Law Commons^™

Digital Market Perfection, Rory Van Loo

Michigan Law Review

Google’s, Apple’s, and other companies’ automated assistants are increasingly serving as personal shoppers. These digital intermediaries will save us time by purchasing grocery items, transferring bank accounts, and subscribing to cable. The literature has only begun to hint at the paradigm shift needed to navigate the legal risks and rewards of this coming era of automated commerce. This Article begins to fill that gap by surveying legal battles related to contract exit, data access, and deception that will determine the extent to which automated assistants are able to help consumers to search and switch, potentially bringing tremendous societal benefits. Whereas …

Intellectual Property In Experience, Madhavi Sunder

Michigan Law Review

In today’s economy, consumers demand experiences. From Star Wars to Harry Potter, fans do not just want to watch or read about their favorite characters— they want to be them. They don the robes of Gryffindor, flick their wands, and drink the butterbeer. The owners of fantasy properties understand this, expanding their offerings from light sabers to the Galaxy’s Edge®, the new Disney Star Wars immersive theme park opening in 2019.Since Star Wars, Congress and the courts have abetted what is now a $262 billion-a-year industry in merchandising, fashioning “merchandising rights” appurtenant to copyrights and trademarks that give fantasy owners …

Consumer Preferences For Performance Defaults, Franklin G. Snyder, Ann M. Mirabito

Michigan Business & Entrepreneurial Law Review

Commercial law in the United States is designed to facilitate private transactions, and thus to enforce the presumed intent of the parties, who generally are free to negotiate the terms they choose. But these contracts inevitably have gaps, both because the parties cannot anticipate every situation that might arise from their relationship, and because negotiation is not costless. When courts are faced with these gaps in a litigation context, they supply default terms to fill them. These defaults usually are set to reflect what courts believe similar parties would have agreed to if they had addressed the issue. These “majoritarian” …

Stubborn Things: An Empirical Approach To Facts, Opinions, And The First Amendment, Daniel E. Herz-Roiphe

Michigan Law Review First Impressions

This essay offers an empirical approach to the problem, rooted in an argument that the underlying rationale for the fact/opinion distinction in compelled speech doctrine tells us something about how this distinction should be policed. Commercial speech enjoys protection by virtue of its value to listeners, it is from the listener's vantage point, then, that courts should assess whether a compelled disclosure is fact or opinion. And if we are interested in learning how disclosures will affect listeners, we might try asking them, just as courts adjudicating trademark suits frequently use consumer surveys to determine how customers understand the meaning …

Chopping Down The Rainforest: Finding A Solution To The "Amazon Problem", Eric Andrew Felleman

University of Michigan Journal of Law Reform Caveat

Current economic conditions in the United States have led to a dramatic decrease in state tax revenue. Without these funds, states will be unable to support important public services, and hundreds of thousands of jobs in the public and private sectors are at risk of being cut, as states work to close $103 billion in budget gaps. Accomplishing that will involve overcoming many hurdles, such as the unpopularity of raising taxes during times of economic trouble, but one largely untapped source could provide a significant amount of income to states. States currently lose around $23 billion annually in uncollected use …

Playing With Fire: Proceeding Cautiously With Reforms To The Michigan Fireworks Safety Act, Nicholas Pietropaulo

University of Michigan Journal of Law Reform Caveat

On January 1, 2012, the Michigan Fireworks Safety Act went into effect. It marked a significant change in how the state of Michigan treats the sale and use of “consumer fireworks.” Effectively, the new statute authorizes the sale and use of Roman Candles, bottle rockets, aerials, and other fireworks that had previously been banned. Almost immediately, challenges and complaints were raised. On one side, eight fireworks vendors challenged the constitutionality of one of the law’s provisions that required such vendors to purchase insurance at an arguably unreasonable rate. The court dismissed that case, holding that it could not be said …

Everything In Its Right Place: Social Cooperation And Artist Compensation, Leah Belsky, Byron Kahr, Max Berkelhammer, Yochai Benkler

Michigan Telecommunications & Technology Law Review

The music industry's crisis response to the Internet has been the primary driver of U.S. copyright policy for over a decade. The core institutional response has been to increase the scope of copyright and the use of litigation, prosecution, and technical control mechanisms for its enforcement. The assumption driving these efforts has been that without heavily-enforced copyright, artists will not be able to make a living from their art. Throughout this period artists have been experimenting with approaches that do not rely on technological or legal enforcement, but on constructing web-based business models that engage fans and rely on voluntary …

