Widener University School of Law announced that Guhan Subramanian, the Joseph Flom Professor of Law & Business at Harvard Law School, delivered the 2013 Annual Francis G. Pileggi Distinguished Lecture in Law. This is the 29th year of this Lecture Series.

The title of this year’s lecture was, “Delaware’s Choice,” and was presented on Friday, Nov. 22 in the du Barry room of the Hotel du Pont at 11th and Market Streets in Wilmington. The Institute of Delaware Corporate and Business Law provided a synopsis of this year’s lecture. Professor Subramanian provided an overview of his presentation on the Harvard Law School Corporate Governance Forum with links to related commentary.

Frank Reynolds of Thomson Reuters also penned a helpful overview of the Lecture.

Highlights of the lectures from prior years were provided on these pages here, here and here.

Subramanian, who also serves as the Douglas Weaver Professor of Business Law at Harvard Business School, discussed Delaware’s antitakeover statute, DGCL Section 203, its constitutionality and the merits of amending it to strengthen it against a possible legal challenge.

Subramanian is the first person in the history of Harvard University to hold tenured appointments to both the law school and the business school. His research explores topics in corporate governance and negotiations, and he has published articles in the Stanford Law Review, the Yale Law Journal, the Harvard Business Review and the Harvard Law Review. His work has been featured in the Wall Street Journal, the New York Times and The American Lawyer. His book “Dealmaking: The New Strategy of Negotiauctions” has been translated into five other languages. Prior to joining the Harvard faculty he spent three years at McKinsey & Company.

The annual Pileggi lecture is presented by Widener Law and the Delaware Journal of Corporate Law. The series has attracted many renowned speakers in the area of corporate law since the first Pileggi lecture in 1986. As in the past, this year’s program has been approved in Delaware for one continuing legal education credit and in Pennsylvania for one substantive continuing legal education credit.

The event each year is made possible by the generosity of Francis G. Pileggi, a founding attorney of Pileggi & Pileggi and father of Widener Law alumnus Francis G.X. Pileggi, who conceived of the idea while he was on the law review in order to create a corporate law forum for practitioners, judges and academics.

Larry Ribstein gives his view of Professor Steve Bainbridge’s presentation on the Unocal case, and the abstract of the article on which Bainbridge based the 21st Annual F.G. Pileggi Distinguished Lecture in Law to the Delaware Bench and Bar last week. Several members of the Delaware Chancery Court and Delaware Supreme Court, in addition to members of the Bar, were in attendance to hear Bainbridge’s positive perspective on the case. Ribstein has also presented the Pileggi Lecture in years past.

This post was prepared by Frank Reynolds, who has been following Delaware corporate law, and writing about it for various legal publications, for over 30 years.

The law school professor widely regarded as the “dean” of Delaware corporate law told a gathering of the state’s bench and bar in Wilmington Nov. 8 that he was just fortunate to be in the right place at the dawn of the age of hostile takeover litigation.

At the 35th Annual Francis G. Pileggi Distinguished Lecture in Law at the Hotel duPont, Widener University Delaware Law School Professor Emeritus Lawrence A. Hamermesh presented his unique perspective on more than 40 years of legal trends in an interview with fellow Widener professor Paul L. Regan. The law school provided an excellent overview of the event on their website.

Hamermesh said in 1976, he was fresh out of Yale Law School and working for the law firm Morris Nichols Arsht & Tunnel in Wilmington when he was assigned to a minority shareholder’s appraisal suit over the value of the stock of Kirby Lumber Corp.

He said that low-profile case involved issues that were common to later high-stakes hostile acquisition litigation that dominated the docket of the Delaware Chancery Court for decades. Bell v. Kirby Lumber Corp. 413 A 2d 137 (Del. 1980).

Morris Nichols frequently defended companies and their officers and directors, who usually took the position that the company’s worth should be based on its revenue — in Kirby’s case, about $120 a-share — but the plaintiff said its assets were worth $770 a-share.

Kirby’s legacy

Hamermesh said as merger and acquisition battles heated up through the 1980’s, hostile bidders seeking control of a bare majority of a target company’s stock so they could profitably sell off its pieces were focused on asset value.

“The court struck a compromise and averaged Kirby’s stock value between those two value extremes but that was just the beginning” of a long, see-saw battle between corporate officers and directors on one side and hostile bidders and activist investors on the other, he said.

Often, he faced his interviewer, Prof. Regan, in those battles during Regan’s stint at firm Skadden Arps, before Hamermesh traded the courtroom for the Widener classroom in 1994, where the two have steered the corporate law department.

They said they have witnessed the evolving struggle between corporate operating value and break-up asset value proponents put takeover litigation and the Delaware business courts in the national spotlight.

Often, the threat of a takeover that would bust up a company and its business made strange bedfellows out of traditional adversaries, such as management and labor who would be forced to put aside their differences to present a united front against a hostile bidder, Hamermesh noted.

