Law Commons^™

Not-For-Profits, Esgs, And The Economic Structure Of Corporate Law, Saul Levmore

The University of Chicago Business Law Review

A compelling point in The Economic Structure of Corporate Law is that the single goal of maximizing shareholder value is efficient and generally desirable because it gives the managers one aim—while leaving room for law and private contracts to impose constraints on the firm in order to control negative externalities and other social concerns. Easterbrook and Fischel say that: “A manager told to serve two masters (a little for the equity holder, a little for the community) has been freed of both and is answerable to neither.” The point is an especially good one when the manager has more of …

Insider Trading: Easterbrook And Fischel And Easterbrook Vs. Fischel, Jonathan R. Macey

The University of Chicago Business Law Review

This Article examines the perspective on insider trading in Frank Easterbrook and Daniel Fischel’s classic work, The Economic Structure of Corporate Law, comparing it with the perspectives the authors have taken in other work on the topic in which the Book’s authors did not coauthor with each other. While Easterbrook and Fischel have similar conceptions about the meaning of “fairness” in securities regulation and corporate law, their differing assumptions about the efficacy of the contracting process within the corporation explain their disagreements about what insider trading law should look like.

Both Easterbrook and Fischel correctly view material inside information as …

Easterbrook And Fischel On Corporate Purpose, Edward B. Rock

The University of Chicago Business Law Review

Frank Easterbrook and Daniel Fischel’s comments on corporate purpose are as fresh today as they were when they were first published in the 1980s. Starting from the “contractarian” perspective, they asked a key question about questions such as “what is the goal of the corporation?”, namely, “Who cares?”

In this contribution to the symposium volume in their honor, I examine the current corporate purpose debate through the lens of their rather brief comments that first appeared in their 1989 article, “The Corporate Contract.” In doing so, I focus on a variety of issues raised by their analysis: What are the …

Pills In A World Of Activism And Esg, Caley Petrucci, Guhan Subramanian

The University of Chicago Business Law Review

Easterbrook and Fischel’s The Economic Structure of Corporate Law advances their now famous passivity thesis, which posits that managers should remain passive in the face of an unsolicited tender offer for the company’s shares. Consistent with the broader Chicago-school economic belief, Easterbrook and Fischel argue that markets are generally efficient, and therefore restrictions on the market (like poison pills) are bad. In doing so, Easterbrook and Fischel also consider and reject externalities that might cause the market for corporate control to not function well. Thirty years have passed since Easterbrook and Fischel’s seminal work and the world has changed in …

Who Can Tax Telecommuters?: A Case For An Economic Presence Regime, Garry Canepa

The University of Chicago Business Law Review

Should telecommuters who work across states be taxed by the state that they are physically working in? By the state their office is located in? By both? This issue was raised in New Hampshire v. Massachusetts. There, New Hampshire challenged the taxing authority of a Massachusetts rule that taxed New Hampshire residents who had worked within a Massachusetts office prior to COVID-19 related restrictions but were telecommuting from New Hampshire. New Hampshire argued that the Massachusetts rule violated both the Due Process Clause and Commerce Clause. Since the Supreme Court had denied certiorari for this case, the constitutionality of the …

Domestic Corporations And The Alien Tort Statute, Joseph Downey

The University of Chicago Business Law Review

This Comment analyzes the history, jurisprudence, and contemporary status of the Alien Tort Statute, which allows foreign citizens to bring suit in US courts for violations of international law. It attempts to answer two unresolved questions relating to the Alien Tort Statute. First, can domestic corporations be sued under the statue? Based on an analysis of the statute’s text, its history, and lower court decisions, this Comment argues that they rightly should be. This Comment will also define what sort of conduct suffices for an Alien Tort Statute lawsuit to be brought against a domestic corporation and concludes that a …

Mandatory Financial Disclosures As Total Regulatory Takings, Jay Khurana

The University of Chicago Business Law Review

In the aftermath of the GameStop phenomenon in early 2021, there have been increasing calls for expanded mandatory financial disclosures particularly regarding hedge funds and short selling. Efforts to increase disclosure requirements on hedge funds may implicate the Takings Clause of the Fifth Amendment. This comment argues that mandatory disclosure of a firm’s total portfolio—its long, short, and derivative positions—constitutes an uncompensated taking of its trade secrets. This comment explores the application of current takings jurisprudence to trade secrets and financial disclosures. It concludes that the per se rule established in Lucas v. S.C. Coastal Council should apply to public …

