Faculty in the News

Steven M. Davidoff Media Hits

The following is a list of selected media coverage for Steven M. Davidoff. The links below will direct you to sites that are not affiliated with the Moritz College of Law. They are subject to change, and some may expire or require registration as time passes.

 

Supreme Court Tinkering With Securities Class Actions

June 23, 2014

Professor Steven Davidoff wrote an op-ed in The New York Times DealBook on the Supreme Court decision in Halliburton Company v. Erica P. John Fund Inc. A case, he said, some saw as a potential end to the ability of shareholders to sue companies for securities fraud.

“The opinion shows that the Supreme Court seems to love to tinker with the securities laws, but it continues to refuse to kill the business,” he wrote. “The justices decided that the current state of play was sensible. They refused to overrule the decision made in the Basic case. They noted that markets may not be totally efficient, but what was going on here was 'not a binary, yes or no question.' Instead, the issue was whether the company’s price had been affected.The court thus refused to overrule the decision, allowing the fraud on the market theory to stand."



A Merger in a Race With Congress

June 16, 2014

Professor Steven Davidoff wrote an op-ed in The New York Times DealBook on Medtronic’s desire to acquire Covidie. A deal, he said, that could allow the company to reincorporate in Ireland but maintain its headquarters in Minneapolis, lowering Medtronic’s tax rate and allowing it to access its $12 billion in cash held abroad without paying United States taxes.



In Tough Market, Investment Banks Seek Shelter or Get Out

June 12, 2014

Professor Steven Davidoff wrote an op-ed that appeared in The New York Times and The Economic Times on how the world of Goldman Sachs, Morgan Stanley, and other big investment banks is changing.



Hillshire Stuck Between the Terms of 2 Deal Offers

June 11, 2014

Professor Steven Davidoff wrote an op-ed in The New York Times Dealbook on Hillshire Brands recent financial dealings, including the recommendation that the company’s shareholders approve a $4.3 billion acquisition of Pinnacle Foods, whilst Tyson Foods purportedly submitted a winning bid of $7.7 billion to acquire Hillshire Brands – a deal the company had yet to accept or endorse.



Companies can spend millions on security measures to keep executives safe

June 6, 2014

Professor Steven Davidoff was quoted in an article in The Washington Post about the price some companies pay for personal security of their top executives. One company was said to have spent $1.3 million in a single year protecting its chief executive officer, while another was said to have spent nearly $1.5 million for similar services. Davidoff described the practice as a “loophole” that deprives the federal government of tax revenue, and said it should be closed.

“Clearly it’s being exploited to allow executives to get perks,” he said. “If they want to give their executives those perks, fine, but they shouldn’t be subsidized by the federal government.”



InfiLaw temporarily suspends license application to buy Charleston School of Law

June 4, 2014

Professor Steven Davidoff’s New York Times column on Infilaw’s bid to purchase and run the Charleston School of Law was mentioned in an article in the ABA Journal following the company’s request to suspend the offer.

“The controversy over the potential sale ‘may just boil down to snobbery and who should be allowed to attend law school,’” the article quoted Davidoff as writing. “The school was established to turn a profit and to provide a second law school in South Carolina to feed graduates into local jobs, he says. ‘Lost among the dispute is the fact that a lower-tier law school like Charleston—whoever owns it—can not only produce capable graduates but help students start careers they couldn’t have without a law degree.’”



Hillshire Must Decide Whether to Be Target or Suitor

June 4, 2014

Professor Steven Davidoff wrote an op-ed in The New York Times on Hillshire Brands acquisition of Pinnacle Foods as two other companies made competing bids to purchase Hillshire for more than $6 billion, with the contingency that the deal with Pinnacle fall through.



Potential Sale of Law School Raises Debate Over Who Should Profit

June 3, 2014

Professor Steven Davidoff wrote an op-ed in The New York Times on the debate over who should profit from the potential sale of the Charleston Law School in Charleston, S.C.



Fine Legal Point Poses Challenge to Appraisal Rights

May 30, 2014

Professor Steven Davidoff wrote a column in The New York Times on how a fine legal point brought before the court could pose a challenge to the multimillion-dollar appraisal proceedings involving the $1.6 billion buyout of Ancestry.com.



As Information Flows, S.E.C. Faces Difficulty Bottling It Up

May 27, 2014

Professor Steven Davidoff wrote a column in The New York Times on the U.S. Securities and Exchange Commission’s efforts to ensure equal access to information through a rule known as Regulation FD.



A Ruling’s Chilling Effect on Corporate Litigation

May 23, 2014

Professor Steven Davidoff wrote a column in The New York Times on the Delaware Supreme Court’s response to a question from the federal district court on whether or not a private company can amend its bylaws to adopt a provision that makes the loser in any shareholder litigation pay the other side’s fees.



Battle Over Darden Leaves Little Room for Compromise

May 20, 2014

Professor Steven Davidoff wrote an op-ed in The New York Times on the announcement that Darden, who owns the Red Lobster and Olive Garden chains, plans to sell Red Lobster for $2.1 billion to Golden Gate Capital.



The Curious Incident of Pfizer’s ‘Final’ Offer for AstraZeneca

May 19, 2014

Professor Steven Davidoff wrote a column in The New York Times on Pfizer’s final offer of $119 billion to purchase AstraZeneca.



Deal for Zales May Be Done In by Bank of America’s Conflicts

May 16, 2014

Professor Steven Davidoff wrote a column in The New York Times on opposition to Signet’s $1.4 billion acquisition of the Zale Corporation.



Can Uber Achieve $10B Plus Valuation?

May 16, 2014

Professor Steven Davidoff appeared on Bloomberg Television’s “Bloomberg Surveillance” to discuss the ride-share service Uber and tech valuations.



Shareholders Find Strange Treasures in Jewelry Merger

May 16, 2014

Professor Steven Davidoff was quoted in a column on Bloomberg View about a potential conflict of interest in Signet Jewelers' agreement to purchase the Zale Corporation.

“Bank of America represented Zale in the transaction. At the time of its retention, Bank of America advised Zale that it had ‘limited prior relationships and no conflicts with Signet,’” he said. “But Bank of America apparently delivered an unsolicited presentation to Signet on Oct. 7, 2013, in which it promoted an acquisition of Zale by Signet at a price range of $17 to $21 a share. This was the day after the first day that Signet reached out to Zale about an acquisition. A member of the Bank of America team that made that presentation was also subsequently on Bank of America’s Zale team.”



No One’s Looking at Alibaba Risk: Davidoff

May 16, 2014

Professor Steven Davidoff appeared on Bloomberg Television’s “Bloomberg Surveillance” to discuss the hype surrounding Alibaba’s IPO.



To Guide the Merger Giants, Strong Hands Are Needed

May 13, 2014

Professor Steven Davidoff wrote a column in The New York Times on the merger of the Publicis Groupe and the Omnicom Group.



The Problem With the Smart Lawyering Behind Alibaba's IPO

May 7, 2014

Professor Steven Davidoff’s New York Times column on the potential legal issues surrounding the initial public offering of Chinese Internet giant Alibaba Group Holding Limited was mentioned in an article published by American Legal Media discussing the same topic.



Alibaba Investors Will Buy a Risky Corporate Structure

May 6, 2014

Professor Steven Davidoff wrote a column in The New York Times on the risky corporate structure of Alibaba, where investors are unable to have title to most of the company’s Chinese assets due to Chinese prohibitions on foreign ownership.



A Truce at Sotheby’s After a Costly and Avoidable Battle

May 5, 2014

Professor Steven Davidoff wrote a column in The New York Times on the end of Sotheby’s costly legal battle with Daniel S. Loeb’s Third Point.



What Your CEO Is Reading: Broken Infrastructure; CEO Pay

May 2, 2014

Professor Steven Davidoff’s New York Times column on Yahoo CEO Marissa Mayer’s $214 million pay package was mentioned in the Wall Street Journal in a piece titled “What Your CEO Is Reading.” The article quoted Davidoff as saying Mayer’s pay had grown, not due to rising revenues, but rather from her company’s 24 percent stake in “Chinese Internet behemoth” Alibaba Group.

“’The example of Ms. Mayer highlights the absurdities of executive compensation based on stock prices,’ he writes, and demands an opportunity to rethink all stock compensation plans as a way to motivate CEOs. ‘Instead, executives can simply be paid in cash based on their effort,’ he concludes. ‘A novel concept to be sure,’” the article quoted Davidoff as saying.



Yahoo Chief’s Pay Tied to Another Company’s Performance

April 30, 2014

In a New York Times column, Steven Davidoff wrote about how Marissa Mayer hit it big in the executive compensation lottery.

 



The Quirk That Bolsters Allergan’s Defense

April 29, 2014

Steven Davidoff Solomon wrote in this New York Times column: "In the $45.6 billion takeover battle for Allergan, there has been much speculation about what will be the next steps.

But a quirk in Allergan’s governing documents about who can replace removed directors may halt the pursuer, Valeant Pharmaceuticals, and its ally, William A. Ackman’s Pershing Square, in their tracks."



Allergan Bid Charts New Territory in Takeovers

April 22, 2014

Steven Davidoff Solomon wrote in this New York Times column on Allergan:

"The $45.6 billion unsolicited offer for Allergan by Valeant Pharmaceuticals and William A. Ackman’s hedge fund is many things, including bold, novel and mega in all ways. It is a new twist in the struggle between companies and shareholder activists, and could ignite a furious battle not just for Allergan but over the laws governing takeovers and activism."



U.S. Supreme Court To Hear Arguments In Argentina Debt Case

April 21, 2014

Steven Davidoff was featured on a radio program discussing Argentina's teetering economy.

He said, " If we started enforcing judgments against other countries, they might do the same against us and you'd end up in a mini war."



Levine on Wall Street: What Is Insider Trading?

April 21, 2014

Steven M. Davidoff's New York Times column on poison pills was referenced in a Bloomberg article on the same topic:

"Here is Steven Davidoff at DealBook, who also seems a little skeptical. There's a hearing in Delaware court next week:

'The question now is whether the judge in the matter, Vice Chancellor Donald F. Parsons Jr., upholds the old law or decides to rule the pill illegal and create new laws to deal with the new phenomenon of shareholder activism. It is truly the corporate question of our time.'"



Hollywood's Highest Paid Executives: Who Made Bank, Who Sank in 2013

April 21, 2014

Steven M. Davidoff was quoted in TheWrap's annual executive compensation survey. The media industry's top executives reaped the benefits of a strong 2013 when companies like Fox, Disney and CBS all saw their stocks climb by double digits.

“Sumner has paid Philippe and Les Moonves exorbitant amounts, and done it on the basis of paying ‘above average,'” Davidoff said. "But every year they move the average higher. It's a classic case study in excessive executive compensation.”



Poison Pill’s Relevance in the Age of Shareholder Activism

April 18, 2014

Steven Davidoff wrote in a New York Times column about Sotheby’s:

"When we look back 20 years from now, the lawsuit by Daniel S. Loeb and his Third Point hedge fund against Sotheby’s may well be the tipping point in how far companies can go to defend themselves against shareholder activists."



Asking Tough Questions About the Corporate Monitor Boom

April 16, 2014

Are corporate monitors engaged in a boondoggle business? The American Lawyer cited a New York Times column by Steven M. Davidoff, suggesting that they are.

 



In Corporate Monitor, a Well-Paying Job but Unknown Results

April 16, 2014

"In the insider trading case against SAC Capital Advisors, federal prosecutors have given a particularly nice gift to a former federal prosecutor, Bart M. Schwartz,” Steven M. Davidoff wrote in his Deal Professor column. Mr. Schwartz, who is now the chairman of the consulting firm Guidepost Solutions, was appointed SAC’s independent compliance consultant as a condition of SAC’s guilty plea to insider trading charges, which was accepted by a federal judge.

 



Netanyahu: Corporate media is responsible for Israeli crony capitalism

April 11, 2014

A column by Steven M. Davidoff in the New York Times was quoted in a Haaretz article entitled "Netanyahu: Corporate media is responsible for Israeli crony capitalism."



Ruling Highlights Unequal Treatment in Penalizing Corporate Wrongdoers

March 18, 2014

A case involving the sale of the Rural/Metro Corporation shows how Delaware law helps directors avoid penalties for misconduct, Steven Davidoff wrote in this Deal Professor column.



In Corporate Monitor, a Well-Paying Job but Unknown Results

March 15, 2014

In his New York Times Deal Professor column, Steven M. Davidoff wrote, "In the insider trading case against SAC Capital Advisors, federal prosecutors have given a particularly nice gift to a former federal prosecutor, Bart M. Schwartz. Mr. Schwartz, who is now the chairman of the consulting firm Guidepost Solutions, was appointed SAC’s independent compliance consultant and is charged with assessing the firm’s future trading practices."



Appraisal Rights the Latest Tool for Yield-Hungry Hedge Funds

March 5, 2014

Steven M. Davidoff's "Deal Professor" column was cited in an American Lawyer article on hedge funds:

"Davidoff explored the trend in his Wednesday “Deal Professor” column by zeroing in on last year’s management buyout of Dole Foods. In the months since the $13.50-per-share purchase price eked out shareholder approval with 50.9 percent of the vote, hedge funds Fortress Investment Group, Hudson Bay Capital Management, Magnetar Capital and Merion Capital Group have combined to buy up about 14 million Dole shares, Davidoff writes. Those funds, Davidoff notes, are now using their appraisal rights to try to get more money out of their investment—and are doing the same at such other companies as Ancestry.com, Dell and BMC Software."



Icahn Re-Writes Activist Playbook on eBay: Davidoff

February 28, 2014

Steven M. Davidoff examined billionaire investor Carl Icahn’s attempt to affect change at eBay and his claims of a conflict of interest by board members on Bloomberg Television’s “Market Makers.”



A Buyout Offer That Raises Questions of Board Fairness and Duty

February 25, 2014

Professor Steven Davidoff wrote an op-ed for the New York Times about the American Financial Group trying to buy out minority shareholder National Interstate Corporation. Davidoff writes that the American Financial Group is making a myriad of mistakes in their attempt.

"If you happen to control a public company and want to buy out the remaining shareholders, avoid the mistakes made by the American Financial Group in its attempt to squeeze out the minority at the National Interstate Corporation," he writes.



Argentina Takes Its Debt Case to the U.S. Supreme Court

February 25, 2014

Steven M. Davidoff wrote in a New York Times column on Argentina's debt crisis:

"Argentina has now staked the future of its debt, and perhaps its financial fate, with the United States Supreme Court. Yes, you read that right. Argentina wants the nine justices to weigh in on a case involving its obligations to holders of its government bonds and to resolve the mess created by a handful of federal judges."



The Final Battle for a REIT May Be Drawing Near

February 21, 2014

Professor Steven Davidoff wrote an op-ed for the New York Times about Corvex Management and Related Fund Management's battle to control Commonwealth REIT. Barry M. Portnoy and his son, Adam D. Portnoy, who currently manage the company, have employed a variety of tactics to prevent this from happening, An upcoming vote will have large ramifications, Davidoff writes.

"The vote on March 20 is a milestone, but if the Portnoys lose and CommonWealth’s directors are unseated, it is at best only the beginning of the end for CommonWealth shareholders as they continue to wait for the Portnoys to decide the shareholders’ fate," he said.



Outrage Over Wall St. Pay, but Shrugs for Silicon Valley?

February 18, 2014

Professor Steven Davidoff wrote an op-ed for the New York Times about a perceived double-standard in public outcry between compensation on Wall Street and compensation on Silicon Valley. Davidoff argues that excess is scoffed at on Wall Street, but celebrated in Silicon Valley with no real rationale.

"Wall Street bashing ignores the fact that it is finance that produces the money for tech start-ups," he writes. "Finance may not be the sexy part of life, but it is integral to success, as much as good roads or telecommunications. And yes, finance has had its problems — but so does Silicon Valley."



Plaintiff? Is That Really Necessary In A Class Action?

February 4, 2014

A study conducted by Steven Davidoff, along with Notre Dame's Matthew D. Cain, was referenced in an article from Forbes about the myriad of lawsuits involved in business deals.

"This study of M&A litigation by Steven M. Davidoff of Ohio State University and Notre Dame’s Matthew D. Cain found that public-company mergers over $100 million last year drew an average of 6.9 lawsuits each," the article said. "The median fee in those cases was $845,000."



In Yearlong Clash Over Herbalife, Innuendo Trumps Clarity

February 4, 2014

Professor Steven Davidoff wrote an op-ed for the New York Times about Herbalife and the $1 billion short William A. Ackman put on the company after calling it a pyramid scheme. Whether that is true or not, Davidoff says, unfortunately is not what's important.

"The huge swings in Herbalife’s stock price over such news expose a sad truth about Wall Street. Truth doesn’t sometimes matter very much. Instead, as Herb Greenberg at TheStreet.com has written, where the trade will go in the short term is more important," writes Davidoff



Examining the Timing of J.C. Penney’s Poison Pill Change

January 28, 2014

Professor Steven Davidoff wrote an op-ed for the New York Times about JC Penny changing its poison pill to 4.9 percent from 10 percent. The reason for the change, Davidoff says, is tax rules.

