Digital Commons Network^™

Taxing Corporate Payouts, Neil Dokurno, David A. Weisbach

Coase-Sandor Institute for Law & Economics Research Paper Series

Corporate distributions total about $1.5 trillion per year, yet the system for taxing distributions is a mess. It favors buybacks over dividends, and therefore is a possible cause of the growth of buybacks in recent years. It is almost comically complex. And even with its fantastic level of complexity (or perhaps because of the complexity), it provides opportunities for egregious shelters.

Congress has repeatedly attempted reforms to fix these problems, with at best mixed success and often outright failure. Numerous commentators have proposed reforms but all either fail to eliminate the tax differential between buybacks and dividends or require significant …

The Uneasy Case For Copyright Disgorgement, Roy Baharad

Coase-Sandor Institute for Law & Economics Research Paper Series

Along with lost profits damages that are designed to put copyright owners in the position they would have occupied in the absence of infringement, copyright law entitles rightsholders to seek disgorgement of any additional profits elicited by infringers. The disgorgement remedy is designed to infuse principles of unjust enrichment into copyright doctrine, allowing owners to collect any ill-gotten gain creditable to the infringement. Despite its prominence, this Article reveals a hitherto overlooked problem in applying the disgorgement remedy to copyright infringement. As a baseline for the analysis, the Article embraces the canonic distinction between two types of infringements: imitations and …

Can Consumers Protect Themselves Against Privacy Dark Patterns?, Matthew B. Kugler, Lior Strahilevitz, Marshini Chetty, Chirag Mahapatra

Coase-Sandor Institute for Law & Economics Research Paper Series

Dark patterns have emerged in the last few years as a major target of legislators and regulators. Dark patterns are online interfaces that manipulate, confuse, or trick consumers into purchasing goods or services that they do not want, or into surrendering personal information that they would prefer to keep private. As new laws and regulations to restrict dark patterns have emerged, skeptics have countered that motivated consumers can and will protect themselves against these manipulative interfaces, making government intervention unnecessary. This debate occurs alongside active legislative and regulatory discussion about whether to prohibit dark patterns in newly enacted comprehensive consumer …

Lawyer Ceos, M. Henderson, Irena Hutton, Danling Jiang, Matthew Pierson

Articles

No abstract provided.

Colonial Experiences And Contemporary Laws, Adam Chilton, Yun-Chien Chang, Nuno Garoupa, Mila Versteeg

Articles

No abstract provided.

Criminal Procedure In A Time Of Abolition, Adam Davidson

Articles

No abstract provided.

How Are Ideologies False? A Reconstruction Of The Marxian Concept, Brian Leiter

Articles

No abstract provided.

Gender Equality In World Athletics: Transnational Norm Development By Private International Organizations, Michele Krech

Articles

No abstract provided.

A Natural Law Approach To Parental Rights, Richard Epstein

Articles

No abstract provided.

Fraudulent Transfer Law’S Forgotten Foundations, Douglas G. Baird

The University of Chicago Business Law Review

Fraudulent transfer law is one of the principal bulwarks of private law. Fraudulent transfer law, however, now faces a crisis. Courts have long assumed that it was easy to determine whether a debtor made a fraudulent transfer of its property. One could use traditional markers of ownership to determine whether the debtor transferred property to a confederate. But today, most assets are intangible. Transactions happen in the blink of an eye, and they take place entirely on corporate books. Reliance on simple notions of what constitutes a “transfer” of property is wholly inadequate. Understanding what it means for a debtor …

Risk, Return, And Restoration: A Fundamental Approach To Pre-Judgment Interest, Yijia Lu, Scott Vincent

The University of Chicago Business Law Review

Courts routinely miscalculate pre-judgment interest, thereby failing to fully restore injured parties. Because pre-judgment interest can be substantial—often rivaling or even exceeding the underlying award—errors in its calculation are important and may create distorted incentives, promote opportunistic behavior, and suppress investment and economic activity. These errors often stem from reliance on speculation to determine the costs covered by interest. This Article argues that such speculation is unnecessary. The litigation claim is identified as the asset which has burdened the injured party with risks and costs imposed by the wrongful act, eliminating the need to rely on a hypothetical asset to …

Textualism As A Pro-Employee Force In Employment Discrimination Law, Alex Reed

The University of Chicago Business Law Review

Textualism has gotten a bad rap, at least insofar as employment discrimination law is concerned. Derided by antidiscrimination scholars as an interpretive smokescreen concerned less with faithfully construing statutory text than reliably yielding pro-employer results, textualism is understood to pose an existential threat to employment discrimination law. This Article challenges academic orthodoxy by demonstrating that, in practice, textualism is correlated with employee-favorable outcomes. Specifically, the Article examines a subset of the Supreme Court’s major employment discrimination cases over the past thirty years and finds that textualism is twice as likely to be associated with outcomes benefiting employees than it is …

A Commitment Rule For Insolvency Forum, Anthony J. Casey, Aurelio Gurrea-Martínez, Robert K. Rasmussen