The Ftc And The Cpra’S Regulation Of Dark Patterns In Cookie Consent Notices, Danyang Li

The University of Chicago Business Law Review

Dark patterns are designed to confuse and manipulate users to select the option preferred by website owners. Dark patterns are especially prevalent in cookie consent notices, which are notices that websites display to inquire users regarding their cookie preferences. Cookies are often used by websites to track and store user information for functional and marketing purposes. Dark patterns exploit various psychological biases, and the interaction among the biases will likely exacerbate their effects. This Article examines 100 cookie consent notices from the most popular ecommerce websites in the United States and offers a set of empirical data on the current …

Tyson And Leviathan: Usda Rulemaking And The Psa Harm To Competition Requirement, Spencer James Parts

The University of Chicago Business Law Review

Facing concentration in meatpacking, farmers and ranchers are making increasingly urgent calls for protection from practices they claim make it difficult for them to earn a living. Among the statutes they have turned to for recourse is the Packers and Stockyards Act, a 1921 law that prohibits meatpackers from engaging in unfair, deceptive, or unjustly discriminatory practices. Courts, however, have made PSA cases more difficult to win by requiring that plaintiffs prove “harm to competition” to bring a successful case. Recently, the USDA has intervened in this debate, alternately supporting each side of the harm to competition question in controversial …

Kids Are Not So Different: The Path From Juvenile Exceptionalism To Prison Abolition, Emily Buss

University of Chicago Law Review

Inspired by the Supreme Court’s embrace of developmental science in a series of Eighth Amendment cases, “kids are different” has become the rallying cry, leading to dramatic reforms in our response to juvenile crime designed to eliminate the incarceration of children and support their successful transition to adulthood. The success of these reforms represents a promising start, but the “kids are different” approach is built upon two flaws in the Court’s developmental analysis that constrain the reach of its decisions and hide the true implications of a developmental approach. Both the text of the Court’s opinions and the developmental and …

The Exception To Rule 12(D): Incorporation By Reference Of Matters Outside The Pleadings, Laura Geary

University of Chicago Law Review

Defendants frequently attach supporting materials to Rule 12(b)(6) motions to dismiss for failure to state a claim. The plain text of Federal Rule of Civil Procedure 12(d) dictates that judges must either exclude this material or treat the motion as one for summary judgment. However, a substantial exception has emerged that threatens to swallow the rule. The exception, called incorporation by reference, permits the consideration of outside materials when they are either referenced in the pleadings, central to the claim, or sometimes both. Courts have defined these elements differently and have diverged in their understandings of the doctrine. Incorporation by …

In Need Of Better Material: A New Approach To Implementation Challenges Under The Idea, Annie Kors

University of Chicago Law Review

The Individuals with Disabilities Education Act (IDEA) provides a substantive guarantee to a “free appropriate public education” (FAPE) to students with disabilities. The education is to be provided “in conformity with” an “individualized education program” (IEP): an educational plan for the student that is created through a statutorily defined process. Scholars and courts have focused tremendous attention on the level of educational quality that an IEP must offer to meet the IDEA’s requirements. But the creation of an adequate plan is, of course, not the end of the story; the school district then has to implement the plan. This leaves …

The Constitutionality Of Orthodoxy: First Amendment Implications Of Laws Restricting Critical Race Theory In Public Schools, Dylan Salzman

University of Chicago Law Review

The past two years have seen a proliferation of state laws that restrict how race may be discussed in public schools. Among other topics, these laws commonly ban presentation of the viewpoint that the U.S. government—or legal system—is racist. But such policies raise important First Amendment questions: while it is well accepted that school boards and state legislatures retain great discretion to promulgate curricula, the exact scope of that authority is unclear. The Supreme Court case most closely related to this question, Hazelwood School District v. Kuhlmeier, addresses only when school districts may permissibly regulate student speech in curricular contexts. …

The Future Of Embedded International Law: Democratic And Authoritarian Trajectories, Karen J. Alter

Chicago Journal of International Law

This short Essay explains why deeply embedding international law (IL) directly into domestic legal orders is seen as a helpful democratic legal strategy to make international law more effective. It also describes the logistics of embedding international law into national legal systems. The goal is to then query whether and how authoritarian regimes dis-embed or work around this embedded IL. The analysis raises a fundamental question about how time is important for any conversation about embedded or entrenched international or authoritarian law. The embedded IL strategy is a long-game strategy, and as such it can ultimately outlive periods of authoritarian …

The Limits Of Prodemocratic International Law In Europe, Aslı Ü. Bâli

Chicago Journal of International Law

Tom Ginsburg’s Democracies and International Law explores the ways in which regional human rights regimes have been designed to promote and protect democracy and the degree of their success in an age of democratic backsliding. In this symposium contribution, I examine the impact of the relationship between the European Union (E.U.) and Turkey on that country’s record of democratic backsliding. I argue that European countries’ difficulties in managing multi-racial democracy have limited the depth and effectiveness of the E.U.’s pro-democratic commitments in its dealings with Turkey.

