Thank you to the in-person attendees who packed the “sold-out” venue and the hundreds who joined virtually at the 11th Annual Spring Forum on M&A and Boardroom, co-hosted by Freshfields and the Berkeley Center for Law & Business. Here’s our annual report-out and takeaways, along with a link to the forum website. Videos of the panels, where available, can be found hyperlinked at the headings below.
US Antitrust Agencies in 2025 - FTC Commissioner Melissa Holyoak; Former FTC Commissioner (2018-2023) and Current Head of Freshfields US Antitrust Practice, Christine Wilson; and Berkeley Law Professor Stavros Gadinis
Key Takeaways:
- Merger enforcement will remain aggressive during the Trump administration, and will strive to be more transparent and predictable than during the Biden administration.
- Remedies are back on the table, with a focus on remedying only very specific harms arising only from the merger under review rather than attempts at “central planning.”
- Merger enforcement will not preference IPOs over acquisitions of startups – robust markets for both IPO and M&A exits are currently viewed by the US antitrust agencies as important for ensuring continued innovation.
- Existing consent decrees put in place during the Biden administration may be modified in the near term due to changed conditions of fact or law and if the modifications are in the public interest, with a focus on remedying overreaches that may have occurred due to political influence.
- Enforcement will focus on sectors that impact consumers, especially healthcare and consumer retail, while tech (including AI) continue to be an area of focus.
Christine Wilson opened up the discussion by exploring ways in which merger enforcement may be different under the Trump administration. Commissioner Holyoak explained that the antitrust agencies under the Biden administration were hostile towards mergers generally, which showed through the cases they brought and the weakness of some of the theories of harm they relied upon when investigating and challenging mergers. According to Commissioner Holyoak, the focus is now back to well-grounded theories of harm. Commissioner Holyoak emphasized that she will be aggressive when it comes to merger enforcement, but noted investigations will be based on the three-legged stool of documents, testimony, and economics to ensure the FTC has a strong case based on precedent.
Christine Wilson discussed the “procedural shenanigans” that the FTC under Chair Khan used to chill all merger activity. Commissioner Holyoak emphasized the prior administration’s disregard for procedural norms, including a lack of communication and transparency with the parties. The Commissioner declared that her priority is to bring communication and transparency back to merger review processes so that parties can understand the relevant legal and economic theories early on and have constructive, substantive conversations with staff. Commissioner Holyoak then announced that another procedural norm that is back is early termination, though Commissioner Holyoak noted that the FTC is not currently receiving as many requests as they had prior to the Biden administration. She encouraged the audience to increase the quantity of requests for early termination.
Christine Wilson then discussed studies about the effectiveness of remedies. Commissioner Holyoak made clear that remedies are back on the table and emphasized that parties should not hesitate to proactively propose remedies. She explained how, only if FTC thinks the proposed remedies are insufficient, will the FTC take the parties to court. The implication was that the days of merger parties having to “litigate the fix” in court may be in the past. On the issue of retrospective studies of remedies, Commissioner Holyoak emphasized that the commissioners are not “central planners” tasked with creating a perfectly competitive market across all actors, rather their focus is on remedying only what, if anything, is lost as a result of the specific merger under review. The Commissioner further declared that, although behavioral remedies can be more difficult due to monitoring and enforcement costs, they are definitely back on the table for consideration, along with divestiture remedies.
The discussion next moved to merger review policy of acquisitions of startups. Commissioner Holyoak explained that a robust IPO market and a robust M&A exit market are equally valuable. She further expounded on why the FTC should not be foreclosing the ability for startups to be purchased. She declared that there is nothing in the antitrust laws that favors exit via IPOs over being purchased, and that the M&A exit option needs to be maintained. She emphasized that M&A exits for startups merit support because the M&A exit eco-system permits serial founders to continue to create and innovate and then sell their startups.
