Opinion ID: 515453
Heading Depth: 2
Heading Rank: 2

Heading: Standing of a Target Corporation to Raise a Claim Under

Text: 26 the All Holders Rule 27
28 In considering the standing of Polaroid as a target corporation to assert a violation of the All Holders Rule, we are confronted with two strains of jurisprudence: the private right of action cases and the standing cases. Logically, the first resort is to the private right of action cases. If a private right of action exists in favor of a party, standing follows as a matter of course. As will be seen, with respect to shareholders of the target corporation, we conclude that a private right of action exists in their favor and, consequently, they have standing. As will also be seen, with respect to target corporations, the private right of action cases suggest that a target corporation does not have a private right of action because it is not one for whose especial benefit the statute was enacted. Piper v. Chris-Craft Industries, Inc., 430 U.S. 1, 35, 37, 97 S.Ct. 926, 947, 51 L.Ed.2d 124 (1977). In the context of the Williams Act, however, the Supreme Court has intimated that because of the strength of the evidence that Congress intended to create a private right of action, this conclusion as to especial benefit should be given less weight than is ordinarily appropriate with respect to the issue of who may sue. Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Curran, 456 U.S. 353, 391 n. 92, 102 S.Ct. 1825, 1846 n. 92, 72 L.Ed.2d 182 (1982) (dictum). We thus also look to the cases that the Supreme Court has decided in the standing area, which have, on occasion, allowed a plaintiff to raise the rights of a third party under statutes that create an express right of action in favor of the third party. 3 29 Neither the Williams Act nor the All Holders Rule expressly creates a private right of action to supplement the enforcement powers of the SEC. Furthermore, the only references in the legislative history to private rights of actions are two briefly stated suggestions that, in light of J.I. Case Co. v. Borak, 377 U.S. 426, 84 S.Ct. 1555, 12 L.Ed.2d 423 (1964), which implied a private right of action under section 14(a) of the Exchange Act, courts are likely to allow private rights of action to enforce the Williams Act. These two statements occurred only in two commentators' written, uncommented upon submissions and are thus entitled to little weight. Chris-Craft, 430 U.S. at 31 n. 20, 97 S.Ct. at 944 n. 20 (discussing the two commentators' references to Borak and quoting Ernst & Ernst v. Hochfelder, 425 U.S. 185, 204 n. 24, 96 S.Ct. 1375, 1386 n. 24, 47 L.Ed.2d 668 (1976)); see also Pitt, Standing to Sue Under the Williams Act After Chris-Craft: A Leaky Ship on Troubled Waters, 34 Bus.Law. 117, 142 n. 186 (1978) (quoting submissions in greater detail). 30 Angelastro v. Prudential-Bache Securities, Inc., 764 F.2d 939 (3d Cir.), cert. denied, 474 U.S. 935, 106 S.Ct. 267, 88 L.Ed.2d 274 (1985) explicates the methodology for making the private right of action determination. It requires that we first address three questions: (1) whether the agency rule is properly within the scope of the enabling statute; (2) whether the statute under which the rule was promulgated properly permits the implication of a private right of action; and (3) whether implying a private right of action will further the purpose of the enabling statute. Id. at 947. If a private right of action is determined to exist, we must then decide the difficult question whether a target corporation has standing to bring injunctive relief to vindicate the rights of shareholders under the Rule. Cf. Curran, 456 U.S. at 388-95, 102 S.Ct. at 1844-48 (turning to standing issue only after determining that a private cause of action was available under Commodity Exchange Act in favor of some plaintiffs); Schneider, Implying Private Rights and Remedies Under the Federal Securities Acts, 62 N.C.L.Rev. 853, 882-84 (1984). We turn to the first of the three Angelastro questions. 31
