What this page covers
Texas Senate Bill 29 was the first-mover statute in the post-Tornetta v. Musk
Tornetta disambiguation. SB 29 (signed May 14, 2025) responds to the Jan. 30, 2024 Tornetta v. Musk Chancery opinion (Del. Ch. 2018-0408-KSJM). The Dec. 19, 2025 Delaware Supreme Court reversal in In re Tesla Stockholder Litigation post-dates the statute by seven months and does not undo the political catalyst — the law was already enacted.
wave of state-law efforts to attract Delaware-incorporated companies. Signed by Governor Greg Abbott on May 14, 2025 and effective immediately, SB 29 made three substantive changes to the Texas Business Organizations Code: (1) it amended TBOC §21.552(a) (SECTION 13 of the bill) by adding §21.552(a)(3), authorizing eligible corporations to elect a derivative-standing ownership threshold not exceeding 3% of outstanding shares; (2) it added new TBOC §2.116 (SECTION 4 of the bill), authorizing governing documents to waive the right to a jury trial concerning any internal entity claim; and (3) it added new TBOC §21.419 (SECTION 11 of the bill), codifying the business-judgment rule as a statutory presumption for publicly traded Texas corporations.This page tracks the legislation itself, not the firms that adopted it. For firm-level analysis — including the 62-firm TX-incumbent universe and the verified §21.552 adopter cohort (Tesla, Southwest Airlines, plus candidates) — see Texas companies →. For the single-firm Gusinsky v. Reynolds enforcement case study, see Southwest Airlines §21.552 case study →.
Legislative timeline — SB 29 (89R)
| Date | Action | Significance |
|---|---|---|
| 2025-02-27 | SB 29 filed by Sen. Bryan Hughes | First introduction; companion to interim hearings on Texas business-court reform |
| 2025-03-25 | Senate State Affairs Committee report — favorable, no amendments | Committee passage; sets up floor vote |
| 2025-04-03 | Senate engrossment (RV#159) | Senate passage near-certain; first event-study candidate date for cohort-level cross-sectional analysis |
| 2025-04-04 | House referral — Business & Industry Committee | House process begins |
| 2025-04-29 | House Committee report — favorable | Committee passage |
| 2025-05-02 | House passage (RV#1339) | Passage near-certain in both chambers; cleanest single-day milestone for event-study identification — the cohort-level "market learns SB 29 will become law" event date |
| 2025-05-08 | Enrolled bill sent to Governor | Awaiting signature |
| 2025-05-14 | Signed by Governor Greg Abbott; effective immediately | SB 29 becomes law and takes immediate effect. Texas-incumbent issuers may begin electing into §21.552 from this date forward. Tesla files §21.552-electing 8-K Item 5.03 the very next day (2025-05-15) |
TBOC §21.552 — up-to-3% derivative standing with mandatory coalition access
"… for a corporation with common shares listed on a national securities exchange or a corporation that has made an affirmative election to be governed by Section 21.419 and has 500 or more shareholders, at the time the derivative proceeding is instituted, the shareholder beneficially owns a number of the common shares sufficient to meet the required ownership threshold to institute a derivative proceeding in the right of the corporation identified in the corporation's certificate of formation or bylaws, provided that the required ownership threshold does not exceed three percent of the outstanding shares of the corporation."
For purposes of this section, "shareholder" includes "two or more shareholders acting in concert under an informal or formal agreement or understanding with respect to a derivative proceeding." Tex. Bus. Orgs. Code Ann. §21.551(2)(C) (West 2025).
"The governing documents of a domestic entity may contain a waiver of the right to a jury trial concerning any internal entity claim. … In a lawsuit asserting an internal entity claim, a waiver of the right to a jury trial contained in the governing documents of a domestic entity is enforceable, regardless of whether the applicable governing document is signed by the members, owners, officers, or governing persons."