"J.C. Penney can justify the low trigger because of tax rules that are even more complex than normal," he writes. "When a company accumulates losses, called net operating losses or NOLs, these have value. If the company returns to profitability, it can use them for up to 20 years to offset future gains and avoid paying tax. In some cases, the NOLs can actually be transferred to other parties."



Answers to a Puzzling Deal at Alibaba Remain in the Shadows

January 28, 2014

Professor Steven Davidoff wrote an op-ed for the New York Times about Chinese Internet giant Alibaba's recent purchase of Hong Kong-listed company Citic 21CN. The reasons behind the purchase are not clear and Alibaba does not appear in a hurry to let people know. But as the company moves toward a public listing, Davidoff writes that the company will probably have to be more forthcoming in the future. 

"Once Alibaba does go public, it no longer has the luxury of being coy about its actions, no matter how small," he said. "That’s the price you pay for being in the limelight, up among the technology giants of the world."



What’s Behind Time Warner Cable’s Response to Charter’s Offer

January 23, 2014

Professor Steven Davidoff wrote an op-ed for the New York Times about Charter Communications’ $37.8 billion offer to buy Time Warner Cable. Time Warner's response said that it would be receptive to an offer that valued its company for about $10 billion more. The response was all about subtlety, Davidoff writes.

"Time Warner Cable is posturing, both to set up a defense and to nudge Charter away from making a full-on hostile bid," he writes.

 



Search for the ‘Next Big Thing’ Yields Soaring Valuations

January 21, 2014

Professor Steven Davidoff wrote an op-ed for the New York Times about Google's $3.2 billion deal for Nest Labs, which makes smart thermostats. Davidoff explores valuations in the tech industry, saying sometimes it's mutually beneficial for tech giants like Google, Microsoft, and Facebook to pay more for a company than its worth. The worry is that similar buying practices were seen during the internet bubble more than a decade ago.

"Everyone wins, at least until these great concepts don’t pan out and the bubble pumped up by these prices bursts," Davidoff writes. "Let’s hope this is not what we are seeing again, but it’s hard not to be worried. Silicon Valley has no incentive to stop the valuation madness."



Apollo’s Rush to Get the Chuck E. Cheese Deal Done

January 17, 2014

Professor Steven Davidoff wrote an op-ed for the New York Times about Apollo's attempt to acquire CEC Entertainment, the parent company of Chuck E. Cheese. Apollo appears to be in a rush to complete the deal because of a number of provisions in the contract limiting CEC Entertainment's options to sell and clauses that would speed up the process. Davidoff said the market is not yet sure how to react.

"Will this all work? Chuck E. Cheese’s shares closed on Thursday at $54.75 a share, higher than the offer price of $54 a share, so the market is not sure who will capture the chain and its mouse-like mascot," he writes.



Overhaul of Israel’s Economy Offers Lessons for United States

January 17, 2014

Professor Steven Davidoff wrote an op-ed for the New York times about the overhaul in Israel's economy and whether the United States can learn anything from it. Both countries have large income disparity between the rich and poor, but Davidoff says it remains to be seen whether the two economies and political systems are similar enough to draw any real conclusions.

"Still, while we await the outcome of Israel’s great experiment, it is clear that where there is the perception that harm is being done and where there is the will to change, a democracy can overcome even the most powerful corporate lobbyists. In Israel, at least," he writes.



Nader, an Adversary of Capitalism, Now Fights as an Investor

January 14, 2014

Professor Steven Davidoff wrote an op-ed for the New York Times about a conversation he had with Ralph Nader, who told Davidoff that he fights for shareholder writes and is an “adversary of corporate capitalism." Nader believes the key is getting shareholders organized and to speak as one. Davidoff isn't sure he agrees.

"I’m skeptical, because I think that bringing together the mutual funds and the pension and hedge funds will result in too many different agendas, let alone agreement on Mr. Nader’s goals," he writes. "But it is intriguing that Mr. Nader, the man who at one point was General Motors’ greatest foe, is now so aligned with many of the forces of Wall Street who are pushing for more shareholder control."



Corporate Takeover? In 2013, a Lawsuit Almost Always Followed

January 10, 2014

Professor Steven Davidoff wrote an op-ed in the New York Times about the growing amount of litigation in corporate takeovers. In 2013, more than 97 percent of takeovers involved litigation with the average price costing around $500,000. Sometimes, Davidoff said, the litigation is baseless.

"Many of these lawsuits have no merit, but there are a number of suits that do address real wrongdoing and should be encouraged," he writes. "But any change may be a long way off. The current system benefits plaintiffs’ lawyers but also defense lawyers who earn quite a bit defending these cases. It is also a boon to buyers, who are no longer liable for future claims from shareholders. This is not a bad insurance policy for $500,000 or so."



The Meaning for Businesses in Delaware’s Judicial Nomination

January 8, 2014

Professor Steven Davidoff wrote an op-ed for the New York Times about Judge Leo E. Strine Jr.'s nomination to be Delaware's next chief judge. Judge Strine was the head of the Chancery Court in Delaware,  the nation’s leading court for litigation of business disputes. Though Judge Strine has generally leaned pro-business, Davidoff does not think much will change in the Chancery Court in his absence.

"Don’t expect huge changes," he writes. "In short, the business of Delaware will continue to be doing what it does best, business."



Despite Doldrums in Deal Activity, a Few Highlights This Year

December 17, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times highlighting some of the most prominent business deals in 2013, including Twitter's I.P.O., the merger of US Airways and American Airways, and the Dell management buyout. Overall, David said it was a quiet year for business deals.

"The deal world remained muted this year in terms of big transactions and activity," he writes. "According to Dealogic, the number of announced takeovers in the United States so far this year was down about 22 percent, while volume was $1.1 trillion, up about 15 percent from last year but still below the level in the years before the financial crisis."



Busy in Gray Areas of the Law in a Bid to Control a Rival

December 4, 2013

Professor Steven Davidoff wrote an op-ed for The New York Times about the broadband wireless company LightSquared and the battle being fought by Charlie Ergen and his company Dish Network for control of it. LightSquared filed for bankruptcy in May 2012 and although Dish is unable to acquire the debt as a "direct competitor," Ergen arranged for one of his other companies to acquire  $1 billion of LightSquared’s $1.75 billion in outstanding debt.

"Mr. Ergen has both profited and arranged for Dish to get the prize," Davidoff wrote. "Mr. Ergen has also shown what a great poker player he is, pushing boundaries and taking advantage of every gray area in the law."



Men’s Wearhouse Dusts Off the Pac-Man Defense

November 26, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about the on-going negotiations between Men's Warehouse and  Jos. A. Bank Clothiers. Though Jos. A. Bank originally tried to buy out Men's Warehouse, Men's Warehouse flipped the script and offered to buy Jos. A Bank. Davidoff called the move a "Pac-Man defense."

"These negotiations will turn on which company is the better acquirer and which management team will prevail," Davidoff writes.



Risky Investment Vehicle With High Yields Gains Prominence

November 26, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about the popularity growth of business development companies. Legislative restrictions have loosened on these companies over the years and they have averaged a high rate of return. However, Davidoff writes that these types of companies carry a significant amount of risk.

"If another financial crisis were to erupt, business development companies would be on the front line," he said. "These companies may also be subject to huge interest rate fluctuations in ways that make them even riskier than private equity funds. That’s one reason Finra says this is not for the average investor."



Convoluted Language Makes Cooper Tire Deal Harder to Execute

November 15, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about the upcoming difficulties in the deal between Cooper Tires and  Apollo Tyres Ltd. of India. Davidoff called the provisions "convoluted" and the language does not favor Cooper Tire.

"All in all, it still remains the case that Cooper Tire still has a lot of hoops to go through for $35 a share, and things just became a little more difficult," Davidoff writes.



In a Lemonade Stand, a Transformation of the Corporation

November 12, 2013

Professor Steven Davidoff wrote an op-ed in the New York Times about a new type of corporation that has a social cause, but is not necessarily a charity because it still aims to make a profit. Davidoff contends that this new type of corporation could potentially be more effective than the traditional nonprofit and uses the example of Make a Stand, a lemonade company that also strives to end child slavery, to illustrate his point.

"The question is whether Make a Stand uses this new corporate form to succeed and make more than it could for its cause than as a nonprofit," he writes. "If done right, this could not just raise money to end child slavery, but perhaps create a role model for nonprofits and all types of businesses."



The Case Against Too Much Independence on the Board

November 11, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times warning that independent directors for corporations may not be as beneficial as some people think. While companies with independent directors likely complybetter  with the law, Davidoff contends that having insider knowledge of a campany is still vital to making board decisions.

"The quest for super independence, though, means that boards are losing the inside expertise they may need to properly run the company," Davidoff writes. "Independent directors may be good in some measure, and no one wants to go back to the old days of crony boards. But perhaps it is time to temper the enthusiasm for all independent directors, all the time."



What a Big Investment Says About BlackBerry’s Endgame

November 4, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about what a recently-announced $1 billion investment means for the future of Blackberry. Though Blackberry could go in a number of directions, the major takeaway from the deal is that it buys the company some time, Davidoff says.

"The best spin on this investment is that it buys BlackBerry more time for an overhaul (or perhaps to get a bidder to change its mind), while also positioning some of its major investors to protect themselves if the turnaround effort fails," he writes.

 



A Vote Goes Against Outsize Executive Pay, but It’s Hardly a Blow

November 1, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about Oracle's shareholders rejecting Lawrence J. Ellison’s $78.4 million pay package. Despite the vote, Davidoff writes that high executive pay is not going anywhere and to expect executives like Ellison to continue to cash in on big salaries and bonuses in the future.

"Come next year, Oracle will no doubt be paying its executives tens of millions, and the rest of corporate America will not be that far behind," Davidoff said. "And the biggest shareholders in the land won’t particularly care, even if they occasionally say they do."



Trepidation and Restrictions Leave Crowdfunding Rules Weak

October 29, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about crowdfunding methods and the ruled the SEC has to regulate them. Davidoff says that the rules governing crowdfunding do not carry much clout, despite it being risky investment.

"The S.E.C. has resisted crowdfunding and might not have ever gone along with any effort to endorse the practice," he writes. "But the agency is hamstrung, afraid to do what it could have to make crowdfunding work better for investors. That’s a shame generally, but maybe more so for the people who invest in these small companies and lose everything."



Appeals Court Throws Out Confidential Arbitration in Delaware

October 23, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about a court decision about the legality of private arbitration in rhe state of Deleware. A federal appeals court ruled private arbitration illegal, but the state of Deleware could appeal the case.

"Delaware is likely to appeal because it does have grounds for a case and has nothing to lose at this point.," Davidoff writes. "Lucky for us, we’ll be able to see the entire thing play out in public, as is our constitutional right."



A Chance to End a Billion-Dollar Tax Break for Private Equity

October 22, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about a court case with enourmous tax implications for private equity firms. These types of companies currently are taxed at a capital gains rate of 20 percent intead of at an income rate of 39.6 percent, effectively saving some companies billions of dollars.

This had been an issue some members of Congress were interested in, but this case, which involves Sun Capital, could take the decision out of Congress' hands.

"it may now be that this battle to tax carried interest is not won or lost in the halls of Congress over high-minded concepts of fairness or equity, but rather in the halls of the I.R.S. by applying common sense presumptions that existed all along," Davidoff writes. "Washington, it’s your move."



A Push to End Securities Fraud Lawsuits Gains Momentum

October 15, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about the battle corporations are waging to make it more difficult to sue for fraud. The Supreme Court will soon decide whether to hear Erica P. John Fund v. Halliburton, which could go a long way in dictating future legislation about this issue.

" For good or bad — like so many other issues before the Supreme Court these days — the opponents need only one more vote to change everything." Davidoff writes.



In a Bid for Men’s Wearhouse, a Merger Battle With Modern Strategies

October 11, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about Men's Warehouse rejecting Jos. A. Bank's $2.3 billion takeover offer. Men' Warehouse made it clear that the company was not pleased with the offer, calling it  “opportunistic” and “subject to unacceptable risks and contingencies." Davidoff said that Men's Warehouse is holding their ground now, but in the long run the company is likely to settle on a deal.

"While Men’s Wearhouse is currently saying no, it may soon find itself pressured by the new shareholder forces in our capital markets," he writes.



Delaware Court Lifts Injunction on Activision Blizzard’s Deal With Vivendi

October 10, 2013

Professor Steven Davidoff co-wrote a news story with Michael J. De La Merced for the New York Times about a Delaware Supreme Court ruling that removed an impediment in a deal between video game company Activision Blizzard and Vivendi. Activision Blizzard attempted to repurchase stock from Vivendi, but one of the company's stockholders said that Activision Blizzard’s certificate of incorporation required that shareholders vote on the matter. A lower court ruled in favor of the stockholder, but the Delaware Supreme Court unaminously reversed the decision.



The Hurdles Ahead for a Cooper Tire Deal

October 9, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about the problems ahead in Apollo Tyres' proposed deal to buy Cooper Tires. The legal battle has begun between the two companies and some believe Apollo is the "minnow swallowing the whale."

"In past deals when targets have sued buyers to force them to close the deal, the parties have usually settled with a price renegotiation at best," Davidoff writes. "The litigation, then, can be viewed as a bargaining chip for Cooper to get the best deal possible if the transaction is renegotiated or terminated. But if Cooper’s goal is to complete the deal at the current buyout price, it has a long way to go, with many obstacles, before it can win that race."



In Twitter's I.P.O. Filing, Signs of Start-Up That Has Matured

October 8, 2013

Professor Steven Davidoff wrote an op-ed piece for The New York Times regarding how Twitter's prospectus for an initial public offering was disclosed last week and it appears that the company did not push the boundaries with its filing.

"It’s not as if the criticism of the new rules that allowed the company to first file privately has gone away," Davidoff wrote. "Instead, the disclosure showed something refreshing for a young technology company these days: Twitter is acting like an adult."

 

 



Apax Wins and Loses in rue21 Conundrum of Its Own Design

October 2, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about the conundrum Apax is in because of the rue21 buyout. Apax has interests on both sides of the transaction and Davidoff says that raises some questions.

"If I were an investor in the new Apax funds, I would be wondering why I was buying out the old ones and how this conflict is affecting the decision-making," he writes. "I would also be thinking that perhaps it would just be better to do what the rest of us do — sell at arm’s length."



Apax Wins and Loses in rue21 Conundrum of Its Own Design

October 2, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about potential problems and conflicts of interest Apax created when the company's new investers essentially bought the company's share of rue21, a fashion retailer, from the company's older investers. Davidoff writes that the deal would have been fine if rue21 continued to prosper, but the retailer announced reduced sales shortly after the deal was made.

"There is already one lesson here," he wrote. "When a private equity firm stands on both sides of the transaction, there are bound to be problems. If I were an investor in the new Apax funds, I would be wondering why I was buying out the old ones and how this conflict is affecting the decision-making. I would also be thinking that perhaps it would just be better to do what the rest of us do — sell at arm’s length."



As J.C. Penney Flounders, a Lack of Control Becomes Evident

October 1, 2013

Professor Steven Davidoff wrote an op-ed piece for The New York Times about how J. C. Penney has lost the confidence of the markets and how its share price has significantly dropped.

"The latest events at J. C. Penney provide a hard lesson: With today’s public company, it is sometimes difficult to be sure who is in control," Davidoff wrote.



How the Deal for Rue21 Could Fall Apart

September 30, 2013

Professor Steven Davidoff wrote an op-ed for the New York Tims about the possibility that the deal involving fashion retailer rue21 being acquired by Apax Partners could fall apart and the potential legal ramifications.

"The question is whether the banks or Apax want to risk their reputations for $100 million or more," he writes. "During the financial crisis, reputation didn’t go far. But perhaps things have changed."



Lax Rules Give U.S. Upper Hand in Tussle Over Alibaba I.P.O.

September 24, 2013

Professor Steven Davidoff wrote an op-ed for teh New York Times about the possibility that Chinese internet company Alibaba will go public. The company is looking into filing its initial public offering in New York rather than Hong Kong because the United State has less regulations on companies. The less stringent regulations have led to an increase in the number of IPO's in the United States, but Davidoff wonders if they are a good thing overall.

"The battle for Alibaba’s listing shows that as more big companies go global, the exchanges are going to be increasingly played off one another over which one has the better regulation for companies," he writes. "Unfortunately, this may be a race to the bottom — with the United States leading the way."



A Deal for BlackBerry That’s Not Yet a Deal

September 23, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times analyzing the a letter of intent for Fairfax Financial holdings to acquire Blackberry. Davidoff writes that the letter is by no means an obligation and that the lack of details in it reflect blackberry's desperate state.

"BlackBerry is taking a terrible risk here since the Fairfax deal has a real chance of collapsing and leaving BlackBerry’s committee and its shareholders with nothing. The board probably felt it had no choice," he wrote. "In other words, this is a 'deal' that still has more time to bake before it becomes a deal."



Judge Opens Lid on Deal Companies Would Prefer Stay Shut

September 20, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about the possible implications of a judge preventing a deal between Vivendi and Activision Blizzard until the company shareholders can vote on the sale. The decision will delay the multi-billion dollar deal and potentially "blow up this transaction."

