State Competence to Regulate Corporate Takeovers: Lessons from State Takeover Statutes
64 Pages Posted: 21 Oct 2010
Date Written: 1989
This Article reveals two very different lessons about state competence to regulate corporate takeovers. The first lesson is that some states are enacting anti-takeover legislation for the protectionist purpose of sheltering large local employers. The Article contends that the appropriate response to this legislation is for courts to invalidate it under the Commerce Clause. The second lesson is that some states, most notably Delaware, are enacting anti-takeover legislation to protect a state’s corporate chartering industry. In this instance, federal preemptive intervention is necessary to ensure that state law does not unduly favor management interests at shareholder expense.
Keywords: corporation law, takeovers, Delaware, constitutional law
JEL Classification: K22
Suggested Citation: Suggested Citation