The Debt Dilemma, Katherine Porter

Michigan Law Review

Part I describes the nature of credit card spending and explores the usefulness of Mann's comparative approach to studying credit cards. Part II evaluates Mann's findings on the overall relationships between individual credit card transactions and aggregate levels of spending, borrowing, and bankruptcy. It also briefly analyzes the relationship between his findings and policy recommendations. Part III explores data on families who refrain from credit card use and struggle with serious financial distress. Part IV revisits Mann's policy recommendations in light of this new data. I conclude that implementing credit card reform would offer families only partial, albeit valuable, protection …

The Hidden Roles Of Boilerplate And Standard-Form Contracts: Strategic Imposition Of Transaction Costs, Segmentation Of Consumers, And Anticompetitive Effects, David Gilo, Ariel Porat

Michigan Law Review

Standard-form contracts offered to consumers contain numerous terms and clauses, most of which are ancillary to the main terms of the transaction. We call these ancillary terms "boilerplate provisions." Since most consumers do not read boilerplate provisions or, if they do, find them hard to understand, courts are suspicious of boilerplate provisions and sometimes find them unenforceable under the doctrine of unconscionability. At times, courts conclude that harsh terms have not been accepted by consumers in the first place and therefore are not included in the contract, and on other occasions courts interpret boilerplate provisions in favor of consumers, applying …

Applying 42 U.S.C. § 1981 To Claims Of Consumer Discrimination, Abby Morrow Richardson

University of Michigan Journal of Law Reform

This Note explores several interesting legal questions regarding the proper interpretation of 42 U.S.C. § 1981, which prohibits racial discrimination in contracting, when discrimination arises in the context of a consumer retail contract. The Note further explores how the Fifth Circuit's and other federal courts' narrow interpretation of § 1981's application in a retail setting (which allows plaintiffs to invoke the statute only when they have been prevented from completing their purchases) is contrary to the statute's express language, congressional intent, and to evolving concepts of contract theory, all of which reflect a commitment to the strict enforcement of civil …

Defining "Green": Toward Regulation Of Environmental Marketing Claims, Roger D. Wynne

University of Michigan Journal of Law Reform

This Note joins a rising chorus calling for government regulation of green marketing claims. It attempts to encourage and add a sense of urgency to a burgeoning regulatory movement by highlighting some of the legal issues that such regulation entails. Part I identifies a gap in the law: the inability of current truth-in-advertising laws to clarify the legality of green marketing claims. Part II urges bridging that gap quickly; it examines the costs of continued nonregulation and describes some of the forms regulation is taking. Part III attempts to allay any fears that such regulations might be challenged on first …

Personal, Living Or Family Matters And The Value Added Tax, L. Hart Wright

Michigan Law Review

No tax is ever implemented in a manner which is perfectly responsive to the logical implications of its basic purpose. VAT is no exception.

Those who foster this tax basically intend that ultimate tax incidence be suffered only by individuals and then only in the degree to which they dip into society's pool of consumer-type goods and services. But their implementing legislation is always designed to fall short of reaching all consumer-type goods and services. Ullman's proposed Tax Restructuring Act of 1979 would have been no exception. Under it, a substantial proportion of all such benefits actually would have been …

Consumer Warranty Claims Against Companies In Chapter 11 Reorganizations, Elizabeth Warner

University of Michigan Journal of Law Reform

This article examines the rights of individuals who have purchased warranted goods from a business that subsequently undergoes reorganization under Chapter 11 of the Bankruptcy Reform Act of 1978. Part I establishes that warranty rights are claims in bankruptcy and outlines the procedure that must be followed by a creditor for distribution from the debtor's estate. Part II focuses on how warranty claims are treated in Chapter 11. Part III discusses ways to alleviate the warranty creditor's representational burden, particularly through the intervention and aid of public interest groups. This article concludes that . warranty creditors will receive favorable treatment …