32 Section 14(e) of the Williams Act proscribes fraudulent, deceptive, or manipulative acts ... in connection with any tender offer. 15 U.S.C. Sec. 78n(e). A unanimous Court in Schreiber v. Burlington Northern, Inc., 472 U.S. 1, 105 S.Ct. 2458, 86 L.Ed.2d 1 (1985), held that section 14(e) does not prohibit manipulative conduct unless there has been some element of deception through a material misrepresentation or omission. The Court held that [i]t is clear that Congress relied primarily on disclosure to implement the purpose of the Williams Act and characterized all of the Williams Act provisions as disclosure provisions. Id. at 8-9, 105 S.Ct. at 2463. Schreiber characterizes even section 14(d)(6), which mandates the proration of share purchases when the number of shares tendered exceeds the number of shares sought, and section 14(d)(7), which mandates the payment of the same price to all those whose shares are purchased, as requir[ing] or prohibit[ing] certain acts so that investors will possess additional time within which to take advantage of the disclosed information. Id. at 9, 105 S.Ct. at 2463. It is thus possible to read Schreiber to imply that the All Holders Rule is beyond the SEC's authority under the Williams Act, for the Rule's purpose seems to be neither to ensure full disclosure nor to provide for an adequate time period for investors to comprehend disclosed information. 4 33 Although Schreiber categorizes the proration and best price provisions of the Williams Act as relating to disclosure, these provisions are only tangentially related to ensuring that investors make fully informed decisions. While the All Holders Rule thus has little to do with ensuring complete disclosure, it is no less related to disclosure than are the proration and best price provisions. Moreover, the SEC has articulated a disclosure justification for the Rule: 34 [t]he all-holders requirement would realize the disclosure purposes of the Williams Act by ensuring that all members of the class subject to the tender offer receive information necessary to make an informed decision regarding the merits of the tender offer. If tender offer disclosure is given to all holders, but some are barred from participating in the offer, the Williams Act disclosure objectives would be ineffective. 35 51 Fed.Reg. at 25,875 (footnote omitted). In light of the loose definition that Schreiber itself ascribes to the meaning of a disclosure provision, the emphasis in Schreiber on characterizing the Williams Act as a disclosure statute simpliciter is of small force in an effort to invalidate the All Holders Rule. For the foregoing reasons, we are satisfied that the SEC was acting within its authority in promulgating the All Holders Rule. This conclusion is buttressed by the deference due the agency's interpretation of its enabling statute, the statute being ambiguous on the issue and the agency's interpretation being a permissible one. Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 843, 104 S.Ct. 2778, 2782, 81 L.Ed.2d 694 (1984). 36 The holding of Schreiber--that misrepresentation or nondisclosure is a necessary element of a violation of section 14(e)--is not compromised by a determination that the All Holders Rule is a valid exercise of SEC rulemaking authority. The All Holders Rule is not an attempt to proscribe manipulative practices so much as an attempt to ensure that all holders of a class of securities subject to a tender offer receive fair and equal treatment. And, as explained in the SEC's release, this attempt to ensure fair and equal treatment is the purpose behind both the proration and best price provisions. 51 Fed.Reg. at 25,876. 37 3. Do the relevant provisions of the Williams Act properly permit the implication of a private right of action? 38 The Angelastro methodology next requires us to determine whether the provisions of the Williams Act pursuant to which the All Holders Rule was promulgated create an implied remedy. If not, [n]o private right of action may be implied ... since an agency's rulemaking power cannot exceed the authority granted to it by Congress. Angelastro, 764 F.2d at 947. 39 In determining whether a statute creates a private remedy despite the absence of an express private remedy provision,  '[t]he key to the inquiry is the intent of the Legislature.'  