"It may well be that Activision appeals rather than risk a renegotiation with Vivendi," Davidoff writes. "The fact that an appeal hasn’t been filed yet or a quick shareholder vote already announced is evidence of the difficult conversation and hypothetical situations being played out now by the parties. It’s an $8 billion drama better than any video game, at least for deal junkies."



Dole Food’s Buyout in 2013 Looks a Lot Like One in 2003

September 17, 2013

Professor Steven Davidoff wrote a column for The New York Times discussing how the buyout of the Dole Food Company has many similarities to the one that occured in 2003.

David H. Murdock, the chief executive of Dole, has offered to acquire the company for $13.50 a share in the buyout,  after taking Dole private in a $2.5 billion deal in 2003. But eventually the company went public again, raising $446 million.

"The cast of characters seems to be a rerun of the 2003 buyout," Davidoff wrote. "For example, four of the directors on Dole’s seven-member board, including Mr. Murdock, were directors when the company was public the first time. Two of the directors are former or current executives of Dole, with more than a decade at the company."

 



Weil on Finance: Twitter’s IPO Plans and China’s Ghost Towns

September 13, 2013

Professor Steven Davidoff's op-ed in the New York Times about Twitter's iniital public offering filing was quoted in a post from Bloomberg. Davidoff wrote that Twitter being able to keep information private during the filing process could be detrimental.

 “There might be value in having the regulator’s critique of a company’s IPO occurring more or less simultaneously in the public eye,” he writes. “And let’s face it: does anyone believe that Twitter would not have gone public if filing confidentiality had not been available?”



Lessons From the Dell Deal

September 12, 2013

Professor Steven Davidoff wrote an op-ed in the New York Times about Dell's buyout. In the piece he talks about the importance of the initial bidding, the benefits of shareholder activism, and the "perils" of management buyouts.

"The Dell board must be praised for trying to prevent Mr. Dell from using his position to gain an unfair advantage, something Mr. Dell amenably went along with," Davidoff writes. "But the question remains: Why can’t management simply run the company and make these gains for shareholders?"



Google’s Stock Settlement To Perpetuate Co-Founders’ Control

September 12, 2013

Professor Steven Davidoff's op-ed in the New York Times was cited in an article from Value Walk. In the article, Davidoff questions the legality of Google's settlement out of court in which the company will issue nonvoting Class C shares to ensure that co-founders Sergey Brin and Larry Page maintain control of the company.

"Steven M. Davidoff of Dealbook points out the odd settlement would perpetuate the co-founders’ control and hence stretch the laws of corporate finance," the article says. "He feels the settlement doesn’t make clear what, if any, value it gives to Google shareholders."



Google’s Stock Settlement May Not Do Much for Shareholders

September 11, 2013

Professor Steven Davidoff wrote an op-ed in the New York Times about a lawsuit against Google centered about their plan to issue nonvoting Class C shares to ensure co-founders Sergey Brin and Larry maintain control of the company. Google's shareholders voted against the plan, but the company decided to pursue it anyway. The case was settled out of court, but Davidoff questions whether it's fair to the shareholders that Google's co-foudners can increase their control in the company without paying for it.

"In the end, the real issue is not whether Google’s co-founders can do this," Davidoff writes. "One would hope they wouldn’t without shareholder approval, but that is clearly an afterthought. Rather, the question is whether they can do this without having to paying for the privilege. That’s the real issue in this settlement, and it’s now in the judge’s hands."



An Initial Filing, in Fewer Than 140 Characters

September 11, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about Twitter providing scant details to go along with its initial public offering filing. The Jump-Start Our Business Start-ups or JOBS Act allows Twitter to keep many of the details from the public until 21 days the company’s Wall Street bankers start to pitch the planned offering to investors, In the article, Davidoff questions whether the JOBS Act should appy to well-known companies like Twitter.

"Let’s face it: does anyone believe that Twitter would not have gone public if filing confidentiality had not been available?" he writes. "In the end, the JOBS Act provision might help some real emerging growth companies, but the need to apply it so broadly is questionable."



A Trading Frenzy Over Oh-So-Hot LinkedIn Shares

September 10, 2013

Professor Steven M. Davidoff wrote an op-ed in the The New York Times Dealbook about LinkedIn's recent sale of $1.2 billion worth of stock. In the piece, he questions whether the sale really benefits the company's shareholders or if it just helps feed a "trading frenzy."

"It is easy to say that the company can sell stock, so it should," he writes. "But it was that kind of behavior that got us into the tech bubble and the tremendous crash that came afterward. As Reuters Breakingviews wrote in praising LinkedIn for selling at such a high price, perhaps LinkedIn “will eventually reverse the trick and repurchase stock at a bargain-basement price. That is the real risk here. The stocks may be going up now, but if the past is anything on Wall Street, these big stock run-ups are too often accompanied by falls."



Tech Titans Without Checks and Balances

September 4, 2013

Professor Steven M. Davidoff was quoted in a post on the The New York Times Dealbook about Silicon Valley giants like Google lacking the checks and balances of a typical public company.

“The gods of Silicon Valley have repeatedly sought to take the companies they founded public while retaining control as if they were still private,” Davidoff writes. “Recent events at Google and other technology companies show that perhaps this control may be bad not only for the companies but also for the founders, who are increasingly living in a world bereft of checks and balances.”



Thorny Side Effects in Silicon Valley Tactic to Keep Control

September 3, 2013

Professor Steven M. Davidoff wrote an op-ed for The New York Times about the how "gods of Silicon Valley" are restricting the power of their shareholders. Technology companies are trending toward a dual-class structure that ensures executives like Mark Zuckerberg keep control of the company even if they sell some of their shares.

"The problem with this structure is that the shareholders’ voice of dissent is locked out," Davidoff writes. "And studies have shown that in general, this type of dual-class structure does not perform as well as traditional arrangements"



A Lesson for Boardroom Battles

August 30, 2013

Professor Steven M. Davidoff wrote an op-ed for The New York Times in which he examines how proxy access is affecting Taro Pharmaceutical Industries in Israel. Public companies in the United States opposed proxy access and ultimately succeeded in making sure it wasn't enacted. companies like Taro Pharmaceutical Industries provide a model of the potential ramifications of proxy access, Davidoff said.

"In the United States, proxy access is dead, but like zombies, regulatory ideas have a habit of being hard to kill," he writes. "If proxy access does re-emerge, we will have some 120 Israeli companies that are like Taro – listed in the United States but with Israeli governance – as an example."



The Morning Ledger: Dodd-Frank disclosures may be costly

August 28, 2013

Professor Steven M. Davidoff's op-ed in the The New York Times Dealbook about the Dodd-Frank Wall Street Reform and Consumer Financial Protection Act was linked by the Wall Street Journal. In the piece, Davidoff writes that a short section in the law that requires public companies to list their median salary next to their CEO's salary has little effect on corporate governance, is difficult to calculate and can cost millions of dollars.

 



A Simple Solution That Made a Hard Problem More Difficult

August 27, 2013

Professor Steven M. Davidoff wrote an op-ed in the The New York Times Dealbook about a rule requiring companies to list their median salaries next to the salry of their chief executive. In the piece, Davidoff writes that the rule has little effect on corporate governance, is difficult to calculate and can cost millions of dollars.

"Easy-sounding fixes like more disclosure can sometimes have unintended and costly consequences," Davidoff writes. "There are also no easy answers to hard problems. This type of legislation appears to be more about being able to show that you are doing something, anything about a problem without actually fixing it."



On Wall Street, a financial plan thrives despite failure

August 16, 2013

Professor Steven M. Davidoff wrote an op-ed for The New York Times about how special purpose acquisition companies, or SPACs, are thriving despite a record of failure. He writes that SPACs, which are also known as blank check companies, are generally not as safe or rewarding as private equities and those involved tend to have varying levels of expertise. Despite this, there has been evidence that SPACs are continuing to prosper.

"SPACs have brought companies to market that do not appear to perform particularly well," Davidoff writes. "There have been some successes, including Burger King, which went public through a London-based SPAC, but the failures appear to far outnumber the successes. But Silver Eagle's IPO shows that these entities are thriving despite the record of failure. Silver Eagle is the fourth SPAC to go public this year."



A Thriving Financial Product, Despite a Record of Failure

August 13, 2013

Professor Steven M. Davidoff wrote an op-ed for The New York Times Dealbook about special purpose acquisition companies, or SPACs, which raise money through an IPO and then search for a company to buy. He writes that SPACs have a history of failure, in some part due to supporters making bad decisions, as supporters don't necessarily have to have expertise in the field. He also writes that after the acquisition, companies tend to perform poorly, as some are brought into the market before they're ready.

"In other words, SPACs may persist, not because they are good for investors or the companies themselves, but because they are a sought-after financial product," Davidoff writes. "This may also be true for (SPAC) Silver Eagle, but for its sake, let’s hope that past performance is no indication of future results."



In American Greetings Deal, Echoes of Larger Buyout for Dell

August 6, 2013

Professor Steven M. Davidoff wrote an op-ed for The New York Times Dealbook about two management-led buyouts: those of Dell and American Greetings. He connects the two deals with, "Both deals illustrate the rising tide of shareholder power, as well as the devilish issues that emerge when management tries to buy a public company." Davidoff writes that both deals are quite rare in a way.

"In both the Dell and American Greetings deals, we are seeing something quite rare: shareholders actually exercising their given power," Davidoff writes. "Yet if they succeed, the question becomes whether Dell’s or American Greeting’s shareholders will become the proverbial dog who caught the car, wondering what to do next."



Air Products Faces Modern Form of Hostile Takeover

July 31, 2013

Professor Steven M. Davidoff wrote an op-ed for The New York Times Dealbook about the Wednesday announcement that William A. Ackman’s firm, Pershing Square Capital Management, had acquired a 9.8 percent stake worth $2.2 billion in Air Products and Chemicals. He referred to the deal as a "modern form of the hostile takeover:" the activist investor.

Davidoff writes, "This all means that the next few months will be occupied by talking about management changes and perhaps fruitful attempts to make nice. But in the background, Pershing Square will have the threat until October of nominating its own directors and starting a proxy contest. And make no mistake, Pershing Square has acted on this threat before."



With Fewer Barbarians at the Gate, Companies Face a New Pressure

July 30, 2013

Professor Steven M. Davidoff wrote an op-ed for The New York Times Dealbook about hostile takeovers. He writes that the year has consisted of only three hostile offers, and only 12 hostile bids all of last year. Davidoff writes that the hostile takeover, which companies have fought to kill for 30 years, is on a downturn because the market has changed.

"But today’s markets are more complicated. Activist investors search out undervalued companies, while institutional investors also do their part in aggressively pushing management for better stock performance. Simply put, the forces on companies to perform better appear to have worked, leaving fewer undervalued targets for hostile bidders," Davidoff writes. "Hostile takeovers have also become riskier. Not only boards, but shareholders at target companies are much more willing to say no if they feel a bid is underpriced."



Hedge Fund’s Suit on Fannie and Freddie May Spell Trouble for U.S.

July 29, 2013



Choices Ahead for the Dell Board, but Not Much Time

July 24, 2013

Professor Steven M. Davidoff wrote an op-ed for The New York Times about Dell's final move, as founder Michael S. Dell and his partner, Silver Lake Partners, have "made their final move, raising their bid by 10 cents a share and calling it their 'best and final' proposal." Davidoff writes that "Mr. Dell has demanded that, in connection with this increased bid, the Dell board modify the voting rules on the deal." Davidoff writes that this would be a small change with big consequences, as approval for his bid would be easier.

"Mr. Dell and Silver Lake are seeking the approval of a majority of only unaffiliated shareholders voting at the meeting," Davidoff writes of Mr. Dell's proposal. "This would exclude shareholders who simply don’t show up to the meeting or don’t care to about the vote. The number of shareholders who don’t vote is likely to be lower in a controversial deal like this, but this is still likely to be a significant percentage of Dell’s shares."



Yahoo’s share buyback is legal, but timing is suspect

July 24, 2013

Professor Steven M. Davidoff wrote an op-ed for The Economic Times about Yahoo's share buyback. One of Yahoo's biggest investors, Daniel Loeb, and his hedge fund, Third Point, recently abandoed the company, and now Yahoo has agreed to buy 40 million shares back from Third Point at $1.16 billion. Davidoff writes that the share repurchase has a "whiff of greenmail."

"Greenmail is yet another relic of the 1980s that we'd rather forget, along with big hair," Davidoff writes. "Back then, companies would repurchase the stock of corporate raiders at a premium simply to make them go away. Greenmail was quite controversial, and some states banned the practice, though Delaware, where Yahoo and many other corporations are organized, did not."



Debating, Yet Again, the Worth of Law School

July 18, 2013

Professor Steven Davidoff wrote an op-ed for The New York Times Dealbook about the true value of going to law school. A recent study reported that the average additional earning for law school graduates is $1 million, and the study has received backlash. Davidoff writes that the criticism is well-intentioned, as some are crying out on behalf of law school grads who haven't been able to find work. On the other hand, Davidoff writes that at least 75 percent of graduates easily exceed the amount of tuition paid.

"Still, no graduate program promises its graduates a job," he writes. "Just look at those offering doctorates in English. But even if 75 percent of students have an economic justification for law school, not everyone does. In this light, every potential student should do a real cost-benefit assessment in light of the law school tuition he or she will be paying."



Clearwire Deal Is a Lesson in High-Stakes Bidding

June 25, 2013

Professor Steven M. Davidoff wrote an op-ed for the New York Times DealBook about the bidding for Clearwire communications corporation. He compares takeovers to a poker game, where billions of dollars are "in the pot." He writes that bids for Clearwire fluctuated between the originial bids from Sprint, to a competing bid from Dish, which eventually caused Sprint to up the ante of its bid.

Davidoff writes that the lessons to take away from the bidding for Clearwire is that majority shareholders have an initial advantage that they ought to take advantage of -- by finding higher bids or perhaps choosing not to sell. Additionally, he says not all shareholders are alike and that "the clearest lesson is that the price an investment bank and a board are willing to call fair is quite different from what someone is willing to pay."



The Intricate Endgame for Dell

June 25, 2013

Professor Steven M. Davidoff wrote an op-ed for the New York Times DealBook about the battle for Dell and its shareholders' dwindling options.

He writes, "The battle for Dell is now really all about what Carl Icahn is up to. Mr. Icahn and Southeastern Asset Management have been working hard to come up with an alternative to the Michael Dell/Silver Lake bid. Despite the hard work, nothing has panned out. It truly appears that it is all a maneuver to extract more money for shareholders from the current buyers.

"In other words, it has become a giant game of chicken."



The Management Buyout Path of Less Resistance

June 12, 2013

Professor Steven M. Davidoff wrote an op-ed for the New York Times DealBook about management buyouts. He uses the example of the Dole Food Company, which David Murdock, chairman and chief executive of Dole Food, is attempting to make private. Davidoff writes that while management buyouts are subject to easy criticism, there is a set of best practices to be used to manage the inherent conflicts present in such buyouts.

"These controls include the creation of a special committee of independent directors with independent advisers, a go-shop provision to allow the company to seek other offers once the deal is announced and a provision that the transaction be approved by a majority of the shareholders not part of the buyout group to ensure that independent shareholders can veto the deal," Davidoff writes. "The central idea behind all of these is to empower boards and shareholders to say no and negotiate a deal with management on terms the company would get from other bidders."
 



A Year Later, the Missed Opportunity of the JOBS Act

June 11, 2013

Professor Steven M. Davidoff wrote an op-ed for the New York Times DealBook about the Jump-Start Our Business Startups Act, or the JOBS Act, and why it was a missed opportunity to truly spur more I.P.O.’s. Davidoff writes that the JOBS act was not as effective as it could've been, as "Dealogic recorded an average of 33 I.P.O.’s per quarter in the year before the JOBS Act versus 31 I.P.O.’s per quarter in the year after."

"The act was intended to help spur a moribund market in small I.P.O.’s.," Davidoff said. "But for offerings that raised less than $100 million, there were actually fewer after the JOBS Act. According to Dealogic, there were an average of 15 such I.P.O.’s per quarter in the year before the new law versus an average of 13 per quarter the year after."



Elan Finds Creative ‘Poison Pill’ to Defend Against a Hostile Bid

June 6, 2013

Professor Steven M. Davidoff wrote an op-ed for the New York Times DealBook about Irish company Elan, a developer of drugs and drug-delivery systems, which is attempting to fight off Royalty Pharma’s $6.4 billion hostile bid. Since the company is based in Ireland and its stocks are listed in Ireland, its primary regulator is the Irish Takeover Panel. Davidoff writes that this means a bid for Elan will play out much differently than a bid for a company in the U.S. would. He explains that takeover defenses are often prohibited in Ireland, making it difficult for Elan to fight off Royalty Pharma's bid.

"Elan’s main defense has been instead to make what others have called “poison pill” acquisitions, or deals that, in essence, act like a poison pill to make the company more expensive and thereby discouraging a hostile takeover," Davidoff writes.



