Compliance » How The #MeToo Movement Has Changed M&A

How The #MeToo Movement Has Changed M&A

May 21, 2019

sexual harassment

The #MeToo movement has had a major effect on what investors and buyers are obliged to do in order to manage risk. This Today’s General Counsel article, by Littler attorneys Devjani H. Mishra and Raoul Parekh, discusses some red flags, including the familiar “actual and threatened claims” against the company, as well as certain kinds of employment agreements (such as the liquidated damages provision that was buried in Harvey Weinstein’s contract). But there is a fine line that must be walked, the authors warn. On one side lies “an overbearing buyer making unreasonable inquiries of a seller that lie outside their reasonable knowledge and inflate the costs of any potential deal. On the other side, a passive buyer sleepwalks into an issue that erodes the potential upside to the transaction entirely.”

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