Curran, 456 U.S. at 377-78, 102 S.Ct. at 1838-39 (quoting Middlesex County Sewerage Authority v. National Sea Clammers Association, 453 U.S. 1, 13, 101 S.Ct. 2615, 2623, 69 L.Ed.2d 435 (1981)). As explained above, however, the language and legislative history of the Williams Act are essentially silent as to the existence of a private right of action to enforce its provisions. We must thus take into account the background understanding under which Congress operated when it passed the statute. Id. 456 U.S. at 378-88, 102 S.Ct. at 1839-44. If Congress operated against a background understanding that courts would create private remedies that would further the purposes of the statute, then Congress most likely intended that a statute be enforceable through a private right of action unless the language (or legislative history) of the statute obviates this inference. In short, courts must take into account the  'contemporary legal context'  informing what Congress perceived itself to be doing when it acted. Id. at 379, 102 S.Ct. at 1839 (quoting Cannon v. University of Chicago, 441 U.S. 677, 698-99, 99 S.Ct. 1946, 1958, 60 L.Ed.2d 560 (1979)); see also Stewart and Sunstein, Public Programs and Private Rights, 95 Harv.L.Rev. 1193, 1229-32 (1982). 40 Congress passed the Williams Act in 1968. By then the private right of action under section 10(b) of the Exchange Act, 15 U.S.C. Sec. 78j(b), and SEC Rule 10b-5, 17 C.F.R. Sec. 240.10b-5, had been firmly established by a host of lower federal court decisions. See generally Herman & MacLean v. Huddleston, 459 U.S. 375, 380 n. 10, 103 S.Ct. 683, 686 n. 10, 74 L.Ed.2d 548 (1983); Chris-Craft, 430 U.S. at 55 n. 4, 97 S.Ct. at 956 n. 4 (dissenting opinion). Moreover, the leading Supreme Court case on the implication of private remedies at that time was J.I. Case Co. v. Borak, 377 U.S. 426, 84 S.Ct. 1555, 12 L.Ed.2d 423 (1964). Borak held that the shareholders of a corporation had a right of action against the corporation, both individually and through a derivative action, when it violated section 14(a) of the Exchange Act by obtaining shareholder approval of a merger through false and misleading proxy statements. Despite the absence of an express private remedy under section 14(a), the Court unanimously held that section 14(a) could be privately enforced because enforcement of the proxy rules provides a necessary supplement to [Securities and Exchange] Commission action.... [T]he possibility of civil damages or injunctive relief serves as a most effective weapon in the enforcement of the proxy requirements. 377 U.S. at 432, 84 S.Ct. at 1560. 41 According to the SEC, the All-Holders Rule was promulgated pursuant to sections 14(d) and 14(e) of the Williams Act. 51 Fed.Reg. at 25,875. 5 As discussed infra, at 1003, section 14(e), the fraud provision of the Act, has been found to create a private right of action. Similarly, courts have held that sections 14(d)(6) and 14(d)(7) create private rights of action. See Pryor v. United States Steel Corp., 794 F.2d 52, 57-58 (2d Cir.) (shareholders have right of action under section 14(d)(6)), cert. denied, 479 U.S. 954, 107 S.Ct. 445, 93 L.Ed.2d 393 (1986); Field v. Trump, 850 F.2d 938, 946 (2d Cir.1988) (shareholders have right of action under section 14(d)(7)). 42 In light of the judicial construction of Rule 10b-5 and Borak, it is reasonable to conclude that Congress passed the Williams Act with an understanding that courts would construe the Act as creating private remedies that would enforce the provisions of the Act effectively. What constitutes effective enforcement of a statute is of course itself a difficult question. While a private remedy tends to increase the level of enforcement, increased enforcement is not necessarily consonant with the level of enforcement contemplated by Congress in passing the statute. Although Borak did not address this point, and it is not easy to discern what Congress had in mind with respect to the appropriate level of enforcement of the Williams Act, the presumption that Congress acted with an understanding of how courts have construed its statutes suggests that we should construe congressional silence regarding desired enforcement levels as supporting a high level of enforcement, for Congress was legislating against a background of ready judicial implication of private remedies. 43 The Supreme Court has held that whether the plaintiff is 'one of the class for whose especial benefit the statute was enacted'  is a  'relevant' ... factor[ ] in determining whether a private remedy is implicit in a statute not expressly providing one. Chris-Craft, 430 U.S. at 37, 97 S.Ct. at 947 (quoting Cort v. Ash, 422 U.S. 66, 78, 95 S.Ct. 2080, 2087, 45 L.Ed.2d 26 (1975)); see also Curran, 456 U.S. at 391 n. 91, 102 S.Ct. at 1846 n. 91. The Williams Act was enacted for the purpose of protecting target company shareholders. Chris-Craft, 430 U.S. at 35-36, 39, 97 S.Ct. at 946, 948. Because the class sought to be protected by the Williams Act are the shareholders of the