Teaching

Stanford Journal of Law, Business and Finance 27(1) (2022): 1-93 

Summary: A review of the intuition for key empirical strategies for evaluating the relationship between governance and shareholder value, and a guide for lawyers that explains how they can evaluate these studies and engage with their weaknesses 

Coverage: Columbia Blue Sky Blog and the Oxford Business Law Blog

This class examines the law and economics of U.S. venture capital (VC) finance, the contract structures that are used to achieve these economics and the legal framework in which such contracting takes place. The course will cover topics relating to venture capital investments in start-up companies, the structure of VC backed companies, the allocation of cash-flow and control rights in these companies, and litigation arising from unique VC arrangements. The course will focus on how VC contract provisions are designed to protect investors from economic and voting dilution, how they allocate merger consideration in an acquisition of a VC-backed startup company, and how they can be used to incentivize subsequent investment by a company's VC investors. The course will also discuss various policy debates on the role of VC firms and the governance of startup founders. 

Corporate governance is a major policy issue in business regulation, and has increasingly become headline news in recent political debates. This course discusses the major debates in corporate governance, the challenges for designing an optimal system for governing corporations, and the increasingly important role of lawyers in these policy debates. To that end, the course hosts guest speakers with various backgrounds that have unique experience in corporate governance matters. The course focuses on a range of issues. For example, is shareholder activism by hedge funds and other institutional shareholders good for shareholder value, or does it promote short-termism? Are CEOs paid too much, and should their compensation be regulated? Do anti-takeover devices entrench managers or promote long-term strategic growth? Does state competition for corporate charters lead to a race to the top or the bottom? In discussing each of these topics, the course considers whether corporations are best regulated by the government or market discipline. As part of the course, students acquire the skills to review empirical studies and evaluate the implications of these studies for legal policy and corporate practice. 

In recent years, there has been growing pressure on profit-seeking corporations to address social problems, such as inequality and climate change. This class critically evaluates the law and policies underlying recent developments that have allowed or required firms to take on a more active role in social and environmental issues. The class covers a range of topics, including the economic structure of nonprofit firms, the debate on corporate purpose and the profit-maximization norm, the rise of ESG investing, the proliferation of new legal hybrid forms, recent developments in the law of managerial fiduciary duties, the role of microfinance and fair trade in promoting development, and tax and subsidy policies to encourage corporations to pursue social goals, including the recent Opportunity Zone program. The inquiry focuses primarily on what types of structures best align investors’ interest in profit-making with different social purposes.

This course surveys the law providing ground rules for the organization, internal governance, and financing of corporations and other forms of business associations such as partnerships and limited liability companies. Topics include limited liability, fiduciary duties, shareholder voting, derivative suits, control transactions, mergers and acquisitions, public contests, and trading. The emphasis throughout is on the functional analysis of legal rules as one set of constraints on business associations, among others. 

This course is a survey of the key concepts and cases in the law of mergers and acquisitions. It covers central and emerging issues in the practice of M&A including the different ways to structure deals, the negotiation and drafting of merger agreements, the fiduciary standards that govern director conduct, defensive techniques, and the ancillary topics with which M&A lawyers must be familiar, such as relevant securities regulations, tax matters, and antitrust. We also discuss the economic logic of why parties merge and cover some finance and accounting basics, but the primary focus of the course is legal rather than financial.