The conversation then moved to a discussion of recent petitions to modify consent decrees that were finalized under the Biden administration. Commissioner Holyoak discussed her dissents to the consent decrees in ExxonMobil and Chevron. She highlighted her view that the majority overreached by focusing on the composition of executive teams and boards that had nothing to do with assessing whether the mergers in question limited competition. She noted the mergers in question did not limit competition and rather were investigated due to political pressure from the Senate. Commissioner Holyoak then declared that she was supporting revisions to the Enbridge Energy consent decree. She noted that the criteria for modifying consent decrees are: (1) whether there are changed conditions of fact or law and (2) whether the modification is in the public interest based on a cost/benefit analysis. Christine Wilson noted that there were a number of Biden administration consent decrees that require prior approval of future M&A activity and that those decrees might be candidates for petitions for modification.
The conversation finished with a discussion of which industries would receive heightened scrutiny by the US agencies during the Trump administration. Commissioner Holyoak noted that many of the current Big Tech cases began under the first Trump administration. She explained that the agencies remain committed to these cases because, in her words, these companies are of such magnitude that they impact nearly every aspect of the lives of an overwhelming number of citizens and because these companies are involved in the development of AI. She concluded by explaining how the FTC will focus enforcement on sectors that impact American consumers the most and that she viewed the healthcare and consumer retail sectors as the highest priorities for scrutiny.
Nevada, Texas, and Delaware Corporate Law and Courts - Nevada Supreme Court Justice Lidia S. Stiglich; Texas Business Court Judge Sofia Adrogué; Delaware litigator Catherine Dearlove (Richards, Layton & Finger, PA); and Ethan Klingsberg, Co-Head of Corporate/M&A at Freshfields
Ethan Klingsberg, Justice Stiglich, Judge Adrogué, and Cathy Dearlove engaged in a lively dialogue about the material differences and similarities among the corporate laws and business courts of Nevada, Texas and Delaware. The candid conversation provided insight into issues that are often overlooked in the comparison charts that many boards of directors have been reviewing in recent months as they consider the optimal jurisdiction in which to have their companies incorporated. Among the subjects of this intense dialogue were:
- the impact of the availability of jury trials, as a constitutional right of plaintiffs, for all shareholder litigation brought in Nevada and Texas courts, in contrast to the absence of any right to a jury trial for corporate law disputes heard in the Delaware Court of Chancery
- the extent to which the dearth of case law about Nevada and Texas corporate law, as well as the very small number of publicly listed companies historically and currently organized under Nevada and Texas corporate law, contributes to a lack of predictability
- the impact and nature of the election of Nevada judges
- the impact and nature of the process for the appointment by Governor Abbott of judges to the Texas Business Court for two-year terms
- the frequent enactment of amendments of the DGCL by the Delaware legislature which meets in full session every year at least through June, compared with activity of the legislatures of Nevada and Texas each of which meets in regular sessions only every other year, and the nature of the respective political and lobbying environments and plaintiffs’ and corporate defense bars in each of Delaware, Nevada and Texas
- open issues under Nevada case law as to what standard of fairness applies when evaluating the potential liability of a controlling shareholder engaged in a buyout of the shares of the corporation that it does not already own
- open issues under Texas case law as to what standard of fairness applies when evaluating fulfillment of fiduciary duties by directors of a corporation approving a transaction with a controlling shareholder
- the influence of Delaware corporate case law on the thinking and jurisprudence of the courts in Nevada and Texas when making determinations under Nevada and Texas corporate law
- the extent to which “environmental and social” factors and constituencies may serve as a basis for determinations by directors of Texas corporations in a way that is not permitted by Delaware corporate law (and the citation by the Tesla board of this aspect of Texas corporate law as a basis for its move from Delaware to Texas), and the tension between this aspect of Texas corporate law and the anti-ESG campaigns of Governor Abbott
- questions about the constitutionality of the new amendments to DGCL Section 144 (governing transactions with controlling shareholders, directors and officers) as set forth in the recent complaint in the Delaware Court of Chancery against the board of Dropbox
- the origin and nature of Delaware’s “twice tested” approach to judicial review of corporate actions, whether there is any space for such an approach in the courts of Nevada or Texas, and the extent to which this approach has been cut back by the new amendments to Section 144 of the DGCL
Nevada’s Statute-Based Framework
Justice Stiglich discussed Nevada’s statute-based framework for adjudicating shareholder disputes. She noted that, although there are concepts in Nevada corporate law that are arguably “equitable” in nature and there is still room for interpretation of statutory provisions, Nevada corporate law is largely dictated by the Nevada legislature, rather than by case law. Indeed, she contrasted the primarily statute-based approach in Nevada with the Delaware Court of Chancery’s “twice-tested” approach (i.e., where the Court first evaluates whether what has transpired is mechanically permitted under law, and then evaluates whether what has transpired is equitable).