target corporation, it would also be  'consistent with the underlying purposes of the legislative scheme to imply'  a private remedy for these shareholders. Chris-Craft, 430 U.S. at 39, 97 S.Ct. at 948 (quoting Cort v. Ash, 422 U.S. at 78, 95 S.Ct. at 2087) (emphasis omitted). A private remedy will enable injured shareholders to seek damages to compensate for loss stemming from violation of the Act and an injunction against a tender offer violating the Act where the requirements for equitable relief have been met. 44 In light of the considerations set forth above we conclude that Congress intended to create a private right of action enabling target company shareholders to enforce the provisions of the Williams Act pursuant to which the All Holders Rule was promulgated. 45 4. Will implying a private right of action under the All Holders Rule further the purpose of the Williams Act? 46 The final of the three Angelastro questions is whether the purpose of the enabling statute is furthered by creating a private right of action. As noted above, the All Holders Rule is the same type of prohibition as that contained in section 14(d)(6) (the proration provision), and section 14(d)(7) (the best-price provision), and the enforcement of these provisions through a private right of action has been held to further the purposes of the Williams Act. The reasons behind that determination--the need to provide a high enforcement level to deter violations, to compensate injured shareholders and to allow them to protect themselves from irreparable harm through an injunction--apply with equal force to the All Holders Rule. We therefore conclude that the All Holders Rule creates a private right of action for shareholders. There is no evidence, however, that it creates a private right of action for the target corporation. We must therefore address the question whether a target company nonetheless has standing to sue for violation of the Rule. 47 5. Does a target company have standing to assert the interests of its shareholders in a suit to enjoin a tender offer in violation of the All Holders Rule? 48 The Supreme Court has held that the sole purpose of the Williams Act is to protect target [company] shareholder[s]. Chris-Craft, 430 U.S. at 35, 97 S.Ct. at 946. As explained above, the Court has also held that one of the several factors [that] are relevant in determining whether a private remedy is implicit in a statute not expressly providing one is whether the plaintiff is  'one of the class for whose especial benefit the statute was enacted.'  Cort v. Ash, 422 U.S. 66, 78, 95 S.Ct. 2080, 2088, 45 L.Ed.2d 26 (1975) (quoting Texas & Pacific Railway v. Rigsby, 241 U.S. 33, 39, 36 S.Ct. 482, 484, 60 L.Ed. 874 (1916) (emphasis added)). In view of these factors there can be no doubt that shareholders injured by a tender offer in violation of the Rule have standing to sue the tender offeror for either monetary or injunctive relief. No reported decision, however, has discussed the question whether a target company has standing to seek to enjoin a tender offer in violation of the All Holders Rule. 6 We find the question a difficult one. 49 We first discuss the constitutional facet of the standing requirement. The Constitution requires that a plaintiff allege personal injury fairly traceable to the defendant's allegedly unlawful conduct and likely to be redressed by the requested relief. Allen v. Wright, 468 U.S. 737, 751, 104 S.Ct. 3315, 3324, 82 L.Ed.2d 556 (1984). Polaroid has no problem in meeting this aspect of the standing requirement, as it is evident that Polaroid can reasonably determine that it will be injured by the successful conclusion of Shamrock's tender offer. Cf. Unocal, 493 A.2d at 954 (board of directors (of a Delaware corporation such as Polaroid) addressing a pending takeover bid has an obligation to determine whether the offer is in the best interests of the corporation and its shareholders); Bebchuk, The Case for Facilitating Competing Tender Offers, 95 Harv.L.Rev. 1028 (1982) (a successful bid by a tender offeror may foreclose a higher bid by a third party). The Supreme Court has also held that although a plaintiff must show injury to obtain standing, there is no constitutional requirement that the merits of the lawsuit directly relate to the plaintiff's injury. See Duke Power Co. v. Carolina Environmental Study Group, 438 U.S. 59, 78, 98 S.Ct. 2620, 2633, 57 L.Ed.2d 595 (1978). 