Wisconsin passed a law (Wis.Stat.
§ 180.726(2)) making it harder to do
a hostile takeover of a Wisconsin corporation.
Basically, it said that if a
corporation bought up all the shares of a Wisconsin corporation, it
couldn't merge with them for three years.
This law had provisions that
went over and above those in Federal law (the Williams Act).
Amanda was trying to takeover
Universal (a Wisconsin corporation). They sued to have the Wisconsin law
declared an unconstitutional violation of the Commerce Clause.
The Trial Court found the
Wisconsin law to be constitutional. Amanda appealed.
The Appellate Court affirmed.
The Appellate Court found
that Wisconsin's law was 'unwise' and would hurt shareholders because it
made people less willing to buy shares of Wisconsin corporations.
However, it didn't impermissibly disrupt interstate commerce, so it
wasn't a violation of the Commerce Clause.
The Court found that the law
did not discriminate between in-State and out-of-State corporations.
Therefore it was not a violation of the Dormant Commerce Clause.
The Court noted that the
principle of Federalism meant that the States could become laboratories
for deciding which laws were good and which were bad. Wisconsin's law
was within constitutional standards, and if the people of Wisconsin
didn't like it, they could always vote for legislators committed to
overturning it.
