Corporate litigation in specialized business courts
McCahery,Joseph A. de Roode,Alexander
McCahery,Joseph A.
de Roode,Alexander
Abstract
In US derivative cases, plaintiffs' lawyer fees and monetary awards distort shareholder value. Using a data set form the Dutch Enterprise Chamber, this chapter analyzes the benefits of corporate litigation without these externalities. We find significant abnormal returns within a short timespan surrounding the filing and resolution of mergers and acquisitions (M&A)-related lawsuits. Over longer horizons, we document that resolutions have little impact on shareholder value. Moreover, our findings suggest that longer waiting times for court resolutions are costly. In settings without strong distortions, derivative style litigation may therefore serve an important function.
Description
Date
2025-12-18
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Publisher
Oxford University Press
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Keywords
Corporate litigation, shareholder value effects, derivative cases, derivative style litigation, business courts
Citation
McCahery, J A & de Roode, A 2025, Corporate litigation in specialized business courts. in J N Gordon & W-G Ringe (eds), Oxford handbook of corporate law and governance. 2nd edn, Oxford Handbooks, Oxford University Press, Oxford. https://doi.org/10.1093/oxfordhb/9780192888006.013.0042