The University of Chicago Business Law Review

In this Article, we propose a new rule for determining the proper forum for insolvency proceedings. Currently, the Model Law on Cross-Border Insolvency (Model Law)—promulgated by the United Nations Commission on International Trade Law (UNCITRAL)—looks to a debtor’s center of main interest (COMI) to determine the proper forum for a foreign main insolvency proceeding. This rule is flawed. It is both inflexible and manipulable. It is also indeterminate and neither requires nor allows advance commitment by debtors. As a result, it leads to uncertainty, increases litigation costs, and opens the door to opportunistic manipulation by debtors. These costs, in turn, …

The Cost Of Qui Tam: Assessing The Constitutional Challenges To The False Claims Act, Jonathan Coleman

The University of Chicago Business Law Review

The federal government’s most powerful tool for combating fraud is the False Claims Act (FCA). The statute targets individuals and entities that submit fraudulent claims for government funds, particularly in healthcare—where it addresses Medicare and Medicaid fraud—and in government contracting, including defense industry overpayments. FCA violators must repay up to three times the government’s losses, along with additional penalties. A key feature of the FCA is its qui tam provision, which allows private citizens, known as relators, to sue violators on behalf of the United States. The statute incentivizes whistleblowing by granting relators 15% to 30% of any successful recovery. …

Corporate Law Competition In The Eu Revisited: Italian Corporations Moving North And The Missing German Spacs, Ben W. Fuhrman

The University of Chicago Business Law Review

This Article analyzes recent developments in European corporate law to argue that a Corporate Law Competition is emerging in the EU. For nearly half a century, scholars in the U.S. have engaged in a debate about a Corporate Law Competition between U.S. states and its various implications. In the late 1990s and the early 2000s, the European Court of Justice rendered a series of liberalizing decisions that broke with the long-standing prohibition on corporate mobility in the EU. Despite these judgements, scholars generally assert that there is no Corporate Law Competition among EU member states. This Article challenges such consensus …

The Political Carbon Cycle, Dhruv Chand Aggarwal

The University of Chicago Business Law Review

Democrats and Republicans strongly disagree about climate policy. This Article explains how these political disagreements can affect greenhouse gas emissions of private-sector corporations. Combining a hand-collected dataset tracking the careers of U.S. state governors over two decades and a proprietary emissions database, I find that companies release more greenhouse gas emissions when their headquarter state has a Republican governor. To establish a causal connection between gubernatorial partisanship and corporate emissions, I analyze the effect of close elections. After a Republican replaces a Democratic governor in a closely contested election, which cannot be easily predicted in advance, companies headquartered in that …

Generative Ai Meets Section 230: The Future Of Liability And Its Implications For Startup Innovation, Megan E. Cistulli

The University of Chicago Business Law Review

The rapid advancement of generative artificial intelligence (AI) is testing the limits of Section 230 of the Communications Decency Act, a statute that has long shielded online platforms from liability for user-generated content. This liability shield helped shape the modern internet, but AI’s ability to create its own content blurs the traditional distinction between platforms acting as passive hosts and those functioning as active publishers. As a result, courts and lawmakers are reexamining the scope and future of Section 230. This Comment examines how proposed reforms to Section 230 could impact startups and emerging tech companies that use generative AI …

Owning Marriage In Robinson's Gilead Novels, Lee Anne Fennell

Public Law and Legal Theory Working Papers

No abstract provided.

Forced Migration And Women's Empowerment: Evidence From Rohingya Refugees, Adam Chilton, Katerina Linos, Anup Malani

Public Law and Legal Theory Working Papers

We explore a puzzle: high levels of satisfaction among forcibly displaced Rohingya women in informal camps in Hyderabad, India. Despite experiencing extreme poverty, loss of family and community, and high levels of gender-based violence after resettlement, both men and women—particularly women—report significant increases in satisfaction. We structured a representative household survey, employed a trusted female Muslim interviewer with deep ties to the local community, interviewed comparable numbers of men and women, and embedded list experiments in our questionnaire, to allow people to answer sensitive questions indirectly. We attribute this paradoxical finding to increased freedom post-resettlement, facilitated by economic, legal, and …

Scrutinizing Sex, Jessica A. Clarke

University of Chicago Law Review

Critics of the Supreme Court’s equal protection jurisprudence despair that the Court conceives of discrimination as the mere classification of individuals on for- bidden grounds, such as race and sex, rather than systemic patterns of subordination. On the Court’s anticlassification theory, affirmative action, which relies on overt racial or gender classifications, is generally forbidden. Anticlassification rules are insensitive to context: a classification is a classification, no matter how well intentioned it might be, no matter what effects it might have, and no matter if it treats members of various groups in ways that are substantively equal. Whether a classification might …

Reestablishing Religion, Richard C. Schragger, Micah Schwartzman, Nelson Tebbe

University of Chicago Law Review

In the last few years, the Supreme Court has upended its doctrine of religious freedom under the First Amendment. The Court has explicitly rejected separationism, which limited government support of religion, and it has adopted interpretations of disestablishment and free exercise that provide special solicitude for religion. Now, the government must treat religion equally with respect to providing public benefits. But it must also grant special exemptions from regulations that burden religion. This pattern of equal treatment for benefits and special exemptions from burdens yields a doctrinal structure that gives preference to religion. We refer to this regime as structural …

Bankruptcy’S Turn To Market Value, Mark J. Roe, Michael Simkovic

University of Chicago Law Review

Chapter 11 was widely viewed as a failure in the first decade of the Bankruptcy Code’s operation, the 1980s. Large firms were mired in bankruptcy for years; the process was seen as expensive, inaccurate, and subject to abuse. While basic bankruptcy still has its critics and few would say it works perfectly, the contrast with bankruptcy today is stark: bankruptcies that took years in the 1980s take months in the 2020s.