50 Polaroid thus meets the constitutional requirements of standing. The Supreme Court, however, has held that the sole purpose of the Williams Act is to protect target company shareholders. In raising a claim under the Williams Act, Polaroid is therefore seeking to vindicate not its own rights but the rights of its shareholders. The issue in this case is consequently whether Polaroid has third party or jus tertii  standing to assert the right of Polaroid shareholders to a tender offer that does not violate the All Holders Rule. See generally Monaghan, Third Party Standing, 84 Colum.L.Rev. 277 (1984); Sedler, The Assertion of Constitutional Jus Tertii: A Substantive Approach, 70 Calif.L.Rev. 1308 (1982); C. Wright, A. Miller, & E. Cooper, 13 Federal Practice and Procedure Sec. 3531.9 (1984). 51 One context in which the Supreme Court has freely allowed jus tertii standing is when an association raises the rights of its members. Trade associations, public interest groups and other such associations have been permitted, for example, to challenge federal agency rules under the Administrative Procedure Act's judicial review provision, despite the language of the provision, which merely states that [a] person suffering legal wrong because of agency action, or adversely affected or aggrieved by agency action within the meaning of a relevant statute, is entitled to judicial review thereof. 5 U.S.C. Sec. 702. See National Motor Freight Traffic Association v. United States, 372 U.S. 246, 247, 83 S.Ct. 688, 689, 9 L.Ed.2d 709 (1963) (per curiam); Sierra Club v. Morton, 405 U.S. 727, 739, 92 S.Ct. 1361, 1368, 31 L.Ed.2d 636 (1972); Simon v. Eastern Kentucky Welfare Rights Organization, 426 U.S. 26, 40, 96 S.Ct. 1917, 1925, 48 L.Ed.2d 450 (1976); Japan Whaling Association v. American Cetacean Society, 478 U.S. 221, 230-31 n. 4, 106 S.Ct. 2860, 2866-67 n. 4, 92 L.Ed.2d 166 (1986). Sierra Club described this doctrine as an example of a more general principle that an organization whose members are injured may represent those members in a proceeding for judicial review. 405 U.S. at 739, 92 S.Ct. at 1368. 52 Organizations raising constitutional challenges brought under 42 U.S.C. Sec. 1983 have also been allowed to gain standing by asserting the interests of their members. The Court has formulated the doctrine as follows: 53 an association has standing to bring suit on behalf of its members when ... (a) its members would otherwise have standing to sue in their own right; (b) the interests it seeks to protect are germane to the organization's purpose; and (c) neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit. 54 Hunt v. Washington State Apple Advertising Commission, 432 U.S. 333, 343, 97 S.Ct. 2434, 2441, 53 L.Ed.2d 383 (1977). 55 If Polaroid fit within the contours of this jus tertii associational standing doctrine, we could hold that it had standing to raise the rights of its shareholders, who can sue under the All Holders Rule, and thus itself sue under the Rule. Weighing in favor of allowing such standing is that while individual shareholders may often find the cost of the litigation beyond their means, the target corporation will usually have the resources to finance it, and, in many cases, this will have the salutary effect of enforcing the securities laws. A number of considerations, however, weigh against allowing the corporation jus tertii standing to represent the interests of its shareholders based on associational standing. 56 The interest that a corporation would be vindicating in such a suit is the right of some of its shareholders to sell at a price equal to that of other of its shareholders to a third party, the tender offeror. This is an interest different in kind from that pursued in a corporation's ordinary litigation, which seeks to protect the corporation's business. Shareholders in a widely traded corporation such as Polaroid are generally free to sell their stock on any terms that they wish without interference from the corporation. While shareholders band together to form an organization with a single management to run a business, this endeavor does not normally include protecting shareholders in their relationships with third parties. It is thus doubtful whether the interests that Polaroid seeks to protect in its litigation under the All Holders Rule are germane to the organization's purpose. Hunt, 432 U.S. at 343, 97 S.Ct. at 2441. See C. Wright, A. Miller, & E. Cooper, 13 Federal Practice and Procedure Sec. 3531.9 at 617 (The greatest care [in extending association standing] ... should be taken with organizations that ordinarily would not be expected to undertake litigation on behalf of their constituents. An ordinary commercial corporation, for example, generally should not be permitted to borrow standing from injured stockholders.). 