F.B.I. Pick Could Offer Look Into World of Ray Dalio

June 4, 2013

Professor Steven M. Davidoff wrote an op-ed for the New York Times DealBook about President Barack Obama's planned FBI nominee, James Comey, and the hedge fund he worked for beginning in 2010. Davidoff writes that the hedge fund, Bridgewater Associates, which is the largest hedge fund in the world, has a curious policy of "radical honesty," put into place by founder Ray Dalio.

Dalio's way of running the company involves the implementation of 210 principles which he wrote out into a 123-page manifesto. Some of the "principes" include bits on firing employees who don't have a fit at the company, not trying to please everyone, and "designing your machine to achieve your goals." Davidoff said these principles might be laughable but they are policy at Bridgewater, and seem to bring the company and its employees success. He writes that perhaps if Comey is in fact nominated to the FBI, he might want to publicize his opinion on hedge funds and why he worked at Bridgewater.



China’s Pork Deal May Hinge on the Risk for an Uproar

May 30, 2013

Professor Steven M. Davidoff wrote an op-ed for the New York Times DealBook about a potential deal between the United States' Smithfield Foods and Shuanghui International of China. Davidoff writes that the deal is the largest Chinese acquisition of an American company, so it is bound to receive intense scrutiny. It is also an issue of national security, and is therefore under review.

"The review is likely to cover three categories," Davidoff writes. "First, it is likely to look at any contracts Smithfield has to supply pork to the military or other security agencies. Second, it is likely to examine any special technology like farm-rearing techniques that might be transferred to China. Finally and perhaps most relevant, there is the food supply chain itself and whether Shuanghui will be in a position to disrupt the United States’ food supply — or at least the supply of pork."



A Hotel Company Is Hobbled by a Deal Struck in Bad Times

May 28, 2013

Professor Steven M. Davidoff wrote an op-ed for the New York Times DealBook about the Morgans Hotel Group's private investment in public equity, or PIPE, deal from 2009. At the time, the company was struggling, but Davidoff writes that it was not out of other options. While the company didn't have to strike such an unfavorable deal, Davidoff writes, it chose to strike a PIPE deal with Yucaipa, an investment firm that would make a $72 million infusion into Morgans.

In exchange, Yucaipa received preferred securities and warrants to acquire as many as 12.5 million shares of Morgans Hotel, and if Morgans' debt remained unpaid, the interest payments will increase to 10 percent in 2014 and 20 percent in 2016. Now, Yucaipa owns 27.9 percent of Morgans and its appointment to the board runs the company. Davidoff warns against companies striking such deals because it can leave the company in quite the unfavorable position once an investor begins to take over.



With His Magic Touch, Buffett May Be Irreplaceable for Berkshire

May 21, 2013

Professor Steven M. Davidoff wrote an op-ed for the New York Times DealBook about Warren Buffet and his company, Berkshire Hathaway. Davidoff writes that Buffet has an extraordinary gift for sealing excellent deals, which the company might find hard to replace after the 82-year-old chief executive and dealmaker is gone. "The ability to make acquisitions on favorable terms is a testament to Mr. Buffett’s personality and skills as a deal maker," Davidoff writes. "It also highlights an almost unsolvable problem for his company, Berkshire Hathaway, and its shareholders."

Davidoff gives an example of a recent deal Buffet secured for the company.

"The bottom line is that the bankers’ disclosure shows that the amount that 3G and Berkshire paid was below that of many other deals in the food industry," Davidoff writes. "Mr. Buffett is getting 55 percent of Heinz plus an interest payment of $700 million a year. This is an extraordinarily good deal."



Dispute at JPMorgan Grows, for All the Wrong Reasons

May 14, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times DealBook over whether to split the jobs of chief executive and chairman at JPMorgan Chase. He called the dispute "silly" and "unimportant." One side of the argument alleges that the company would become more valuable if the positions were split, which Davidoff called a valid point based on the idea that "a separate chairman gives voice to the board by having someone who can stand up to the chief executive." But he said ulitmately it is unclear what the effect would be in this case because all companies are different.

He said if a change is made it shouldn't be about sending a message to the current chief executive and chairman Jamie Dimon or about banks being too big. If this is the case, Davidoff writes, the issue should be brought up by shareholders more directly. In the end, though, he says the fight is silly and unlikely to make an impact.



Hasty Deal to Save Chrysler in Depths of Crisis Returns to Haunt

May 7, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times DealBook regarding the deal made to save Chrysler in 2009. He discusses the various beneficiaries from the deal, including Fiat, the Treasury Department, the Canadian government, and the majority share that went to  the union workers’ health care trust. His focus is on the calculation errors that resulted in a $6 billion difference in value as seen from Fiat and the now-profitable Chrysler's sides. Now a deal looms to sort out the payout to the health care trust, which depends on the value of the company.



"Technology, Turbulence and Trends" will be Focus of National Conference Of The Society of Corporate Secretaries & Governance Professionals

April 30, 2013

Professor Steven Davidoff is set to speak at The 67th National Conference of the Society of Corporate Secretaries & Governance Professionals July 13 at the Saturday brunch. The PR Newswire released a story about the conference, which is set to run July 10-13 in Seattle.

The conferences' theme for 2013 is Governance | wired, focusing on the key ways social media and technology trends affect business professionals. The conference will include panels featuring legal, regulatory, and governance issues as well as breakout sessions aimed at private, public, and nonprofit entities.



In Venture Capital Deals, Not Every Founder Will Be a Zuckerberg

April 30, 2013

Professor Steven M. Davidoff wrote an op-ed for the New York Times DealBook about the importance of founders negotiating their rights when they decide to allow venture capitalists to invest in their businesses. He discusses that many companies, such as Bloodhound, who have venture capitalists as investors can often lose out (by millions in this particular case) even if the company is sold. This is because venture capitalists often demand preferred shares, getting their payouts before founders and employees.

Davidoff stresses the importance of negotiating greater control rights to ensure founders also make money off the sale of their businesses. He says that studies have found that founders who do this end up receiving on average $3.7 million more.



In M&A Litigation, Attorneys' Fees Under Attack?

April 26, 2013

Professor Steven Davidoff's research was cited in an article in Corporate Counsel regarding attorney fees.



Flawed Bidding Process Leaves Dell at a Loss

April 23, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times DealBook about the lack of a bidding war over Dell. "The fizzled bidding for Dell is a result of the board’s extreme reliance on a process known as a go-shop and how it ran the initial sale. If this episode does not change the way companies sell themselves, perhaps it should," he wrote.



What’s at Stake in the Fight Over a REIT

April 18, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times DealBook regarding the risks involved in the fight over real estate investment trust, CommonWealth REIT. "It’s not pretty, and it’s all a result of CommonWealth’s claim that all its disputes with shareholders must be arbitrated. In some ways, the contest for CommonWealth is a fairly normal hostile bid with heated rhetoric, lots of litigation and managers who have grown rich from operating the company and who do not appear to want to go quietly," he wrote.



Can Disciplining Bank Boards Help Drive Reforms?

April 17, 2013

Professor Steven Davidoff's April 5 New York Times DealBook op-ed was cited in an article on Knowledge@Wharton Today regarding the role of bank directors.



In the Markets, at Least, Fannie and Freddie Still Astound

April 9, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times regarding the stock trading among Fannie Mae and Freddie Mac. "The government changed them from commercial entities with a goal of making money for stockholders into quasi-public service companies intended to help the housing mortgage market function," he wrote.



Little Accountability for Directors, Despite Poor Performance

April 5, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times about the lack of accountability with board directors in companies.

"As it stands, directors have more to fear about getting old than about doing a lousy job," he writes. "For those who ascribe to kindergarten principles, this is disheartening. These principles would say that if you do something wrong, there should be consequences. But these basic rules we all are taught in childhood don’t appear to apply in the boardroom."



Hedge Funds up the Ante for a Stronger Board

April 5, 2013

Professor Steven Davidoff spoke to the Bloomberg Television "Market Makers" on "the practice of hedge funds paying the board members they back" and how companies can justify the amount of money given to elected board directors. "These are not ordinary directors...these are directors who are going to come in, change the company, change how they work...and we want to reward them for the extra work they're doing," he said of the mentality of the hedge funds.



Delaware's greatest (M&A litigation) hits, via Vice Chancellor Parsons

March 26, 2013

Professor Steven Davidoff's statistics were cited in an article on News and Insight regarding M&A litigation in Delaware's courts.



The Difficult Choices Ahead for the Dell Board

March 24, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times DealBook about the choices ahead for Dell now that some preliminary bids are in. "Under this agreement, the parties agreed to a 'go-shop' period. In this case, the 'go-shop' provides for a 45-day period during which the Dell board can freely solicit and speak to other bidders," he wrote.



In Spinoffs, a Chance to Jettison Liabilities

March 12, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times DealBook regarding the dangers of companies producing "spinoffs;" citing Time Warner as a most recent example. "...the new Time doesn’t even have a leader to guide it through this difficult transition. Any leadership is going to have to execute a turnaround with limited resources and in the public glare..." he wrote.



Deals Now Make Sense, Not Just Money

March 11, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times Room for Debate regarding companies' reasons for making big deals and acquisitions. "Today's deals are more about building up than cashing in," Davidoff wrote.



For Icahn, a Game of Chicken With Dell’s Board

March 7, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times DealBook regarding the role of Carl C. Ichan in the buyout of Dell. "If the board does not implement his proposed dividend recapitalization, Mr. Icahn then indicated that Dell should commit to hold its annual meeting at the same time shareholders vote on the deal. Mr. Icahn then generously promised to run his own slate of directors to replace the current board," wrote Davidoff.



In Herbalife ‘Short War,’ Hedge Funds Miss the Target

March 5, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times DealBook regarding the interest of hedge fund billionares in the company, Herbalife. "As a result, the debate over Herbalife has been reduced to the level of a junior high school feud as it becomes about traders trash-talking each other," wrote Davidoff.



In Wall St. Tax, a Simple Idea but Unintended Consequences

February 26, 2013

Professor Steven M. Davidoff wrote an op-ed for the New York Times DealBook about the dangerous consequences caused by a financial transaction tax. "Some say that a financial transaction tax is a cost-free way to kill many a bird with one stone — raising revenue, preventing financial crashes and making markets safer. But advocates of this neat idea conveniently ignore the century of less-than-successful experience with this tax, including New York State’s own failed attempt," he wrote.



Deal Between Office Depot and OfficeMax Not Quite Ready for Release

February 20, 2013

Professor Steven M. Davidoff wrote an op-ed for the New York Times DealBook regarding the merging of OfficeMax and Office Depot and the problems associated with it. "The earnings — and the details of the deal — were apparently released too early. Office Depot had a conference call for its earnings scheduled for next week. OfficeMax was set to report its financials on Thursday," he wrote.



‘Currency War’ Is Less a Battle Than a Debate on Economic Policy

February 19, 2013

Professor Steven Davidoff wrote an op-ed for DealBook New York Times about what the term "currency war" really means. "It is really a debate about how industrialized countries will grow out of their economic malaise, and even the term 'currency war' is being misused," he wrote.



Buffett’s Kind of Deal

February 15, 2013

Professor Steven Davidoff wrote an op-ed for DealBook New York Times regarding the recent acquisition of H.J. Heinz by Warren E. Buffet. "Warren E. Buffett is known for picking public targets, setting his price and the targets agreeing without much bargaining to be acquired. In those deals, once Mr. Buffett showed up, the companies appeared to lose interest in finding any other bidders," he wrote.



Unusual Moves in Confronting Apple’s Huge Pile of Cash

February 12, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times DealBook on the problems Apple is running into with its rapidly accumulating money pile. "The money just sits there, not earning much in an environment of extremely low interest rates. And the problem is only getting worse. Apple is accumulating money at an enormous rate — more than $23 billion in the last quarter alone," he wrote.



How Dell Tried to Avoid Potential Buyout Pitfalls

February 8, 2013

Professor Steven Davidoff wrote an op-ed for the New York Times DealBook on the provisions Dell has put in place in it's acquisition agreement. "All told, while the full facts still need to be disclosed, it appears that Dell has gone out of its way to address problems that have arisen in previous management buyouts," he wrote.



Justice Department Faces Uphill Battle in Proving S.& P. Fraud

February 5, 2013

Professor Steven Davidoff co-authored an article with Peter Henning for The New York Times White Collar Watch as the Deal Professor.

In the article, which regarded the Justice Department’s civil complaint toward Standard & Poor’s, Davidoff and Henning wrote:

“By accusing S.& P. of fraud, the Justice Department may be able to undermine any First Amendment claim by the company. The protections afforded by the Constitution do not extend to statements made as part of a fraudulent scheme. By charging that the ratings were designed to help the company generate new business, the government may block S.& P. from having the complaint dismissed before trial.”



Reasons to Be Suspicious of Buyouts Led by Management

February 5, 2013

As the Deal Professor, Professor Steven Davidoff wrote an article for The New York Times DealBook, regarding management-led buyouts.

Threading through examples of such buyouts, Davidoff wrote: “Take J. Crew, whose buyout group included the company’s chief executive, Millard Drexler. At the last minute, his bidding group dropped the price it was willing to pay by $2 a share. The J. Crew board still went ahead with the deal, probably because the directors felt they had no choice.”



Lessons for Entrepreneurs in Rubble of a Collapsed Deal

January 29, 2013

Professor Steven Davidoff, as the Deal Professor, wrote an article for The New York Times DealBook, which centered on lessons to be learned from Goldman Sach’s legal dispute with Dragon Systems. One of which to specifically learn from, he wrote, was to “know your advisers.”

“It is perhaps no coincidence that this suit was brought in 2009 — in the wake of the financial crisis, when Goldman’s unpopularity made it a good time to sue,” Davidoff wrote. “These claims would go to a jury, and Goldman was hardly the most sympathetic defendant. But bashing Goldman or any other bank goes only so far when the hard truth spells otherwise.”



Reports Reveal Financial Challenges, but Few Solutions

January 22, 2013

Professor Steven Davidoff, as the Deal Professor, wrote an article for The New York Times DealBook. In the article, which centered on the World Economic Forum and its influence on JPMorgan Chase and the Federal Reserve, Davidoff wrote:

“The World Economic Forum and its leaders appear to be moving on, but if the financial titans gathered there are really going to fight off the small but growing number of critics who are calling for the breakup of the big banks or even more likely a stronger Volcker Rule, they should put forth an alternative or an explanation for why these blowups keep occurring. The forum would seem to be an ideal place to do it.”



Ackman, Herbalife and Celebrity Short-Sellers

January 1, 2013

Professor Steven Davidoff wrote a column for the New York Times DealBook regarding the power of celebrity investors like William A. Ackman. "There is a culture of worship around Mr. Ackman and a small circle of hedge fund deities like Mr. Einhorn, John A. Paulson of Paulson & Company and even Steven A. Cohen at a somewhat tarnished SAC Capital Advisors. When one of them says or does something, it quickly reverberates in the market," Davidoff wrote.



Venoco board gets an 'F' for selling company

December 26, 2012

Professor Steven Davidoff's column for The New York Times, the Deal Professor, was the featured news in an article by the Denver Business Journal about Venoco Inc. Davidoff gave the purchase a failing grade because Marquez was able to buy the company "with favorable terms and no financing lined up, without resistance from the board."



Why the USA is still the best place for investment banking deals

December 19, 2012

Professor Steven Davidoff's blog post for The New York Times DealBook was quoted at length in the DeBord Report on 89.3 KPCC's website. The Southern California Public Radio Station called Davidoff's piece questioning whether the American investment banking model finding opportunities abroad an "excellent cold-water-to-the-face post."



Keeping tabs on the bailout

December 11, 2012

Professor Steven Davidoff was quoted in an article on American Public Media about the U.S. bailout recovery. "“I think we should pop the Champagne bottles,” he said. “We’ve done much better than people thought we would.”



Doing the Shareholder Sidestep

December 6, 2012

Professor Steven Davidoff wrote a column for the New York Times Deal Book about Starbucks Corporation's acquisition of Teavana Holdings and Freeport-McMoRan Copper and Gold’s deal for Plains Exploration and Production and the McMoRan Exploration Company. "...public shareholders had no say in the deal — and there never was a possibility for a better offer, given the short time between signing and consent," he wrote.



Hazards of Formula One Extend Beyond the Racecourse

December 4, 2012

Professor Steven Davidoff wrote a column for the New York Times Deal Book about deal-making with the Formula One racing company. "Formula One has long been identified with Bernie Ecclestone, an 82-year-old Englishman referred to in the British tabloids as 'F-1 Supremo.' He built the business, starting as a trader of motorcycle parts. Yet the controlling stake in the Formula One companies had been held by the German media magnate Leo Kirch," he wrote.



At Orient-Express, the Board Holds All the Cards

November 29, 2012

Professor Steven Davidoff wrote an op-ed for the New York Times regarding the hierarchy structure of Orient-Express, a luxury hotel owner based in Bermuda. "It’s good to be a director of Orient-Express – and it’s likely to stay that way," he said. "...it is because these directors can elect themselves, a unique characteristic among companies worldwide. Shareholders have no real say in the selection of Orient-Express’s directors."



