We examine two distinct forms of information bundling that can occur when a firm releases a restatement: “positive bundling,” the release of good news with the restatement, and “negative bundling,” the release of additional bad news. We use a triple differences testing approach to...

This paper investigates whether and how federal judges’ political ideology affects opportunistic insider trading. Although federal judges are the ultimate arbiters of insider trading enforcement, whether their ideology matters to insiders’ trading decision is unclear because the primary...

Infrastructure matters. Markets are designed by market participants for the benefit of market participants and assessed measuring utility to market participants. The natural result is that market structure becomes a tool used by the most powerful market participants to extract rents from the...

The press has given the public the impression that insider trading is evil, unethical and illegal, when in fact such is not always the case. In some cases, insider trading is beneficial to the economy and to shareholders. Whether insider trading is harmful, unethical or illegal depends on many...

Structured Investment Vehicles or SIVs are highly complex derivative-related vehicles and products, typically involving offshore “bankruptcy-remote” special purpose companies and trusts, complex rules for the management of portfolios of derivative assets and additional rules for the...

This paper offers a model to formalize the economic theory of derivative actions developed during the last 30 years. From this perspective, the derivative action presents two interrelated problems. The first is how to solve the collective action problem that prevents that minority shareholders...

The ad hoc institutional configurations that facilitated the resolution of sovereign insolvency for over thirty years are fragmenting. In the absence of an acceptable alternative, the recent pari passu decision reveals the dangers of common law courts pressured to enforce contracts and paper...

This paper contrasts UK and US governance of M&A break fees to see what the contrast can teach us about trade-offs between litigation and regulation as modes of governance, including how laws change under each regime over time. Data on 1,136 bids in 1989-2008 and 61 fee disputes show: (1) the UK...

The article discusses the rights of unnamed class members in class actions and shareholders in corporate derivative suits to appeal court orders approving the settlement of their claims. As representative actions, class actions and derivative suits by definition necessarily determine the rights...