Second Generation State Takeover Legislation: Maryland Takes a New Tack
This Note examines the approach recently adopted by the Maryland legislature in special session one year after the Supreme Court’s decision in MITE. Maryland has departed radically from the regulatory approach of first generation statutes; however, this Note argues that the statute has failed to escape the constitutional infirmities of its predecessors. Part I outlines the various mechanisms that regulate acquisition of corporate control: the federal tender offer regulatory mechanism known as the Williams Act, state takeover legislation such as the Illinois statute invalidated in MITE, and the new Maryland statute. Part II analyzes the debate concerning the constitutionality of state takeover legislation. Part III applies this analysis to the Maryland approach. It argues that while a court may find that the Maryland approach fails the commerce clause balancing test employed in MITE, the Maryland approach is most clearly subject to attack on the ground that it is incompatible with congressional objectives embodied in the Williams Act. Thus, the Maryland statute will force the courts to readdress the preemption issue left unresolved in MITE.