Spotlight shifts to Delaware

After the U.S. Supreme Court decided in Green v. Santa Fe that merger challenges were the province of  state law and not classic federal securities laws because they focused on fiduciary duty, not securities deceit and fraud, the Delaware state courts rose to prominence, the professors agreed. Santa Fe Industries, Inc. v. Green, 430 U.S. 462 (1977)

They discussed the key Delaware decisions in the 1980’s that tried to balance the right of the directors to manage their companies, against the right of investors, as the owners, to decide the company’s ultimate fate.

Unocal and Revlon’s effect

The Delaware Supreme Court’s Unocal decision for the first time imposed an “enhanced duty” on directors to show that their takeover defense was a reasonable response to a threat to the corporation by a hostile bidder, they said. Unocal v. Mesa Petroleum Co., 493 A.2d 946 (Del. 1985)

One year later, the high court’s Revlon ruling said in a sale-of-control battle the directors effectively become the auctioneers of the company and must take a hostile bidder’s higher offer, because the board’s defenses could be the product of conflicted interests. Revlon, Inc. v. MacAndrews & Forbes Holdings, Inc., 506 A.2d 173 (Del. 1986)

“The Supreme Court said the board has to take the highest offer in a sale situation if its the end of the line for the business, but what if it will live on in some other form?” Hamermesh asked.  In those cases, the board could consider other constituencies, including the interests of constituencies such as employees, creditors and suppliers. Compare generally, Bandera Master Funds LP v. Boardwalk Pipeline Partners, LP, C.A. No. 2018-0372-JTL, Slip op. at 30-31 and n.8 (Del. Ch. Oct. 7, 2019)(recent Chancery decision noting considerations that can be taken into account consistent with fiduciary’s obligation to act in best interests of stockholders.)

The takeover battles evolved into a struggle between long-term revenue proponents and the hedge funds, private equity companies and other activist investors who pushed for changes that would generate quick, short-term profits, he said.

Investing with grandchildren in mind

Today, the issue is still “shareholder primacy”, versus other interests – such as the environment — because “companies can benefit by dumping on the world, but what about my grandchildren — what kind of world will they inherit?” because of investor decisions, he asked.

The professor said like many investors, his stock holdings are through “investment intermediaries” whose short-or-long-term influence on the companies in their portfolio can be hard to gauge.

The iconic Delaware court rulings mainly address the fiduciary duties of corporate officers and directors, “but what duty do investment companies owe to shareholders?” he asked.  The focus has been on the agency costs directors and officers incur in running the company, “but what are the investment intermediaries’ agency costs?”

Responding to Regan’s “where is shareholder litigation going?” question, Hamermesh applauded the Chancery Court’s 2016 Trulia decision that effectively stopped what he called “merger tax” lawsuits in which plaintiff law firms reaped attorney fees for quick settlements that provided no benefit beyond unimportant added deal information.   In re Trulia, Inc. S’holder Litig., 129 A.3d 884, 894 (Del. Ch. 2016).

In hindsight, he said, whatever his contribution has been to his field, his choice of corporate over criminal law meant that, “I was basically representing people fighting about money, and no one was going to die.”

The 35th Annual Francis G. Pileggi Distinguished Lecture in Law (named after the father of this blog’s primary author) will be held on:

Friday, November 8, 2019.

Registration and breakfast is at 8:00 a.m. at the Hotel du Pont in Wilmington, Delaware. The Annual Lecture begins at 8:45 a.m.

The 34th Annual F.G. Pileggi Distinguished Lecture in Law (named after my father) will be presented by Professor David A. Skeel, Jr., the S. Samuel Arsht Professor of Corporate Law at the University of Pennsylvania Law School. Details about the event on November 2, 2018, are at this link, and as follows:

Hotel du Pont, du Barry Room, 11th and Market Streets, Wilmington, Delaware 19801

Breakfast at 8:00 a.m. and lecture at 8:45 a.m.

One substantive CLE credit available in DE and PA and online registration available at   delawarelaw.widener.edu/pileggi2018

For additional information or for accessibility and special needs requests, contact Carol Perrupato at caperrupato@widener.edu or 302-477-2178.

Highlights of the annual lectures for several prior years have appeared on these pages.

The Delaware Journal of Corporate Law
of Widener University Delaware Law School
presents the 31st Annual Francis G. Pileggi Distinguished Lecture in Law

Title of Lecture: “Shareholder Activism: the Triumph of Delaware’s Board-Centered Model and the New Role for the Board of Directors”

Presented by: Professor Jeffrey N. Gordon
Richard Paul Richman Professor of Law, Columbia Law School;
Co-Director, Richman Center for Business, Law & Public Policy;
Co-Director, Ira M. Millstein Center for Global Markets and Corporate Ownership; Co-Director, Center for Law and Economic Studies

Friday, October 16, 2015

8:00 a.m. Breakfast; 8:45 a.m. Lecture

Hotel DuPont, Green Room
11th and Market Streets
Wilmington, Delaware 19801

One substantive CLE credit available in DE and PA

Online registration form available at delawarelaw.widener.edu/pileggi2015

For additional information or for accessibility and special needs requests, contact Rose E. Callahan at recallahan@widener.edu or 302-477-2014.

