Law Commons^™

Efficiency Engines: How Managed Services Are Building Systems For Corporate Legal Work, William D. Henderson

Articles by Maurer Faculty

No abstract provided.

Ceo Side Payments In Mergers And Acquisitions, Brian J. Broughman

Articles by Maurer Faculty

In addition to golden parachutes, CEOs often negotiate for personal side-payments in connection with the sale of their firm. Side-payments differ from golden parachutes in that they are negotiated ex post in connection with a specific acquisition proposal, whereas golden parachutes are part of the executive’s employment agreement negotiated when she is hired. While side-payments may benefit shareholders by countering managerial resistance to an efficient sale, they can also be used to redistribute merger proceeds to management. The current article highlights an overlooked distinction between pre-merger golden parachutes and merger side-payments. Similar to a legislative rider attached to a popular …

Talent Systems For Law Firms, William D. Henderson

Articles by Maurer Faculty

irtually every large US law firm owes its rise and success to a talent system it adopted several decades ago. These talent systems were effective because they created highly skilled business lawyers in a way that aligned the interests of partners, associates, and clients. The most prominent example is the Cravath System, though other business lawyers throughout the US were making similar discoveries at roughly the same time. The tremendous forward momentum of these first-generation talent systems has created the problem of ahistorical partners — owners who collect the late-stage benefits of a talent system approach without understanding its original …

Benchmark Regulation, Gina-Gail S. Fletcher

Articles by Maurer Faculty

Benchmarks are metrics that are deeply embedded in the financial markets. They are essential to the efficient functioning of the markets and are used in a wide variety of ways-from pricing oil to setting interest rates for consumer lending to valuing complex financial instruments. In recent years, benchmarks have also been at the epicenter of numerous, multi-year market manipulation scandals. Oil traders, for example, deliberately execute trades to drive benchmarks lower artificially, allowing the traders to capitalize on the manipulated benchmarks. This ensures that later trades relying on the benchmarks will be more profitable than they otherwise would have been. …

Developments In The Law Affecting Electronic Payments And Financial Services, Sarah Jane Hughes, Stephen T. Middlebrook, Tom Kierner

Articles by Maurer Faculty

No abstract provided.

Transatlantic Influences On American Corporate Jurisprudence: Theorizing The Corporation In The United States, Tara Helfman

Indiana Journal of Global Legal Studies

In interpreting and evaluating the history of the Supreme Court's corporate jurisprudence, legal scholars have deployed three broad theories of corporate legal personality: the aggregate entity theory, the artificial entity theory, and the real entity theory. While these theories are powerful ways of conceptualizing the corporation, this article shows that they have not been as central to the Supreme Court's corporate jurisprudence as recent scholarship suggests. It instead argues that historic transformations in the high court's corporate jurisprudence are best understood in light of contemporary intellectual currents rather than through an expost facto application of the aggregate, artificial, and real …

Contract-Boundary-Spanning Governance Mechanisms: Conceptualizing Fragmented And Globalized Production As Collectively Governed Entities, Jaakko Salminen

Indiana Journal of Global Legal Studies

Conceptualizing how private actors can and should control their supply chains is a tricky question with both economic and legal dimensions. The topic is of extreme importance in today's global economy. On the one hand, this importance is highlighted by events such as the catastrophic and deadly collapse of the Rana Plaza factory building in Bangladesh and the economic fiasco of the Olkiluoto 3 nuclear power plant construction project in Finland, both arguably caused by the lack of effective supply chain governance. On the other hand, the potential benefits of successful supply chain governance, shown by examples such as open …

College Football Coaches’ Pay And Contracts: Are They Overpaid And Unfairly Treated?􀀃, Randall Thomas, Lawrence Van Horn

Indiana Law Journal

College football coaches’ employment contracts and compensation garner public attention and scrutiny in much the same way as those of corporate CEOs. In both cases, the public perception is that they must be overpaid and pampered. Economic theory claims that for coaches and CEOs to be overpaid, they must be receiving compensation in excess of the value they create for their organizations. However, both receive pay-for-performance compensation, which structurally aligns their compensation with value creation. This means we need to examine the underlying structure of the contract that gives rise to the observed compensation to determine whether they are appropriately …

The Race To Safety: How Private Lawmaking And Voluntary-Standard Adoption Can Inspire A Global Regime That Strengthens And Harmonizes Product Safety Standards, Alexandra Muir

