457 U.S. 624 (1982)
MITE Corp. and its wholly owned subsidiary MITE Holdings, Inc., both Delaware corporations with principal executive offices in Connecticut, initiated a cash tender offer for all outstanding shares of Chicago Rivet & Machine Co., a publicly held Illinois corporation, on January 19, 1979, by filing a Schedule 14D-1 with the Securities and Exchange Commission.1
MITE offered $28 per share, approximately $4 above the prevailing market price, but did not register the offer under the Illinois Business Take-Over Act.2 On the same day MITE filed suit in the United States District Court for the Northern District of Illinois against Illinois Secretary of State James Edgar, seeking a declaratory judgment that the Illinois Act was preempted by the Williams Act and violated the Commerce Clause, together with temporary, preliminary, and permanent injunctive relief.3
Chicago Rivet responded three days later by suing in Pennsylvania to enjoin the offer under that state's takeover disclosure law, but its efforts there proved unsuccessful.4 On February 1, 1979, the Illinois Secretary of State notified MITE of his intent to issue a cease-and-desist order.5 The following day Chicago Rivet informed MITE it would file suit in Illinois state court, and the district court issued a preliminary injunction prohibiting the Secretary from enforcing the Illinois Act against MITE's tender offer.6
MITE published its nationwide tender offer in the February 5, 1979, edition of the Wall Street Journal.7 Chicago Rivet simultaneously offered to purchase approximately 40 percent of its own shares at $30 per share.8 On February 9 the district court entered final judgment declaring the Illinois Act preempted by the Williams Act and violative of the Commerce Clause, and permanently enjoined its enforcement.9 The parties then entered an agreement withdrawing both offers and granting MITE thirty days to examine Chicago Rivet's books and records.10 On March 2, 1979, MITE announced it would not proceed with any tender offer.11
The United States Court of Appeals for the Seventh Circuit affirmed the district court's judgment.12 The Supreme Court noted probable jurisdiction.13
Whether the case is moot?14
A case is moot if the parties lack a legally cognizable interest in the outcome because no live controversy remains between them.15
No. The Secretary of State notified MITE of intent to issue a cease-and-desist order and indicated enforcement would follow reversal, exposing MITE to civil and criminal liability for the February 5, 1979 nationwide tender offer published in the Wall Street Journal after the preliminary injunction issued.16 The established facts show MITE filed suit the same day it initiated the offer without Illinois registration, the district court issued the preliminary injunction on February 2, and final judgment followed on February 9, yet the Secretary's enforcement threat keeps the constitutional questions live.17
The case is not moot.18
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Joined by Justice Brennan
Justice Marshall dissented on the ground that the preliminary injunction issued February 2, 1979, must be presumed to grant MITE permanent protection from penalties for violations during its effective period.19 Because any state enforcement action would therefore be subject to a complete federal-law defense, no live controversy existed and the case should have been dismissed as moot.20 He emphasized that parties seek injunctions to obtain permanent immunity for actions taken in reliance on the order, and the presumption favors such protection absent contrary language.21
Justice Rehnquist dissented on the separate ground that MITE had withdrawn its offer, announced it would not proceed, and had no intention to engage in future activity regulated by the Illinois Act.22 With the underlying tender offer dead for reasons unrelated to the statute's validity, the controversy that gave rise to the injunction was no longer live.23 He stressed that this Court has no power over a suit not pending before it and that a decision here would not resolve any actual controversy between the parties.24
Whether the Illinois Business Take-Over Act is preempted by the Williams Act under the Supremacy Clause?25
A state statute is preempted under the Supremacy Clause when it stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress, even if simultaneous compliance is physically possible.26
Yes. The Illinois Act's 20-business-day precommencement notification and hearing provisions, together with the Secretary's authority to deny registration on substantive fairness grounds, frustrate the Williams Act's policy of neutrality between management and the bidder.27 MITE's January 19, 1979 Schedule 14D-1 filing and February 5 nationwide offer complied with federal timing and disclosure rules.28 Yet the Illinois statute would have delayed or blocked the offer through mandatory hearings requested by management-controlled shares or Illinois shareholders holding 10 percent, and through the Secretary's inequitable-offer review, thereby upsetting the balance Congress struck.29
The Illinois Business Take-Over Act is preempted by the Williams Act.30
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Justice Stevens concurred in the judgment on Commerce Clause grounds but declined to join the preemption holding.31 He concluded that Congress's policy of neutrality in the Williams Act does not necessarily prohibit state legislation that provides additional protection to interests broader than those of incumbent management.32 He reasoned that federal judges lack power to grant blanket immunity through injunctions and that the Williams Act's evenhanded approach leaves room for state measures in appropriate circumstances.33
In his view the statute's neutrality policy assumes corporate entities of substantially equal resources and does not imply a congressional intent to bar states from assuring greater protection to interests that often extend beyond incumbent management.
Whether the Illinois Business Take-Over Act violates the Commerce Clause?34
A state statute must be upheld if it "regulates evenhandedly to effectuate a legitimate local public interest, and its effects on interstate commerce are only incidental . . . unless the burden imposed on such commerce is clearly excessive in relation to the putative local benefits." Pike v. Bruce Church, Inc., 397 U. S. 137, 142 (1970).35
Yes. The Illinois Act directly regulates and prevents interstate tender offers by requiring registration before any communication to shareholders nationwide, including the February 5, 1979 Wall Street Journal offer by Delaware corporations MITE and MITE Holdings to shareholders of an Illinois corporation scattered across the country.36 The Act's nationwide reach and potential for indefinite delay impose a substantial burden on interstate securities transactions.37 This burden outweighs Illinois's asserted interests in protecting resident shareholders and regulating internal affairs, especially because the statute applies even when no Illinois shareholder is affected and exempts a target's self-tender.38
The Illinois Business Take-Over Act violates the Commerce Clause.39
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Justice Powell joined the Commerce Clause analysis in Part V-B because it leaves room for some state regulation of tender offers.40 He noted that the Williams Act's neutrality policy assumes roughly equal resources between offeror and target and does not preclude state measures protecting broader public interests when a small or regional target faces a much larger bidder.41 He observed that conglomerate formations and resource disparities can produce adverse consequences for communities when headquarters move.42
Justice O'Connor joined only the portions of the opinion addressing mootness and the Commerce Clause.43 She concluded that it was unnecessary to reach preemption and would affirm the judgment of the Court of Appeals solely on the ground that the Illinois Act is invalid under the Commerce Clause.44 She agreed the case is not moot and that the Act's nationwide reach renders it unconstitutional.45
In her view the statute's sweeping extraterritorial effect and potential to stifle interstate securities transactions justified invalidation without addressing Supremacy Clause questions.