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 The Law of Corporate Finance and Financial Markets  posted by  duggu   on 1/1/2008  Add Courseware to favorites Add To Favorites  
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 Akula, John, 15.617 The Law of Corporate Finance and Financial Markets, Spring 2004. (Massachusetts Institute of Technology: MIT OpenCourseWare), (Accessed 10 Jul, 2010). License: Creative Commons BY-NC-SA

The words "equal justice under law" are engraved in the west pediment of the U.S. Supreme Court, sitting above the building's main entrance. (Image courtesy of The Supreme Court Fellows Program.)

Course Highlights

Students complete two take-home exercises, which are available on the assignments page. Summaries of the lecture discussions have also been posted.

Course Description

Much of 15.617 focuses on mergers and acquisitions (M&A), and the law-sensitive aspects of financial services and financial markets. The course is designed to be an introduction to business law that covers the fundamentals, including contracts, liability, regulation, employment, and corporations. This class also provides an in-depth treatment of the law of finance.




15.617 is an introduction to business law which covers the fundamentals, including contracts, liability, regulation, employment, and corporations, with an in-depth treatment of the law of finance, including law-sensitive aspects of M&A transactions, national and international financial and securities markets, venture capital and private equity, the financial structure of the corporation and other business entities, antitrust, bankruptcy and reorganization, the regulation of financial service providers, and the regulatory and liability risks associated with innovative financial products and services.

Some Advice from John Akula on Picking a Law Course

I offer the following three law courses at Sloan:

  • 15.615/15.647, Law for the Entrepreneur and Manager (fall and spring) (615 is the full-semester course; 647 is the first half)
  • 15.616, Innovative Businesses and Breakthrough Technologies - The Legal Issues (fall only)
  • 15.617, The Law of Corporate Finance and Financial Markets (spring only)

Based on my experience as a practicing lawyer, I recommend that students at Sloan take a law course. Managers face many law-sensitive issues that are crucial to the welfare of their companies and their own careers. These issues often arise suddenly and outside the normal course of business. Each of my courses is designed to give you the understanding you will need to exercise good judgement and leadership in those situations. Each course will also provide you with the foundation in law that you will need to make effective use of legal advisors, and to develop later in your careers a more sophisticated understanding of any legal issues that are central to your particular responsibilities.

However, I do not expect students to take more than one law course. Thus my courses are designed as an array of choices, not a sequence, and there is substantial overlap with respect to legal fundamentals. You should pick the one that interests you most.


Class Attendance

Students should attend class, since material is covered that is not in the readings. Attendance is taken. Absences for good cause (such as job hunting or family obligations) are excused. You should e-mail the TA before or shortly after the class in question, with a "cc" to the instructor, to request an excused absence. You do not need to include any personal details with the request.

Class Participation and "On-deck" Preparation

All students are expected to participate in class discussion. In addition, for each class, some students will be assigned in advance to be "on-deck." "On-deck" students should make certain that they prepare with special care and are ready to respond to questions about the readings. Guest lecturers are invited to call on the on-deck students. Each student will be "on-deck" approximately three times.

Take-home Exercises

There are two take-home exercises. Students have three hours for an exercise, and some choice as to the particular three-hour period. The exercises have been scheduled to be available during the periods shown on the assignments page. For each exercise, each student will make arrangements with the TA to receive the exam by e-mail at a mutually determined time during the availability period, and will e-mail back the completed exam within three hours of receiving it. The second exercise will cover only material not covered by the first.

During the period the exercises are available, students may not consult any other person about the content of the course.

The exercises heavily emphasize the required readings. The questions and format will be similar to previous years (although the exercises from some past years were of different lengths.) Past exercises and a sample answer will be made available to students.

It is not expected that students will need the full three hours to complete the exercise. I use this format so that a student does not have to write fast to do well. This may be of special importance to students for whom English is a second language.

Students Who Take More Than One of My Courses

If you take more than one of my courses, an additional research paper will be required in the second course, on a topic to be determined in discussions with the instructor.


Grading is not tied to a formula, but will be based approximately as shown below:

First Take-home Exercise 30%
Second Take-home Exercise 40%
Class Attendance/Participation 30%

Textbook and Course Readers

Students should purchase: Bagley, Constance E., and Craig E. Dauchy. The Entrepreneur's Guide to Business Law. 2nd ed. South-Western College Publishing, 2002. ISBN: 0324042914. We will read most of this book. There will also be a course-reader available at the MIT copy center later in the semester.

Changes from Last Year

This is the first year this course is offered. It is replacing a half semester course (15.649) given in past years on the law of M&A.




Module I - Basic Building Blocks
1 Introduction

The Law of Duties
2 The Law of Duties (cont.)  
3 The Hard Edge of Regulation  
4 Contracts  
5 Contracts (cont.)  
6 Module I Wrap-up  
Module II - M&A
7 Key Players, Stages and Deal Structures

Guest: Terry Mahoney, Partner, LeBoeuf, Lamb, Greene & McRae
8 Tax Considerations in Structuring a Deal

Guest: Martin Allen, Partner, Kirkpatrick & Lockhart
9 The Basic Terms of a Purchase Agreement

Guest: Terry Mahoney, Partner, Leboeuf Lamb Greene & McRae
10 Buying a Publicly-held Company I

Guests: Stu Cable and Jim Matarese, Partners, Goodwin Procter
11 Buying a Publicly-held Company II

Guests: Stu Cable and Jim Matarese, Partners, Goodwin Procter
12 International M&A and Joint Ventures

Guest: David Walek, Ropes & Gray
Module III - Forms of Business Entities
13 Forms of Doing Business - An Introduction First exercise available one day after lecture 13 at noon
14 The Publicly-held Corporation I - Insider Trading and Disclosure

Guest: Jocelyn Arel, Partner, Testa Hurwitz & Thibeault
First exercise due two days before lecture 14 at 5 p.m. (two days after it was made available)
15 The Publicly-held Corporation II - Governance and Accountability

Guest: Lisa Wood, Partner, Foley Hoag
Module IV - Raising and Investing Money
16 Venture Capital

Guest: Edward Freedman, Corporate Counsel, Flagship Ventures
17 Other Private Equity

Guest: John LeClaire and David Watson, Partners, Goodwin Procter
18 Public Offerings and Investment Banking

Guest: James Hackett, Partner, Choate Hall & Stewart
19 Commercial Lending and Securitization

Guest: Matthew Furlong, Partner, Bingham McCutchen
20 Building a Hedge Fund Portfolio

Guest: Tim Diggins, Partner, Ropes & Gray
Module V - Competition, Mobility and Insolvency
21 Antitrust Second exercise available one day after lecture 21 at noon
22 Bankruptcy and Reorganization I

Guest: John Whitlock, Partner, Palmer & Dodge
Second exercise due one day after lecture 22 at 9 p.m. (two days after it was made available)
23 Bankruptcy and Reorganization II

Guest: John Whitlock, Partner, Palmer & Dodge
24 Wrap-up   Tell A Friend