Note: The jury-trial waiver authority is structurally separate from the §21.552 ownership-threshold election. SB 29 SECTION 4 added §2.116 (jury waiver, located in Title 1 General Provisions); SB 29 SECTION 13 added §21.552(a)(3) (3% standing threshold, located in Chapter 21 For-Profit Corporations). A corporation may elect either, both, or neither.
§21.552(a)(3) authorizes corporations to set a threshold of up to 3%. A company may elect any value greater than 0% and not exceeding 3%, or may decline to elect entirely, in which case no §21.552 threshold applies and standing reverts to the default contemporaneous-ownership rule under federal Rule 23.1. The TBOC §21.552 Bylaw Scan documents a range of elections in the post-SB 29 cohort: VOYG (Voyager Technologies) at 1% — the lowest in the cohort; ARCB (ArcBest) elected a single-share threshold (effective opt-out); most other adopters (Tesla, Southwest Airlines, UAMY, Caris Life Sciences, RUSH.A, SPFI, LEGH, FRMI, XXI, SpaceX) set the threshold at the statutory maximum of 3%. ExxonMobil and most other Texas-incumbent firms have declined the election entirely. The elected threshold is disclosed in the bylaws filed as an Ex. 3.1 or Ex. 3.2 to an 8-K Item 5.03.
Key mechanical features
- The 3% figure is a statutory maximum. Corporations elect any threshold from greater than 0% up to and including 3%. Default if not elected: no threshold beyond federal Rule 23.1 contemporaneous-ownership.
- Election is opt-in. Applies only to Texas-incorporated public companies that affirmatively elect via charter or bylaw amendment, disclosed by 8-K Item 5.03.
- Mandatory coalition access. §21.551(2)(C) defines "shareholder" to include "two or more shareholders acting in concert." This is a statutory aggregation right — the threshold is met by any combination of shareholders whose joint holdings clear it. Coalition assembly cannot be barred by the corporation.
- No dollar-value alternative. Section 21.552 does not include a $1 million market-value threshold. The $1M-or-3% formulation belongs to §21.373, the separate opt-in shareholder-proposal statute enacted by SB 1057.
- Continuous-ownership requirement. Standing must be maintained throughout the proceeding (consistent with federal Rule 23.1 continuous-ownership doctrine).
- Jury-trial waiver. Plaintiffs bringing derivative actions waive jury trial for internal-entity claims.
- Beneficial ownership. Statute defines beneficial ownership inclusively, aligning with §13(d) Schedule 13G/13D conventions.
Coalition math — how easily 3% is cleared at a Fortune-50 issuer
Worked example: ExxonMobil
| Coalition size | Combinations clearing 3% | Notes |
|---|---|---|
| 1 firm individually | 3 | Vanguard (10.31%), BlackRock (7.45%), State Street (4.92%) each qualify alone |
| 2-firm pairs | 15,207 | Two-firm coalitions whose combined ExxonMobil ownership exceeds 3% |
| 3-firm combinations | 38.5 million | Three-firm coalitions clearing 3% |
| 4-firm combinations | 65.1 billion | Four-firm coalitions clearing 3% |
Without the "Big Three" (excluding Vanguard, BlackRock, State Street)
If the entire critique is right that the Big Three are passive and won't form coalitions, the analysis still works among the remaining 5,058 13F filers:
| Coalition size (ex-Big-Three) | Combinations clearing 3% | Notes |
|---|---|---|
| 1 firm individually | 0 | No single non-Big-Three filer holds 3% of ExxonMobil |
| 2-firm pairs | 32 | Anchored by FMR LLC (2.37%) and Geode Capital Management (2.30%); 28 pairs combine FMR or Geode with another large institutional holder (Norges Bank, Capital Research, BNY, JPMorgan, Morgan Stanley, Northern Trust, Schwab, T. Rowe Price, State Farm, Eaton Vance, Dimensional, Fisher, UBS, Managed Account Advisors, Strategic Advisers); plus one pair combining Norges Bank + Capital Research (3.03%) |
| 3-firm combinations | 152,856 | Any third institution added to the FMR + Geode anchor produces another qualifying trio |
| 4-firm combinations | 389 million | Stable across top 500 or all 5,058 remaining filers |
The §21.552 threshold is structurally accessible to coalitions of institutional shareholders, even excluding the three largest index-fund families. Among the remaining 13F filers in the ExxonMobil ownership base, 32 two-firm pairs would jointly clear the 3% threshold — anchored by FMR LLC and Geode Capital Management (the latter a Vanguard affiliate; in a strict ex-indexer analysis, Geode would also be excluded).
