Law Commons^™

Federalism Obstacles To Advancing Renewable Energy, Michael B. Gerrard

Faculty Scholarship

Many states have been taking steps to increase the use of renewable energy sources such as wind and solar. How­ever, because electricity is a commodity in interstate commerce and electrons once on the grid do not respect state borders, these state efforts have begun to collide with the dormant Commerce Clause (the principle that the Constitution’s grant of authority to Con­gress to regulate commerce among the states also limits the ability of the states to discriminate against other states) and related constitutional doctrines.

Deluge Of New York City Laws Guards Against Flooding, Protects Environment, Michael B. Gerrard

Faculty Scholarship

The last year of Michael Bloomberg’s 12-year term as mayor of New York City saw a remarkable and little-noticed deluge of new environmental laws. The City Council passed and the mayor signed more than 50 envi­ronmental bills. Over half of these laws were passed in the aftermath of Superstorm Sandy and focused on making infrastructure more resilient, improving emergency preparedness and response, and easing recovery for homeowners and businesses. In addi­tion, laws were enacted concerning clean energy, improving energy and fuel efficiency, reducing emissions from vehicles, and strengthening the city’s recycling laws.

Toward A Constitutional Review Of The Poison Pill Essay, Lucian A. Bebchuk, Robert J. Jackson Jr.

Faculty Scholarship

We argue that the state-law rules governing poison pills are vulnerable to challenges based on preemption by the Williams Act. Such challenges, we show, could well have a major impact on the corporate law landscape.

The Williams Act established a federal regime regulating unsolicited tender offers, but states subsequently developed a body of state antitakeover laws that impose additional impediments to such offers. In a series of well-known cases during the 1970s and 1980s, the federal courts, including the Supreme Court, held some of these state antitakeover laws preempted by the Williams Act. To date, however, federal courts and commentators …

Finding Order In The Morass: The Three Real Justifications For Piercing The Corporate Veil, Jonathan Macey, Joshua Mitts

Faculty Scholarship

Few doctrines are more shrouded in mystery or litigated more often than piercing the corporate veil. We develop a new theoretical framework that posits that veil piercing is done to achieve three discrete public policy goals, each of which is consistent with economic efficiency: (1) achieving the purpose of an existing statute or regulation; (2) preventing shareholders from obtaining credit by misrepresentation; and (3) promoting the bankruptcy values of achieving the orderly, efficient resolution of a bankrupt's estate. We analyze the facts of veil-piercing cases to show how the outcomes are explained by our taxonomy. We demonstrate that a supposed …

Three Proposals For Regulating The Distribution Of Home Equity, Ian Ayres, Joshua Mitts

Faculty Scholarship

The Consumer Financial Protection Bureau’s recently-released “qualified mortgage” rules effectively discourage predatory lending but miss an equally important source of systemic risk: low-equity clustering. Specific “volatility-inducing” mortgage terms, when present in a substantial cluster of mortgage contracts, exacerbate macroeconomic risk by increasing the chance that the housing and lending markets will have to absorb a wave of simultaneous defaults after a downturn in housing prices. This Article shows that these terms became prevalent in a substantial proportion of residential mortgages in the years leading up to the home mortgage crisis. In contrast, during the earlier “amortization era” (when mortgagors were …

Market Structure And Political Law: A Taxonomy Of Power, Zephyr Teachout, Lina M. Khan

Faculty Scholarship

The goal of this Article is to create a way of seeing how market structure is innately political. It provides a taxonomy of ways in which large companies frequently exercise powers that possess the character of governance. Broadly, these exercises of power map onto three bodies of activity we generally assign to government: to set policy, to regulate markets, and to tax. We add a fourth category – which we call "dominance," after Brandeis – as a kind of catchall describing the other political impacts. The activities we outline will not always fit neatly into these categories, nor do all …

The Empty Call For Benefit-Cost Analysis In Financial Regulation, Jeffrey N. Gordon

