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Full-Text Articles in Law

Mapping The Future Of Insider Trading Law: Of Boundaries, Gaps, And Strategies, John C. Coffee Jr. Dec 2012

Mapping The Future Of Insider Trading Law: Of Boundaries, Gaps, And Strategies, John C. Coffee Jr.

Faculty Scholarship

The current law on insider trading is arbitrary and unrationalized in its limited scope in a number of respects. For example, if a thief breaks into your office, opens your files, learns material, nonpublic information, and trades on that information, he has not breached a fiduciary duty and is presumably exempt from insider trading liability. But drawing a line that can convict only the fiduciary and not the thief seems morally incoherent. Nor is it doctrinally necessary. The basic methodology handed down by the Supreme Court in SEC v. Dirks and United States v. O’Hagan dictates (i) that a ...


Constitutional Uncertainty And The Design Of Social Insurance: Reflections On The Obamacare Case, Michael J. Graetz, Jerry L. Mashaw Jan 2012

Constitutional Uncertainty And The Design Of Social Insurance: Reflections On The Obamacare Case, Michael J. Graetz, Jerry L. Mashaw

Faculty Scholarship

The gravamen of the constitutional complaint against the individual mandate is its supposed intrusion on personal freedom. But, when all was said and done, no one attacked a state government’s requirement that individuals must purchase health insurance, nor advanced any constitutional limitation on the states doing so. All we have is a holding that if the federal government wishes to do the same, it must exercise its powers to tax and spend, not its power to regulate. The ACA case then is best understood as a legal attack on the means but not the goals of the health care ...


Technological Innovation, International Competition, And The Challenges Of International Income Taxation, Michael J. Graetz, Rachael Doud Jan 2012

Technological Innovation, International Competition, And The Challenges Of International Income Taxation, Michael J. Graetz, Rachael Doud

Faculty Scholarship

Because of the importance of technological innovation to economic growth, nations strive to stimulate and attract the research and development (“R&D”) that leads to that innovation and to make themselves hospitable environments for the holding of intellectual property (“IP”). Tax policies have taken center stage in their efforts to accomplish these goals and to capture a share of the income from technological innovations. Designing cost-effective methods of supporting technological innovations has, however, become substantially more difficult as the world economy has become more interconnected. Where R&D is performed and where income is earned change in response to the ...


Eparpillement Aux Quatre Vents: La Fragmentation Du Droit Du Sport, Giovanni Distefano, Petros C. Mavroidis Jan 2012

Eparpillement Aux Quatre Vents: La Fragmentation Du Droit Du Sport, Giovanni Distefano, Petros C. Mavroidis

Faculty Scholarship

Scattering to the Four Winds: The Fragmentation of Sports Law

Sports Law is characterized by a multiplicity of sources: from the outset, law-making function was mainly carried out by different and competent sports associations (both national and international). Two major events have wreaked havoc: on one side, the ever-increasing professionalization of sports business has given birth to the outcrop of private associations – active in a sort of grey and undefined area – torn between public authority ans free market; on the other side, international federations have been called upon to manage those same associations. Lack of institutional and substantive coordination, both ...


One (Firm) Is Not Enough: A Legal-Economic Analysis Of Ec-Fasteners, Chad P. Brown, Petros C. Mavroidis Jan 2012

One (Firm) Is Not Enough: A Legal-Economic Analysis Of Ec-Fasteners, Chad P. Brown, Petros C. Mavroidis

Faculty Scholarship

The WTO’s Appellate Body (AB) dealt with a number of issues for the first time in the Report of EC-Fasteners. Importantly, the AB discussed the consistency of the European Union (EU) regulation with the multilateral rules on the conditions for deviating from the obligation to calculate individual dumping margins. Although China formally won the argument, the AB may have opened the door to treat China as a non-market economy (NME) even beyond 2016 when China’s NME-status was thought to expire under the terms of China’s 2001 WTO Accession Protocol. The AB further dealt with numerous other issues ...


The Legal And Economic Principles Of World Trade Law: National Treatment, Gene M. Grossman, Henrik Horn, Petros C. Mavroidis Jan 2012

The Legal And Economic Principles Of World Trade Law: National Treatment, Gene M. Grossman, Henrik Horn, Petros C. Mavroidis

Faculty Scholarship

The primary objective of most trade agreements is to restrain members' use of trade policies for protectionist purposes. But it would be pointless to restrict the application of border instruments without regulating the possible use of domestic policies for protectionist purpose. To this end, most agreements include an obligation for National Treatment (NT) of foreign products. The NT provision in the GATT appears in Art. III, which applies to most government actions that have impact trade. It requires that imported products be treated as favorably by domestic policy as similar, indigenous products. This study offers suggestions based on legal and ...