She highlighted that, unlike the Delaware Court of Chancery, each litigant in Nevada has an absolute right to a jury trial—even in the Nevada Business Court— and that litigants can jointly request bench trials.
Justice Stiglich emphasized that, although state court judges in Nevada are elected, the Nevada courts are by no means partisan. She discussed how, in contrast to the recent Wisconsin Supreme Court election, the judicial elections in Nevada are nonpartisan at every level of the court system. She added that Nevada state judges are subject to ethical rules to minimize any perceived partisanship.
Texas’ New Business Court
Judge Adrogué opened with an introduction of the Texas Business Court, which was established in September 2024, and explained that the Texas bar is among the most sophisticated in the country (indeed, she noted that Texas is the most litigious state in the United States). She described the Court as facing a full docket, although only a small percentage of the cases are akin to the shareholder suits that are regularly brought in the Delaware Court of Chancery. She explained that the Texas Business Court has, similarly to the Delaware Court of Chancery, the right to grant equitable remedies. In addition, she highlighted that the Texas Constitution guarantees the right of a litigant in the Texas Business Court to a jury trial.
She reviewed recent bills introduced in, but not yet adopted by, the Texas legislature relating to corporate litigation in Texas. One bill purports to permit the organizational documents of Texas corporations to include waivers of jury trials. Whether such a waiver will be permitted by the Texas Constitution is an open question. Another provision sets forth a process for a Texas corporation’s board, in advance of deliberations about a related party transaction, to obtain an advisory opinion from the Court as to whether directors are independent.
Subsequent Developments in Texas
On May 14, 2025, approximately three weeks after the focus at the conference on (i) the right of shareholder-plaintiffs to jury trials for adjudication of their claims against boards, (ii) the existing case law providing that Texas corporate law looks to Delaware case law for guidance, and (iii) the existing case law that provides that a heightened “fairness” standard applies to the duties of directors when approving transactions with a controlling shareholder, Texas enacted a series of amendments to its corporate law that included the following provisions to address these areas of focus:
- a provision that if the organizational documents of a corporation provide for a waiver by shareholders of the right to a jury trial, then a shareholder shall be deemed to have waived such right by virtue of buying shares of the corporation (it remains to be seen whether Texas courts will hold that this provision conflicts with the guarantee of a right to a jury trial under the Texas Constitution)
- a provision that the plain meaning of the Texas Business Organizations Code may not be supplanted, contravened or modified by the laws or judicial decisions of any other state and that a failure of managerial officials of a Texas corporation to consider the laws or judicial decisions of other states shall not constitute or imply a breach of Texas corporate law
- a process for a Texas corporation, in advance of deliberations about a related party transaction or responding to a demand for a derivative suit, to obtain an advisory opinion from the Texas state court as to whether directors are independent
- a provision that, in all instances, including related party transactions with a controlling shareholder, the directors and officers of publicly listed Texas corporations will benefit from the rebuttable presumption that they acted in good faith, on an informed basis, in furtherance of the interests of the corporation, and in obedience to the law and the corporation’s governing documents, and that no cause of action against any director or officer of a publicly listed Texas corporation shall exist in any circumstance (including in the case of duty of loyalty breaches) unless both one of the foregoing presumptions has been rebutted and there has been a breach of a duty involving fraud, intentional misconduct, ultra vires action, or knowing violation of law (Thus, although Texas law now statutorily insulates the directors and officers with these presumptions and thresholds, Texas law remains silent on whether the controlling shareholder may have heightened duties of fairness when engaging in transactions with the corporation. In contrast, the amendments to Section 144 of the DGCL do insulate the controlling stockholder from liability if Section 144’s specified procedural requirements are satisfied.)