Faculty Scholarship

The call for benefit-cost analysis (BCA) in financial regulation misunderstands the origins and utility of BCA as a guide to administrative rule making. Benefit-cost analysis imagines an omniscient social planner who can calculate costs and benefits from a natural system that generates prices (costs and benefits) that do not change (or change much) no matter what the central planner does. For example, the toxicity of chemicals, the health hazards of emissions, the statistical value of life – these do not change in response to health-and-safety regulation. For the financial sector, however, the system that generates costs and benefits is constructed …

Systemic Harms And Shareholder Value, John Armour, Jeffrey N. Gordon

Faculty Scholarship

The financial crisis has demonstrated serious flaws in the corporate governance of systemically important financial firms. In particular, the norm that managers should seek to maximize shareholder value, as measured by the stock price, proves to be a faulty guide for managerial action in systemically important firms. This is not only because the failure of such firms will have spillovers that defy the cost-internalization of the tort system, but also because these spillovers will harm their own majoritarian shareholders. The interests of diversified shareholders fundamentally diverge from the interests of managers and other controllers because the failure of a systemically …

Good Will Hunting: How The Supreme Court's Hunter Doctrine Can Still Shield Minorities From Political-Process Discrimination, Kerrel Murray

Faculty Scholarship

When the Sixth Circuit struck down Michigan’s anti-affirmative-action Proposal 2 in 2012, its reasoning may have left some observers hunting for their Fourteenth Amendment treatises. Rather than applying conventional equal protection doctrine, the court rested its decision on an obscure branch of equal protection jurisprudence known as the Hunter doctrine, which originated over forty years ago. The doctrine, only used twice by the Supreme Court to invalidate a law since its creation, purports to protect the political-process rights of minorities by letting courts invalidate laws that work nonneutrally to make it more difficult for them to “achieve legislation that is …

Merger Control Procedures And Institutions: A Comparison Of The Eu And Us Practice, William E. Kovacic, Petros C. Mavroidis, Damien J. Neven

Faculty Scholarship

The objective of this paper is to discuss and compare the role that different constituencies play in US and EU procedures for merger control. We describe the main constituencies (both internal and external) involved in merger control in both jurisdictions and discuss how a typical merger case would be handled under these procedures. At each stage, we consider how the procedure unfolds, which parties are involved, and how they can affect the procedure. Our discussion reveals a very different ecology. EU and US procedures differ in terms of their basic design and in terms of the procedures that are naturally …

Judicial Leadership In Family Court: A Cautionary Tale, Jane M. Spinak

Faculty Scholarship

For the past 35 years I have been practicing in, teaching, and writing about the Family Court. The problem-solving court movement in the last two decades – with its proliferation of drug courts, mental health courts, and veterans courts, to name a few – renewed my interest in the historical roots of the family court because of the parallels between the original juvenile court and the recent problem solving court movement. One of the key elements – perhaps the defining element – in both is the role of the judge as the leader of the court. That is what I …

Lawyering That Has No Name: Title Vi And The Meaning Of Private Enforcement, Olatunde C.A. Johnson

Faculty Scholarship

On the occasion of the fiftieth anniversary of the Civil Rights Act of 1964, this Essay examines the problem of private enforcement of Title VI. The Essay reviews the unduly constrained approach to private enforcement taken by courts in prominent decisions such as Regents of the University of California v. Bakke and Alexander v. Sandoval. Yet the Essay argues that to focus primarily on private court enforcement of Title VI will continue to relegate the provision to the margins of civil rights discourse, to make the provision appear largely as the "sleeping giant" of civil rights law. The practice …

The Agency Roots Of Disparate Impact, Olatunde C.A. Johnson

Faculty Scholarship

The disparate impact strand of antidiscrimination law provides the possibility of challenging harmful employment, education, housing, and other public and private policies and practices without the often-difficult burden of proving intentional discrimination. And yet the disparate impact standard seems to be facing its own burdens. Rulings by the Supreme Court in recent years have shaken the disparate impact standard's footing. In Ricci v. De- Stefano, the Court rejected a frontal assault to the disparate impact standard under Title VII of the Civil Rights Act of 1964, but cast the standard as at odds with Title VII's true core – …

Rolling Back The Repo Safe Harbors, Edward R. Morrison, Mark J. Roe, Christopher S. Sontchi