Indiana Journal of Global Legal Studies

Today's economy is dominated by global actors. Over the past few decades, transnational corporations have increased in number and importance while domestic corporations have turned to outsourcing to cut costs and increase efficiency. The globalized economy has caused a breakdown in both physical and legal boundaries, as products in international commerce move from one jurisdiction to another, often adhering to safety standards of an entirely different jurisdiction than the one in which they are sold. This breakdown raises concerns about product safety and illustrates the importance of creating a consistent products liability regime for the international market. At the same …

Disability Rights And Labor: Is This Conflict Really Necessary?, Samuel R. Bagenstos

Indiana Law Journal

In this Essay, I hope to do two things: First, I try to put the current labor-disability controversy into that broader context. Second, and perhaps more important, I take a position on how disability rights advocates should approach both the current contro-versy and labor-disability tensions more broadly. As to the narrow dispute over wage-and-hour protections for personal-assistance workers, I argue both that those workers have a compelling normative claim to full FLSA protection—a claim that disability rights advocates should recognize—and that supporting the claim of those workers is pragmatically in the best interests of the disability rights movement. As to …

Disciplining Corporate Boards And Debtholders Through Targeted Proxy Access, Michelle M. Harner

Indiana Law Journal

Corporate directors committed to a failed business strategy or unduly influenced by the company’s debtholders need a dissenting voice—they need shareholder nominees on the board. This Article examines the biases, conflicts, and external factors that impact board decisions, particularly when a company faces financial distress. It challenges the conventional wisdom that debt disciplines management, and it sug-gests that, in certain circumstances, the company would benefit from having the shareholders’ perspective more actively represented on the board. To that end, the Article proposes a bylaw that would give shareholders the ability to nominate direc-tors upon the occurrence of predefined events. Such …

Agora: Reflections On Rjr Nabisco V. European Community: The Scope And Limitations Of The Presumption Against Extraterritoriality, Hannah Buxbaum

Articles by Maurer Faculty

No abstract provided.

The Reform Of The Corporate Duty Of Care In China -- From The Introspection Of Delaware And Taiwan, Jui-Chien Cheng

Maurer Theses and Dissertations

The concept of fiduciary duty, derived from common law, was introduced to the Company Law of People’s Republic of China in 2005. The fiduciary duty plays an extremely important role in common law, particularly in U.S. corporate law. For this reason, one might have expected dramatic consequences from its introduction to Chinese law. In reality, however, few fiduciary lawsuits have been brought to the courts of China since 2005. There are three main reasons for the rarity of due care lawsuits.

First, Chinese fiduciary law has neither clear content nor a practical enforcement. This is especially true of the body …

Executive Compensation In Controlled Companies, Kobi Kastiel

Indiana Law Journal

Conventional wisdom among corporate law theorists holds that the presence of a controlling shareholder should alleviate the problem of managerial opportunism because such a controller has both the power and incentives to curb excessive executive pay. This Article challenges that common understanding by proposing a different view based on an agency problem paradigm. Controlling shareholders, this Article suggests, may in fact overpay managers in order to maximize controllers’ consumption of private benefits, due to their close social and business ties with professional managers or for other reasons, such as being captured by professional managers. This tendency to overpay managers is …

Verizon’S “Certification Process” And Why The Fcc Needs To Take A Stand, P. J. Gretter

Indiana Law Journal

This Note will give an in-depth review of the legality and policy implications of Verizon’s lengthy certification process. Part I will give a short background of the time leading up to Verizon’s purchase of the C-Block. It will then review the actual rules of the agreement between Verizon and the FCC at the time of the purchase, as well as the pertinent history following the purchase. Part II will analyze whether Verizon’s lengthy certification process violates the C-Block rules or the general spirit of Verizon’s agreement to abide by the rules. Part III will then argue that, even if Verizon’s …

Good-Cause Statutes Revisited: An Empirical Assessment, Adi Ayal, Uri Benoliel

Indiana Law Journal

One of the most vital debates in franchise law focuses on whether state or federal law should adopt “good-cause statutes” (GCSs), which require franchisors to show good cause before terminating contractual relations with a franchisee. The traditional law-and-economics analysis suggests that GCSs are inefficient. This inefficiency argument is based upon one central hypothesis: GCSs increase franchisee free riding since they limit the franchisor’s ability to terminate the franchise contract easily. The free-riding hypothesis has been significantly influential in the development of franchise law, as is evident in state and federal statutory regimes. To date, the majority of states and the …

