With the resurgence of these market cowboys, Main Street and Wall Street are revisiting a multibillion-dollar debate: do these guys do right by the shareholders they often claim to serve, or are they hired guns focused solely on the bounty they’ll get for clinching the deal? When the 1980s shuddered to a close, investment bankers got lots of the blame for what went wrong. And they deserved it. Last week, in the wake of a court ruling that slammed advisers in the Paramount case, the chorus was raised again. But as a new wave of mergers breaks, Wall Street critics should take a broader look. Lawyers may be a tired target, but they direct traffic in these affairs. And as last year’s boardroom battles illustrate, the ultimate responsibility for shareholders lies with the board of directors. There are also the courts: takeover law is still fluid, leaving plenty of room for confusion.

Investment banking was once a more genteel–and mundane–line of work: bankers helped companies raise money through stocks or bonds to build a plant or make a friendly acquisition. In the mid-1970s the game changed. As takeover fever mounted, executives terrified of corporate raiders ran into the arms of the bankers. As the new power brokers, they initiated the deals and invented financing tools, such as new types of junk bonds, to get them done.

With people sadder and somewhat wiser, the 1990s won’t be an instant replay of the 1980s. Powerful shareholders are holding boards and CEOs more accountable. The focus is on “strategic alliances,” such as drug-maker Merck’s merger with discount distributor Medco, rather than on deals fueled by financial speculation. Deals are done more with stock than debt. And some CEOs these days even declare their independence from investment bankers: Bell Atlantic’s Ray Smith boasts that he pulled off his big deal with little of their help.

But the dynamic that drives the bankers remains. “Their mission in life is to do deals, and that hasn’t changed,” says Don Chew, editor of the journal of Applied Corporate Finance. That mission rests on how bankers are paid. If a deal is completed, they make millions; if it isn’t, they collect at best a consolation prize. And what if the deal is good for the CEO, but not for shareholders? The banker is supposed to advise the board, which, in turn, reports to shareholders. But he knows who hired him. All bankers learn, says one in New York, that they “get paid for protecting the CEO.”

That’s exactly the charge being leveled in the case of Paramount. The studio–along with properties including Simon & Schuster–has been the target of two determined suitors, Viacom, owner of MTV, and QVC, the home-shopping network. But after a court slammed Paramount for cozying up to Viacom over QVC, players in and around the Paramount camp are pointing fingers, trying to duck the blame. Many are eager to dump it on Lazard Freres, Paramount’s august investment bank. Did it try to get the best deal for shareholders–or did it simply protect Paramount head Martin Davis?

Davis’s wishes have been crystal clear since September, when he announced that Viacom would acquire Paramount but he would still run it. When QVC’s Barry Diller made a higher bid, things got complicated–especially since Diller and Davis are bitter rivals. Still, Paramount thought it had an out. The contract it had written with Viacom set high hurdles for other bidders even to get into the game; Paramount’s lawyers at Simpson Thacher & Bartlett told the board that QVC couldn’t play, and that the board was free to dismiss the offer. Common sense would have dictated that the bankers compare the offers in their “fairness opinion,” the financial analysis that is the basis for a board’s decision. But fairness opinions are often more a matter of artful phrasing than rigorous analysis. Lazard called Viacom’s bid “fair” even as it noted that QVC’s bid was higher.

Critics believe that Paramount lawyers and bankers rendered advice that was highly questionable–and the board swallowed it–hoping the deal would squeak through. It didn’t. “Meeting with QVC was the last thing management wanted to do,” said the judge, so they and the board chose “to bide behind” some rickety legalisms. Paramount was forced to start over; it will look at new bids this week.

Officers at Paramount and Lazard wouldn’t comment for this article. But Simpson’s Dick Beatty says his team was blindsided by the court: “They changed the law.” In fact, the Delaware courts have been inconsistent at times, and experts are already debating the new ruling. In the end, observers are left with several less-than-satisfying explanations. In one version, Paramount’s directors, lawyers and bankers made a good-faith effort and were simply taken by surprise. In another, they were close to conspiratorial in their maneuverings and got caught.

Under any scenario, the investment bankers don’t deserve all the blame. Regulators, legislators and courts have virtually never held investment bankers accountable–as they do lawyers and accountants–for the advice they give. And the onus is really on the board of directors. They could refuse to pay on a fee-for-deal basis, and they could look more skeptically at the advice they get. Paramount might study the lesson taught by General Motors and IBM: the buck really does stop at the boardroom.