Faculty Scholarship

Recent decades have seen substantial expansion in exemptions from the Bankruptcy Code's normal operation for repurchase agreements. These repos, which are equivalent to very short-term (often one-day) secured loans, are exempt from core bankruptcy rules such as the automatic stay that enjoins debt collection, rules against prebankruptcy fraudulent transfers, and rules against eve-of-bankruptcy preferential payment to favored creditors over other creditors. While these exemptions can be justified for United States Treasury securities and similarly liquid obligations backed by the full faith and credit of the United States government, they are not justified for mortgage-backed securities and other securities that could …

Surprisingly Punitive Damages, Bert I. Huang

Faculty Scholarship

Damages can add up to super-punitive amounts in unintended ways. To take a textbook example: The Defendant has caused an industrial accident or other mass tort. Plaintiff 1 sues, winning punitive damages based on the reprehensibility of that original act. Plaintiff 2 also sues – and also wins punitive damages on the same grounds. So do Plaintiff 3, Plaintiff 4, and so forth. If each of these punitive awards is directed at the same general badness of that original act, then these punishments are redundant. When such redundancy occurs, even damages that are meant to be punitive can reach surprisingly …

Concurrent Damages, Bert I. Huang

Faculty Scholarship

Imagine that a hacker is working for a university official secretly spying on faculty members – say, to find out who has been leaking information to the press about internal disciplinary matters. The injuries to a given victim of the hacking might follow a classic learning curve: The first few intrusions into her e-mail account reveal a storehouse of personal secrets, but further break-ins yield less and less new information. One might say there is diminishing marginal harm.

There is no such leveling off, however, in the compensation that would be awarded to that victim. The electronic privacy law …

Compulsory Sexuality, Elizabeth F. Emens

Faculty Scholarship

Asexuality is an emerging identity category that challenges the assumption that everyone is defined by some type of sexual attraction. Asexuals – those who report feeling no sexual attraction to others – constitute one percent of the population, according to one prominent study. In recent years, some individuals have begun to identify as asexual and to connect around their experiences interacting with a sexual society. Asexuality has also become a protected classification under the antidiscrimination law of one state and several localities, but legal scholarship has thus far neglected the subject.

This Article introduces asexuality to the legal literature as …

The Case For An Unbiased Takeover Law (With An Application To The European Union), Luca Enriques, Ronald J. Gilson, Alessio M. Pacces

Faculty Scholarship

Takeover regulation should neither hamper nor promote takeovers, but instead allow individual companies to decide the contestability of their control. Based on this premise, we advocate a takeover law exclusively made of default and menu rules supporting an effective choice of the takeover regime at the company level. For political economy reasons, we argue that different default rules should apply to newly public companies and companies that are already public when the new regime is introduced. Newly public companies should be governed by default rules that favor the interests of (minority) shareholders over those of management and controlling shareholders, because …

Will International Law Save Us From Climate Disasters?, Michael B. Gerrard

Faculty Scholarship

I am going to address the role of international law in dealing with disasters that can be caused or worsened by climate change.

An Examination Of The Challenges, Successes And Setbacks For Clinical Legal Education In Eastern Europe, Dubravka Aksamovic, Philip Genty

Faculty Scholarship

The authors first met in 2000, and have collaborated in conferences, workshops, and other projects since then. We also represent two sides of an international exchange that has frequently occurred in the past 15 years: a European law teacher who attends training sessions, networks with colleagues from other European universities, learns about American models of clinical education, and possibly receives some outside funding; and an American law teacher who is graciously hosted by Europeans, promotes American models of clinical education, and, one hopes, observes, listens and learns about the European system. We are also experienced teachers within our own universities …

Leveraging Antidiscrimination, Olatunde C.A. Johnson

Faculty Scholarship

As the Civil Rights Act of 1964 turns fifty, antidiscrimination law has become unfashionable. Civil rights strategies are posited as not up to the serious task of addressing contemporary problems of inequality such as improving mobility for low-wage workers or providing access into entry-level employment. This Article argues that there is a danger in casting aside the Civil Rights Act as one charts new courses to address inequality. This Article revisits the implementation strategies that emerged in the first decade of the Act to reveal that the Act was not limited to addressing formal discrimination or bias, but rather drew …