Self-Binding Corporations
Corporate charters for giants like Boeing and Google are unusually brief, offering only a generic permission to engage in any lawful activity and omitting any substantive policy guidance. A new paper proposes that companies embed concrete provisions—such as data‑privacy standards or safety commitments—directly into their charters and bylaws, giving shareholders a contractual basis for lawsuits if those promises are broken. The approach leverages existing Delaware law, which already allows such clauses, and relies on institutional investors to champion the reforms. If adopted, these self‑binding provisions could reshape governance by aligning managerial actions with shareholder‑approved standards.
Paul Weiss Discusses Ninth Circuit Dismissal of Securities Fraud Claims on Loss Causation Grounds
On Feb. 6, 2026 the Ninth Circuit unanimously affirmed a district court’s dismissal of securities‑fraud claims against Comerica, holding that the alleged 7.4% two‑day stock drop was too modest, typical, and quickly reversed to satisfy loss‑causation. The court applied its three‑factor...
Paul Weiss Discusses Third Circuit Ruling on Exclusive CFTC Jurisdiction Over Sports-Related Event Contracts
On April 6, 2026 the U.S. Court of Appeals for the Third Circuit ruled that the Commodity Futures Trading Commission (CFTC) has exclusive jurisdiction over sports‑related event contracts offered by prediction‑market operator Kalshi, deeming them "swaps" under the Commodity Exchange...
Intellectual Property Collateral and the Governance of Innovation Finance
Firms in technology, healthcare and life‑sciences now derive most of their market value from intangible assets such as patents, software and data, prompting lenders to treat intellectual‑property (IP) rights as primary collateral. 90% of S&P 500 valuation is tied to intangibles,...
Rethinking Materiality in the Debate Over ESG
Debates over ESG disclosures expose a deeper doctrinal gap: the lack of a clear definition of materiality in securities law. Professor Karen Woody proposes a taxonomy that divides materiality into substantive, regulatory and procedural categories, showing how each influences disclosure...
Gibson Dunn Discusses Delaware Supreme Court’s Revival of Nationwide Noncompete
The Delaware Supreme Court reversed a Chancery Court ruling that dismissed an 18‑month, nationwide noncompete in Payscale Inc. v. Norman. The high court held that well‑pleaded allegations linking the covenant’s scope and duration to legitimate business interests can survive a...
Future Equity, Present Value: The Law and Economics of SAFEs
The Simple Agreement for Future Equity (SAFE) was introduced by Y Combinator in 2013 to replace convertible notes, stripping away debt features while preserving the ability to convert into preferred stock later. SAFEs quickly became the standard for seed‑stage financing...
Finite Ventures
The article introduces "finite ventures" – business entities with a predefined lifespan – as an underused corporate‑governance tool. It shows that limited‑life structures are already common in private‑equity funds, venture‑capital funds, SPACs, and historic enterprises like the East India companies....
From “Dexit” To “Dentry”: Merger Agreements Amid the Debate Over Where to Incorporate
The debate over "Dexit" – corporations leaving Delaware – appears to be reversing as Delaware retains dominance for merger agreement law. While many firms consider Nevada or Texas for incorporation, most public‑company deals still choose Delaware contract law and its...
Davis Polk Discusses SEC’s Application of Securities Laws to Crypto
The SEC released a commission‑level interpretive release, jointly endorsed by the CFTC, that outlines when federal securities laws apply to crypto assets. It introduces a five‑category taxonomy—digital commodities, collectibles, tools, stablecoins, and digital securities—and clarifies that non‑security tokens can still...
Are Bidder-Initiated Takeovers Opportunistic?
The authors test whether bidder‑initiated takeovers exploit private information to overpay with inflated shares, contrasting that view with a rational payment‑design hypothesis. Analyzing 2,968 U.S. public acquisitions from 2000‑2020, they find bidders launch only half of deals and stock financing...
How Australia’s Financial Accountability Regime Aims to Strengthen Corporate Accountability
Australia’s Financial Accountability Regime (FAR) expands corporate liability beyond boards, targeting senior managers across banks, insurers and pension funds that represent roughly one‑third of the S&P/ASX 50 market cap. The regime imposes statutory duties of honesty, integrity, due care and...
Rethinking Private Ordering: The Financial Disclosure Quandary
The SEC has delegated full rulemaking authority over U.S. financial disclosure to the private‑sector Financial Accounting Standards Board (FASB), creating a full‑delegation private‑ordering model. This arrangement places standard‑setting power in the hands of accountants who also must comply with the...
Sullivan & Cromwell Discusses FDIC Rescission of Policy Statement Limiting Participation of Private Investors in Failed-Bank Acquisitions
On March 19, the FDIC rescinded its 2009 Statement of Policy that limited private‑equity participation in failed‑bank acquisitions, aiming to broaden the pool of bidders and reduce resolution costs. The move follows a pilot program that pre‑qualifies nonbanks for asset...
How Legal Systems Can Avoid the Pitfalls of Mass Arbitration
In early 2020 a San Francisco judge forced DoorDash to honor its own arbitration clause after more than 5,000 drivers filed individual demands, spending over $1 million in fees while the company balked at $12 million in administrative costs. The case illustrates how...
