Martin Lipton Wachtell, Lipton, Rosen & Katz 51 West 52nd Street New York, NY 10019 United States Learn more about SSRN Profiles SCHOLARLY PAPERS 15 DOWNLOADS Rank 9,574 7,901 SSRN CITATIONS Rank 19,116 13 CROSSREF CITATIONS 44 Scholarly Papers (15) Sort by: Actions: Email selected abstracts View: Selected Original List All Versions All Abstracts Recognizing the potential for conflicts between managements self-interest in preserving the independence of a target company and the directors decision to accept or reject a takeover bid, Lipton advocated the following best practices: In this section of the article, Lipton began to embrace a more assertive role for independent directors and advisors. Martin Lipton | Above the Law (Lipton is not referring to himself, but Joe Flom. Beyond Friedman's Doctrine: The True Purpose of the Business The Mod Squad and Twin Peaks star is survived by her two actress daughters, Kidada and Rashida Jones, her . . Perhaps the most notable early voices on the opposite side of the debate were then-Professors Frank Easterbrook and Daniel Fischel, who argued in response to Lipton that current legal rules allowing the targets management to engage in defensive tactics in response to a tender offer decrease shareholders welfare.36 Easterbrook and Fischel urged that the proper management response to an unsolicited tender offer was passivity: management should not propose antitakeover charter or bylaw amendments, file suits against the offeror, acquire a competitor of the offeror in order to create an antitrust obstacle to the tender offer,37 buy or sell shares in order to make the offer more costly, give away to some potential white knight valuable corporate information that might call forth a competing bid, or initiate any other defensive tactic to defeat a tender offer. Their conclusion: shareholders welfare is maximized by an externally imposed legal rule severely limiting the ability of managers to resist a tender offer even if the purpose of resistance is to trigger a bidding contest.38 Responding directly to some of the points advanced in Takeover Bids, Easterbrook and Fischel argued that Lipton was simply wrong in concluding that takeovers injure the long-term interests of the corporate system and economy since (they asserted) a successful long-term plan will be reflected in higher share prices that discourage takeovers.39 More fundamentally, they challenged Liptons premise of a targets duty to consider the interests of noninvestor groups such as employees, customers, creditors, and the community in general as deeply flawedcontending that because [t]akeovers improve economic efficiency and that improvement usually enhances the position of those who deal with the firm.40 Liptons approach, the then-professors argued, amounts to rejection of the idea that agents (managers) are accountable to their principals (shareholders); and by allowing management to sacrifice shareholder interest to those of noninvestor groups, far more than the separation of ownership and control or any other characteristic of the modern corporation, would greatly prejudice shareholders by decreasing the incentive of management to act in their best interest.41, In a follow-up writing in the Business Lawyer, Easterbrook and Fischel elaborated on their critique of Liptons position.42 There they identify the source of their differences as springing from the treatment of fundamental economic issuesnamely, their views that Lipton was wrong in contending that his approach was in the shareholders interests. at 865.58Hoffer Kaback, Martin Lipton: For the Defense, Directors & Boards, Summer 1999.59Robert Slater, Mercenaries of the Takeover Game: Joseph Flom & Martin Lipton, in The Titans of Takeover 145, 157 (1987). Correct decision by Andy Madley to ignore VAR recommendation and award #FulhamFC 2nd goal at #CrystalPalace - accidental handball by Mitrovic, who did not score himself. As of this time in the American public markets, no protection against this sort of coercion existed under the securities laws. L. Rev. This experience with Harold McGraw to defend the company his family had created was transformative for Lipton, as Lipton explained: Harold thought that the company was worth far more than [the] $34 per share [Amex offered] and would achieve that value in just a few years. She has one sister named Rachael who is her best friend. Liptons advocacy for takeover defense rested on several pillars. This post is based on his Wachtell Lipton memorandum. at 1713 (By 1979, I was if not 100 percent, 99.9 percent involved in defending against hostile takeovers.).20 Martin Lipton, Takeover Bids in the Targets Boardroom, 35 Bus. L. Rev. . 