Mortgage Modification And Strategic Behavior: Evidence From A Legal Settlement With Countrywide, Christopher J. Mayer, Edward R. Morrison, Tomasz Piskorski, Arpit Gupta Jan 2012

Mortgage Modification And Strategic Behavior: Evidence From A Legal Settlement With Countrywide, Christopher J. Mayer, Edward R. Morrison, Tomasz Piskorski, Arpit Gupta

Faculty Scholarship

We investigate whether homeowners respond strategically to news of mortgage modification programs by defaulting on their mortgages. We exploit plausibly exogenous variation in modification policy induced by U.S. state government lawsuits against Countrywide Financial Corporation, which agreed to offer modifications to seriously delinquent borrowers with mortgages throughout the country. Using a difference-in-difference framework, we find that Countrywide's relative delinquency rate increased more than ten percent per month immediately after the program's announcement. The borrowers whose estimated default rates increased the most in response to the program were those who appear to have been the least likely to ...


Towards A Legal Theory Of Finance, Katharina Pistor Jan 2012

Towards A Legal Theory Of Finance, Katharina Pistor

Faculty Scholarship

This paper develops the building blocks for a legal theory of finance. LTF holds that financial markets are legally constructed and as such occupy an essentially hybrid place between state and market, public and private. At the same time, financial markets exhibit dynamics that frequently put them in direct tension with commitments enshrined in law or contracts. This is the case especially in times of financial crises when the full enforcement of legal commitments would result in the self-destruction of the financial system. This law-finance paradox tends to be resolved by suspending the full force of law where the survival ...


On The Theoretical Foundations For Regulating Financial Markets, Katharina Pistor Jan 2012

On The Theoretical Foundations For Regulating Financial Markets, Katharina Pistor

Faculty Scholarship

How we think about financial markets determines how we regulate them. Since the 1970s modern finance theory has shaped how we think about and regulate financial markets. It is based on the notion that markets are or can be made (more) efficient. Financial markets have been deregulated when they were thought to achieve efficient outcomes on their own; and regulation was designed to lend crutches to them when it appeared that they needed support. While modern finance theory has suffered some setbacks in the aftermath of the global crisis, defenders hold that improving market efficiency should still be the overriding ...


I Like To Pay Taxes: Taxpayer Support For Government Spending And The Efficiency Of The Tax System, David M. Schizer, Yair Listokin Jan 2012

I Like To Pay Taxes: Taxpayer Support For Government Spending And The Efficiency Of The Tax System, David M. Schizer, Yair Listokin

Faculty Scholarship

This paper is based on a simple proposition, which we believe but cannot prove: If taxpayers support the way their tax dollars are spent, they are more likely to comply voluntarily and less likely to change their behavior to avoid tax. To show that our claim is plausible, we offer direct evidence from a literature involving experiments, draw on the more general economics and psychology literature on prosocial behavior, and also invoke philanthropy as a “real world” analogy; after all, charitable donors contribute money voluntarily (indeed, 2% of the U.S. GDP), largely because they believe in the way their ...


Law By Non Sequitur: Norcon V. Niagara Mohawk, Victor P. Goldberg Jan 2012

Law By Non Sequitur: Norcon V. Niagara Mohawk, Victor P. Goldberg

Faculty Scholarship

Under the common law, a contracting party could only demand assurance of performance if the other party was insolvent. If a party had reasonable grounds for insecurity, the UCC §2-609 allowed it demand adequate assurance even if the counterparty were solvent. The Restatement (Second) adopted the same rule for non-goods. In NorCon v. Niagara Mohawk the New York court extended the adequate assurance doctrine for some non-goods contracts. Although the decision seems to imply that there is some relation between the NorCon facts and its conclusion as to the law, there is none. Relying primarily on material available to the ...


The Political Economy Of Dodd-Frank: Why Financial Reform Tends To Be Frustrated And Systemic Risk Perpetuated, John C. Coffee Jr. Jan 2012

The Political Economy Of Dodd-Frank: Why Financial Reform Tends To Be Frustrated And Systemic Risk Perpetuated, John C. Coffee Jr.