Dark Law On The South China Sea, Stephen Cody

Chicago Journal of International Law

In Democracies and International Law, Tom Ginsburg warns of an emerging post-liberal order influenced by powerful authoritarian regimes and new illiberal laws that repurpose global rights, undermine international courts, and expand executive power. Autocrats and kleptocrats embedded in the global economy increasingly appear to use international law to preserve their power, protect norms of non-intervention, and enhance the global stability of autocratic rule. Legalistic autocrats, for example, exploit judicial deference and vague statutory language in national security laws to circumvent checks on their authority. This process, which I call “dark law,” aids in the consolidation of state power and the …

International Institutions And Platform-Mediated Misinformation, Aziz Z. Huq

Chicago Journal of International Law

The Essay is part of a Symposium on Tom Ginsburg’s insightful book Democracies and International Law. It explores one particular kind of interaction between democratic nation states and international instruments and institutions: how international law and institutions either mitigate or exacerbate harms to democracy from the diffusion of misinformation and hate speech on social-media platforms. I identify three distinct pathways not covered by Ginsburg: (a) international law as an off-the-rack legal regime for content-moderation by such platforms; (b) international contouring of feasible domestic regulation; and (c) ex ante and ex post international regulation of platform-mediated misinformation. Reflection upon these pathways …

The Role Of Transnational Civil Society In Shaping International Values, Policies, And Law, Mariana Olaizola Rosenblat

Chicago Journal of International Law

This Essay suggests that predictions about the character of international law in the context of rising authoritarianism may be nuanced by paying closer attention to the influence of transnational civil society (TCS) on global affairs and normative development. While acknowledging that pro-liberal civil society has faced escalating threats from authoritarian governments in recent years, the Essay highlights the resilience, adaptability, and creativity of TCS, which finds ways to remain active and harness sources of strength despite those threats. However, TCS is not always pro-liberal, and there is evidence of strong anti-liberal civil society influence as well. Whether or not authoritarian …

Clearview Ai, Tiktok, And The Collection Of Facial Images In International Law, Miriam Kohn

Chicago Journal of International Law

Private companies’ collection of facial images is on the rise globally, which has major implications for both economic development and privacy laws. This Comment uses the facial recognition technology company Clearview AI and the video sharing app TikTok as case studies to examine the problems raised by these practices. After summarizing the relevant legal regimes created by the United Nations (U.N.) and the European Union (E.U.), it applies the E.U. privacy regime to TikTok’s most recent Privacy Policy. The Comment concludes by proposing updates to the E.U. and U.N. privacy regimes to more effectively regulate TikTok’s data collection and analogous …

Wipo’S Proposed Treatment Of Sacred Traditional Cultural Expressions As A Distinct Form Of Intellectual Property, Alberto Vargas

Chicago Journal of International Law

For the past twenty years, the United Nations’ World Intellectual Property Organization (WIPO) has been working on what could be a major shift in international intellectual property law. WIPO’s work has uniquely focused on intellectual property protection for “traditional cultural expressions” (TCEs), a term which roughly describes a broad conception of indigenous groups’ intellectual property. Most recently, WIPO published its latest proposed Draft Provisions/Articles for the Protection of Traditional Knowledge and Traditional Cultural Expressions, and IP & Genetic Resources. These Draft Provisions propose a tiered rights system in which the owners of sacred TCEs receive more protective rights than the …

Democracy And Statehood, Veronika Fikfak

Chicago Journal of International Law

This Essay addresses the relationship between democracy and statehood. The two concepts have been linked since the 1990s, when new entities claiming statehood were expected to have constituted themselves on a democratic basis and to have put in place democratic government structures to be recognized by the international community. Yet, as Professor Tom Ginsburg’s book Democracies and International Law reveals, the rise of autocracies and a general backlash against democracy in the last three decades have led to changes in countries’ behavior. This Essay argues that today, the requirement of democratic process and institutions for international recognition is less stringent. …

Tianxia, Or Another Grossraum? U.S.–China Competition And Paradigm Change In The International Legal Order, Tokujin Matsudaira