8, 2016); see also Pearlman, 75 Bus. at 104 n.10. He has written and lectured . at 108.29Lipton, 35 Bus. As a matter of lawyering, its absolutely brilliant, Stanford University Law Professor Ronald Gilson told Legal Affairs. Instead, milkmen delivered dairy in reusable glass bottles. Law. Martin Lipton, a founding partner of Wachtell, Lipton, Rosen & Katz, specializes in advising major corporations on mergers and acquisitions and matters affecting corporate policy and strategy. Its always been a team effort, but we all know that Marty has always been first among equals.9, Lipton grew the firm based on his valuesa firm that was based on mutual trust, a commitment to professional excellence, and thought leadership. [25][26] Since 1985 Lipton has been on each list of the National Law Journal of the 100 Most Influential Lawyers in America. The nearest subway station to Susan And Martin Lipton Hall (Valpo) in Manhattan is a 14 min walk away. [5] In the fall of 1958 he practiced law at Seligson, Morris & Neuburger, a ten-lawyer firm of Charles Seligson and J. Lincoln Morris, where he teamed with Leonard Rosen and George Katz, fellow NYU Law graduates. The 'We Are The World . But we gave an opinion, an absolute opinion. Joseph Flom (left) and Martin Lipton (Right). For Harold it was not about money. at 105.24Lipton, 35 Bus. Image 163 of 168 from the May 16, 2003 publication of The Detroit Jewish News. Martin Lipton Found! - See Phones, Email, Addresses, and More The CEO of McGraw-Hill, and descendant of the founders, Harold McGraw, begged Lipton to defend his company against a hostile bid from American Express. 1952 . As a personal matter, Lipton viewed the type of hostile offers of the periodwhich often involved an implicit willingness of the bidder to go away for a payment to itself, so-called green mail, a coercive two-tiered front-end loaded bid stampeding stockholders into acceptance, partial offers for only a majority of the shares, and plans to dismantle and leverage up the targetas harmful to society. 8Martin Lipton, Collected Quotations (2021).9Timothy Harper, A Boardroom Lawyer, Super Law. Not only that, Liptons memos, as will be seen, had a voice and a point of view, unlike the lengthier, on the one hand, on the other approach, that often characterized legal discourse of that time. I felt I was involved in a processthat was not good for the economy, not good for the people involved, and I developed a very, very strong bias against doing bust-up deals. A conversation with Susan Lytle Lipton LL.M. '71 - Harvard Law School But we had really failed to find a case directly on point. at 848.53Gilson, 33 Stan. [11], In 1979, Lipton was asked to take a leave of absence from Wachtell Lipton and voluntarily serve as special counsel to the Energy Department, and then in 1980 to serve as the acting first general counsel of the Synthetic Fuels Corporation. These Subway lines stop near Susan And Martin Lipton Hall (Valpo): 6, 6X. 31Lucian A. Bebchuk, Toward Undistorted Choice & Equal Treatment in Corporate Takeovers, 98 Harv. an analysis of the raider and its management and in the case of a partial offer or an exchange offer pro forma financial statements and a comparative qualitative analysis of the business and securities of both companies. In fact, before Lipton developed guidance for takeover targets, he developed a checklist for those making a hostile tender offer for control. Using the threat of the poison pill (a term not coined until the next year), El Paso negotiated its sale to the hostile suitor from a position of strength. After being selected for Law Review, Lipton met his future partners Herbert Wachtell, Leonard Rosen, and George Katz, who were law review editors in the year ahead of him.4 In fact, as Lipton recalled it, My friendship with Herb got off to a rocky start when he took the first note I wrote for the Law Review and completely rewrote it on his typewriter amidst a constant stream of criticism. L. Rev. If a majority of the directors are officers or otherwise might be deemed to be personally interested, other than as shareholders, a committee of independent directors, although not in theory necessary, from a litigation strategy standpoint may be desirable. The bridegroom, 25, is an associate in the New York law firm of Simpson, Thacher & Bartlett. This wasnt a business proposition. Protecting employees who had had given years to the company, preserving a legacy of quality for consumers, and honoring commitments to corporate communities struck Lipton as entirely proper goals when responding to a takeover. The group's executive director was Ms. Kremer's daughter, Kylie Jane Kremer, who recently worked on Sean Hannity . In 1982 Lipton created the Shareholder rights plan or poison pill, which has been described by Ronald Gilson of the Columbia and Stanford Law Schools as "the most important innovation in corporate law since Samuel Calvin Tate Dodd invented the trust for John D. Rockefeller and Standard Oil in 1879. Terry Zeller. To this day, that principle guides the firm [we created] and the firm [still] does not have a written partnership agreement.8, Although Lipton was the primary mover in creating the firm, he and his friend Herb Wachtell divided the senior partner spoils, with Wachtell being first in the firms name, and Lipton being first named partner on the letterhead. A dozen years ago, investor and entrepreneur Marc Andreessen described software as eating the world. Today, the same might be said of mobile apps. Recently, there has been much confusion and misinformation about (1) environmental, social, and governance (ESG) considerations, (2) the ways in which companies, boards, asset managers, investment funds, and other market participants can, do, and should factor such considerations into their decision-making processes, and (3) the need for companies to consider, balance, advance, and . Martin Lipton, a founding partner of Wachtell, Lipton, Rosen & Katz, specializes in advising major corporations on mergers and acquisitions and matters affecting corporate policy and strategy. Over the years, the Marty memo and firm writings drawing on its template became the major way that Wachtell Lipton communicated with clients and found new clients, as over time, more and more company counsel, CEOs, investment bankers, and even other law firms, asked to be on the distribution list to hear the thoughts of Lipton and his partners. This was in an era when such struggles were rare. at 113.30Lipton, 35 Bus. If target management prevents shareholders from responding to an offer, that valuation process is bypassed. 