57 In addition to this concern, the inherent conflicts of interest in litigation under the All Holders Rule may make a corporation a poor representative of shareholder interests. Although an association may rely on the standing of its members to assert standing for itself by showing that only one of its members has the type of redressable injury that would give it standing to sue individually, Warth v. Seldin, 422 U.S. 490, 511, 95 S.Ct. 2197, 2211, 45 L.Ed.2d 343 (1975), associational standing has never been granted in the presence of serious conflicts of interest either among the members of an association or between an association and its members. 58 The first potential conflict is between those shareholders who view litigation to enjoin a tender offer as adversely affecting their opportunity to collect on the tender offer premium and those shareholders who are cut out of the tender offer and thus may want to see it defeated. Even though some shareholders are disadvantaged by their exclusion from the tender offer, a great majority of shareholders will often benefit from the offer. A corporation is thus an uncertain representative for the interests of the disadvantaged shareholders, as it may have an eye to protecting the interests of the majority. This undermines the basis for jus tertii standing--that the jus tertii advocate will vigorously assert the interests of the right-holder. See Craig v. Boren, 429 U.S. 190, 194, 97 S.Ct. 451, 455, 50 L.Ed.2d 397 (1976); Singleton v. Wulff, 428 U.S. 106, 114, 96 S.Ct. 2868, 2874, 49 L.Ed.2d 826 (1976) (plurality opinion). Indeed, one basis for the constitutional requirement that a litigant have a personal stake in a litigation is to assure that concrete adverseness which sharpens the presentation of issues upon which the court so largely depends for illumination of difficult ... questions. Simon v. Eastern Kentucky Welfare Right Organization, 426 U.S. 26, 38 n. 16, 96 S.Ct. 1917, 1924 n. 16, 48 L.Ed.2d 450 (1976) (quoting Baker v. Carr, 369 U.S. 186, 82 S.Ct. 691, 7 L.Ed.2d 663 (1962)). 59 The second conflict of interest that may interfere with the proper conduct of the litigation in some cases is that between the management of a corporation and its shareholders. Even shareholders injured by their exclusion from a tender offer may sometimes profit handsomely from the tender offer and be injured by litigation that defeats it. The market price of the stock of a corporation jumps skyward within minutes after a credible tender offer is made. Excluded holders of the security can thus profit from the tender offer by selling their shares at the market price to third parties. If the excluded holders fail to sell to third parties, they still have the shares they started out with when the tender offer closes; in this sense they are no worse off than if there had been no tender offer. Indeed, they may be better off since they now have a suit for damages against the tender offeror who excluded them from the tender offer. 60 While shareholders (including those excluded from the offer) thus have a reason to react favorably to many tender offers, those in control of the target corporation have a natural incentive to resist a corporate takeover. Unless protected by golden parachutes guaranteeing them a lucrative exit from corporate affairs, the corporation's top officers may suffer a substantial loss in future earnings if the tender offer is successful. As Polaroid's home state of Delaware has recognized, measures adopted to ward off a takeover raise the omnipresent specter that a board may be acting primarily in its own interests, rather than those of the corporation and its shareholders.... Unocal, 493 A.2d at 954. 7 61 The mere presence of a conflict of interest does not, of course, prove that management's hostile reaction to a tender offer is not in the best interests of shareholders. Indeed, Delaware law requires that a board addressing a pending takeover bid to determine whether the offer is in the best interests of the corporation and its shareholders. Unocal, 493 A.2d at 954. Nevertheless, the presence of a genuine conflict of interest in many takeover situations weighs heavily against allowing corporations to assert the rights of shareholders under an associational jus tertii standing theory. 