By: Rachel Landy (CLS Blue Sky Blog)
For almost four decades, scholars have been debating whether business lawyers provide value to transactions. The discussion began with a significant article by Professor Ronald Gilson. In the article, Gilson referred to business lawyers as “transaction cost engineers.” He argued that these engineers optimize the cost of a transaction by helping contracting parties find efficient ways to resolve negotiation stalemates. This way, they create more valuable deals.
Gilson’s theory gave us important insights into sophisticated corporate law practice, where outside lawyers are hired to make unique deals happen. However, the current literature does not explain how many business lawyers, particularly startup lawyers, operate. Startup lawyers can control the cost of their client’s eventual exit (for example, an acquisition or an initial public offering (IPO)) well before that transaction takes place. By doing this, they can influence the value of the startup itself. These lawyers are not just transaction cost engineers; they are exit engineers…
Featured News
Judge Mehta Questions Both Sides in Landmark Google Antitrust Case
May 2, 2024 by
CPI
FCC Urges Urgent Funding for Removal of Chinese Telecom Equipment from U.S. Networks
May 2, 2024 by
CPI
Former Pioneer CEO Facing Potential Criminal Charges For Colluding With OPEC
May 2, 2024 by
CPI
South Korea’s Antitrust Regulator Greenlights K-Pop Powerhouse Deal
May 2, 2024 by
CPI
Exxon’s Pioneer Purchase Approved, Former CEO Barred from Board
May 2, 2024 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Economics of Criminal Antitrust
Apr 19, 2024 by
CPI
Navigating Economic Expert Work in Criminal Antitrust Litigation
Apr 19, 2024 by
CPI
The Increased Importance of Economics in Cartel Cases
Apr 19, 2024 by
CPI
A Law and Economics Analysis of the Antitrust Treatment of Physician Collective Price Agreements
Apr 19, 2024 by
CPI
Information Exchange In Criminal Antitrust Cases: How Economic Testimony Can Tip The Scales
Apr 19, 2024 by
CPI