48In contrast to Liptons view of the primary role of the board of directors in accepting or blocking a tender offer, Gilson saw the board of directors as aiding the shareholders in making the decision through providing the shareholders with information or bargaining on behalf of the shareholders which may involve looking for a white knight. Throughout most of the 1970s, Wachtell Lipton was as likely to represent those making hostile tender offers as those resisting them. 2019-2020 Wharton Alumni Magazine. 14See, e.g., Beneficial Ownership, Takeover and Acquisitions by Foreign and Domestic Persons: Proceedings Before the Securities & Exchange Commission 151-52 (Nov. 14, 1974) (statement of Martin Lipton) (opens by arguing that tender offers should not be impeded, that they provide valuable liquidity, and that they are the only practical way that has evolved for changing control . He is an Emeritus Chairman of Prep for Prep, having served as Chairman from 1990 to 2002 and a member of the American Academy of Arts & Sciences, and a Chevalier de la Lgion d'Honneur. Takeovers in the Ivory Tower: How Academics Are Learning Martin Lipton Her father is a partner in the New York law firm of Wachtell, Lipton, Rosen & Katz. Advisory Committee on Tender Offers. Law. His tenacious tactics established . By Jim Rutenberg, Jo Becker, Eric Lipton, Maggie Haberman, Jonathan Martin, . That point made, the case for takeover defense was based on the more fundamental level of the necessity of long-term planning and consideration of all the corporations constituencies: Even in the face of such an ad hoc consortium, the necessity from technological, social and economic standpoints for long-term planning by business requires a policy decision in favor of not mandating decisions that ignore or penalize long-term planning. [8][10] Also, in 1975, as a trustee of the NYU School of Law, Lipton played a major role in saving NYU from its financial crisis by selling the Mueller Macaroni Company. The Detroit Jewish News Digital Archives - May 16, 2003 - Image 163 Hayden Hall to Be Renamed to Lipton Hall - Washington Square News Lawyers Don't Make Enough - Forbes That work helped get the firm involved in helping clients run and defend proxy fights, the technique by which contests for corporate control tended to occur in the 1970s. The senior partner of the firm, Charles Seligson, taught at NYU and Lipton had been a student in Seligsons bankruptcy course. Martin Lipton - Wikipedia Law. Because of Liptons academic success, Dean Niles encouraged Lipton to consider a teaching career focusing on corporate law, a subject in which he had developed a particular interest. ))16 Beneficial Ownership, Takeover and Acquisitions by Foreign and Domestic Persons, at 183. Chen and Ang created a plant-based beverage inspired by Asian milk tea the iconic drink theyve loved since childhood by ethically sourcing tea from fair-trade, single-origin family-owned farms and focusing on sustainability and flavor. THE Glazer family will be offered a deal to stay on at Manchester United by Britain's richest man. Peggy Lipton -- model, "It" Girl, and Golden Globe-winning actress -- has died at age 72. 1161, 1164 (1981).37Easterbrook & Fischel, 94 Harv. YOU HAVE 5,000 FOLLOWERS. [3] The firm was founded as a handshake among four friends and to this day does not have a written partnership agreement. 1709, 1709-11 (2020). Martin Lipton's profile, publications, research topics, and co-authors. Thus, another prominent Columbia Law Professor, Herbert Wechsler, helped Lipton secure a clerkship in 1956-57 with Judge Edward Weinfeld of the U.S. District Court for the Southern District of New York. In support of that critique, the then-professors argued that it was implausible to suggest that stock is priced in the market at less than its true value, since they assume that markets are indeed efficient; that it is futile to expect that shareholders could monitor managers performance; that shareholders are unambiguously worse off if defensive tactics preserve corporate independence.43 On a doctrinal level, their argument against application of the business judgment rule to defensive tactics was rested on the premise that managers have acute conflicts of interests in resisting takeovers, and their view that shareholders welfare is maximized by a binding legal rule requiring managers to acquiesce when confronted with a tender offer. Liptons recommendation that target company boards consult with legal and financial experts in determining whether to oppose a takeover bid was derided as sheer waste while no doubt lucrative for the various outside professionals involved; under the then-professors view, the targets board should relax, not consult any experts, and let the shareholders decide.44.
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