62 For all the foregoing reasons, it would appear that Polaroid does not fit within the confines of the associational standing jus tertii doctrine. 8 63 We nonetheless consider a number of possible counterarguments to the conclusion that a target corporation does not have jus tertii standing to assert the interests of its shareholders under the All Holders Rule. 64 Polaroid has asserted that [t]he public interest is ... clearly in favor of the enforcement of the securities laws. Appellant's Brief at 37. Unfortunately, this facile assertion does not take us too far. It fails to consider whether such relief will result in an enforcement level in excess of that desirable from a policy perspective or that contemplated by Congress. It also fails to consider the impact of such relief on any congressional decision to entrust regulatory decisions to a centralized, specialized, and more politically accountable body such as the SEC rather than private litigants and the courts. Finally, it fails to consider the extent to which the social benefits of enforcement may be incommensurate with the social costs in light of the costs of the litigation to the parties and the judicial system, the cost of uncertainty imposed by the litigation on the capital markets, the cost of compliance, and the cost resulting from the possibility that the litigation may defeat the tender offeror's efforts to consummate what may be a socially beneficial transaction. 9 The text and legislative history of the Williams Act (and the administrative history of the All Holders Rule) are silent on the issue. As the foregoing demonstrates, any attempt to rely upon one's own conception of what would constitute good tender offer policy, in addition to being inappropriate, is too latent with difficulties to yield a definitive answer. 65 Rather than invoking policy arguments, it might be argued that, as in the implied right of action inquiry discussed above, a court should presume that Congress expected courts to continue to apply the jus tertii standing doctrine extant at the time Congress passed the legislation. This argument, however, is unlikely to be of any help to Polaroid, as the jus tertii doctrine was no more liberal at the time that Congress passed the Williams Act. See Sedler, supra, 70 Calif.L.Rev. at 1308-09. 10 66 As explained infra at 1003, this Court has held that target corporations have standing to raise a claim under section 14(e) that the tender offer contains fraudulent misrepresentations or omissions. The best argument for allowing target corporations standing to sue under the All Holders Rule may thus be that there is no reason to distinguish All Holders Rule standing from misrepresentation standing. There is, however, a reason to draw this distinction. The bar against misrepresentation is meant to protect all shareholders. Shareholder litigation under the aegis of the corporation makes greater sense in this context, where the class of persons whose rights the corporation is vindicating constitutes all of its shareholders. The All Holders Rule, by contrast, protects what are likely to be only a minority of shareholders. Moreover, it may be more difficult to detect fraud than to detect violations of the All Holders Rule, and the possibility of irreparable harm may be greater in the case of fraud because of the greater difficulty in computing monetary loss. The need for target corporation standing in the fraud context may thus be greater than in the context of the All Holders Rule. Finally, the rule that target corporations have standing to sue for fraud was adopted by this Court without discussion; the Court simply reached the merits in such suits. While we do not question the continued efficacy of target corporation standing in fraud suits, the manner in which the rule was adopted should make us hesitant to construe it as definitively settling the question of target corporation standing outside of the fraud context. 67 We therefore hold that, although the All Holders Rule creates a private right of action enabling injured shareholders to sue a tender offeror whose offer violates the Rule, a target corporation has no standing to sue under the Rule. 11 We thus affirm the district court's refusal to grant a preliminary injunction on the basis of Polaroid's All Holders Rule claim. 68