Copyright Complements And Piracy-Induced Deadweight Loss, Jiarui (Jerry) Liu

Indiana Law Journal

Conventional wisdom suggests that copyright piracy may in effect reduce the deadweight loss resulting from copyright protection because it allows the public unlimited access to information goods at a price closer to marginal cost. It has been further contended that lower copyright protection would benefit society as a whole, as long as authors continue to receive sufficient incentives from alternative revenue streams in ancillary markets, for example, touring, advertising, and merchandizing. By evaluating the empirical evidence from the music, performance, and video game markets, this Article highlights a counterintuitive yet important point: copyright piracy, while decreasing the deadweight loss in …

Se(C)(3): A Catalyst For Social Enterprise Crowdfunding, Dana Brakman Reiser, Steven A. Dean

Indiana Law Journal

The emerging consensus among scholars rejects the notion of tax breaks for social enterprises, concluding that such prizes will attract strategic claimants, ultimately doing more harm than good. The SE(c)(3) regime proposed by this Article offers entrepreneurs and investors committed to combining financial returns and social good with a means of broadcasting that shared resolve. Combining a measured tax benefit for mission-driven activities with a heightened burden on shareholder financial gains, the revenue-neutral SE(c)(3) regime would provide investors and funding platforms with a low-cost means of screening out “greenwashed” ventures.

Global Data Meets 3-D Printing: The Quest For A Balanced And Globally Collaborative Solution To Prevent Patent Infringement In The Foreseeable 3-D Printing Revolution, Tyler Macik

Indiana Journal of Global Legal Studies

This Note explores a potential global solution to the foreseeable patent infringement problems with 3-D printing and do-it-yourself users. More specifically, at a time when 3-D printing is quickly gaining popularity and recognition for its many beneficial applications through advancements in printing and scanning technology, the current state of patent law lacks the ability to detect and prevent patent infringement among do-it-yourself users of 3-D printing. I propose a potential global solution that would provide a balance between fostering growth in 3-D printing and upholding patentees' rights by exploring the possibility of creating a collaborative, intergovernmental 3-D CAD file database …

Breaking The Curse: A Multilayered Regulatory Approach, Hunter Dekoninck

Indiana Journal of Global Legal Studies

Eastern Africa has been plagued for generations with what Richard Auty considers 'The Resource Curse." This curse, translated into modern economic tragedies, is the exploitive extraction and use of precious minerals from Eastern Africa, specifically the Democratic Republic of the Congo (DRC). As a result of attempts to combat the international market that perpetuates this curse, Section 1502 of the Dodd-Frank Wall Street Reform Act, largely in response to human rights activism, passed into law a provision requiring companies to account to the Securities and Exchange Commission (SEC) for their use of certain listed foreign minerals. Although such regulation is …

Labor Law 2.0: The Impact Of New Information Technology On The Employment Relationship And The Relevance Of The Nlra, Kenneth G. Dau-Schmidt

Articles by Maurer Faculty

The NLRA system of collective bargaining was born during the industrial age of the early twentieth century. As a result, key terms in the statute such as "employee," "employer," and "appropriate bargaining unit" were first interpreted in the context of long-term employment and large vertically integrated firms that dominated this era. Beginning in the late 1970s, the new information technology wrought a revolution in the organization of production increasing short-term contingent employment and the organization of firms horizontally in trading and subcontracting relationships across the globe. To maintain the relevance of collective bargaining to the modern workplace, the interpretation of …

Advancing A Framework For Regulating Cryptocurrency Payments Intermediaries, Sarah Jane Hughes, Stephen T. Middlebrook

Articles by Maurer Faculty

This Article looks at competing models for regulating providers of services to individuals and businesses that take cryptocurrencies in payment for goods and services, including operators of online wallets and exchanges, and other cryptocurrency market intermediaries whose functions resemble "money service businesses" or "money transmission." We conclude that, in addition to whatever "money services" or "money transmission "prudential regulation the States or federal government may adopt, the operation of wallets and exchanges requires a new commercial law that lays out rights and liabilities of cryptocurrency users in a robust and transparent fashion. We use Article 4A of the Uniform Commercial …