SB 1057's proxy-disclosure obligation requiring corporations that opt into §21.373 to describe in their proxy statements "how shareholders may contact one another to aggregate their holdings" (Jackson Walker; Haynes Boone) provides one institutional mechanism by which coalition assembly could occur in practice. Whether such assembly does occur, and at what cost, is an empirical question on which evidence has not yet been systematically published.
The de minimis-plaintiff dynamic — Gusinsky v. Reynolds as case study
The plaintiff in Gusinsky v. Reynolds, the first reported §21.552 enforcement decision, held 100 shares of Southwest Airlines — approximately $3,000 worth of stock against a corporation with approximately $18 billion in market capitalization, representing approximately 0.000017% of Southwest Airlines's outstanding shares. The N.D. Tex. court dismissed the derivative complaint on the ground that 100 shares fell far below the 3% threshold Southwest had elected by bylaw.
Whether the post-§21.552 threshold also screens out non-strike-suit derivative actions by genuine small shareholders is a contested empirical question on which evidence has not yet been systematically compiled. Practitioner commentary on both sides exists: see Gibson Dunn (defending the threshold as targeting strike suits); cf. Stephen M. Bainbridge & M. Todd Henderson, Texas's Mistake, U. Chi. L. Rev. Online (forthcoming 2026) (raising threshold-overinclusion risk).
Source. See Shane Goodwin, Read the Fine Print: What ExxonMobil's Proxy Actually Says About Texas Redomiciliation, SMU Corporate Governance Initiative Working Paper (Apr. 2026); coalition methodology and replication workbook on file with the SMU CGI.
TBOC §21.419 — codification of the business-judgment rule
In taking or declining to take any action on any matters of a corporation's business, a director or officer is presumed to act (1) in good faith; (2) on an informed basis; (3) in furtherance of the interests of the corporation; and (4) in obedience to the law and the corporation's governing documents. Neither a corporation nor any of the corporation's shareholders has a cause of action against a director or officer unless: (1) the claimant rebuts one or more of those presumptions; and (2) it is proven by the claimant that (A) the director's or officer's act or omission constituted a breach of one or more of the person's duties as a director or officer; and (B) the breach involved fraud, intentional misconduct, an ultra vires act, or a knowing violation of law. In alleging any of those four predicate acts, a party must state with particularity the circumstances constituting that conduct.
The §21.419 codification is significant for three reasons: (a) it codifies four director/officer presumptions (good faith, informed basis, corporate-interest, law-compliance); (b) it requires a claimant to both rebut a presumption and prove a breach that involved fraud, intentional misconduct, ultra vires conduct, or knowing violation of law — a stacked requirement that materially raises the bar for a successful fiduciary-duty challenge in Texas state courts; and (c) it imposes a heightened-pleading particularity requirement on the four predicate-conduct grounds. Critics argue this is a one-way ratchet that protects boards beyond what Delaware case law would. SB 29 does not impose a clear-and-convincing evidentiary standard for any element of the §21.419 framework; the enrolled bill text uses the ordinary preponderance standard for proof of breach. See Tex. S.B. 29, 89th Leg., R.S. § 11 (2025), codified at Tex. Bus. Orgs. Code Ann. § 21.419 (West 2025).
Companion legislation — SB 1057 / TBOC §21.373
A shareholder may submit a proposal for action at an annual or special meeting of a publicly traded corporation only if the shareholder, for at least six months immediately preceding the date of submission, has owned or beneficially owned shares with an aggregate market value of at least $1 million or shares constituting at least 3 percent of the corporation's voting power. The proponent must additionally solicit holders of at least 67 percent of the voting power before the meeting.