Multiple changes explain bankruptcy’s success—creditor learning, statutory reform, better judging and lawyering, new techniques, fuller integration of the improved mechanisms that the 1978 Code added—and we do not challenge …

The International Law Of Land (Grabbing): Human Rights And Development In The Context Of Racial Capitalism, Gabriele Wadlig

Chicago Journal of International Law

This article investigates the concept of tenure security within international law, emphasizing the global legal architectures that influence and shape land tenure governance at the intersections of international human rights law and development. By tracing the evolution of tenure security from colonial practices to modern development paradigms, the article contends that international development and human rights frameworks often perpetuate dispossession and inequality. It critiques the convergence of human rights and development narratives around the formalization of land tenure, demonstrating how this practice reinforces Western legal frameworks and ontologies of land. The article examines a range of instruments including various UN …

Remedies In The First Hundred Days Of Trump Ii: A Gently Adversarial Collaboration, Samuel Bray, James E. Pfander

Public Law and Legal Theory Working Papers

No abstract provided.

International Measures To Support The Rule Of Law, Tom Ginsburg, Christoph Schoppe

Book Sections

No abstract provided.

Reorganization By Force, Jared I. Mayer

Coase-Sandor Institute for Law & Economics Research Paper Series

Nearly every chapter 11 is “voluntary” in that it’s initiated by the company’s managers. Yet the Bankruptcy Code also allows unsecured creditors to force a company to reorganize under an “involuntary chapter 11.” Involuntary chapter 11s are rare and largely ignored by scholars. That’s potentially because bankruptcy and corporate law largely defer to managers’ business judgment as to how to maximize the company’s value, and investors have several contract and corporate law tools designed to discipline underperforming managers. So, what work can involuntary chapter 11s do?

This Article shows that an involuntary chapter 11 can be the optimal solution for …

The Backstop Party, Vincent S.J. Buccola, Adi Marcovich Gross, Matthew R. Mcbrady

Coase-Sandor Institute for Law & Economics Research Paper Series

Bankruptcy exit financing has become a site of recurring conflict in the intra-class creditor skirmishes that now so often mark corporate reorganization. When creditors in an ad hoc group sufficiently large to accept a plan of reorganization on behalf of an impaired class agree to underwrite, or “backstop,” the debtor’s plan-contemplated capital raise, creditors who hold identical claims but are excluded from the backstop group cry foul that the Bankruptcy Code bars their unequal treatment. All-or-nothing arguments have proved unsatisfying, however, because, on the best reading of the Code, the merits depend on a matter of fact that is not …

A Companion Guide To The Restatement Of Consumer Contracts, Oren Bar-Gill, Omri Ben-Shahar, Florencia Marotta-Wurgler

Coase-Sandor Institute for Law & Economics Research Paper Series

This short Essay, written by the Reporters of the recently published Restatement of Consumer Contracts, is intended as a companion to the Restatement. It highlights three areas, where the Reporters’ ambition was only partially reflected in the final version of the Restatement. The first was to ground the restated rules and principles in a systematic, empirical analysis of the entire body of consumer contracts cases. The second goal was to avoid an emphasis on disclosure mandates that have been shown to be unhelpful and even counter-productive. The third goal was to infuse the Restatement with social science realism, especially in …

The Economics Of Healthcare Fraud, Jetson Leder- Luis, Anup Malani

Coase-Sandor Institute for Law & Economics Research Paper Series

Healthcare fraud imposes a sizable cost on U.S. public healthcare budgets and distorts health care provision. We examine the economics of health care fraud and enforcement using theory and data and connect to a growing literature on the topic. We first offer a new economic definition of health care fraud that captures and connects the wide range of activities prosecuted as fraud. We define fraud as any divergence between the care an insurer says a patient qualifies for, the care a provider provides, and the care a provider bills for. Our definition clarifies the economic consequences of different categories of …

Judge Ai: Assessing Large Language Models In Judicial Decision-Making, Eric A. Posner, Shivam Saran

Coase-Sandor Institute for Law & Economics Research Paper Series

Can large language models (LLMs) replace human judges? By replicating a prior 2 x 2 factorial experiment conducted on 31 U.S. federal judges, we evaluate the legal reasoning of OpenAI’s GPT-4o. The experiment involves a simulated appeal in an international war crimes case, with two altered variables: the degree to which the defendant is sympathetically portrayed and the consistency of the lower court’s decision with precedent. We find that GPT-4o is strongly affected by precedent but not by sympathy, similar to students who were subjects in the same experiment but the opposite of the professional judges, who were influenced by …