In Court Battle, a Game of Brinkmanship With Argentina

November 27, 2012

Professor Steven Davidoff wrote an op-ed for the New York Times about Argentina's possible debt to some American hedge funds. "This game of chicken is a lesson on the hazards of United States courts’ interfering in international affairs," he said.



Wall Street Offers a Second Career for Former Politicians

November 6, 2012

Professor Steven M. Davidoff wrote an op-ed for the New York Times regarding money-making options politicians have after their time in office. "Take Tony Blair, the former British prime minister. In September, Mr. Blair was called to Claridge’s hotel in London to mediate a renegotiation of the proposed acquisition of Xstrata by Glencore, according to British news reports. Mr. Blair, who negotiated peace in Northern Ireland, put his skills to good use, apparently earning himself roughly $1 million for three hours of work," he wrote.



What Next for Netflix?

November 1, 2012

Professor Steven M. Davidoff wrote an op-ed for the New York Times about the future of Netflix. "But the company’s shareholdings are about to turn over as arbitrageurs race in to acquire Netflix stock in anticipation of a sale. Hedge funds already had a big stake in Netflix; one fund, Blue Ridge Capital, held a 4.5 percent position as of June 30, according to public filings," he wrote.



The Risks of Tapping Your Retirement Fund for an Alternative Use

October 30, 2012

Professor Steven M. Davidoff wrote an op-ed for The New York Times about the dangers of using retirement money for other ventures, like starting a business. "The strategies to do so and not run afoul of I.R.S. regulations are varied, but the main one is to start a business and have it adopt a 401(k) plan. The existing 401(k) plan is rolled into the new one, which is invested in the new business. Voilà — instant financing. The downside, however, is that there is no money for retirement if the business fails," he wrote.



Exclusive: What's in a sentence?

October 27, 2012

Professor Steven M. Davidoff was quoted in an article in the Business Standard regarding the sentencing of Rahul Bajaj for insider trading. "Davidoff argues that even despite the rubble of Enron’s catastrophic collapse staring the American public in the face, 'the case against Skilling was so amorphous that prosecutors found it difficult at first to weave the various threads into a cogent narrative,'" wrote Rajiv Rao.



Gamesmanship in Xstrata-Glencore Merger Vote

October 25, 2012

Professor Steven M. Davidoff wrote an op-ed for the New York Times regarding the Xstrata shareholder vote on its merging with Glencore. "The vote has been structured in a way to maximize efficiency in the hope that $200 million in management retention payments are also approved. It’s just part of the machinations intended to influence the voting on the largest deal of the year," he wrote.



Few Winners in Heated Cellphone Wars

October 23, 2012

Professor Steven M. Davidoff wrote an op-ed for the New York Times about the battle between major cell phone companies like Verizon and AT&T. “Maneuvers by American cellphone providers to acquire one another are threatening to erupt into all-out war. And the question is not only which ones will survive, but whether the survivors will be ruined by the prey they are rushing to swallow, leaving consumers by the wayside,” he said.



Mediation, Arbitration, and the Promise of Privacy

October 22, 2012

Professor Steven M. Davidoff was quoted in an article on HarvardLaw.com regarding privately adjudicated arbitrations in Delaware.  Delaware judges and courts are renowned for their expertise in adjudicating the most complex business disputes in the United States, explains Steven M. Davidoff in the New York Times.



In Citigroup Shake-Up, a New Show of Power by Boards

October 16, 2012

Professor Steven Davidoff wrote an op-ed for the New York Times about the changing role of the board of directors and chief executives, citing the resignation of Vikram S. Pandit of Citigroup. "Mr. Pandit’s resignation is remarkable because it goes beyond what had been the traditional board role, which has been to stand back and hire or fire the chief executive. Here, the board appeared to want to change the course of Citigroup’s operations against the wishes of Mr. Pandit," wrote Davidoff.



Despite Its Problems, Dodd-Frank Is Better Than the Alternatives

October 16, 2012

Professor Steven Davidoff wrote an op-ed for the New York Times about why the Dodd-Frank Act is better than its alternatives. The Dodd-Frank Act is designed to regulate banks to prevent financial crisis. "The bottom line is that there are real problems with Dodd-Frank. It contains tons of extraneous stuff, and even the provisions dealing with the large banks are sometimes too convoluted and intricate. The mess that the regulatory agencies are in as they try to sort out the Volcker Rule is a good example," he wrote.



Don't mess with Texas (if you're a lawyer for plaintiffs in an M&A case)

October 9, 2012

Professor Steven Davidoff was mentioned in a Thompson Reuters article on state courts using attorney fee awards to encourage plaintiffs in complex business litigation cases to file in their state. "A recent study co-authored by Ohio State University associate law professor Steven Davidoff (aka Deal Prof of The New York Times' Dealbook) found that state courts use fee awards to induce plaintiffs' lawyers to file suits in their jurisdiction, in an example of "inter-state jockeying" among the courts," the article said.



The Private Equity Wizardry Behind Realogy’s Comeback

October 9, 2012

Professor Steven Davidoff wrote a column for The New York Times Dealbook on the company Realogy, the operator of Century 21 who was basically left for dead during the housing crisis but has since come roaring back to life. The company has been restructured multiple times in the past several years and is about to undergo an I.P.O. "Realogy’s Hollywood-like comeback shows how private equity firms can succeed even when they make the wrong call. The firms can use financial engineering to create Rube Goldbergesque financing structures that frankly appear to create their own money. Realogy has more than 15 different types of debt instruments alone. The case of Realogy shows private equity can be a company’s savior during even the worst of times," Davidoff wrote.



Why MetroPCS Is Truly in Play

October 4, 2012

Professor Steven Davidoff wrote an opinion editorial for The New York Times Dealbook on the recent deal between MetroPCS and T-Mobile USA. "The deal structure is not that of a typical merger where a buyer simply acquires the target. It is instead a recapitalization. A recapitalization is a fancy term that means the rejiggering of a company’s capital structure," wrote Davidoff. "MetroPCS is reported to be — surprise! — not unhappy that this new deal may spur Sprint to come to the table. And because Revlon duties apply, MetroPCS’s board is now bound to take the highest price reasonably available."



In Market Rebound, a Windfall for Wall Street Executives

October 2, 2012

Professor Steven Davidoff wrote a column for The New York Times Dealbook about the rising compensation for executives at big banks. According to Davidoff, many bank executives were given stock options in 2008 and 2009 because it was permissible under TARP. Those options, originally valued at $142 million, are now work $457 million, an increase of 221 percent. "It’s hard to justify and it goes a long way toward explaining the persistent anger toward Wall Street, " Davidoff wrote.



A Hedge Fund’s Complex Scheme May Cost It Millions

September 25, 2012

Professor Steven Davidoff wrote a column for The New York Times Dealbook on a Canadian case about Mason Capital Management, a hedge fund, and Telus Corporation, a large Canadian telecommunications company.  Mason set up a complex deal in which it acquired 19 percent of Telus's voting stock and financed the deal with a roughly equivelent short position in Telus's nonvoting common stock. Davidoff points out that this once seemingly nonfail deal is likely to now end up as not very profitable for Mason because of some slick manuevering by Telus and support by the Canadian courts.



The Economics of Law School

September 24, 2012

Professor Steven Davidoff wrote a column for The New York Times Dealbook on the costs and expenses of law schools, pointing out that the cost of veternary school has rised considerably while applications have soared and salaries for vets remain low. "The problem of law school is one that is ubiquitous to higher education — the current model is inherently expensive but even today, lower-priced alternatives don’t seem to meet the standards or be desired by many students," Davidoff wrote.



Third Point to raise $250m for cat fund

September 13, 2012

Professor Steven Davidoff's column in The New York Times Dealbook was discussed in an Royal Gazette article on the reinsurance market in Bermuda.



Seeking Critical Mass of Gender Equality in the Boardroom

September 11, 2012

Professor Steven Davidoff wrote a column in The New York Times Dealbook about the lack of women on the board of directors on Fortune 500 companies and the likely impact adding more women would have on those businesses.



Revolutionary, Ordinary Innovation

August 31, 2012

Professor Steven Davidoff's column In the Ordinary, Silicon Valley is Finding the Next Big Thing was the subject of a post by Wall Street Journal writer Irving Wladawsky-Berger, who wrote "Professor Davidoff makes a very important point about this latter kind of innovation: what makes these innovations disruptive is the way they transform every-day, ordinary activities. These innovations are simultaneously revolutionary and ordinary. As a result, they are often much more subtle than classic lab-based innovations, which few would ever call ordinary."



Humanitarian Effort in Congo Puts S.E.C. in Unintended Role

August 28, 2012

Professor Steven Davidoff wrote a column for The New York Times Dealbook on provisions in the Dodd-Frank Act that require public companies to disclose and monitor whether they use conflict minerals that may have originated in the Congo.  Davidoff reviews the recently released regulations and questions whether the law will be effective and is the right avenue for addressing a humanitarian issue.



Profits in G.M.A.C. Bailout to Benefit Financiers, Not U.S.

August 23, 2012

Professor Steven Davidoff wrote a column for The New York Times Dealbook telling the long and winding tale of ResCap, a subsidiary of Ally Financial, formerly General Motors Acceptance Corporation (G.M.A.C.), as it makes its way through massive losses, bailouts, and now bankruptcy.



How Instagram Could Have Cut a Better Deal

August 20, 2012

Professor Steven Davidoff wrote a column in The New York Times dicussing strategies Instagram could have used when it was bought out by Facebook to protect the value of the deal, which was originally valued at about $1 billion, but has dropped to about $735 million as the value of Facebook stock has declined.



Founder Richard Schulze won't back off from Best Buy takeover

August 16, 2012

Professor Steven M. Davidoff was quoted on Minnesota Public Radio about Best Buy founder Richard Schulze's recent attempts to buy the company. "If you look at the statement from Best Buy, he's certainly free to talk to them. He's not free to form a group," Davidoff said. "He could talk about the possibility of making a bid. But once they enter beyond preliminary stages, he's going to have to come back to the board and seek their approval."



In $440 Million Trading Error, Upside of Wall St. Failures

August 7, 2012

Professor Steven Davidoff wrote an article for The New York Times DealBook as the Deal Professor. The article suggested an accidental $440 million trading error by Knight Capitol Group demeans the survival Wall Street firms.

“The Knight Capital debacle follows a long list of Wall Street failures. In the last few years, Lehman Brothers, Bear Stearns and MF Global have destroyed themselves. Before that, Drexel Burnham Lambert filed for bankruptcy in 1990, Barings in 1995, Long-Term Capital Management in 1998, Refco in 2005 and Amaranth Advisors in 2006. In the late 1980s and early 1990s, the savings and loan scandal resulted in a spate of bank liquidations. In the 1970s, there was the implosion of the Wall Street financial institution Goodbody & Company, and in the decade before, the failure of Ira Haupt & Company,” Davidoff wrote. “While you may look at horror when you see this record, Wall Street is actually better than average in the failure department these days.”



Adding Up Marissa Mayer’s Pay at Yahoo

July 27, 2012

Professor Steven Davidoff wrote an article for The New York Times DealBook as the Deal Professor. The article estimated chief executive of Yahoo Marissa Mayer’s compensation. Davidoff suggested a five-year contract for Mayer would be around $117 million.

“But to really cash in, Ms. Mayer will not only have to stay at Yahoo for several years but also hit financial goals, which have yet to be defined,” Davidoff wrote. “In other words, much of her success and money will mean hitting those targets. It remains to be seen whether they will be meaningful targets, but Daniel. S. Loeb, the head of the activist hedge fund Third Point, which owns about 6 percent of Yahoo, has a big stake in seeing her achieve significant gains.”



Interesting Deals That Flew Under the Radar

July 20, 2012

Professor Steven Davidoff, as the Deal Professor, wrote an article for The New York Times DealBook. The article recapped deals made midsummer and included deals such as Georgia Gulf acquiring PPG Industries, WellPoint acquiring Amerigroup, and a deal between Australia Acquisition and Harbinger Capitol.

Of Fidelity National Financial acquiring J. Alexander, Davidoff wrote, “This deal proves the maxim that small deals often exceed the complexities of big, large-cap acquisitions.”



PFGBest Founder Said the Regulators Made Him Steal; Goldman’s Profit Down: Roundup

July 18, 2012

Professor Steven Davidoff was referenced in a New York Observer article for his writing, as the Deal Professor, an article for The New York Times DealBook about former Citigroup banker Brian Stoker.

The article, which highlighted many topics, noted Davidoff wrote Stoker’s trial “is more likely to show ‘how clueless financiers can be.’”



If Little Else, Banker’s Trial May Show Wall St. Foolishness

July 17, 2012

Professor Steven Davidoff, as the Deal Professor, wrote an article for The New York Times DealBook about former Citigroup banker Brian Stoker’s civil trial for “role in creating exotic mortgage securities.”

Davidoff wrote, “Although we’re going to get an inside view into an arcane world, the case more than likely won’t show that anybody acted out of malice. Rather, it will highlight that no one thought hard about the risks — not the buyers, the sellers or the investment banks packaging these complex derivatives. Only a few smart hedge funds realized what was going on, and profited from it.”



Manchester United’s I.P.O. Feels at Home in U.S.

July 11, 2012

Professor Steven Davidoff was mentioned by The New York Times Soccer Blog for an article he wrote as the Deal Professor about Manchester United filing to go public in the United States.

The article noted, Davidoff wrote, “Manchester United will not need to file quarterly reports, report material events, file proxy statements or disclose extensive compensation information, all of which American companies must do … Under a different S.E.C. rule adopted in 2008, Manchester United also does not need to report financials under the generally accepted accounting principles used in the United States, but can instead rely on international financial reporting standards.”

The article was also referenced by YCharts and was published in print in the The New York Times DealBook.



In Manchester United’s I.P.O., a Preference for American Rules

July 10, 2012

Professor Steven Davidoff wrote an article for The New York Times DealBook as the Deal Professor.

He wrote in the article, which was about Manchester United filing to go public in the United States, “The soccer team has recently found a home for its stock in the United States. Manchester United filed the papers this month for its initial public offering on the New York Stock Exchange, and the Glazers are taking advantage of the country’s willingness to be more flexible when it comes to shareholder rights. Manchester United is proposing a corporate structure that would give the Glazers shares with 10 votes apiece. Public investors would receive one vote for each share.”



The Strange Takeover Limbo of CVR

July 5, 2012

Professor Steven Davidoff, as the Deal Professor, wrote an article for The New York Times DealBook.

In the article, which was about CVR Energy and Carl C. Icahn, Davidoff wrote, “Mr. Icahn’s battle to force CVR to sell itself ended with him entering into a novel arrangement with the CVR board. The company agreed to allow Mr. Icahn’s funds to make a tender offer to acquire the company at $30 a share.”



Preserving Money Market Funds Is Good for Corporate America

July 5, 2012

Professor Steven Davidoff was mentioned in an ICI Viewpoints article, which examined an article he wrote as the Deal Professor for The New York Times DealBook about money market funds.

“If the SEC proposals go through, the money market fund industry would shrink to a shadow of its current size —and then what would happen to what Davidoff calls ‘the heart of corporate finance?’” the article noted. “In our view, it is far better for investors, for corporate America, and for the economy to have money market funds with higher investment standards than no money market funds at all.”



Board Members Should Face Consequences

July 4, 2012

Professor Steven Davidoff wrote an article for The New York Times, in which he suggested board members should be considerate of shareholders.

“Regardless of whether they are primarily representing shareholders, directors need to be held responsible for each decision, if not liable. As it stands, directors are effectively immune from paying out of their own pocket for any successful civil suit arising from even the poorest and most reckless of decisions,” Davidoff wrote. “Criminal prosecutions are as rare as unicorns. Yet every kindergartner knows that without consequences, people are unlikely to act with appropriate care and deliberation.”



Money markets are the new interbank markets

June 27, 2012

Professor Steven Davidoff was referenced in a Reuters blog for his suggesting money-market funds might replace interbank markets.

The blog noted, Davidoff says, the money-market industry’s argument basically comes down to saying that it’s important to make retail investors believe their money is secure, even when it isn’t. And that’s not the kind of argument that any regulator should have any time for.”



Money Market Industry’s Resistance May Hurt Companies

June 26, 2012

Professor Steven Davidoff wrote an article about money market funds for The New York Times DealBook as the Deal Professor.

“Money market funds hold about $2.6 trillion, a sizable sum but down sharply from the days before the financial crisis, when these funds held about $4.3 trillion,” Davidoff wrote. “The decline came after the Reserve Primary Fund, the nation’s oldest and largest money market fund with $64 billion, 'broke the buck' — in which the value of its shares fell below $1 — in 2008 in the wake of Lehman Brothers' bankruptcy. The fund had been left holding $785 million of Lehman’s debt.”



In Insider and Enron Cases, Balancing Lies and Thievery

June 19, 2012

Professor Steven Davidoff, as the Deal Professor, wrote an article for The New York Times DealBook about former chief executive Jeffrey K. Skilling being sentenced 24 years due to his conviction of 19 counts after the 2001 collapse of Enron.