§21.373 is structurally distinct from §21.552. It governs Rule 14a-8-style shareholder proposals (board nominations and annual-meeting business), not derivative actions. The 67% pre-solicitation requirement is the most striking departure from federal practice — effectively, only sponsoring shareholders with cooperative institutional support could meet the threshold.
SEC Rule 14a-8 governs shareholder proposals at federally-registered issuers. A Texas statute imposing stricter eligibility thresholds than the federal rule presents a Supremacy-Clause question: does Texas's election effectively override federal proxy law? SEC Chair Paul Atkins, in his Keynote Address at the John L. Weinberg Center for Corporate Governance's 25th Anniversary Gala (Oct. 9, 2025), signaled potential compatibility under Rule 14a-8(i)(1)'s state-law-incompatibility ground — explicitly stating that proposals from proponents who fail to satisfy SB 1057's $1M-or-3% / 6-month / 67%-solicitation requirements "should be excludable" under (i)(1) (see practitioner coverage: HLS Forum; Gibson Dunn; Sullivan & Cromwell). No court ruling has issued. Texas-incumbent firms appear to be in a wait-and-see posture pending legal clarity — zero confirmed §21.373 adopters as of measurement date. This is itself a finding: if the §21.373 regime were unambiguously valuable, more firms would have elected.
Federal-preemption questions for §21.552 itself
§21.552's derivative-action threshold raises subtler preemption questions than §21.373. Three doctrinal channels are in play:
- Internal Affairs Doctrine. Established Supreme Court precedent (CTS Corp. v. Dynamics Corp. of America, 481 U.S. 69 (1987); Edgar v. MITE Corp., 457 U.S. 624 (1982)) holds that the state of incorporation has primary regulatory authority over internal corporate affairs. §21.552's threshold sits squarely in that internal-affairs lane and should be resilient to constitutional challenge.
- Dormant Commerce Clause. A Texas statute imposing standing requirements on derivative actions in any court (including federal diversity-jurisdiction courts) might be argued to burden interstate commerce. The counterargument: §21.552 governs the corporate-law right of action, not the procedural court access; under Erie, federal courts in diversity apply state law on the substantive cause-of-action elements.
- SLUSA / Securities Litigation Uniform Standards Act. SLUSA precludes most state-law class actions involving covered securities. §21.552, however, governs derivative actions (corporation as nominal plaintiff), not class actions, so SLUSA preemption is not directly implicated.
Gusinsky v. Reynolds (N.D. Tex. Mar. 17, 2026, infra) is the first reported decision applying §21.552 in federal court, providing some early evidence that the threshold is enforceable in federal diversity proceedings without preemption objection.
Judicial enforcement — Gusinsky v. Reynolds
Holding. The court dismissed the derivative complaint because the plaintiff held only 100 shares of Southwest Airlines common stock, well below the 3% derivative-proceeding ownership threshold that Southwest had adopted by bylaw under §21.552(a)(3). The court applied Texas's continuous-ownership requirement; the plaintiff's federal-law and open-courts theories were treated as abandoned or insufficiently developed rather than reached on the merits. The opinion is the first federal-court application of a §21.552(a)(3) bylaw threshold and signals that an adopted threshold has pleading-stage force in federal diversity jurisdiction.
Implication for the §21.552 election decision. Gusinsky demonstrates that the §21.552 threshold has practical bite: it can dispose of low-share-count derivative actions at the pleading stage. For Texas-incumbent boards considering whether to elect, Gusinsky is the first piece of evidence that election produces an enforceable, federal-court-cognizable shield.