Delaware
Cathy addressed the assertion, recently made by some commentators and included in some proxy statements relating to reincorporation votes, that the Delaware courts have become less predictable. She highlighted unique characteristics of the Delaware Court of Chancery that bolster the stability and predictability of Delaware law—notably, that the Chancellor and Vice Chancellors (i) are appointed for 12-year terms and thus are insulated from external influences or pressures and (ii) are experts in avoiding hindsight bias, a problematic characteristic of juries. In addition, she highlighted the recent passage of SB21 (which provides safe harbors for transactions with controllers, directors, and officers, as well as heightened standards for Section 220 books and records demands) as a source of additional stability and predictability in Delaware. She explained that, although the amendments to DGCL Section 144 per SB21 may have limited the liability of directors, this amendment still requires the directors to act in good faith and therefore leaves room for Delaware’s twice-tested approach to apply even when parties are relying on the safe harbor.
EU Antitrust in 2025 - Guillaume Loriot, Deputy Director-General for Mergers in the Directorate-General for Competition of the European Commission; and Thomas Janssens, a leader of Freshfields’ European Antitrust Practice
Key Takeaways:
- Divestiture remedies are preferred, but the EC will accept behavioral remedies in limited instances.
- Acquisitions of nascent competitors is an enforcement priority, but the EC will need additional work in this area to develop a consistent and practicable approach.
- Transatlantic cooperation is critical, both for businesses/innovation and enforcers.
- Regulators should not be afraid of addressing new competition issues and embracing new theories of harm, as long as it is done in a consistent and transparent manner. This flexibility is critical to assessing mergers involving innovative companies.
- Although the Draghi Report, which is an important source of guidance for the EC, stresses the importance of fostering European champions, the Commission will be assessing mergers between US and European companies with the same standards and rigor as mergers between two European companies.
Address by Deputy Director-General Guillaume Loriot
Deputy Director-General Guillaume Loriot led off with his take on what he sees as the current priorities of the European merger control process.
First, he emphasized the importance of international collaboration for fostering innovation as well as the strong transatlantic links among antitrust enforcers.
Second, is the focus on a single market objective. He explained how the EC needs to ensure open markets within a single market despite the existence of national borders between member states. He discussed how this approach is distinct from the tasks of US enforcers who usually can take a single market as a given.
Third, he addressed how, in contrast to the approach sometimes taken in the US, the EC takes a broader view of consumer welfare (including business customers down the chain) and is concerned with protecting the competitive process at levels beyond just consumers.
The address next turned to prioritized sectors for merger review. He stressed that the EC is not laser focused on big tech. In 2023, only four of the EC’s 11 challenged transactions were in the tech space, while in 2024, only one in 10 was a tech sector merger. He explained why the most important interventions last year concerned airlines, telecoms, agriculture, and consumer products.
The Deputy Director-General then stressed that non-price competition, including innovation, is an important part of merger assessment and that the EC is in the process of considering how to protect innovation going forward. Loriot emphasized the need for a rigorous and thorough evolution of the EC’s legal framework to protect against adverse impacts on innovation even if this means adopting theories that have not previously been tested. He expressed the view that it would be possible to adhere to the principles of the rule of law, transparency, reliance on facts, and reasoned decisions, while entering adopting new perspectives on how to protect competition.
Loriot concluded by saying that the job of regulators is not to pick the winner of the market but to make sure the market remains winnable for all in the market – maintaining the uncertainty over who will win is the key challenge. He explained how the new merger guidelines being drafted by the EC would promote to this objective.
Fireside Chat by Thomas Janssens with Deputy Director-General Guillaume Loriot
Thomas Janssens opened the discussion by reviewing the subject of so-called “killer acquisitions” – where the objective of the buyer is to eliminate a nascent competitor – and whether these types of transactions deserve to be an enforcement priority. Deputy Director-General Loriot noted the challenge of investigating numerous small acquisitions and how the EC still does not have a system in place that is sufficient and proportionate for investigating these types of transactions. He noted that member state investigations of these types of small acquisitions will likely become a trend.
