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For helpful comments, I thank Alan Auerbach, Alan Blinder, Mitchell Engler, Victor Fleischer, Mark Gergen, Kevin Hassett, James Hines, Mitchell Kane, Alex Raskolnikov, Julie Roin, Frank Sammartino, Daniel Shaviro, Joel Slemrod, Gene Seago, David Weisbach, Larry Zelenak, and participants at the University of Michigan’s Tax Policy Workshop Series and NYU’s Colloquium Series on Tax Policy and Public Finance. Special thanks to Reed Shuldiner and Michael Knoll for many useful discussions. This research was not supported by funding from any outside source. The working paper version of this Article was first circulated and posted on SSRN on June 25, 2007. See Chris William Sanchirico, The Tax Advantage to Paying Private Equity Fund Managers with Profit Shares: What is It? Why is It Bad? (University of Pennsylvania Institute for Law and Economics Research Paper No 07-14, June 25, 2007), online at http://ssrn.com/abstract= 996665 (visited June 8, 2008).

This Article greatly benefited from comments and criticisms by Ben Depoorter, Lee Anne Fennell, Mark Fenster, Sonia Katyal, Jim Krier, Tom Merrill, Adam Mossoff, Dan Richman, Ed Rock, Carol Rose, Chris Serkin, Peter Siegelman, Henry Smith, Phil Weiser, and participants in the 2007 Property Works in Progress Conference at the University of Colorado Law School.

Many people helped me think through the problems addressed in this article. I am especially grateful to Larry Alexander, Randy Barnett, David Bernstein, Julie Cohen, Lee Anne Fennell, Martin Lederman, Gary Peller, Adam Samaha, Geoffrey Stone, Mark Tushnet, and Rebecca Tushnet, and to participants at workshops at The University of Chicago Law School, Georgetown University Law Center, and Loyola University Law School. I received excellent research assistance from James Banda and Richard Harris.

We are grateful to Rosalind Dixon, Heather Gerken, Rick Hasen, Sam Issacharoff, Jonathan Masur, Rick Pildes, Adam Samaha, Max Schanzenbach, Josh Sellers, Cass Sunstein, Emerson Tiller, Dan Tokaji, and Fred Vars for helpful comments and conversations. We would also like to thank the workshop participants at Northwestern University School of Law, University of Toronto Faculty of Law, Yale Law School, the Searle Symposium on Empirical Studies of Civil Liability, and the Conference on Empirical Legal Studies. Carolyn Sha and Annabelle Yang provided invaluable research assistance.

This Article has benefited from the comments and suggestions of Professors Bobby Ahdieh, Douglas Baird, Margaret Blair, Bill Bratton, William Christie, Steven Davidoff, Gillian Hadfield, Paul Heald, Larry Helfer, Donald Langevoort, David Millon, Erin O’Hara, Bob Rasmussen, Hans Stoll, Bob Thompson, Joel Trachtman, and Todd Zywicki. The Article also benefited from faculty workshops at the University of Georgia, the University of Pennsylvania, the University of Southern California, and Northwestern University. I would also like to thank Murray Teitelbaum, James Duffy, and the staff of the New York Stock Exchange for their time and valuable insight.

We are grateful to Bruce Ackerman, Rachel Brewster, Ethan Bueno de Mesquita, Bob Cooter, Rosalind Dixon, John Ferejohn, David Fontana, Heather Gerken, Tom Ginsburg, Dan Ho, Cheng-Yi Huang, Alison LaCroix, Daryl Levinson, John Matsusaka, Richard McAdams, Drew Navikas, Anne O’Connell, Eric Posner, Adam Samaha, Lior Strahilevitz, Madhavi Sunder, Cass Sunstein, Matthew Stephenson, and Adrian Vermeule for helpful comments and conversations. Johanna Chan, Monica Groat, Stacey Nathan, and Peter Wilson provided excellent research assistance. Financial support was provided by the John M. Olin Foundation and the George J. Stigler Center for the Study of the Economy and the State.

My thanks to Michael Abramowicz, Brad Clark, John Duffy, Howell Jackson, Geoffrey Miller, Richard Nagareda, Robert Rhee, Bill Rubenstein, Anthony Sebok, Mark Spindel, and participants in faculty workshops at Harvard Law School, Georgetown University Law Center, and George Washington University Law School.

Thanks to Robert Bartlett, Alicia Davis-Evans, Todd Henderson, Kim Hogrief, Arthur Levitt, Patrick McGurn, Nell Minow, Maureen Mulligan, Adam Pritchard, Robert Reville, two anonymous referees, and conference participants at The University of Chicago Law School, University of Michigan, and the American Bar Association Tort Trial & Insurance Practice Section for helpful comments and discussions, and to the RAND Corporation Institution for Civil Justice for generous support. Many thanks as well to the Corporate Library for granting me access to their data. All errors are mine.

In preparing this Article, I benefited greatly from conversations with several private-equity partners (both limited and general) as well as the excellent research assistance of Tracey Chenoweth. Thanks also, for insightful comments and advice, to Bobby Bartlett, Kate Litvak, Bob Rasmussen, Larry Ribstein, and Randall Thomas.

Thanks for comments on previous versions to Amitai Aviram, Steve Bainbridge, Vic Fleischer, Ron Gilson, Richard Squire, Michael Weisbach, and Charles Whitehead, and participants at workshops at the Association of American Law Schools, University of Connecticut, Fordham, UCLA School of Law, George Washington University, and the Symposium, The Going-private Phenomenon: Causes and Implications at The University of Chicago Law School. For a longer version of this Article, see Larry E. Ribstein, Uncorporating the Large Firm (University of Illinois Law & Economics Research Paper No LE08-016, May 27, 2008), online at http://ssrn.com/ abstract=1138092 (visited Jan 11, 2009).