The upstream catalyst — Tornetta v. Musk
Holding. Chancellor McCormick rescinded Tesla's 2018 CEO Performance Award (the "Musk Pay Package") on the ground that the process by which the Tesla board approved it had not satisfied the entire-fairness standard applicable to controller-conflicted transactions. The court concluded that Musk was a controlling stockholder for purposes of the pay-package vote and that the board's negotiation process and disclosure to stockholders did not meet the dual-protections framework articulated in Kahn v. M&F Worldwide Corp., 88 A.3d 635 (Del. 2014). Within hours of the opinion, Musk ran an X poll asking whether Tesla should "change its state of incorporation to Texas." The next day (January 31, 2024), Musk posted: "Tesla will move immediately to hold a shareholder vote to transfer state of incorporation to Texas." Tesla filed its DGCL §266 conversion PRE 14A on April 17, 2024 and the conversion took effect June 13, 2024.
Subsequent history. On December 19, 2025, the Delaware Supreme Court, sitting en banc, issued a per curiam opinion in In re Tesla, Inc. Derivative Litigation, 2025 WL 3689114 (Del. Dec. 19, 2025), captioned "AFFIRMED IN PART AND REVERSED IN PART." The Court reversed the rescission remedy and reinstated the 2018 plan, awarded $1 in nominal damages, and reduced plaintiff's counsel-fee award from $345 million to $54.5 million on a quantum meruit basis. The Court did not reach Chancery's underlying liability holdings — on controller status, fiduciary breach, and fairness — because the Justices had "varying views on the liability determination" and chose "the narrower path" of resolving the appeal on remedy grounds alone. Chancery's entire-fairness liability holdings therefore remain standing as trial-court decisions without Supreme Court endorsement.
Implication for SB 29. Texas-incorporation wave dynamics — including Tesla's high-profile move and the broader chilling effect on Delaware boards considering controller-conflicted transactions — gave Sen. Hughes the political opening to file SB 29. The bill explicitly targets the post-Tornetta equilibrium by codifying both the BJR (§21.419) and a derivative-suit threshold (§21.552) that constrains the kind of plaintiff bar that brought Tornetta itself.
Maffei v. Palkon — the "clear-day" doctrine for reincorporations
Holding. The Delaware Supreme Court reversed the Court of Chancery and held that a reincorporation undertaken on a "clear day" — outside the context of any specific transaction in which the controller might extract a non-ratable benefit — is reviewed under the business-judgment rule rather than entire fairness. The court rejected the argument that the reduced-liability benefit of moving to a more management-friendly state is itself a sufficient non-ratable benefit to invoke entire fairness, reasoning that such alleged benefits were too speculative to constitute material extraction of value.
Implication for SB 29 & the broader DExit wave. Maffei v. Palkon dramatically lowered the doctrinal cost of post-Tornetta reincorporations. Boards considering DE→TX moves no longer faced the risk of having the conversion itself reviewed under entire fairness. The combination of Tornetta (raising the cost of staying in Delaware) and Maffei v. Palkon (lowering the cost of leaving Delaware) created the doctrinal pressure that SB 29 capitalized on by giving Texas-incumbent boards an additional statutory safe-harbor.
Other state-law moves — the regulatory-competition landscape
SB 29 sits within a broader 2024-2026 wave of state-corporate-law reforms aimed at attracting (or defending against) the post-Tornetta incorporation flow:
- Delaware SB 21 (2025; signed Mar 25, 2025) — amends DGCL §§144 (interested-director transactions) and 220 (books-and-records), modifying the statutory framework for cleansing controlling-stockholder transactions while preserving the Kahn v. M&F Worldwide common-law framework. Delaware's defensive response to TX/NV reincorporation pressure.
- Nevada AB 239, ch. 142, 2025 Nev. Stat. (effective May 30, 2025), amending NRS Title 7 (principally chs. 78, 92A) (LegiScan; Brownstein; HLS Forum) — clarifies controlling-stockholder fiduciary duties under NRS 78.240 and codifies jury-trial waiver provisions for internal-entity claims under NRS 78.046. Nevada's parallel move to attract DE migrators.
- Federal forum-selection litigation. The post-Tornetta wave has intensified ongoing federal-court litigation over the enforceability of Delaware (and now Texas) forum-selection clauses in derivative and securities actions. Several cases remain pending.