Efts: Consumer Protection Under The Ucc, Susan E. Jinnett

University of Michigan Journal of Law Reform

In view of the economic significance of the payments system, the laws governing it must be equitable and comprehensive. The development of the commercial law applicable to EFTS's, however, currently lags behind the growth of these systems. Threats to the integrity of EFTS's stem from lost, stolen, or forged access cards, illegal taps into communication lines, physical impairment of the equipment, or improper programming. The legal rights and liabilities of consumers where the integrity of an EFTS has been breached remains unclear, in part because the status of EFTS's under current law is uncertain. The rights of the parties involved …

Legislative Restriction Of Creditor Powers And Remedies: A Case Study Of The Negotiation And Drafting Of The Wisconsin Consumer Act, Jeffrey Davis

Michigan Law Review

This Article discusses the background, negotiation, and drafting of selected WCA restrictions on creditor powers and remedies and compares those provisions to the analogous restrictions proposed by other reform measures. In addition to the UCCC, the MCCA and the WCA, two other major works must be considered in any discussion of consumer-credit legislation. First is Working Redraft No. 4 of the UCCC (UCCC Redraft). This proposed revision, published in December 1972, represents a marked change in the UCCC. Many provisions favorable to the consumer have been added, and many of the parallel provisions on sales and loans have been consolidated. …

Consumer Complaints: A Proposed Federal Trade Regulation Rule, Howard R. Lurie

University of Michigan Journal of Law Reform

It is no secret that most consumers are unable to protect themselves in the marketplace, yet government assistance to the consumer is frequently unavailable. All too often the bureaus of government are interested primarily in controversies of major significance. Minor consumer complaints are viewed as an annoyance that distract and interfere with more important matters. What must be done to protect consumers is to redress the balance of power now heavily weighted in favor of business. To do so requires that government go beyond current concepts of appropriate consumer protection and establish unorthodox remedies. One such remedy is suggested in …

New Jersey Retail Installment Sales Act, Eric A. Oesterle

University of Michigan Journal of Law Reform

The effect of the enactment of the New Jersey bill is that a "retail buyer" may now assert against an assignee of the installment contract or subsequent "holder" of the negotiable note any defenses he has against the retail installment seller. The new law would appear to be one of the most comprehensive laws of its type to be enacted. However, the draftsmen apparently left a significant loophole, appropriately termed the "specious cash sale,” which, if exploited, could negate the intended effect of the new law. This note will analyze the bill, compare it with the relevant provisions of the …

Consumer Credit--The Department Store Revolving Charge Account--Usury Resurrected--State V. J.C. Penney Company, Michigan Law Review

Michigan Law Review

The Attorney General of Wisconsin recently brought an action against the J.C. Penney retailing chain for an injunction against any further charges of 1½% per month on the declining balances of its revolving charge accounts. The state alleged that anything in excess of I% per month was a violation of the $12 per $100 per annum usury ceiling established by its legislature as the maximum chargeable for a loan or forbearance of money. Penney admitted that its monthly charge frequently exceeded the allowable rate but argued that its charge was a "time-price differential," exempt from statutory control under the time-price …

New York Specious Cash Sales Act, Craig D. Holleman

University of Michigan Journal of Law Reform

The New York Legislature recently moved to protect consumers in that state from unscrupulous retailers of consumer goods and financers of consumer loans by enacting the Specious Cash Sales Act. The new law is the third in a series of measures designed to remedy certain perceived inequities to which the holder in due course doctrine gives rise in the consumer goods field. Earlier this year, the Legislature undercut complicated mechanisms whereby a finance company could procure from a retailer contracts and obligations containing a waiver-of-defenses provision executed by the buyer-consumer. This law in turn complemented a still earlier statute which …

Underground Gas Storage: Economic Needs And A Proposed Statutory Resolution Of Legal Obstacles, Steven Y. Winnick

University of Michigan Journal of Law Reform

Gas storage is necessary to equate the supply and demand for gas in different parts of the United States. Most areas of the country lack sufficient native gas supplies to meet their own demands for consumption, and commercial natural gas produced mainly in the southwest must be shipped to all parts of the country. The primary and most economical means of shipment is by pipelines. But during the winter months pipelines carrying capacity loads are incapable of meeting the demand for gas, especially for residential space heating. Contrariwise, capacity far exceeds demand during the warmer periods. This Article will discuss …