Faculty Scholarship

Several commentators have argued that financial “reform” legislation enacted after a market crash is invariably flawed, results in “quack corporate governance” and “bubble laws,” and should be discouraged. This criticism has been specifically directed at both the Sarbanes-Oxley Act and the Dodd-Frank Act. This article presents a rival perspective. Investors, it argues, are naturally dispersed and poorly organized and so constitute a classic “latent group” (in Mancur Olson’s terminology). Such latent groups tend to be dominated by smaller, but more cohesive and better funded special interest groups in the competition to shape legislation and influence regulatory policy. This domination ...


Parallel Exclusion, C. Scott Hemphill, Tim Wu Jan 2012

Parallel Exclusion, C. Scott Hemphill, Tim Wu

Faculty Scholarship

Scholars and courts have long debated whether and when "parallel pricing" – adoption of the same price by every firm in a market – should be considered a violation of antitrust law. But there has been a comparative neglect of the importance of "parallel exclusion" – conduct, engaged in by multiple firms, that blocks or slows would-be market entrants. Parallel exclusion merits greater attention, for it can be far more harmful than parallel price elevation. Setting a high price leaves the field open for new entrants and may even attract them. In contrast, parallel action that excludes new entrants both facilitates price elevation ...


Crime And Enforcement In Immigrant Neighborhoods: Evidence From New York City, Garth Davies, Jeffrey Fagan Jan 2012

Crime And Enforcement In Immigrant Neighborhoods: Evidence From New York City, Garth Davies, Jeffrey Fagan

Faculty Scholarship

Immigration and crime have received much popular and political attention in the past decade, and have been a focus of episodic social attention for much of the history of the U.S. Recent policy and legal discourse suggests that the stigmatic link between immigrants and crime has endured, even in the face of evidence to the contrary. This study addresses the relationship between immigration and crime in urban settings, focusing on areal units where immigrants tend to cluster spatially as well as socially. We ask whether immigration creates risks or benefits for neighborhoods in terms of lower crime rates. The ...


Accepting The Limits Of Tax Law And Economics, Alex Raskolnikov Jan 2012

Accepting The Limits Of Tax Law And Economics, Alex Raskolnikov

Faculty Scholarship

This Article explores the limits of tax law and economics, attributing them to the unique complexity of the tax optimization problem. Designers of the optimal tax system must account for the impossibility of deterring socially undesirable behavior, provide for redistribution, and minimize social costs on the basis of assumptions that are laden with deeply contested value judgments, pervasive empirical uncertainty, or both. Given these challenges, it is hardly surprising that economic theory has a much weaker connection to the content of our tax laws and their enforcement than it does to the content and enforcement of many other legal regimes ...


A New Look At Patent Quality: Relating Patent Prosecution To Validity, Ronald J. Mann, Marian Underweiser Jan 2012

A New Look At Patent Quality: Relating Patent Prosecution To Validity, Ronald J. Mann, Marian Underweiser

Faculty Scholarship

The article uses two hand‐collected data sets to implement a novel research design for analyzing the precursors to patent quality. Operationalizing patent “quality” as legal validity, the article analyzes the relation between Federal Circuit decisions on patent validity and three sets of data about the patents: quantitative features of the patents themselves, textual analysis of the patent documents, and data collected from the prosecution histories of the patents. The article finds large and statistically significant relations between ex post validity and both textual features of the patents and ex ante aspects of the prosecution history (especially prior art submissions ...


Moral Rights In The Us: Still In Need Of A Guardian Ad Litem, Jane C. Ginsburg Jan 2012

Moral Rights In The Us: Still In Need Of A Guardian Ad Litem, Jane C. Ginsburg

Faculty Scholarship

Over ten years ago in the Cardozo Arts and Entertainment Law Journal, I inquired whether authors’ “moral rights” had come of (digital) age in the US. Ever-hopeful at that time, I suggested that then-recent legislation enacted to enable the copyright law to respond to the challenges of digital media might, in addition to its principal goal of securing digital markets for works of authorship, also provide new means to protect authors’ interests in receiving attribution for their works and in safeguarding their integrity. The intervening years’ developments, however, indicate that, far from achieving their majority, US authors’ moral rights remain ...


Courthouse Iconography And Chayesian Judical Practice, William H. Simon Jan 2012

Courthouse Iconography And Chayesian Judical Practice, William H. Simon

Faculty Scholarship

This contribution to a symposium on Judith Resnik and Dennis Curtis’s Representing Justice considers what courthouse imagery and design might be appropriate for “Chayesian” judicial practice. The imagery and design that Resnik and Curtis examine largely connotes traditional litigation – lawsuits that are bi-polar, retrospective, and self-contained. However, judicial practice is increasingly Chayesian – concerned with forward-looking efforts to coordinate multipolar problems with sprawling party structures. Traditional iconography is inadequate to Chayesian practice because it celebrates equilibrium and communicates information about cases one-by-one. By contrast, Chayesian intervention often induces productive disequilibrium and it can only be made transparent through expression that ...