The discussion then turned to the Draghi Report, which emphasized the need to create European champions, and whether the EC’s review of the merger guidelines will be more of a revolution or evolution. Loriot pointed out that all acquisitions—whether the acquiror is American or European—will be subject to the same scrutiny and substantive analysis. He explained why he views attention to criteria other than the impact on pricing to be an evolution rather than a revolution.
While noting that divestiture remedies are preferred, he stated that the EC will be open to behavioral remedies that work with specific facts and circumstances.
In addition, Loriot and Janssens reviewed the long history of strong cooperation between the US antitrust agencies and the EC, including at the staff level, and confirmed that this approach to antitrust review is continuing between the current administrations on both sides of the Atlantic.
The discussion concluded with a review of how foreign investment and national security reviews of mergers are being conducted at the member state level, rather than at the EC level, and the challenges that this approach presents for merger parties.
The SEC in 2025 - Robert Stebbins (SEC General Counsel 2017-2021); Dan Berkovitz (SEC General Counsel 2021-2023); Megan Barbero (SEC General Counsel 2023-2025); Erik Gerding (Freshfields Partner and Former Director of the SEC’s Division of Corporation Finance); and Melissa Hodgman (Freshfields Partner and Former Acting Director of the SEC’s Division of Enforcement)
Erik Gerding opened the panel by sharing predictions for SEC rulemaking and enforcement in 2025. Robert Stebbins stated that he expected the SEC to focus on protecting main street investors and to take the view that it was better to come in early on enforcement cases. Robert then cited crypto and proxy statements as areas for new rules and conversely environmental disclosures as an area of potential retraction. Melissa Hodgman added that the current SEC Chair had made it clear that SEC enforcement is not going away and will focus on fraud, insider trading and conflicts of interest.
Erik then shifted the conversation to a discussion of the evolving role of the SEC’s General Counsel. Megan described the role as overseeing all lawyers and their different functions at the SEC ranging from rulemaking to enforcement and defending the Commission. Erik asked whether she viewed the role as more policy or legal advice focused. Megan responded that it depended on the SEC Chair and their expectations for the GC. Dan agreed and added that the job involved balancing advising the individual commissioners with reporting to and advising the SEC Chair. He commented on the GC role in reviewing rules and recounted that only about 5% are truly controversial.
The discussion then turned to the recent Supreme Court decision in Corner Post, Inc. v. Board of Governors of the Federal Reserve System where the Supreme Court held that the statute of limitations for challenging a federal rule would now run from the alleged injury instead of the date of the rule’s adoption. Dan stated that being able to facially challenge an entire rule decades after the rule was adopted has the potential to substantially impact SEC rulemaking and enforcement. Robert added that Corner Post in his view has, more than any other judicial development, the potential to reorient materially federal rulemaking. Megan added that the SEC may resort to more “rulemaking by enforcement” in response to Corner Post. The panelists discussed what “rulemaking by enforcement” entailed, including the publication of the facts and circumstances behind enforcement actions and leaving securities lawyers to draw out rules therefrom.
Erik then turned the discussion to SEC v. Jarkesy and the end of Chevron deference. The panel discussed how Jarkesy limited the SEC’s ability to adjudicate fraud claims in front of administrative law judges rather than Article III judges, and why the panelists did not believe that this decision would have a meaningful impact. The panel then agreed that the overturning of Chevron, under which the Supreme Court formerly gave broad deference to agency interpretation of congressional statutes, was unlikely to be significant for the SEC. Dan discussed how historically the court decisions reviewing SEC actions have rarely relied on Chevron deference.
The panel then shifted to a discussion of whether Humphrey’s Executor v. US would be overturned by the Supreme Court and thereby permit the President to fire SEC commissioners from outside his political party. This led to an insightful explanation by Dan of the value of having commissioners from both major political parties and the efforts that commissioners make to achieve consensus, which creates a better record for prevailing in any challenge in court to the validity of Commission rulemaking and enforcement actions.