For comprehensive coverage of the post-2020 corporate-law evolution including all three state regimes, see Corporate Law History →.
Empirical question — does §21.552 election affect equity valuation?
This is the central empirical question SMU CGI's Reincorporation Tracker is positioned to answer. The single-firm and pooled-cohort analysis lives at:
- Texas companies — the 62-firm TX-incumbent universe, the verified §21.552 adopter sub-cohort (Tesla, Southwest Airlines, plus candidates), and the pooled CAAR / pooled BHAR statistic across adopters.
- Southwest Airlines case study — the methodologically cleanest single-firm test (TX-incumbent, no migration confound, full bespoke battery: synth control + market model + sector-augmented + matched-pair + raw differential + Patell-z + bootstrap + BHAR 1/3/6/12mo + CTE alpha + Newey-West HAC pairwise tests).
Provisional finding (as of v6-rev127): the verified-adopter-cohort headline is consistent with the null hypothesis at the announcement window. Southwest Airlines's day-0 abnormal return is +0.09% (Patell-z p = 0.96); long-run BHAR is statistically indistinguishable from zero. ExxonMobil's day-0 reading was Day-0 abnormal return = +0.02% (95% placebo-rank CI [−1.48%, +1.53%]; not statistically distinguishable from zero) on the redomestication announcement, with TOST equivalence rejecting any governance discount of ±2pp at p = 0.011. The market did not price a governance discount.
Adoption-rate framing. The relatively low elective uptake of the §21.552 ceiling at TX-incumbent issuers (2-7 confirmed/candidate adopters of 62) is consistent with the statute working as designed: most firms do not need a threshold because they do not face active strike-suit pressure, and the firms that do (Tesla, Southwest Airlines) have elected. The 3% maximum is itself a ceiling; firms could elect lower percentages without electing 0%, but most adopters that have elected have set the threshold at the statutory maximum. This is consistent with the legislative intent: §21.552 is an opt-in safe harbor for boards that face contingency-fee strike-suit pressure, not a mandate that displaces existing derivative standing.
Caveat. The headline empirical question is whether the §21.552 election produces a measurable equity-price reaction; the headline is a null finding at announcement and over twelve months post. The headline normative question is whether the statute is well-designed; the answer turns on the coalition-math analysis above (yes, the threshold is structurally accessible to coalitions of real shareholders) and on the Gusinsky enforcement record (the first application barred a 100-share strike-suit plaintiff, confirming the statute targets that profile rather than meritorious shareholder oversight).
Causal identification — difference-in-differences (treated adopters vs TX-incumbent non-adopters)
Why this design. A hostile reviewer's primary attack on the single-event-study and pooled-CAAR readings above is selection bias: firms that elect §21.552 are not random draws from the TX-incumbent universe; they self-select. A pooled-cohort BHAR cannot separate the "§21.552 adoption effect" from the "firm-type that adopts §21.552 effect." The cleanest off-the-shelf identification strategy that survives the selection critique is a difference-in-differences with two-way fixed effects, run on the joint TX-incumbent panel around the SB 29 effective date.
DiD specification.
ARi,t = δ · (Treati × Postt) + γi (firm FE) + λt (date FE) + εi,t
where ARi,t is the market-model abnormal return for firm i on date t, Treati = 1 for verified §21.552 adopters {Tesla, Southwest Airlines, CNP, LEGH, HSCS, Dillard's, United States Antimony}, Postt = 1 for trading days on or after 2025-05-14 (SB 29 effective), γi are firm fixed effects, λt are date (calendar-day) fixed effects. Standard errors are clustered at the firm level (Liang-Zeger, 1986) to allow for arbitrary within-firm serial correlation.
- Control group: the TX-incumbent non-adopting firms in the Panel A universe — the 62-firm TX-incumbent roster minus the 10-firm §21.552 adopter set (8 Tier-1 verified + candidates pending verification) and excluding firms with insufficient daily-return coverage in the estimation window.
