A Great Game: The Dynamics of State Competition and Litigation

37 Pages Posted: 13 Jan 2012 Last revised: 30 Mar 2015

See all articles by Matthew D. Cain

Matthew D. Cain

Berkeley Center for Law and Business

Steven Davidoff Solomon

University of California, Berkeley - School of Law; European Corporate Governance Institute (ECGI)

Date Written: January 1, 2015

Abstract

We provide a multi-dimensional picture of jurisdictional competition for corporate litigation by examining merger litigation in a hand-collected sample of 1,117 takeovers from 2005-2011. We find that entrepreneurial plaintiffs’ attorneys drive this competition by bringing suits in jurisdictions which have previously awarded more favorable judgments and higher fees and by avoiding unfavorable jurisdictions. States with an apparent interest in attracting corporate litigation respond in-kind by adjusting judgments and awards to re-attract litigation. These states award higher attorneys’ fees and dismiss fewer cases when attorneys have been migrating to other jurisdictions. Our findings illuminate the dynamics and existence of jurisdictional competition for corporate litigation.

Keywords: Merger Litigation, Takeovers, Jurisdictional Competition, Delaware, Plaintiffs' Attorneys, Shareholder Class Actions

Suggested Citation

Cain, Matthew D. and Davidoff Solomon, Steven, A Great Game: The Dynamics of State Competition and Litigation (January 1, 2015). Iowa Law Review, Vol. 100, No. 165, 2015, Available at SSRN: https://ssrn.com/abstract=1984758 or http://dx.doi.org/10.2139/ssrn.1984758

Matthew D. Cain (Contact Author)

Berkeley Center for Law and Business ( email )

215 Boalt Hall
Berkeley, CA 94720-7200
United States

Steven Davidoff Solomon

University of California, Berkeley - School of Law ( email )

215 Boalt Hall
Berkeley, CA 94720-7200
United States

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

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