UT Soft Law Review

UT Soft Law Review No.2 2010equipped to be actively engaged with the market in real time. The following quote by JusticeJacobs when he was Vice Chancellor deciding a famous “dead hand” poison pill case isinstructive.Since the 1980s, [takeover] law, largely judge-made, has been racing to keep abreast of theever-evolving and novel tactical and strategic developments so characteristic of this importantarea of economic endeavor that is swiftly becoming a permanent part of our national (andinternational) economic landscape. 13Delaware takeover law in the 1980s and early 1990s was assembled through a racebetween market innovators and the courts. Although the pace of market activity is slower inJapan, we have already seen that the market has a tendency to race ahead of policymakers.(For example, the METI/MOJ Guidelines do not contemplate the type of shareholder rightsplan used in the Bull-Dog Sauce Case). The U.S. (and as I will argue below, the UK) bothhave institutions that are well suited to providing rapid, sophisticated guidance in response toongoing market developments in the takeover field. Japan needs such as institution too.Takeover Policy with Japanese Characteristics?Let’s return to our simple matrix. The discussion thus far has filled in some of the boxeson this matrix. Although this is not the place to elaborate, I would argue that in someimportant areas of enforcement culture, Japan shares traits with the UK.Takeover Law and Policy MatrixUS JAPAN UKDecision-maker BOD ? SHLegislave Guidanceon DefensesNo No, but Guidelines No, but Takeover CodeCommon Defensive/Protective MeasuresRights Plan StaggeredBoardRights Plan MandatoryBid Cross ShareholdingMandatory BidUltimate Authority Courts Courts [METI-MOJ/CVSG] Takepver PanelLegal Culture Hard Law Soft Law Soft LawEnforcement Culture Formal Decentralized Informal Centralized Informal CentralizedCorporate Culture Property Community PropertyMarket Forces/PhilosophyStrong Weak, but Changing Strong13 Jack Jacobs, Vice Chancellor, Delaware Court of Chancery, in Carmody v. Toll Brothers, Inc. 723 A.2d1180, 1185 (Del. Ch. 1998).34