synergies among sub-fields of intellectual property and Jerusalem, Israel. In 2001, he was appointed the first Saul A. Fox fessorships in three of Penn’s schools: the School of Arts and Award, presented by the American College of Commercial Finance devising innovative mechanisms for protecting property entitlements. Distinguished Professor of Business Law. During 2005–06, he was Sciences, where he has been professor of economics since 1976; the Lawyers. He is a Fellow and Director of the American College of again a Visiting Professor of Law, and Lady Davis Fellow, at Wharton School, where he was professor of management, 1980–92; Bankruptcy. He also served as U.S. Delegate and Position Coordi- Andrew W. Postlewaite Hebrew University. Professor Rock served as co-director of ILE and the Law School, where he became professor of law and economics nator (appointed by U.S. Department of State) at the Diplomatic Harry P. Kamen Professor of Economics, School of Arts and Sciences; from 1998-2010. in 1984. He has been senior advisor to the Brookings Panel on Economic Conference for the Cape Town Convention on International Professor of Finance, The Wharton School Activity in addition to consulting for the Federal Reserve’s Board of Interests in Mobile Equipment and the Protocol on Matters Reed Shuldiner Governors and the Council of Economic Advisors. He has also served Professor Postlewaite received his Ph.D. from Northwestern Specific to Aircraft Equipment, in Cape Town, South Africa. He Alvin L. Snowiss Professor of Law as a member of the National Council on Employment Policy and as a also served as a U.S. Delegate for the UNIDROIT Geneva Securities University in 1974 and joined the Penn faculty from the University commissioner on the Minimum Wage Study Commission. Professor Convention at the Diplomatic Conferences in Geneva. His current of Illinois in 1980. He is editor of American Economic Journal: Professor Shuldiner is a recognized expert in the taxation of Wachter served as Deputy Provost of the University of Pennsylvania research centers on intermediated securities, security interests Microeconomics, past editor of the International Economic Review and financial instruments and transactions. His area of research is from July 1995 to January 1998, and as Interim Provost from January in bankruptcy, and bankruptcy theory. past co-editor of Econometrica. He serves on the Board of Directors taxation and tax policy. His current research includes the taxation to December 1998. He is the author of numerous articles in law and of the National Bureau of Economic Research, the Council of the of risk under income, wealth and consumption taxes, and the economics, as well as in corporation law and labor law and economics. Robert H. Mundheim Game Theory Society, and on the Executive Committee of the viability and effects of a federal wealth tax (with David Shakow). University Professor of Law and Finance Emeritus, University of American Economic Association. He has published widely in the Professor Shuldiner served as Associate Dean at Penn Law from Susan M. Wachter Pennsylvania; Of Counsel, Shearman & Sterling; formerly General areas of strategic behavior and industrial organization. 2000–02. During spring 2005, Professor Shuldiner was the William Richard B. Worley Professor of Financial Management, Professor Counsel, U.S. Treasury and Executive Vice President and General K. Jacobs, Jr. Visiting Professor of Law at Harvard Law School. He of Real Estate and Finance, The Wharton School; Co-Director, Institute Counsel of Salomon, Inc. Michael R. Roberts was a Visiting Assistant Professor at Yale Law School during for Urban Research Associate Professor of Finance, The Wharton School 1994–95. Before joining the Penn law faculty in 1990, he served in Mr. Mundheim is Vice Chair of the Board of Trustees of the the Office of Tax Legislative Counsel of the U.S. Department of the From 1998 to 2001, as Assistant Secretary for Policy Development New School University, a member of the Council and Executive Michael R. Roberts is a tenured Associate Professor of Finance at Treasury, was counsel to the law firm of Cadwalader, Wickersham and Research, U.S. Department of Housing and Urban Development, Committee of the American Law Institute, a Trustee of the Curtis the Wharton School of the University of Pennsylvania. Professor and Taft, and was an associate with the Washington, D.C., law firm Dr. Wachter served as the senior urban policy official and principal Institute of Music, and Chairman of the American Bar Association’s Roberts earned his B.A. in Economics from the University of of Wilmer, Cutler and Pickering. Professor Shuldiner received his advisor to the Secretary on overall HUD policies and programs. At Standing Committee on Ethics and Professional Responsibility. California at San Diego, and his M.A. in Statistics and Ph.D. in J.D. from Harvard University in 1983 and his Ph.D. in economics Wharton, Dr. Wachter was Chairperson of the Real Estate Department Economics from the University of California at Berkeley. In from the Massachusetts Institute of Technology in 1985. and Professor of Real Estate and Finance from July 1997 until her 1998 David K. Musto addition to his experience at the Wharton School, he has taught at appointment to HUD. She founded and currently serves as Director of Ronald O. Perelman Professor in Finance, The Wharton School Duke University’s Fuqua School of Business. His primary research Wharton’s Geographical Information Systems Lab. Dr. Wachter served is in the area of corporate finance and in particular: capital as a member of the Board of Directors of the Beneficial Corporation David K. Musto is the Ronald O. Perelman Professor in Finance at structure, investment policy, financial contracting, and payout from 1985 to 1998 and of the MIG Residential REIT from 1994 to 1998. the Wharton School, where he has been on the faculty since 1995. policy. Recent work has examined issues including the design of She was the editor of Real Estate Economics from 1997 to 1999 and He has a B.A. from Yale University and a Ph.D. from the University debt securities and the role of control rights in influencing financial serves on the editorial boards for several real estate journals. Dr. of Chicago, and between college and graduate school he worked and investment policy. His research has received several awards Wachter has been a member of the Advanced Studies Institute of the for Roll and Ross Asset Management in Los Angeles. He is an editor including the Brattle Prize for Distinguished Paper published in the Homer Hoyt Institute since 1989. Wachter co-founded and is co-direc- Journal of Finance, and Best Paper awards at the Financial Manage- tor of the Institute for Urban Research at Penn. She is author of more ment Association and Southwestern Finance Association annual than 100 scholarly publications and is the recipient of several awards conferences. In addition to his research, Professor Roberts has for teaching excellence at the Wharton School.
