The Seventh Circuit and the Market for Corporate Control

Abstract

This article explores five crucial Seventh Circuit takeover opinions: MITE Corp. v. Dixon; Panter v. Marshall Field & Co.; Dynamics Corp. of America v. CTS Corp. (CTS I); Dynamics Corp. of America v. CTS Corp. (CTS II); and Amanda Acquisition Corp. v. Universal Foods Corp. As the earlier Seventh Circuit opinions demonstrate, the debate over the legitimacy of target management behavior was characterized at the outset of the 1980s by traditional constitutional and corporate doctrinal analysis. With the passage of time, however, the debate was dramatically refocused by an infusion of economic analysis. With Judges Easterbrook and Posner-two leading generals of the Law & Economics ("L&E") school-among its members, the Seventh Circuit played a pivotal role in the resulting restatement of the law of hostile takeovers. For this reason alone, the Circuit's takeover opinions merit review as the decade comes to a close.