The panel ended with further predictions. Robert predicted that the SEC would not retract any rules, such as environmental rules, without notice and comment. Megan noted that a recent executive order cited the good cause exception in the Administrative Procedure Act to avoid notice and comment in conjunction with a separate executive order directing the different agencies to find rules to quickly repeal. She was less sure whether the SEC would follow Robert’s view or instead find some rules to strike down in compliance with the executive orders. Dan predicted that the SEC would maintain the Howey test and find a way to regulate crypto under the test. Melissa predicted that the SEC would be able to keep in place the existing cybersecurity rule by focusing on materiality.
Delaware Court of Chancery Update - Vice Chancellor Paul A. Fioravanti, Jr. of the Delaware Court of Chancery; Meredith Kotler, Freshfields’ Co-Head of Securities & Shareholder Litigation; and Berkeley Law Professor Adam Badawi
Vice Chancellor Fioravanti, Meredith Kotler, and Professor Badawi discussed the adoption of Delaware Senate Bill 21, which amended the law relating to transactions involving directors, officers or controlling stockholders, as well as shareholder access to corporate records. They recounted that the discussion about SB 21, prior to it passing, was intense and divisive at times.
The Vice Chancellor then discussed the aspiration, as articulated by Chief Justice Roberts, that judges should aspire to call “balls and strikes” like umpires and the challenges that the complexities of the law present for this approach. The Vice Chancellor read from and commented on Will Stevens’ classic law review article, entitled “The Common Law Origins of the Infield Fly Rule,” and discussed this article’s relation to the spirit of American common law and the role of a judge presiding over a “court of equity rooted in fairness.”
Meredith, Professor Badawi, and the Vice Chancellor then discussed recent cases about earnout provisions. They discussed how earnout provisions are contract provisions, and the principles applicable to contractual interpretation of earnouts. They discussed tips for how to draft earnout provisions, the role of post-closing integration teams in complying with the terms of earnouts, and the real-world challenges that lawyers negotiating earnouts face.
The conversation then turned to advisor disclosures and a recent case, City of Sarasota Firefighters' Pension Fund v. Inovalon Holdings, Inc., about the level of financial disclosures to boards and shareholders by transaction advisors. They discussed how this subject is not a new one, and talked through special issues applicable to disclosures by banks and by law firms.
The next subject was the state of advance notice by-laws in light of Kellner v. AIM ImmunoTech, Inc. They discussed the obstacles faced by challenges to advance notice by-laws, the role of equitable review in resolving these challenges, and when a cure period for a misstep under an advance notice bylaw may be appropriate.
Meredith then turned the conversation to guidance on the issue of liability on the part of an acquiror for aiding and abetting breaches of duty by the target company’s executives and directors.
The conversation ended with a discussion of the strengths of, and challenges faced by, the Delaware Court of Chancery. The discussion reviewed the speed and efficiency of the Court of Chancery, the level of preparedness of the bench, the extensive experience and case law that characterizes the Court’s work, the ability to expedite cases, and the high quality of the lawyers that appear regularly before the Court.
AI and Data Regulation - California Attorney General Rob Bonta; Freshfields Partner and Former White House Counsel Attorney Janet Kim; and Berkeley Law Professor Frank Partnoy
Professor Partnoy discussed, with Attorney General Rob Bonta and Janet Kim, the regulatory tension between encouraging AI innovation and protecting consumers from potential harms and risks.
Attorney General Bonta explained how companies should be thinking about regulation of AI. He emphasized that all existing laws still apply to AI, just like they apply to all other technologies. He focused on a few specific areas of oversight, including transparency for consumers about whether they are viewing content that is generated by AI, the possibility of biased outputs, deepfakes in elections, AI-generated robocalls, and healthcare algorithms. He explained his approach to balancing the principles that regulation needs to be more extensive when the risks are higher (e.g., the use of AI to oversee a nuclear facility) and that impeding of innovation needs to be avoided.
