The Brief: Law School News and Events

Institute for Law and Economics Plumbs ‘Central Nervous System’ of Finance and Government By Mark Eyerly

Edward RockMichael WachterHow is the upheaval in credit markets affecting private equity deals? Should regulations regarding corporate governance be revised? Just how do controversial deals come together? “The answers to these questions affect where we work, what’s happening to our retirement funds,” says Edward B. Rock, L’83, Penn Law professor and co-director of the Institute for Law and Economics at the University of Pennsylvania. “We bring together judges, regulators, investment bankers, dealmakers, private equity leaders, hedge fund managers, lawyers, and academics for closed-door conversations about issues at the cutting edge of law and business.

“Our participants work in the central nervous system of finance and government, and their decisions are not a matter of millions of dollars, but trillions of dollars,” he adds. “Like poker, once money rests on the outcome, things become really interesting.” Founded in 1980 as a general center for law and economics, ILE now devotes most of its biannual off-the-record roundtables to corporate finance or corporate law. About 50 people — invitation only, please — attend each program.

“Our Board and sponsors are our program,” says Michael L. Wachter, ILE co-director and the William B. Johnson Professor of Law and Economics at Penn Law School. “By assembling leading figures in law and business and building our programs around their expertise, we have created a unique forum for discussing critical issues.”

“I don’t know if there’s any other forum like it, anywhere,” says Robert L. Friedman, L’67, senior managing director and chief legal officer at The Blackstone Group, and ILE chair from 2001 to 2007. “Busy M&A lawyers and investment bankers don’t ride Amtrak to Philadelphia just for the heck of it; they need to get some value out of it, and they keep coming back.”

The morning typically is devoted to presentations of academic research; the afternoon, a panel showcasing practitioners. The robust and confidential discussions mean that people can say what they think without worrying about how it might look in The Wall Street Journal.

“It’s remarkable how ILE has grown from something local into a national leader,” says Delaware Supreme Court Justice Jack B. Jacobs. He describes ILE as “a resource helpful to us, not for a specific case but in terms of our ability to think through and be educated on developing areas.”

“When leading financial experts tell you the world is ‘X’ and the law presumes that the world is ‘Y,’ that’s a good argument for changing the law,” says ILE co-director Rock, who also is the Saul A. Fox Distinguished Professor of Business Law. “What we do is simple but it can get complicated.”

ILE’s Board of Advisors includes top executives and lawyers from companies such as Goldman, Sachs & Co., Lehman Brothers, KKR, DuPont, Unisys Corp., and General Electric Co., as well as many major law firms. Its new chairmen are Joseph Frumkin, L’85, a leading M&A partner at Sullivan & Cromwell, and Charles “Casey” Cogut, L’73, global head of the M&A Practice Group at Simpson Thacher & Bartlett LLP.

The Institute is a joint research center of the Law School, Wharton, and the Department of Economics in the School of Arts and Sciences.

“Penn is uniquely qualified to bring together this kind of program,” says Wachter. “Who else has on one campus some of the world’s best law, finance and business scholars?”

The ILE leadership team gets even stronger this fall with the addition of a third co-director, Professor Jill E. Fisch, who is joining the Law School faculty from the Fordham Corporate Law Center. In addition to the roundtables, ILE maintains an active program calendar. Chancery Court programs are a component of a Penn Law course on corporate law and finance co-taught by Leo E. Strine, Jr., L’89, vice chancellor of the Delaware Chancery Court, and Wachter. Deal Day taps the expertise of ILE’s board to examine complex transactions in-depth, and two public lecture series — Law and Entrepreneurship and Distinguished Jurist — present lawyers who have led noteworthy careers as corporate executives and entrepreneurs, or as members of the judiciary. ILE also co-sponsors an annual two-day academic conference on Law and Finance, in conjunction with Wharton and New York University.

ILE is supported by a diverse group of corporations, law firms, foundations, and individuals who are excited about the topics they explore and the people they meet under the auspices of the Institute.

“For me as an academic, the ILE programs are essential,” Rock says. “I couldn’t produce the scholarship I do without having access to these people.”

For more details, visit ILE’s website at

Mark Eyerly is Associate Dean for Communications at Penn Law School.