46 institute for law and economics associate faculty 47 associate faculty ILE Investors 2010–2011
Amy Wax Funding for the Institute for Law and Economics comes from Robert Mundheim Professor of Law a diverse group of individuals, law firms, corporations, and foundations who endorse our work each year. We are pleased A graduate of Yale College and Harvard Medical School, Professor and privileged to recognize and thank the ILE investors whose Wax trained as a neurologist at New York Hospital before complet- generous contributions underwrite the activities described in ing a law degree at Columbia Law School in 1987. She served as a this report. We deeply appreciate their support and their active clerk to the Honorable Abner J. Mikva of the U.S. Court of Appeals participation in institute programs. for the D.C. Circuit and worked for six years at theO ffice of the Solicitor General at the U.S. Department of Justice, where she Benefactors Members argued 15 cases before the U.S. Supreme Court. She taught from $25,000 or above $5,000 to $9,999 1994 to 2001 at the University of Virginia Law School. Her areas of Charles I. Cogut and Simpson James H. Agger thacher & Bartlett LLP Blank Rome LLP teaching and research include civil procedure, remedies, labor and Robert L. Friedman Harkins Cunningham LLP employment law, poverty law and welfare policy, the law and Paul G. Haaga, Jr. Leon C. Holt, Jr. economics of work and family, and social science and the law. Skadden, Arps, Slate, Meagher Myron J. Resnick & Flom LLP Professor Wax joined the Penn Law Faculty in fall 2001. Sullivan & Cromwell LLP Donors Up to $4,999 Bilge Yilmaz, Associate Professor of Finance, The Wharton School Sponsors Christopher Foulds $10,000 to $24,999 Mary J. Grendell Apollo Capital Management, L.P. Edmund Kitch Bilge Yılmaz is an Associate Professor of Finance at the Wharton AQR Capital Management, LLC James A. Ounsworth School. Prior to his current appointment, he taught at the Barclays Capital Americas John F. Schmutz Graduate School of Business, Stanford University, and held visiting Bernstein Litowitz Berger Konstantin Vertsman & Grossmann LLP Eric Wilensky positions at the University of Chicago and INSEAD. He received his Cadwalader, Wickersham & Taft LLP Kenneth W. Willman BS degrees in Electrical Engineering and Physics from Bogaziçi Isaac D. Corré University, and his PhD in Economics from Princeton University. Cravath, Swaine & Moore LLP Credit Suisse His research focuses on corporate finance, political economy Dechert LLP and game theory. Recently, he has published articles on the Delaware Department of State Dewey & LeBoeuf LLP inefficiency of tender offers, optimal security design, corporate DuPont bankruptcy, strategic trading, and predatory lending. His Fidelity Management current research interests also include corporate governance & Research Company Stephen Fraidin and private equity. Joel E. Friedlander Gibson, Dunn & Crutcher LLP Goldman, Sachs & Co. Perry Golkin Grant & Eisenhofer P.A. Hughes Hubbard & Reed LLP Innisfree M&A Incorporated Roy J. Katzovicz MacKenzie Partners, Inc Merck & Co., Inc. Millennium Management Foundation Morgan, Lewis & Bockius LLP Morris, Nichols, Arsht & Tunnell LLP Potter Anderson & Corroon LLP Proskauer Rose LLP Allan N. Rauch Richards, Layton & Finger, P.A. Schulte Roth & Zabel LLP Seyfarth Shaw LLP Shearman & Sterling LLP Sungard Data Systems Inc. Vanguard Wachtell, Lipton, Rosen & Katz Young Conaway Stargatt & Taylor, LLP Design: Dyad Communications Design:
48 institute for law and economics lectures 49 Institute for Law & Economics University of Pennsylvania 3400 Chestnut Street, Philadelphia, PA 19104-6204 215.898.7719, www.law.upenn.edu/ile/
September 2011
Michael L. Wachter, Co-Director William W. Bratton, Co-Director William B. Johnson Professor Professor of Law of Law and Economics 215-898-6911 215.898.7852 [email protected] [email protected] Vicki L. Hewitt, Program Director Jill E. Fisch, Co-Director 215.898.7719 Perry Golkin Professor of Law [email protected] 215.746.3454 [email protected]
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 jurispru- dence. 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.O ur 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 partici- pants 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 2010–2011 appears on page 48.