“Until the financial crisis, Enron’s bankruptcy was viewed as Exhibit A of corporate crime and executives run amok. After trial that lasted months, Mr. Skilling was convicted of securities fraud, among other crimes. Judge Sim Lake sentenced him to the low end of the recommended sentencing range after Mr. Skilling expressed remorse, asserting that he was “innocent of these charges,” Davidoff wrote in the article, which was published online and in print by The New York Times.

“The sentence was viewed as harsh by a few commentators at the time, but for those who were victimized by Enron’s collapse and lost their jobs or life savings, Mr. Skilling got what he deserved.”



In Insider and Enron Cases, Balancing Lies and Thievery

June 19, 2012

Professor Steven Davidoff, as the Deal Professor, wrote an article for The New York Times DealBook about former chief executive Jeffrey K. Skilling being sentenced 24 years due to his conviction of 19 counts after the 2001 collapse of Enron.

“Until the financial crisis, Enron’s bankruptcy was viewed as Exhibit A of corporate crime and executives run amok. After trial that lasted months, Mr. Skilling was convicted of securities fraud, among other crimes. Judge Sim Lake sentenced him to the low end of the recommended sentencing range after Mr. Skilling expressed remorse, asserting that he was “innocent of these charges,” Davidoff wrote in the article, which was published online and in print by The New York Times.

“The sentence was viewed as harsh by a few commentators at the time, but for those who were victimized by Enron’s collapse and lost their jobs or life savings, Mr. Skilling got what he deserved.”



FP500: Private practice

June 19, 2012

Professor Steven Davidoff was quoted in Financial Post Magazine in an article about exempt market trading’s effect on economic development.

“Why should only rich people be allowed to invest in pre-IPO Facebook?” Davidoff questioned about private stock trading negatively affecting public markets.



Dealing With the Facebook Lawsuits

June 18, 2012

Professor Steven Davidoff, as the Deal Professor, and Peter Henning wrote an article for The New York Times DealBook about Facebook filing a brief in response to more than 40 lawsuits filed against the company.

Davidoff wrote, “While this motion is standard when there are multiple lawsuits, the content is far from typical, as with many things about Facebook. The company seems to be using the motion to address some of the negative publicity cast on it about the I.P.O. by arguing that it disclosed everything it should have to investors, and the party really responsible for the precipitous drop in its share price was Nasdaq.”



Blessed after 40

June 17, 2012

The Columbus Dispatch included Professor Steven Davidoff in an article about Central Ohioans who are older than 40 celebrating their first Father’s Day. Davidoff and his wife Idit Jacques welcomed to their family twin daughters Orly and Nili June 2.

“I have a lot more perspective and awareness than if I had gone through this in my 20s, and that really has helped me through this,” Davidoff said. “It has made me see that my girls are such a gift and I’m so blessed.”



For Private Equity, Fewer Deals in Leaner Times

May 29, 2012

Professor Steven Davidoff wrote an article as the Deal Professor for The New York Times DealBook.

In the article regarding the difficulties private equity firms face with deals in the financial crisis, Davidoff wrote, “For the future barons of private equity, this means a world where they have less impact. Deals will be smaller, and their hedge fund brethren will reap the bigger publicity and fees.”



Management Buyouts Can Be Too Cozy

May 25, 2012

Professor Steven Davidoff, as the Deal Professor, wrote an article for The New York Times DealBook. In the article, which was about California oil company Venoco’s proposed $770 million management buyout, Davidoff wrote managers can plan a bid opportunity, so they pay a lower price.

Davidoff also wrote, “The company’s stock is at about $9.25 a share, well below the offer price, meaning investors are not confident shareholders will approve the deal. It also may be that the Venoco board has good reasons for agreeing to this deal. The board appeared to be well advised, and it followed governance rules.”



How to Fix the Fed: Dismiss Dimon, Boot the Bankers, and Can the Corporations

May 25, 2012

Professor Steven Davidoff was referenced in a Huffington Post article about the Federal Reserve’s board members, specifically Jamie Dimon.

The article noted, “As Davidoff documents, the Fed is repeatedly bending or violating its own rules to prevent shareholders from exercising their rights to limit executive compensation or take action against underperforming or ethically-challenged executives.”



Potential legal woes starting to pile up on Facebook IPO

May 23, 2012

Professor Steven Davidoff, as the Deal Professor, and Peter Henning wrote an article for The New York Times DealBook, which was also published in the Austin American-Statesman and The Zimbabwe Mail.

In the article, which was about Facebook’s initial public offering possibly becoming one of the most litigated offerings, Davidoff wrote, “At least three shareholder lawsuits have so far been brought against Facebook and the three leading underwriters of the IPO, Morgan Stanley, JPMorgan Chase and Goldman Sachs, alleging that Facebook failed to disclose material information about its growth prospects.”

 



Disclosure by Short-Sellers Would Improve Market Clarity

May 22, 2012

Professor Steven Davidoff wrote an article for The New York Times DealBook as the Deal Professor. The article, which was published online and in print by The New York Times, was about short-sellers’ effect on stock market value, including Herbalife’s value.

He wrote, “Short-sellers have a right to try to talk a stock down, just as much as other investors can try to talk a stock up. Yet when a public company is under fire, market manipulation is often the cry when there is short-selling. (In short sales, a trader borrows shares to sell, hoping they will fall before buying them back at a profit.)”

The article as also published on Progressive Voices.



Private equity and the campaign

May 15, 2012

Professor Steven Davidoff was featured on a podcast by American Public Media. The podcast centered on Mitt Romney's favoring private equity. Davidoff said of the President Barack Obama attacking Romney’s ties to private equity, “Well it’s where the money is, right?”



China Flexes Its Regulatory Muscle, Catching Google in Its Grip

May 15, 2012

Professor Steven Davidoff, as the Deal Professor, wrote an article for The New York Times DealBook about China’s influence in Google’s proposed $12.5 billion acquisition of Motorola Mobility.

“In Europe and the United States, the expectation was that acquisition might face a high hurdle, given that Google faces broader antitrust inquiries there,” Davidoff wrote. “But those antitrust regulators signed off on the deal in early February, leaving China — Motorola Mobility’s second-largest market behind the United States, with $1.4 billion in revenue last year.” He concluded, “China is unavoidable."

The article was published online and in print by The New York Times.



After $2 Billion Loss, Will JPMorgan Move to Claw Back Pay?

May 14, 2012

Professor Steven Davidoff wrote an article as the Deal Professor for The New York Times DealBook.

In the article, which questioned if JPMorgan Chase will implement its clawback policy because Ina Drew and two traders left the bank amid its $2 billion trade loss, Davidoff wrote, “Prior to the financial crisis, a clawback wasn’t really an option. Bank executives and other employees kept prior compensation, even if it turned out that they bore responsibility for their institution’s later billion-dollar losses.”

He also wrote, “We are about to see the first real test of the new post-financial crisis regime. Hopefully, Wall Street will do better this time.”



Protesters, Shareholders Neutralized as Bank of America CEO Collects Millions

May 10, 2012

Professor Steven Davidoff's article as the Deal Professor for The New York Times DealBook was referenced in an article by The Nation.

The article was about Bank of America’s CEO and quoted Davidoff as writing, “The Fed appears to prefer the management of poorly performing banks over those who want to run the banks’ operations better.”



In Blocking Activists, the Fed Protects Poorly Performing Banks

May 8, 2012

Professor Steven Davidoff, as the Deal Professor, wrote an article for The New York Times DealBook about the Sitwell Group’s attempt to elect nominees to First Financial Northwest’s board of savings and loan. Davidoff gave his take on the Federal Reserve taking care of the situation.

“The Fed appears to prefer the management of poorly performing banks over those who want to run the banks’ operations better. To accomplish this, it is taking a bureaucratic view of its regulations, claiming in the case of First Financial that two of nine directors constitute control of the bank when it obviously doesn’t. Under Fed policies, even trying to start a proxy contest to force management change can subject a shareholder to bank holding company regulations,” Davidoff wrote.

The article was published online and in print by The New York Times.



Lessons From the Vulcan Materials Ruling

May 7, 2012

Professor Steven Davidoff, as the Deal Professor, wrote an article for The New York Times DealBook.

In the article about the Vulcan Materials Ruling, Davidoff wrote, “Historically, Vulcan has been more interested in a combination, but Martin Marietta (Materials) deferred any deal largely over issues related to chief executive succession. In the most recent iteration of the acquisition discussions, which began in 2010, the parties started negotiating under the assumption that Vulcan would be the acquirer. When the relative stock prices of the companies diverged and Martin Marietta’s became more valuable, it was Martin Marietta that became the natural acquirer, but Vulcan now demurred because it believed its stock was now undervalued.”



Ignoring the Real Money in the Bank of America Lawsuits

May 4, 2012

Professor Steven Davidoff wrote an article as the Deal Professor with Peter J. Henning for The New York Times DealBook about Bank of America lawsuits.

“The shareholder cases largely comprise state law claims against the bank’s board and executives brought in the Delaware Chancery Court and the Federal District Court in Manhattan,” the article noted. “In those cases, the plaintiffs contend that the bank’s board breached its fiduciary duties by approving the acquisition and failing to try to terminate the deal based on Merrill (Lynch)’s poor performance in the fall of 2008. The plaintiffs also assert that board members failed to disclose the compensation to be paid at yearend to Merrill employees and failed to disclose Merrill’s interim and yearend results in a timely manner.”



Walking Away From Merger Deals

May 2, 2012

Professor Steven Davidoff wrote an article for The New York Times DealBook as the Deal Professor. In the article, which centered on Gores Group potentially turning down a $1 billion buyout of Pep Boys, Davidoff wrote the case is the “first significant postcrisis claim by a private equity firm in a public deal.”

He also wrote, “I would not be surprised if Pep Boys tries to bring this to a head before the 30-day period Gores requested is over. Ultimately, though, any litigation is really a dispute about whether Pep Boys receives nothing or $50 million in case the deal is terminated. There is still the possibility that Gores will try to renegotiate the deal.”



Wall Street Gives the Fed an Earful on Counterparty Credit Limits

May 2, 2012

Professor Steven Davidoff was referred to in an American Banker article for his writing as the Deal Professor for The New York Times DealBook.

The article, regarding the meeting of financial services CEOs to argue against limiting banks’ exposure to one another, touched on Davidoff’s thoughts about a recent shareholder protest that "are more likely to dissipate once the media attention surrounding them dies down." The article also noted Davidoff argued, “The investor revolts at Barclays, Citi and Chesapeake Energy say more about those companies' egregious practices than the prevailing mood among investors.”



Furor Over Executive Pay Is Not the Revolt It Appears to Be

May 1, 2012

Professor Steven Davidoff, as the Deal Professor, wrote an article for The New York Times DealBook about shareholder protests at Barclays, Citigroup, and Chesapeake Energy over excessive executive pay. The article was published online and in print by The New York Times.

“These are all old reasons that pay continues to spiral upward, but recent events don’t change anything. The best we are going to get, even in egregious cases, is a few apologies and tweaks,” Davidoff wrote. “Let’s see what these companies do once the rage fades in a few years. Citigroup’s board has yet to announce any compensation changes.”



Fraud Heightens Jeopardy of Investing in Chinese Companies

April 24, 2012

Professor Steven Davidoff wrote an article for The New York Times DealBook as the Deal Professor.

In the article, which was about fraud on behalf of ChinaCast Education Corporation and SinoForest Corporation jeopardizing investing in Chinese companies, Davidoff wrote, “Here lies the ultimate lesson. An investment in Chinese companies is really an investment in the people who run these companies. While some, if not most, of these executives are well intentioned, there seems be a lot of suspicious activity out there.”

He ended with a piece of advice: “For American investors, it may be that the risks are worth the potential gains in investing in China, but don’t say you haven’t been warned.”



America Loves to Watch Its Too-Big-Too-Fail CEOs Squirm

April 20, 2012

Professor Steven Davidoff's column, "Citigroup Has Few Options After Pay Vote" was quoted by TIME Business.

“Citigroup is such a big target, the chances of it escaping such a suit are very low unless Mr. Pandit gives back all of this compensation. But I suspect that Mr. Pandit will not be in such a generous spirit," Davidoff wrote.
 



Is Citi's Failed Say-On-Pay Vote a Sign of the Times?

April 20, 2012

Professor Steven Davidoff's column, "Citigroup Has Few Options After Pay Vote" was quoted by another column on Law.com.



The Escalation in Hostile Takeover Offers

April 20, 2012

Professor Steven Davidoff, as the Deal Professor, wrote a column for The New York Times DealBook on the recent flurry of companies attempting hostile takeovers of other firms.

"It’s a surprising development considering that some prominent investment bankers in mergers and acquisitions were predicting their demise after Air Products’ yearlong failure to acquire Airgas. These bankers argued that hostile offers were just too difficult to pull off," Davidoff wrote.



Giving Shareholders a Voice

April 19, 2012

Professor Steven Davidoff's column, "The Case Against Staggered Boards," was referenced in another column in The New York Times DealBook in regard to proposals urging companies with a staggered board, which allow shareholders to replace only a few directors each year, to place all board members up for election every year.



DEALBOOK; In Judging Hostile Bids, Look at How Recent Targets Fared

April 18, 2012

Professor Steven Davidoff, as the Deal Professor, wrote an article for The New York Times DealBook. An examination of hostile takeover bids, the article touched on targets such as Shares of Airgas, Air Products & Chemicals, Potash Corporation of Saskatchewan, and Casey’s General Stores.

“Companies that have prospered by spurning offers and remaining independent usually have a strong, informed board that is willing to stand up to both its chief executive and a hostile raider,” David off wrote.



Why Citigroup Will Likely Be Sued Over Vikram Pandit’s Pay

April 18, 2012

Professor Steven Davidoff's column in The New York Times DealBook was quoted by CNBC.com in an article discussing the likelihood of Citigroup being sued over CEO Vikram Pandit's pay, which was rejected by shareholders.

Davidoff wrote: "Citigroup may also face litigation. In a number of other cases, shareholder plaintiffs’ lawyers have sued after votes rebuffed pay packages, claiming that the board of directors breached its fiduciary duties or wasted corporate money by ignoring shareholders and paying excessive compensation.

"Citigroup is such a big target, the chances of it escaping such a suit are very low unless Mr. Pandit gives back all of this compensation. But I suspect that Mr. Pandit will not be in such a generous spirit."



In Judging Hostile Bids, Look at How Recent Targets Fared

April 17, 2012

Professor Steven Davidoff, as the Deal Professor, wrote a column that appeared in the national edition of The New York Times about the success of companies warding off hostile takeover bids. Davidoff dicusses Illumina's looming shareholder vote on whether to replace Illumina's board with nominees proposed by Roche Holdings of Switzerland.



New Share Class Gives Google Founders Tighter Control

April 13, 2012

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, wrote a column about Google's new share class. The tech company created a nonvoting share class in order to give its founders tighter control of the company. They did this, they said, in order to "focus on the long term."

Davidoff said this could create a pattern: "In the meantime, one thing is certain. The clear trend in technology companies is to deny shareholders this choice and a real vote. In other words, expect more Google followers."



The Incredible, Magically Metamorphosing Taxpayer-Subsidized Executive Perk

April 12, 2012

Professor Steven Davidoff was quoted by EconoMonitor.com in a column discussing executive perks. According to the article, some high-level executives have found a way to get taxpayers to subsidize the cost of luxuries, such as private jets.

“If an outside security consultant determines that executives need a private jet and other services for their safety, the Internal Revenue Service cuts corporate chieftains a break. In such cases, the chief executive will pay a reduced tax bill or sometimes no tax at all," Davidoff wrote in his column for The New York Times DealBook. “Even when tax is due, the company sometimes takes care of it.”



For Some Corporate Chiefs, Private Security Is a Tax Break

April 10, 2012

Professor Steven Davidoff wrote an article that appeared in the April 11 national edition of The New York Times as the Deal Professor about the corporate tax trick employed by the directors of some corporations.

"...directors often dole out personal safety perks to ease a chief executive’s tax bill. By classifying the benefits as security measures, the executives typically get a better tax treatment on the services," he wrote.



What’s Behind Coty’s Teddy Bear Hug?

April 2, 2012

Professor Steven Davidoff wrote an article for The New York Times DealBook as the Deal Professor about Coty Group’s proposal to acquire the Avon Group for $23.25 a share in a transaction valued at roughly $10 billion.



From Congress, a Law Befitting a Sausage Factory

April 1, 2012

Professor Steven Davidoff wrote a column published in the April 4 national edition of The New York Times DealBook as the Deal Professor about the JOBS Act and its effectiveness in creating new jobs.



Weighing the Arguments For and Against Staggered Boards

March 23, 2012

Professor Steven Davidoff was quoted for his writing as The New York Times Deal Professor in an article on law.com. The article, which was about staggered boards, quoted Davidoff, “Companies are acting to adopt a staggered board before shareholder pressure comes to bear.”



In Private Equity I.P.O., a Shareholder Fear of Losing Favor

March 13, 2012

As the Deal Professor, Professor Steven Davidoff wrote an article for the New York Times DealBook about the Carlyle Group struggling to get a public offering for the private equity firm.