Are These Game Changers? Developments In The Law Affecting Virtual Currencies, Prepaid Payroll Cards, Online Tribal Lending, And Payday Lenders, Sarah Jane Hughes, Stephen T. Middlebrook

Articles by Maurer Faculty

In the year since our last survey, there have been significant legal developments in the areas of virtual currencies, prepaid payroll cards, online tribal lending, and payday lending. What connects some of these topics is an increasingly common strategy by federal banking regulators to influence and control the actions of entities that are not directly subject to their supervision through the relationships such entities have with regulated financial institutions. These developments also demonstrate robust state legislative and regulatory action relating to the provision of electronic payments and financial services, and document class actions alleging violations of federal and state laws. …

A Call For Truth In The Fashion Pages: What Global Trend In Advertising Regulation Means For U.S. Beauty And Fashion Advertisers, Ashley O'Neil

Indiana Journal of Global Legal Studies

The advertising industry serves an important purpose in our society by acting as the main source of information for consumers about products. Global advertisement spending reaches into the hundreds of billions of dollars annually. Because advertising plays such a large role in the economy, regulators across the globe have increasingly sought to promote truth in advertising. As a result, advertising regulation has exploded in the recent decades. Recently, the beauty and fashion industries have come under fire from advertising regulatory bodies, most notably in Europe, for misleading and offensive advertising practices. Regulators and interest groups are concerned by the unrealistic …

Did New York State Just Anoint Virtual Currencies By Proposing To Regulate Them, Or Will Regulation Spoil Them For Some?, Sarah Jane Hughes

Articles by Maurer Faculty

This Essay previews issues raised by the general subject of regulating virtual currencies and the specific efforts of New York State’s Department of Financial Services’ proposed Virtual Currency Regulatory Framework (the BitLicense) in particular. It focuses on five topics in the proposal and their interplay with the current regulation of “money services” and “money transmission” in other states, using the Commonwealth of Virginia and the State of Washington approaches on a few common topics for comparison purposes. It also asks whether regulation of virtual currencies is likely to cause more widespread adoption of virtual currencies or to frustrate the proponents …

Human Capital Accounting, William D. Henderson

Articles by Maurer Faculty

No abstract provided.

Selling Art: An Empirical Assessment Of Advertising On Fertility Clinics' Websites, Jim Hawkins

Indiana Law Journal

Scholarship on assisted reproductive technologies (ART) has emphasized the commercial nature of the interaction between fertility patients and their physicians, but little attention has been paid to precisely how clinics persuade patients to choose their clinics over their competitors’. This Article offers evidence about how clinics sell ART based on clinics’ advertising on their websites. To assess clinics’ marketing efforts, I coded advertising information on 372 fertility clinics’ websites. The results from the study confirm some suspicions of prior ART scholarship while contradicting others. For instance, in line with scholars who are concerned that racial minorities face barriers to accessing …

Selling Art Or Selling Out?: A Response To Selling Art: An Empirical Assessment Of Advertising On Fertility Clinics' Websites, Jody L. Madeira

Indiana Law Journal

Roundtable on Regulating Assisted Reproductive Technology 2012

Independent Directors And Shared Board Control In Venture Finance, Brian J. Broughman

Articles by Maurer Faculty

In most VC-backed firms neither the entrepreneurs nor the VC investors control the board. Instead control is typically shared with a mutually appointed independent director holding the tie-breaking seat. Contract theory, which treats control as an indivisible right held by one party, does not have a good explanation for this practice. Using a bargaining game similar to final offer arbitration, I show that an independent director as tie-breaker can reduce holdup by moderating each party’s ex post threat position, potentially expanding the range of firms which receive external financing. This project contributes to the literature on incomplete contracting and holdup, …

A Potential Game Changer In E-Commerce Taxation, David Gamage, Andrew J. Haile, Darien Shanske

Articles by Maurer Faculty

In this essay, we evaluate recent legislative proposals for Congress to authorize state taxation of e-commerce. We argue that these proposals contain a potential game-changing innovation — the requirement that states provide remote sellers with “adequate software” for calculating use tax due within the state. Properly implemented, we explain how this innovation could force states to internalize the compliance costs of levying tax collection obligations on remote sellers, thereby incentivizing the states to simplify their sales and use tax statutes and resolving concerns about states overburdening interstate commerce.