Dating The State: The Moral Hazards Of Winning Gay Rights, Katherine M. Franke Jan 2012

Dating The State: The Moral Hazards Of Winning Gay Rights, Katherine M. Franke

Faculty Scholarship

The article offers a critical analysis of the complexities of having the state recognize and then take up gay rights as a cause of its own. I examine three principal contexts – the role of gay rights in the state of Israel’s re-branding campaign, the response to Iranian President Mahmoud Ahmadinejad’s 2007 speech at Columbia University in which he claimed that there were no homosexuals in Iran, and the role of gay rights in Romania’s effort to join the European Community – as examples of the moral hazards that a minority faces when the state takes up their interests ...


On The American Paradox Of Laissez Faire And Mass Incarceration, Bernard E. Harcourt Jan 2012

On The American Paradox Of Laissez Faire And Mass Incarceration, Bernard E. Harcourt

Faculty Scholarship

In The Illusion of Free Markets (Harvard 2011), Professor Bernard Harcourt analyzes the evolution of a distinctly American paradox: in the country that has done the most to promote the idea of a hands-off government, we run the single largest prison complex in the entire world. Harcourt traces this paradox back to the eighteenth century and demonstrates how the presumption of government incompetence in economic affairs has been coupled with that of government legitimacy in the realm of policing and punishing. Harcourt shows how these linked presumptions have fueled the expansion of the carceral sphere in the nineteenth and twentieth ...


Fantasies And Illusions: On Liberty, Order, And Free Market, Bernard E. Harcourt Jan 2012

Fantasies And Illusions: On Liberty, Order, And Free Market, Bernard E. Harcourt

Faculty Scholarship

Critical thinkers have used various terms to describe the collective imaginary that has real effects on individuals, society, and politics. Freud used the term “einer Illusion” to characterize religious belief in his work, The Future of an Illusion, though many others in the psychoanalytic tradition would turn to the notion of fantasy. Marx sometimes used the term illusion and he notoriously deployed the optical illusion and the phantasmagoria in his famous discussion of commodity fetishism. (And Marx, of course, is the father of Ideologiekritic). Foucault at times used the language of fantasy and phantasms, in an early period deployed the ...


The Politics Of Incivility, Bernard E. Harcourt Jan 2012

The Politics Of Incivility, Bernard E. Harcourt

Faculty Scholarship

The Flemish painter, Pieter Bruegel, portrayed in his artwork men relieving themselves, cripples begging, and peasants toiling – as well as butchery and the gallows. In his masterful work, The Civilizing Process, Norbert Elias revealed how the “late medieval upper class” had not yet demanded, as later generations would, that “everything vulgar should be suppressed from life and therefore from pictures.” For centuries now, defining incivility has been intimately connected with social rank, class status, political hierarchy, and relations of power. The ability to identify and sanction incivility has been associated with positions of political privilege – and simultaneously has constituted and ...


After The Great Recession: Regulating Financial Services For Low- And Middle-Income Communities, Ronald J. Mann Jan 2012

After The Great Recession: Regulating Financial Services For Low- And Middle-Income Communities, Ronald J. Mann

Faculty Scholarship

This paper, prepared as a speech at Washington and Lee Law School, discusses regulatory strategies for lending to LMI households after the Great Recession. It argues that the CFPB's emphasis on behavioral economics is likely to lead it astray, especially if it relies on assumptions drawn from experience with middle-class behavior to interfere with the choices made by LMI households that face a different set of opportunities than the middle-class households more familiar to regulators. More generally, the paper suggests that most of the financial distress faced by LMI households is a result of broader social and institutional problems ...


Updating Disclosure For The New Era Of Independent Spending, Richard Briffault Jan 2012

Updating Disclosure For The New Era Of Independent Spending, Richard Briffault

Faculty Scholarship

One of the most striking developments in recent elections has been the upsurge in spending by independent committees, particularly Super PACs and 501(c) nonprofit corporations, that are not technically affiliated with specific candidates or parties but that frequently work to promote or oppose specific candidates or parties. In many elections, these committees are de facto surrogates for the candidates they are aiding. Although our disclosure laws are reasonably effective at obtaining the disclosure of the identities of donors to candidates and parties, they fail to provide effective disclosure of the identities of the donors to independent committees. The Citizens ...