“Shareholders appear to be an afterthought. In the case of Carlyle, public investors have no say in Carlyle’s management and no vote. The other firms take similar stances,” Davidoff wrote.

The article was also published on Progressive Voices.



Strine, El Paso and the shaming thing

March 7, 2012

Professor Steven Davidoff was quoted for writing as the Deal Professor in an article on The Deal Pipeline.

The article, which was about Delaware Chancellor Leo Strine and his decision on El Paso, quoted Davidoff wrote, “This decision once again shows that Chancellor Strine is a bold judge, one who is brilliant and willing to make waves. It is yet one more in a line of cases chastising chief executives for steering the negotiating process to their own benefit."

 



A Mirror Can Be a Dangerous Tool for Some C.E.O.’s

March 6, 2012

Professor Steven Davidoff wrote an article for the New York Times DealBook as the Deal Professor which regarded the power of “narcissistic” CEOs and their victimizing shareholders.

“To be sure, a narcissistic personality can serve companies well. It can instill an almost cultlike loyalty. The self-belief of the chief executives can lead them to take gambles that would cause others to hesitate. Again, Apple is a terrific example of narcissism’s positive side,” Davidoff wrote.

The article was also published on Progressive Voices.



Goldman’s conflicts, part 917

March 6, 2012

Professor Steven Davidoff was quoted in a Reuters article regarding Goldman Sach’s difficulties in El Paso Corporation being taken over by Kinder Morgan.

“What Goldman did isn’t illegal, just inappropriate in an age in which Wall Street’s morals and behavior are under the public microscope,” Davidoff said. “Goldman Sachs’s engagement letter with El Paso probably limits its liabilities to no more than $20 million.”



The Losers in the El Paso Corp. Opinion

March 4, 2012

Professor Steven Davidoff wrote an article for the New York Times DealBook as the Deal Professor.

In the article, which concentrated on “the losers” of Kinder Morgan acquitting the El Paso Corporation, Davidoff wrote, “While it will continue to dispute these facts and its liability exposure is limited, Goldman (Sachs) is most likely the biggest loser because of its continuing self-inflicted the reputational wounds. This is another black eye.



For Companies, Tax Code Adds to Debt’s Appeal

February 28, 2012

Professor Steven Davidoff, as the Deal Professor, wrote an article for the New York Times DealBook about the federal tax code’s effect on corporate debt.

“While overall United States corporate debt levels have fallen over the years, it is not hard to conclude that the tax code is creating incentives for companies to take on more debt than they otherwise would,” Davidoff wrote. “The extra debt can lead to higher bankruptcy rates, higher administration costs and excessive risk-taking. Too much debt can make recessions last longer as companies struggle to shake off their burden.”



State Pensions Find Private Equity Bites as Blackstone Cuts Jobs

February 23, 2012

Professor Steven Davidoff was quoted in an article in Business Week about the trend of public pension funds investing in private equity firms in an attempt to increase their profits. State and local government retirement funds “have been the investors that have really fueled private equity’s rise,” said  Davidoff. “For those people who complain about private equity, the money is really coming from pension funds.”



Under Volcker, Old Dividing Line in Banks May Return

February 22, 2012

Professor Steven Davidoff wrote a column in the New York Times Dealbook on the Volcker Rule and its impact on investment banks like Goldman Sachs and Morgan Stanley, which, as a result, may end up being treated like commercial banks instead of investment banks under the law. "The Volcker Rule, for all its good intentions, may perhaps unleash a burst of rapid financial innovation to do something it never intended: recreating the prefinancial crisis division between investment banks and commercial banks," Davidoff wrote.



Bain Capital Stays Quiet Amid Attacks on Mitt Romney, Private Equity

February 21, 2012

Professor Steven Davidoff was quoted in a Daily Beast article about the shocking silence by Bain Capital despite the media attention it is receiving as a result of Mitt Romney's bid for the Republican nomination.  “If you ask me does private equity provide value, I think the answer is yes,” said  Davidoff, a former Wall Street attorney who now teaches law at Ohio State. “But while that might be true from an economic theory standpoint, that’s a complicated argument to put forward. That might be why private equity is reluctant to talk,” said Davidoff, who wrote the book Gods at War: Shotgun Takeovers, Government by Deal and the Private Equity Implosion. “Every multinational at one point or another has laid people off.  That’s what happens in corporate America. But saying that would be little solace to people losing their jobs.”  



DealBook Online

February 17, 2012

Professor Steven Davidoff wrote a comment for the New York Times Dealbook on Diamond Foods announcement that it would restate its financial results for two years. It also placed its chief executive, Michael J. Mendes, and its chief financial officer, Steven M. Neil, on administrative leave. Diamond had previously agreed to acquire the Pringles brand from Procter & Gamble. According to Davidoff, this restatement and executive changes are likely to constitute a real-life material adverse change, giving P.& G. the right to terminate the acquisition, which almost never happens.



America’s Export to Canada: Shareholder Activism

February 17, 2012

Professor Steven Davidoff wrote a column for the New York Times Dealbook about recent shareholder battles in Canada involving the Canadian Pacific railroad.



Engage the activist

February 13, 2012

Professor Steven Davidoff was quoted in a Canadian Lawyer Magazine article about the current climate for shareholder activists and how to deal with them. “This topic is deeply in the minds of everyone in Canada and it’s because of Bill Ackman’s arrival in Canada,” said Davidoff.
 



How the Romney-Bain flap could change public pensions

February 13, 2012

Professor Steven Davidoff was mentioned in a Washington Post article about public pension plans being managed by private equity firms.  Public pensions across the country are also facing a huge financing gap. And pension plans “desperate for yield” could still be inclined to turn to private-equity, which has generally been considered “a high-performing asset class,”  Davidoff was quoted as writing.



A $100 Billion Value for Facebook? That May Be Possible

February 10, 2012

Professor Steven Davidoff wrote a column for The New York Times Dealbook analyzing the value of Facebook and the implications of that volume.



Zuckerberg Secures Himself Lots of Power (and Money)

February 10, 2012

Professor Steven Davidoff was quoted in the Atlantic in a story about the valuation of Facebook.  The article quoted from Davidoff's recent blog post: "Facebook’s organizing documents dictate that when Class B shares are transferred, they typically will convert into the low-vote Class A shares. It is likely that, over time, Mr. Zuckerberg will hold onto the bulk of his Class B shares as other holders of Class B shares sell off their stakes. Mr. Zuckerberg can also sell down his shares. But until the Class B shares comprise less than 9.1 percent of the outstanding Facebook shares, the holders of the Class B shares control Facebook. Given this low threshold, Mr. Zuckerberg, 27, is likely to have enough Class B shares to give him control of the company for a long, long time, despite the fact that he will have a much smaller economic stake."



Diamond Foods Debacle May Crack Open a MAC

February 10, 2012

Professor Steven Davidoff wrote a column for The New York Times Dealbook on the possible collapse of Diamond Foods purchase of Pringles from P & G because of a material breach of the contract to purchase.



Shareholder lawyers sue over Delaware forum-selection

February 8, 2012

Professor Steven Davidoff was mentioned in a Reuters article about a series of shareholder suits filed in Delaware.



Amid Attacks on Private Equity, Efforts to Study Its Value

January 24, 2012

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, examines what private equity firms do in the wake of political attacks related to Mitt Romney's career in the industry. He takes a look at different papers on the topic of whether private equity companies " 'strip and flip' companies, leaving them for bankrupt." The column ran in the national edition of The New York Times.



Fed more profitable, but hedge funds far ahead in pay stakes

January 19, 2012

Professor Steven Davidoff's column for The New York Times DealBook was picked up by The Sydney Morning Herald, theage.com, and Southern California public radio station 89.3 KPCC. Known as the Deal Professor to his readers, Davidoff compares the Federal Reserve to a hedge fund.



Carlyle Group’s IPO Lays The Groundwork For An Abusive, Coercive MBO In About Five Years

January 18, 2012

Professor Steven Davidoff's column for The New York Times DealBook was quoted by Dealbreaker.com in a follow-up piece about Carlyle Group LP's move to block future investors' capability to sue the private equity firm.



Carlyle Readies an Unfriendly I.P.O. for Shareholders

January 18, 2012

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, takes a closer look at the initial public offering for private equity group Carlyle Group LP. "It is quite possible that Carlyle Group ... is proposing the most shareholder-unfriendly corporate governance structure in modern history."



Must read: Deal Prof's study of competition for M&A litigation

January 17, 2012

Professor Steven Davidoff and University of Notre Dame Professor Matthew Cain's paper A Great Game: The Dynamics of State Competition Litigation was reviewed and quoted from by Thomson Reuters News & Insight.

"The paper ... features up-to-the-minute commentary and a deep understanding of why lawyers do what they do," writes Alison Frankel in her On the Case column.

She continues: "Davidoff and Cain looked at the litigation spawned by 955 public deals, completed between 2004 and 2010 and valued at more than $100 million. From that hand-curated sample, they examined Securities and Exchange Commission filings, court filings, and other public documents to find out where cases were filed, whether they were dismissed or settled, what kind of benefits shareholders achieved in settlements, and what plaintiffs' lawyers were awarded in fees. They assembled the data into a series of charts and tables that show some significant trends in M&A shareholder litigation."



Cain & Davidoff on State Competition for Corporate Litigation

January 15, 2012

Professor Steven Davidoff and University of Notre Dame Professor Matthew Cain's paper A Great Game: The Dynamics of State Competition Litigation was featured on the Securities Law Prof Blog, edited by Barbara Black, director of the Corporate Law Center at the University of Cincinnati College of Law.



In GOP Campaign, Private Equity Firms Draw Flak

January 13, 2012

Professor Steven Davidoff was interviewed for a piece that aired on NPR's Morning Edition about private equity firms, such as the one Republican presidential nominee hopeful Mitt Romney ran in the 1980s.

After private equity firms find a few large investors — usually pension funds, university endowments, and possibly wealthy individuals — they use that money to borrow more so they can buy other companies, usually those that are in trouble or undervalued, Davidoff explained.

"They buy them in hopes that they can increase the value of the companies and sell them at a fantastic profit," said Davidoff, who worked on merger and acquisition deals as a lawyer before becoming a professor at The Ohio State University Moritz College of Law.

"Sometimes operating them efficiently means that employees lose their jobs, plants are closed down and companies are restructured," he told NPR.

Davidoff later added that a valid criticism of private equity firms is that their managers make use of a lucrative loophole to cut their tax bill. "The barons of private equity are probably paying a lower tax rate than their secretaries, in terms of percentages."



China Case Reveals Risks of Investing in a Foreign Company

January 12, 2012

Professor Steven Davidoff wrote an article as the Deal Professor for the New York Times DealBook. The article centered on the topic of the risks of foreign investment due to the ChinaCast Education Corporation case.

“Foreign companies are not as familiar with United States practices and laws governing domestic corporations. They are sometimes more willing to push the envelope, either out of cultural inexperience or simple ignorance,” Davidoff wrote. “ChinaCast itself appears to have been a bit behind the ball in getting good advice. It hired Mackenzie Partners, a top American proxy adviser, to represent it only after it lost the first ruling in Delaware. The distance and language barriers only exacerbate these problems.”



Lehman Still Doing Deals in a Second Life on Wall Street

January 10, 2012

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, wrote about Lehman Brothers' refusal to die despite its collapse in 2008. The column was published in the national edition of The New York Times.

"Like all good horror villains, Lehman still exists, sort of. The Lehman Brothers estate is in its fourth year of administration in Federal Bankruptcy Court in Manhattan. It’s the largest bankruptcy in history, involving the liquidation of $65 billion in assets. As of October, the estate had made substantial progress settling almost $100 billion in claims," he writes.

"... The Lehman estate is even scheduled to exit bankruptcy soon, but don’t think this will end the story. Lehman is looking to get bigger."

Davidoff's column was referenced by Newser.com and Reuters' Counterparties.com.



Moritz law professor among few NY Times columnists

January 9, 2012

Professor Steven Davidoff was the subject of a profile in The Lantern, the student-run newspaper of The Ohio State University. Of interest is Davidoff's job outside of the classroom -- as a columnist for The New York Times DealBook.

"Most of my time is spent being a law professor ­— writing academically and teaching. In the remaining time I write from home, mostly on weekends or at nights," Davidoff said. "The New York Times is my hobby, so to speak."



The Top of the Class in Deal-Making

December 29, 2011

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, awarded “the Deal Professor A’s, the grade for the best deals and deal makers of 2011.”

Davidoff listed such awardees alphabetically. Included were Silver Lake Partners purchasing 70 percent interest in Skype for $1.9 billion from eBay, then later selling to Microsoft for $8.5 billion, as well as iGate partnering with Apax in a $1.2 billion deal to acquire Patni. Groupon, however, received an "F" in the list.



or Wall Street Deal Makers, Sometimes It Pays to Be Bad

December 27, 2011

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, opted to forego awarding "F" grades on bad deals in 2011 and decided to focus instead on the year's biggest buyouts, in which litigation was brought before takeovers could be completed.



Year-End Surprises in Deal Law

December 21, 2011

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, was "knee-deep" in grading when he wrote this column about a turn of events out of Delaware pertaining to three different cases.



Cracker Barrel board won't include Sardar Biglari

December 21, 2011

Professor Steven Davidoff was quoted by The Tennessean in Nashville, Tenn., in an article about whether the denial of Cracker Barrel shareholder Sardar Biglari on the company's board would signal the departure of the "multi-millionaire [sic] takeover artist."

Davidoff, a financial regulation expert, said state and federal rules regulating the volume of a single shareholder’s stock would probably discourage Biglari from increasing his stake in Cracker Barrel in the days ahead. Acquiring more shares “would not make practical sense right now,” Davidoff said. “All the statutes would make it foolhardy to do so.”



The Obstacles in the Hostile Bid for Vulcan

December 13, 2011

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, examines "an aggressive style of hostile offer we haven't seen lately" in the case of Martin Marietta Materials' $4.8 billion offer for Vulcan Materials.



Wall St.’s Odd Couple and Their Quest to Unlock Riches

December 13, 2011

Professor Steven Davidoff, the Deal Professor for The New York Times DealBook, wrote an article about private equity and public pensions.

In the article, Davidoff addresses the two as if they were an "odd couple" and chronicles their "dates."

"Private equity’s first date with public pensions was in 1981, when the Oregon Investment Council, the manager of Oregon’s pension fund, invested along with Kohlberg Kravis Roberts & Company to buy the retailer Fred Meyer," he wrote.



Yahoo’s Alibaba Quandary

December 9, 2011

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, considered what Yahoo could do with its 43 percent stake in Alibaba, the Chinese Internet giant.

"The stake, Yahoo’s crown jewel asset, is worth billions of dollars and provides the company a foothold into China. The problem is that Yahoo has an agreement that gives Alibaba’s shareholders the option to repurchase the stake through a right of first refusal. Alibaba’s chief executive, Jack Ma, desperately wants to acquire Yahoo’s shares and will no doubt try to exercise this right," he writes. "That means Yahoo’s options are even more limited than people think."



10 Questions for Jon Corzine

December 7, 2011

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, offered up 10 questions the House Agricultural Committee should ask Jon S. Corzine, former chief executive of MF Global Holdings and a former Democratic senator from New Jersey -- provided Corzine would not plead his Fifth Amendment right against self-incrimination.



Limited Choices for Yahoo, Each One With Its Own Risks

December 6, 2011

Professor Steven Davidoff, writing as the Deal Professor in a column for the print edition of The New York Times, reveals why an auction would have been the cleanest transaction for the company as its board looks to make a deal and discusses options still remaining.



Facebook May Be Forced to Go Public Amid Market Gloom

November 29, 2011

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, discusses how Facebook's many shareholders could force the social media giant to undertake an initial public offering.

"Another Internet hot shot, Groupon, is trading below its offering price, and the market for Internet initial public offerings over all appears to be deflating. The European sovereign debt crisis isn’t helping the market gloom. The coming months are shaping up to be a bad time to undertake an I.P.O.," Davidoff writes. "Still, Facebook will almost certainly have to go public during this time whether it wants to or not — and whether or not it can get a valuation of $100 billion or more in doing so."



Private Markets Offer Valuable Service but Little Disclosure

November 22, 2011

Professor Steven Davidoff, writing a column for The New York Times as the Deal Professor, discusses concerns surrounding private, closed markets that offer sophisticated investors the opportunity to buy shares in up-and-coming companies before their initial public offerings. But little information is provided about the companies.

“The S.E.C. thus faces a quandary. These private markets offer an increasingly desirable service by providing an outlet to sell shares in companies that do not want to subject themselves to the increased regulation and scrutiny that comes with being public,” Davidoff writes.

“Congress is considering a number of bills intended to make trading in these markets easier, and the S.E.C. is also reviewing its rules governing private markets. Congress may also want to consider enacting requirements for companies with shares actively trading on these markets to disclose sufficient information to allow informed trading. … Investors will otherwise remain in the dark, gambling without information.”

His column also was published by the Progressive Voices website.



