Eric W. Orts

In M&A, an acquirer must pay an acquisition premium to target shareholders. However, much to academic puzzlement, this universal reality rubs against theory. Two fundamental ideas in modern financial economics are the efficient capital market hypothesis (ECMH) and the capital asset pricing model (CAPM). Together, they tell us: (1) an efficient market incorporates into the stock price all public information and thus all factors of value except private information, (2) the intrinsic value of a firm is the discounted, per CAPM, future free cash flow, (3) thus, stock price and intrinsic value should be tethered, albeit stock price can be “noisy.” Accepting these truths in the main, what accounts for the universal fact that an acquirer always pays a premium when the stock price is said to be “right”? The academic and practical answer is found in the theory of the firm and Coase's error. The theoretical answer has a practical implication on Delaware merger rules.

On July 17, 2026, Scoular, a Nebraska-based agricultural company, entered into a three-year deferred prosecution agreement (DPA) with DOJ to resolve a Foreign Corrupt Practices Act (FCPA) case. The case has all the hallmarks of a standard FCPA resolution and is also notable for its cartel nexus: DOJ emphasized that Scoular's bribes unknowingly benefitted a Mexican cartel – an administration enforcement priority.

Corporate law gives corporations the ability to own assets, enter contracts, raise funding, and operate at scale. The central commitment corporations make in return is to act lawfully. Yet when violations of the law are hard to detect and penalties are limited, illegal conduct can be profitable.

In a recent comment letter , we take issue with a Department of Labor proposal (the “Proposal”) to create a safe harbor that would facilitate

The Private Securities Litigation Reform Act's (“PSLRA”) automatic stay during the pendency of a motion to dismiss is one of the most important procedural protections for defendants in a securities action. The stay, which applies to “all discovery and other proceedings” during the pendency of “any motion to dismiss,” protects defendants from incurring costs that may be obviated based on the outcome of the motion.

In November 2024, the Financial Accounting Standards Board finalized its Disaggregation of Income Statement Expenses (DISE) standard. Beginning in 2028, public firms will have to break out employee compensation from each functional expense item on the face of their income statements, including cost of goods sold (COGS) and selling, general, and administrative expense (SG&A). The reform comes in response to complaints that the face of an income statement tells investors what a firm spends money on by function, but almost nothing about the labor, materials, and other inputs that drive those functions.

In 2023, an open-source project for managing decentralized autonomous organizations (DAOs) on Ethereum became embroiled in a dispute that raised legal and governance questions for digital assets and decentralized technology. The protocol, called Aragon, had structural traits that are common in crypto but less familiar to most industries. Governance authority sat nominally with holders of the ANT token, while legal control of the community treasury (worth roughly $155 million in ETH at the time of the Association's

Governments around the world are rediscovering ownership as an instrument of economic policy. From Washington's industrial policy and Beijing's state-owned enterprises (SOEs) to sovereign wealth funds across Asia, states are increasingly acting not merely as regulators but as strategic shareholders. The question confronting policymakers is no longer whether governments should own corporations, but how they should govern them.

In resolving a significant issue of first impression, the Delaware Court of Chancery held today that directors of public benefit corporations approving a change-of-control transaction are not required to maximize stockholder value.

Principles and practices of good corporate governance offer a potentially powerful way to manage uncertainty that is often unrealized. Boards allocate capital based on probabilistic assessments of outcomes they often cannot control. Risk committees price scenarios that may never materialize. Institutional investors build social impact (e.g., ESG, CSR, and GRC) mandates around commitments whose fulfillment remains unverifiable in real-time. These and other concerns remain in some if not most of the trillion-dollar socially responsible investing (SRI) industry. The emergence and ascendance of prediction markets over the past year suggest a new social impact architecture that might serve both the informational needs of corporate actors and the accountability demands of the stakeholders they affect. These needs and demands, we argue, may be satisfied by offering a market architecture for betting on positive, aspirational, and socially impactful time-bound event outcomes.