Contextualizing Regimes: Institutionalization As A Response To The Limits Of Interpretation And Policy Engineering, Charles F. Sabel, William H. Simon Jan 2012

Contextualizing Regimes: Institutionalization As A Response To The Limits Of Interpretation And Policy Engineering, Charles F. Sabel, William H. Simon

Faculty Scholarship

When legal language and the effects of public intervention are indeterminate, generalist lawmakers (legislatures, courts, top-level administrators) often rely on the normative output of contextualizing regimes – institutions that structure deliberative engagement by stakeholders and articulate the resulting understanding. Examples include the familiar practices of delegation and deference to administrative agencies in public law and to trade associations in private law. We argue that resorting to contextualizing regimesis becoming increasingly common across a broad range of issues and that the structure of emerging regimes is evolving away from the well studied agency and trade association examples. The newer regimes mix public ...


Updating Disclosure For The New Era Of Independent Spending, Richard Briffault Jan 2012

Updating Disclosure For The New Era Of Independent Spending, Richard Briffault

Faculty Scholarship

One of the most striking developments in recent elections has been the upsurge in spending by independent committees, particularly Super PACs and 501(c) nonprofit corporations, that are not technically affiliated with specific candidates or parties but that frequently work to promote or oppose specific candidates or parties. In many elections, these committees are de facto surrogates for the candidates they are aiding. Although our disclosure laws are reasonably effective at obtaining the disclosure of the identities of donors to candidates and parties, they fail to provide effective disclosure of the identities of the donors to independent committees. The Citizens ...


Super Pacs, Richard Briffault Jan 2012

Super Pacs, Richard Briffault

Faculty Scholarship

The most striking campaign finance development since the Supreme Court’s Citizens United decision has not been an upsurge in corporate or union spending as many commentators predicted. Instead, federal election campaigns have witnessed the emergence of a new campaign finance vehicle – the Super PAC – which relies primarily on extremely large individual contributions, not corporate or union money, but which threatens to upend the federal campaign finance regime in place since 1974.

Super PACs can accept contributions in unlimited amounts and use them to engage in unlimited independent expenditures expressly supporting or opposing candidates. Non-existent before the spring of 2010 ...


Foreword: Embracing Administrative Common Law, Gillian E. Metzger Jan 2012

Foreword: Embracing Administrative Common Law, Gillian E. Metzger

Faculty Scholarship

This article begins with the descriptive claim that much of administrative law is really administrative common law: doctrines and requirements that are largely judicially created, as opposed to those specified by Congress, the President, or individual agencies. To be sure, governing statutes exert some constraining force on judicial creativity, but the primary basis of these judge-fashioned doctrines lies in judicial conceptions of appropriate institutional roles, along with pragmatic and normative concerns, that are frequently constitutionally infused and developed incrementally through precedent. Yet the judicially created character of administrative law is rarely acknowledged by courts – and to the extent courts do ...


Punitive Preventive Justice: A Critique, Bernard E. Harcourt Jan 2012

Punitive Preventive Justice: A Critique, Bernard E. Harcourt

Faculty Scholarship

This book chapter critically examines punitive preventive measures, such as preventive detention for dangerous individuals, stop-and-frisks on the street, and order-maintenance policing. After reviewing the traditional concern expressed about punitive preventive practices, the chapter investigates the empirical evidence in support of such measures, concluding that the purported need for these measures is, on balance, factually overstated and generally unproven. But the empirical problems foreground a deeper theoretical difficulty with punitive preventive justice, namely that the modern approach to punitive prevention relies predominantly on economic cost-benefit analytic methods that effectively displace political debate and contestation. Like earlier punitive preventive interventions – such ...


The Case For Original Intent, Jamal Greene Jan 2012

The Case For Original Intent, Jamal Greene

Faculty Scholarship

This essay, written for a symposium celebrating the centennial of Max Farrand's Records of the Federal Convention, seeks to situate the constitutional culture's heavy reliance on the Convention debates within an academic environment that is generally hostile to original intent arguments. The essay argues that intentionalist-friendly sources like the Convention records and The Federalist remain important not because they supply evidence of original meaning but rather because the practice of advancing historical arguments is best understood as a rhetorical exercise that derives persuasive authority from the heroic character of the founding generation. This exercise fits within a long ...