The panelists then discussed different approaches to regulating AI. Janet stated that clients want to comply, but sometimes find it difficult to invest in compliance with a spectrum of inconsistent laws and regulatory regimes across states and the globe. Janet discussed how regulators have started to ask companies to self-diagnose risk and generate their own mitigation measures, and, although this approach helps avoid overwrought policy, it creates problematic incentives for companies to be less transparent. The panel engaged in a discussion about how to drive AI regulation in a direction that caters to regulatory certainty and uniformity. Attorney General Bonta concluded that the AI regulatory process will necessarily be iterative and require adjustment over time.
The panelists then addressed the debates over the future of Section 230, the federal law that shields internet platforms from liability for content posted by users on their platforms. Janet expressed concerns that changing Section 230 immunity would be destabilizing and would not necessarily make the internet safer. She argued that platforms are already incentivized to remove harmful speech in order to create a positive user experience, and that government intervention into that process raises freedom of speech concerns. She explained how designing AI regulation in a manner that targets service providers may not address where the harm is occurring and could have a damaging impact on technology and business. Attorney General Bonta argued that platforms should have some responsibility for the content that they host, particularly if they are aware of its harms. He expressed the view that, although the owners of the AI tools should not be responsible for every implementation of those tools, they should share a degree of responsibility with creators and other people who use those tools.
The panel concluded with a discussion of the ways in which regulations and common law applicable to AI are evolving, the risks of regulators taking a “gotcha” approach, and the need for continued dialogue between enforcers, such as the Office of Attorney General Bonta, and those, such as Janet Kim, who are in the trenches on a daily basis with dynamic, private sector clients offering or integrating AI as important parts of their business.
The Four Approaches of Advisors - Opening Remarks by Ethan Klingsberg
Ethan Klingsberg, who has hosted this conference since its inception eleven years ago and has been a leader of Freshfields US corporate and M&A practices for the last six years, walked the attendees through four approaches that advisors take when surveying the M&A and corporate landscape.
First, there’s the “talking your book approach.” Here, advisors talk about the “return of animal spirits” and the “robust pipeline,” and how M&A can cure all corporate ills, warding off activism, ensuring widespread shareholder support, generating bumps in trading multiples, and fostering glory for boards and executives.
Second is the “alarmist” approach. Here, advisors talk about how the “sky will fall” unless clients pay urgent attention to a subject that only the advisor truly understands. Over the years, advisors have claimed that Armageddon is at our doorstep if corporations did not start urgently paying more attention to how to navigate proxy access, majority voting standards, appraisal rights, SOX 404, data privacy, artificial intelligence, dual class sunsets, antitrust merger guidelines, the entire fairness doctrine, and, most recently, which state in which to be incorporated.
Third, is what Ethan described as the “legal realist” approach. He observed that traditionally this conference has been focused on this approach. The idea behind this approach is not to spend time “talking your book” or being alarmist, but to give actionable, “straight shooter” insights on what are the real risks arising under antitrust, foreign investment, securities, and corporate law regimes. This school busts myths and sets the record straight.
Ethan then described how this realist approach, while still worth pursuing, has serious limitations amid the radical uncertainty and dynamism of the current legal and political environment, and risks being as delusional as the “talking your book” and “alarmist” schools.
This led to a discussion of a fourth approach that is not about reading tea leaves from governmental authorities. He recounted his work in the early 1990s, following the collapse of Communism in Eastern Europe, with the newly formed Hungarian Constitutional Court where the backdrop was a legacy of state socialism and autocracy that flouted the rule of law and left an absence of useful guidance for jurisprudence going forward. The Court had to figure out approaches to property rights, civil liberties, and human rights. The Court had to exercise independent thinking and draw on bedrock principles of jurisprudence and legal reasoning. When we are in environment where the governmental landscape is radically uncertain and irrational, the burden falls on the lawyers not to be realistic, but to follow a pathway analogous to that blazed by those who courageously built the rule of law out of the wasteland of Communism. Corporate and regulatory lawyers are not simply machines for execution that necessarily conform to whatever is the governmental landscape is at any given time. For there to be integrity to our corporate and transactional systems, we need to remember this.
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The firm would like to thank Emily Abbott, Thomas Jung, Victor Ma, Roger Li and Gabriela Roca Fernandez for their contributions to these takeaways.