- Event date: 2025-05-14, the SB 29 effective date (Tex. S.B. 29, 89th Leg., R.S. (2025), codified at Tex. Bus. Orgs. Code Ann. §§21.419, 21.552 (West 2025)). This is the population-level shock; firm-specific bylaw-amendment adoption dates serve as auxiliary placebo windows.
- Window: 90 trading days pre / 90 trading days post, with a 240-day estimation window for the underlying market model (CRSP value-weighted index).
- Identification assumptions: (i) parallel pre-trends — tested via event-time leads (-90 to -1) on the Treat×Post interaction; (ii) no anticipatory adoption — SB 29 was not signed into law until May 14, 2025, so any pre-period treatment effect would have to operate through legislative-passage anticipation, not adoption; (iii) SUTVA — we assume non-adopting TX-incumbents are not affected by §21.552 elections at adopting firms.
- Headline coefficient: δ = the average treatment-on-treated effect of being a verified §21.552 adopter, in basis points of daily abnormal return, post-effective-date. Reported with cluster-robust standard error, t-statistic, and two-sided p-value.
How this responds to the hostile-referee critique. The DiD addresses the "Selection bias" finding (Weakness #3 in the AI-reviewer red-team report) and Recommendation #1 (causal identification beyond single-event-study) by providing a within-TX-incumbent comparison that absorbs the time-invariant firm characteristics — controller status, sector, leverage, growth profile — that drive selection into adoption. It does not claim to identify the LATE for the never-treated; it does claim to recover an unbiased ATT for the verified-adopter sub-cohort under standard parallel-trends + no-anticipation assumptions.
Implementation status. The DiD runner is wired into the current pipeline (03_ANALYSIS/code/hygiene/phase5z_did_runner.py, step 8 of 14 in rebuild_full_battery_and_deploy.ps1; canonical v6-rev127). Output JSON (tracker_pipeline/did_results.json) and the firm-day panel CSV (did_event_study_panel.csv) are regenerated each pipeline run. The headline δ coefficient and pre-trends test will be surfaced here on the next pipeline build; until then this card documents the design so a hostile referee can stress-test the specification before reading the result.
Robustness queue. (i) staggered-adoption variant using firm-specific bylaw-amendment dates rather than the SB 29 effective date as the treatment timing (Goodman-Bacon decomposition + Sun-Abraham estimator); (ii) Bartik-style IV using historical derivative-litigation exposure as an instrument for §21.552 adoption probability (per Recommendation #4); (iii) inverse-probability-weighting (IPW) double-robust ATT to relax linearity in firm covariates.
Bluebook citations
Statutes: Tex. S.B. 29, 89th Leg., R.S. (2025), codified at Tex. Bus. Orgs. Code Ann. §§21.419, 21.552 (West 2025) (effective May 14, 2025).
Tex. S.B. 1057, 89th Leg., R.S. (2025), codified at Tex. Bus. Orgs. Code Ann. §21.373 (West 2025) (effective Sep. 1, 2025).
Cases: Tornetta v. Musk, 310 A.3d 430 (Del. Ch. 2024) (McCormick, C.), aff'd in part and rev'd in part sub nom. In re Tesla Derivative Litigation, 2025 WL 3689114 (Del. Dec. 19, 2025) (per curiam) (rescission reversed; 2018 plan reinstated; $1 nominal damages; fee reduced to $54.5M on quantum meruit basis; Court declined to reach liability holdings); Maffei v. Palkon, 339 A.3d 705 (Del. 2025) (en banc), 2025 WL 384054 (Feb. 4, 2025); Gusinsky v. Reynolds, No. 3:25-cv-01816-K (N.D. Tex. Mar. 17, 2026) (Kinkeade, J.).
Foundational doctrine: Kahn v. M&F Worldwide Corp., 88 A.3d 635 (Del. 2014); CTS Corp. v. Dynamics Corp. of America, 481 U.S. 69 (1987); Edgar v. MITE Corp., 457 U.S. 624 (1982).
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