Delaware Chancery Court Hears Cheers and Critiques at Columbia

November 21, 2011

Professor Steven Davidoff’s research was mentioned in a Corporate Counsel piece published by Law.com about a gathering of the academic community and the Delaware Court of Chancery, the country’s premier business court, at Columbia University Law School.

William Savitt, a partner at Wachtell, Lipton, Rosen & Katz piqued the audience's interest with his hypothesis that the court functions, in some ways, like a regulator. This attribute of offering "prospective guidance"—combined with judges who are known for engaging with academics, practitioners, and writers in the blogosphere—functions almost like a "notice and comment procedure" that characterizes a regulatory body, said Savitt.

Savitt pointed to Davidoff’s research, showing the skyrocketing incidents of shareholders in public companies challenging deals through litigation. A decade ago, about one in 10 such deals inspired a lawsuit; by 2010, the litigation rate spiked to 84 percent.



A Complicated Maneuver for Control of Yahoo

November 15, 2011

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, discusses the potential detour the Yahoo sale process might be taking.

“Instead of selling the company outright, Yahoo is reportedly contemplating a large sale of stock to one or more private equity firms using a controversial structure known as a PIPE, or private investment in public equity,” Davidoff writes.

“But does Yahoo’s latest turn mean battle-scarred shareholders will lose out on a valuable sale opportunity?”

The column also was published by International Business Times, an online global newspaper.



The Wisest Entrepreneurs Know How to Preserve Equity

November 15, 2011

Professor Steven Davidoff, writing as the Deal Professor for The New York Times Deal Book, discusses what is given up when entrepreneurs seek venture capital financing early in exchange for giving up part of their start-up.

“Success can spell the difference in billions. Andrew Mason, the chief executive and founder of Groupon, is worth $2 billion less than Eric Lefkofsky, the man who financed Groupon’s start,” Davidoff writes. “The multibillion-dollar difference is a result of a start-up’s need for capital at the embryonic stage.

His column also was published by The Austin-American Statesman, The Wall Street Journal and numerous technology blogs and websites.



A Troubled Deal and the Law of Unintended Consequences

November 7, 2011

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, takes a closer look at Skyworks Solutions’ attempt to escape its $262.5 million deal to buy Advanced Analogic Technologies. The May deal came with the caveat that any disputes between the two semiconductor companies would be subject to confidential arbitration before the Delaware Chancery Court.

“That fight is now occurring, with Skyworks asserting that Advance Analogic misstated its accounting numbers, and things appear to be going differently than either party intended. The law of unintended consequences is taking over because of the confidential nature of the Delaware proceedings,” Davidoff writes.

“Investors are looking for any snippet of information, while the companies themselves are selectively taking actions to buttress their case in the arena of public opinion. Meanwhile, a public interest group is suing the Delaware judges, contending that the confidentiality of these arbitration proceedings violates the constitutional requirement that judicial proceedings be open to the public.”



Olympus Scandal Reveals How Little Japan Has Changed

November 1, 2011

In an article in The New York Times’ DealBook, Professor Steven Davidoff examines the views of Michael Crichton’s book, “Rising Sun” in conjunction with the Olympus scandal.

“The Olympus scandal exposes the all-too-cozy nature of Japanese business that was subject to so much praise in the 1980s. Japanese corporations are dominated by insiders, and companies are often run for the benefit of these insiders rather than shareholder interests,” the Deal Professor writes.



Directors Behaving Badly: Rajat Gupta Faces Criminal Insider Trading Charges

October 26, 2011

Professor Steven Davidoff was quoted in Forbes from his column in New York Time’s DealBook. The Forbes article, about Rajat Gupta facing criminal insider trading charges, referenced Davidoff’s writing that former directors are not to blame for the collapse of institutions during the financial.



Banks May Be Target of Their Own Tactic: Advocating a Breakup

October 25, 2011

“Will Wall Street remain immune to the product it is selling to the rest of corporate America?” Professor Steven Davidoff asks in an article as The New York Times’ Deal Professor. The article, which appeared online and in print in The New York Times’ DealBook, elaborates on why Wall Street bankers push spinoffs and the effects such spinoffs have on stock prices of banks themselves.



Corporate Governance Issues Grow More Complex

October 21, 2011

A column was published in the New York Times’ DealBook based off a speech given by Professor Steven Davidoff. In Davidoff’s speech to a conference hosted by Institutional Shareholder Services on corporate governance, he explains the unintended consequences that arise from corporate governance becoming more complex.

“In my mind, the biggest corporate governance concern should be whether a specific corporate governance provision adds value to the corporate enterprise,” Davidoff says.



As Economy Goes, So Go Takeovers, Even as Bargains Abound

October 18, 2011

Professor Steven Davidoff compares the merger market to a pack of lemmings in an article for The New York Times’ DealBook. The article was also referenced on Bain & Company’s website for Davidoff’s mentioning of the firm’s 2011 Global Private Equity Report.



What kind of board member will Chelsea Clinton be for IAC?

October 15, 2011

A column written by Professor Steven Davidoff for The New York Times was published in full by The Seattle Times. The piece discusses Chelsea Clinton's appointment to the board of Internet media conglomerate IAC/InterActiveCorp and what pitfalls and profits come with celebrity board members.



DealBook Celebrates 10-Year Anniversary

October 7, 2011

Professor Steven Davidoff was declared a "must-read columnist" in a letter to The New York Times DealBook readers on the occasion of the newsletter's 10th anniversary.



Del Monte Settlement Highlights Risk in M.&.A. Advice

October 7, 2011

Professor Steven Davidoff wrote about Del Monte Foods and Barclays Capital's $89.4 million settlement in the sale of Del Monte to Kohlberg Kravis Roberts & Co. in a blog entry as the Deal Professor for The New York Times DealBook. "The settlement is one of the largest in connection with a deal on record," Davidoff writes. "It is certainly a big number. But does it mean anything for deal-making going forward?"



Columnist: Chelsea Clinton 'Didn't Earn' IAC Board Seat, But Could Still Add Value



October 5, 2011

Professor Steven Davidoff was quoted in the Hollywood Reporter about the appointment of Chelsea Clinton to the IAC Board. “The real question is whether Ms. Clinton can act independently and provide value to the IAC board,” Steven Davidoff, a commentator for the New York Times’ DealBook, wrote late Tuesday. “While there are many doubts on that score - and while Ms. Clinton clearly did not earn this position - she can still demonstrate that she is up to the task.”



A Strange Lesson From Renaissance Learning

October 4, 2011

Professor Steven Davidoff wrote a column in the New York Times about the purchase of Renaissance Learning by Permira even though there appeared to be a higher offer by Plato Learning Inc. Professor Davidoff discusses the possible reasons and consequences as to why in his column.



Chinese Policies Put Squeeze On the Banks

September 29, 2011

Professor Steven Davidoff, in his weekly column for The New York Times, wrote about globalization's positive effect on Wall Street. But, he pondered, "Can Wall Street continue its winning streak? The question boils down to whether it can succeed in Asia, particularly in China."



Cracker Barrel Uses Soft Touch to Keep Pursuer at Bay

September 28, 2011

Professor Steven Davidoff wrote a column for the New York Times Dealbook about the efforts of the Cracker Barrel Old Country Store to fend off a siege by activist force Sardar Biglari, which operates Steak 'n Shake.



A $50 Billion Claim of Havoc Looms for Bank of America

September 27, 2011

Professor Steven Davidoff wrote a column for the New York Times about the Bank of America's potential liability related to its acquisition of Merrill Lynch. The lawsuit, brought by Bank of America shareholders, claims the bank and its executives failed to disclose a $15.31 billion loss that Merrill in the days before and after the acquistion. "Whatever the outcome of this case, it appears that Bank of America shareholders were sacrificed in December 2008 so that the Merrill deal could be completed. The bill may now be coming due for Bank of America," Davidoff wrote.



British Takeover Rules May Mean Quicker Pace but Fewer Bids

September 19, 2011

Professor Steven Davidoff's recent contribution to The New York Times Dealbook discussed the new laws in Britain regarding corporate takeovers.

According to Davidoff, these new rules are much different than U.S. regulations.

"While the consequences of these new rules can be debated, there is little doubt that the British takeover rules stand in stark contrast to the takeover regime in the United States, which is much more protective of targets from hostile and competing bids," he wrote.



The Merrill Lynch and Lehman Deals, 3 Years Later

September 13, 2011

Professor Steven Davidoff's recent contribution to The New York Times Dealbook, which was also published by The Wall Street Journal and LiverMint.com, discussed the implications of the Merrill Lynch and Lehman Brothers deals that took place three years ago.

According to Davidoff, the Lehman deal was much more beneficial than the Merrill Lynch deal.

"The difference shows not only how a chief executive’s hubris can destroy a company, but how three years later, the failure of the Treasury Department, Federal Reserve and the banks themselves to shrink significantly the banks’ mortgage liabilities still threatens our economy," he wrote.



AT&T’s Battle for T-Mobile Is Political as Well as Legal

September 6, 2011

Professor Steven Davidoff's recent contribution to The New York Times Dealbook explains AT&T's battle against the government to complete a deal with T-Mobile. He points out that despite the government intervention, a deal can still be reached.

"While many commentators have viewed the government’s suit as the endgame, it is really the beginning. AT&T is likely to adopt a two-pronged strategy, employing an army of lawyers to fight the matter in court while redoubling its political efforts aimed at bringing the government to the negotiating table in search of a settlement," Davidoff wrote.



In a Quiet Period, Groupon Feels the Noise

September 2, 2011

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, discusses why an internal memo at Groupon could delay its initial public offering (I.P.O.).



Capital One Tries to Buy Too Big to Fail Status

August 24, 2011

Professor Steven Davidoff's recent contribution to The New York Times DealBook sparked commentary from the Columbia Journalism Review, a magazine for American journalists. The magazine cited a piece Davidoff penned recently about Capital One's announcements of pending acquisitions of ING Direct and HSBC. It would bring Capital One's assets to $300 billion.

"It’s good to see this column, even if it is stuffed inside the business section, because press coverage of Capital One’s moves toward too big to fail status has been awfully scant. The WSJ, for instance, gave the news all of 430 words on C3 when it broke," CJR states. "But $300 billion is still a very big bank. And it seems that buying your way to No. 5 ought to be worth a bit of scrutiny."

The CJR piece goes on to quote Davidoff's column: "Community interest groups led by the National Community Reinvestment Coalition, which oppose the deal, say that Capital One is already classified under Dodd-Frank as systemically important since it has more than $50 billion in assets. Why should any such bank be allowed to get bigger?"



M & A wrap: Lifting the Vale

August 24, 2011

Professor Steven Davidoff's recent contribution to The New York Times DealBook was quoted by Reuters. The global news agency cited a piece Davidoff penned recently about Capital One's announcements of pending acquisitions of ING Direct and HSBC. Davidoff proposed the $9.2 billion deal with ING Direct would require clearance from the Federal Reserve because of the systemic risk it poses.

Reuters ran this excerpt of Davidoff's writing: “Whether or not the Fed approves the Capital One/ING Direct transaction, it is time for the Fed to run public hearings on what exactly Dodd-Frank means for our banks and what we as a country want from them."



In Fed’s Move on Capital One Deal, a Test of Dodd-Frank

August 23, 2011

Professor Steven Davidoff contributed to The New York Times DealBook a piece on how the Federal Reserve's decision to block or approve Capital One's $9.2 billion purchase of ING Direct would have a broad impact on the nation's biggest banks.



The MAC Is Back, but Does It Kill a Deal?

August 23, 2011

Professor Steven Davidoff contributed a piece to The New York Times DealBook about the re-emergence of the material adverse change (MAC) clause in acquisitions, which were popular during the height of the financial crisis. "A buyer can invoke a MAC clause to try to drive down the price of an acquisition by taking advantage of either changed market conditions or adverse events affecting the target company," Davidoff writes.



How the Google Deal Hampers Motorola

August 19, 2011

Professor Steven Davidoff recently contributed a piece to The New York Times DealBook about how Google's large, reverse-termination fee in its deal to buy Motorola Mobility puts the latter on a "short leash, dependent upon Google until the acquisition closes."



Behind Google’s Huge Breakup Fee in Motorola Deal

August 18, 2011

Professor Steven Davidoff, writing as the Deal Professor for The New York Times DealBook, posits that Google's $2.5 billion reverse termination fee in its deal with Motorola Mobility is akin to a warning shot over the bow to anitrust regulators. "The fee’s driver is that Google has become what Microsoft was a few years ago, a natural target for European and American antitrust regulators," Davidoff writes. "For the foreseeable future, any significant transaction Google engages in will really be all about antitrust in terms of getting it done."



Tax Policy Change Would Bring Cash Piles Abroad Back Home

August 16, 2011

Professor Steven Davidoff, writing as The Deal Professor for The New York Times DealBook, unfolds the reasons behind American corporations' stockpiling of cash abroad. There are other reasons besides the tax implications, Davidoff writes.



For Bank of America, Countrywide Bankruptcy Is Still an Option

August 11, 2011

Professor Steven Davidoff contributed to The New York Times DealBook this piece examining the potential fallout of Bank of America putting Countrywide into bankruptcy as a means of saving itself from Countrywide's numerous and costly liabilities.

"When Bank of America acquired Countrywide, it did not become responsible for its past misdeeds and any litigation liability. This is true even though it is now clear that Countrywide was insolvent at that time," Davidoff wrote. "Even so, Bank of America could have had Countrywide Financial put into bankruptcy and cordoned off these liabilities. It could still have done this today had it continued to operate Countrywide as a separate company.

"Unfortunately for Bank of America, it didn’t keep things so neat when it acquired Countrywide. Instead, Bank of America engaged in a number of complex transactions to consolidate Countrywide into its operations."



Deals wrap: Valuing Groupon

August 10, 2011

Professor Steven Davidoff's weekly column in The New York Times was quoted by Reuters in an article compiling various deals. The global news agency plucked Davidoff's quote about General Maritime's $200 million loan from Oaktree Management: “When you play with the big boys, you sometimes get hurt."



Hazards of Borrowing Money From Hedge Funds

August 9, 2011

Professor Steven Davidoff contributed to The New York Times DealBook this piece on the potential hazards when public companies borrow from hedge funds, as evidenced in the case of General Maritime's taking a $200 million loan from Oaktree Capital Management.



Ex-Directors of Failed Firms Have Little to Fear

August 2, 2011

Professor Steven Davidoff wrote about former directors of Bear Stearns and Lehman Brothers having little to fear due the financial crisis’ toll on institutions for The New York Times DealBook. Davidoff drew upon the whereabouts of ex-Enron directors after the company’s bankruptcy in 2001. “…they have recovered nicely from the scandal,” he writes and concludes, “In the end, the directors of companies that failed in the financial crisis will most likely receive an even freer pass than the Enron directors.”



Hazards of Borrowing Money From Hedge Funds

August 1, 2011

Professor Steven Davidoff contributed to The New York Times DealBook this piece on the potential hazards when public companies borrow from hedge funds, as evidenced in the case of General Maritime's taking a $200 million loan from Oaktree Capital Management.



Shareholders Weigh Options From BP Spill

July 8, 2010

Professor Steven Davidoff was quoted in a Fox News story about the BP oil spill. The article discussed various lawsuits that are going against BP in the ongoing disaster. Davidoff was quoted regarding a probable settlement in any class action lawsuit: “Steven Davidoff, a professor at the Ohio State University law school, says history shows that once a class action is granted and large numbers of plaintiffs join in, companies try to settle to avoid the possibility of unmanageable damage awards. Davidoff said the potential settlement value for BP shareholders likely will be less than in cases where a company has ‘a record of malfeasance at high management.’"



Skybus shareholders out of luck

February 6, 2009

Professor Steven Davidoff was quoted in a Columbus Dispatch story about the now-bankrupt Skybus Airlines paying back its shareholders. The story states: “‘Many bankruptcies, like those of the major airlines in previous years, take years. So a year by bankruptcy standards is an A-minus,’ said Steven Davidoff, a visiting professor at Ohio State University's Moritz College of Law.”



KCBS Radio in San Francisco

October 7, 2008

Professor Steve Davidoff was quoted on a show on KCBS radio show in San Francisco. He discussed the dealings between Wells Fargo, Citi, and Wachovia.



Bailout Bill Goes to the White House

October 3, 2008

Professor Steve Davidoff was featured on the NPR show To the Point to discuss the bailout bill being passed by the Congress. Davidoff was featured alongside Robert Reich, former U.S. secretary of labor.



What Does It Take to Be 'Too Big to Fail?

September 17, 2008

Professor Steven Davidoff was interviewed on NPR’s To the Point regarding the U.S. government’s decision to back AIG. Davidoff and others provided their insight as to why the world’s biggest insurance company will now be backed with $85 billion in federal money.



In Picking Facebook Shares, Repeating the Mistakes of the Past

November 30, -0001

Professor Steven Davidoff, as the Deal Professor, wrote an article for The New York Times DealBook about investing in Facebook.

“The bottom line is that more needs to be done to educate and help individual investors,” Davidoff wrote. “It should become common knowledge that investing in an individual stock and trading may be fun, but it may also be dangerous to their wealth. Perhaps the warnings could start with a confessed Facebook I.P.O. investor.”