Prior lectures in this series have been highlighted on these pages.

This annual lecture in law by a nationally-recognized corporate scholar took place this year on November 9, 2012 at the Hotel duPont in Wilmington and featured Professor Lyman P.Q. Johnson.

Professor Johnson’s presentation was entitled:

“Unsettled and Unsettling Issues in Corporate Law”

An abstract of his presentation follows:

This lecture revisits two fundamental issues in corporate law.  One involves a great deal of seemingly settled law—the central role of the business judgment rule in fiduciary litigation—while the other—whether there is a mandated corporate purpose—has very little law.  Using the emergent question of whether the business judgment rule should be used in analyzing officer and controlling shareholder fiduciary duties, Professor Johnson will propose a rethinking of the rule’s analytical preeminence.  For a variety of reasons, he suggests elevating duties themselves to be more prominent and deemphasizing the business judgment rule.

As to corporate purpose, Professor Johnson will advocate that Delaware law permit a pluralistic approach in the for-profit corporate sector.  Long agnostic about ultimate corporate objective, Delaware law may have turned unnecessarily toward a strict shareholder primacy focus in the 2010 eBay decision.  To bring clarification and to foster flexibility, Professor Johnson recommends a legislative default provision, with an opt-out feature.

Details about the annual lecture, named in honor of my father, are available here and here. Details about some of the more recent annual lectures in this series are available here, and a list of all 27 prior annual lectures, organized by the Widener University School of Law and the Delaware Journal of Corporate Law, can be accessed here.  Professor Johnson’s law school also provided a press release. The Institute of Delaware Corporate and Business Law provided a summary of the presentatiion.

This year’s Distinguished Lecturer is Professor Edward Rock of the University of Pennsylvania Law School, a nationally recognized corporate law expert. A summary of his background and a sampling of his scholarship are provided in the announcement here. The origin of the  Annual F. G. Pileggi Distinguished Lecture in Law,  sponsored by The Delaware Journal of Corporate Law, the lead law review of Widener University School of Law, is described here. This annual lecture series was named after my father, F. G. Pileggi, and not the author of this blog post. (I have an extra middle initial.) Last year’s Lecture, and links to lecturers from prior years, are highlighted on this blog here.

The topic and the abstract of this year’s presentation, held today, October 9, 2009, in Wilmington, Delaware, is as follows:

TOPIC:
When the Government is the Controlling Shareholder: Implications for Delaware
 

ABSTRACT:
As a result of the bailouts that began in the fall of 2008, the Emergency Economic Stabilization Act of 2008, and Troubled Assets Relief Program, and its various subprograms, the United States Government now owns a large portfolio of equity positions in Delaware corporations, including controlling positions in AIG, Citigroup, GM, and GMAC. Corporate law provides a complex and comprehensive set of standards of conduct governing the behavior of controlling shareholders. When the Treasury is the controlling shareholder, doctrines of “sovereign immunity” replace many of these existing “private law” structures of accountability with federal “public law” norms. In this lecture, I examine Delaware’s place in this new legal landscape.

UPDATEThe Wilmington News Journal published an article about the Annual Lecture here. Also, The Philadelphia Inquirer’‘s Joe DiStefano wrote a piece about the good professor’s Lecture here.
 

The 24th Annual F.G. Pileggi Distinguished Lecture in Law, sponsored by The Delaware Journal of Corporate Law, the lead law review of Delaware’s Widener University School of Law, was presented today by Professor Eric Talley, a visiting professor this year at Harvard Law School.  Here is a short description of this year’s event with a link to a video of the presentation. 

The prior 23 Annual Distinguished Pileggi Lecturers have been listed here. My posts about last year’s Distinguished Pileggi Lecturer (and reference to the two prior years) is available here. Some background on how the Annual Lecture began is described here. 

UPDATE: The Delaware Law Weekly has a story about it here. The Delaware Corporate Litigation Reporter, published by Thompson-West, also has an article about it that they graciously allowed me to reprint on this blog here.

A  partial abstract of this year’s Distinguished Lecture in Law by Professor Eric Talley,  held at the Hotel duPont in Wilmington, Delaware, on October 10, 2008,  is as follows:

How Complexity Simplifies Corporate Law, Governance, and Incentives

ABSTRACT:

Complexity makes corporate law and governance both challenging and interesting. Indeed, the modern corporate enterprise must mediate and regulate a vast number of conflicting interests, claims, constituencies and authority relationships. Within the shadowy interstices of these conflicts, coordination and incentive problems tend to propagate and thrive. In many ways, the key challenge of corporate law is that of constructing balance amid the chaos of these competing forces.