Chicago Journal of International Law

In this Essay, I try to provide some clarification on the concept of Tianxia from the perspectives of both classical Chinese philosophy and constitutional theory, which Tom Ginsburg nominated as the source of authoritarian international law. My observation is that a paradigm shift is occurring in the international legal order. Tianxia designates the ideal relationships between states in the Chinese classics. And in the new paradigm, Tianxia is expected to integrate the international society. In that sense, I take Tianxia as a regime-neutral ideotype between democratic/Western and authoritarian/non-Western legal order. However, Chinese engagement with international law has shown a tendency …

Regulation And Redistribution With Lives In The Balance, Daniel Hemel

University of Chicago Law Review

A central question in law and economics is whether nontax legal rules should be designed solely to maximize efficiency or whether they also should account for concerns about the distribution of income. This question takes on particular importance in the context of cost-benefit analysis. Federal agencies apply cost-benefit analysis when writing regulations that generate multibillion-dollar impacts on the U.S. economy and profound effects on millions of Americans’ lives. In the past, agencies’ cost-benefit analyses typically have ignored the income-distributive consequences of those regulations. That may soon change: on his first day in office, President Joe Biden instructed his Office of …

Neither Here Nor There: Wire Fraud And The False Binary Of Territoriality Under Morrison, Jason Petty

University of Chicago Law Review

No abstract provided.

The Law And Economics Of Animus, Andrew T. Hayashi

University of Chicago Law Review

People sometimes want to harm other people. This truism points to a blind spot in law and economics scholarship, which generally assumes that people are indifferent to the effects of their actions on other people. Diverse areas of the law, such as hate-crime legislation and constitutional equal protection doctrine, reside in this blind spot because they are premised on the existence of animus. I argue that the assumption of indifference unnecessarily limits law and economics analysis and that it is both possible and fruitful to incorporate animus into law and economics. I show that doing so leads to new insights …

Experimental Jurisprudence, Kevin Tobia

University of Chicago Law Review

“Experimental jurisprudence” draws on empirical methods to inform questions typically associated with jurisprudence and legal theory. Scholars in this flourishing movement conduct empirical studies about a variety of legal language and concepts. Despite the movement’s growth, its justification is still opaque. Jurisprudence is the study of deep and longstanding theoretical questions about law’s nature, but “experimental jurisprudence,” it might seem, simply surveys laypeople. This Article elaborates on and defends experimental jurisprudence. Experimental jurisprudence, appropriately understood, is not only consistent with traditional jurisprudence; it is an essential branch of it.

Barbed Wire Fences: The Structural Violence Of Education Law, Latoya Baldwin Clark

University of Chicago Law Review

In this Essay, I argue that, in urban metros like Chicago, poor Black children are victims of not just gun violence but also the structural violence of systemic educational stratification. Structural violence occurs in the context of domination, where poor Black children are marginalized and isolated, vulnerable to lifelong sub-ordination across many domains. Specifically, I argue that U.S. education policy subjects poor Black children to the violence of intergenerational subordination by trapping children behind residential barbed wire fences, starving their schools of necessary resources, and abusively dangling powerless community control.

An Abolitionist Critique Of Violence, Allegra Mcleod

University of Chicago Law Review

The violence experienced by young people of color in the city is multidimensional—both interpersonal and structural. So many of the young have to swallow their rage as they are surveilled in stores and on the streets, as they are targeted by cops for endless stops and frisks, as they are denied jobs, as their schools are closed, and as they are locked in cages by the thousands. For some, the violations and the deprivation turn outward. The instrumental use of violence by some young people becomes a rational adaptive strategy in response to racial and economic oppression. For some of …

Capitalizing On Crisis: Chicago Policy Responses To Homicide Waves, 1920–2016, Robert Vargas, Chris Williams, Phillip O’Sullivan, Christina Cano

University of Chicago Law Review

This Essay investigates Chicago city-government policy responses to the four largest homicide waves in its history: 1920–1925, 1966–1970, 1987–1992, and 2016. Through spatial and historical methods, we discover that Chicago police and the mayor’s office misused data to advance agendas conceived prior to the start of the homicide waves. Specifically, in collaboration with mayors, the Chicago Police Department leveraged its monopoly over crime data to influence public narratives over homicide in ways that repeatedly (1) delegitimized Black social movements, (2) expanded policing, (3) framed homicide as an individual rather than systemic problem, and (4) exclusively credited police for homicide rate …

The Enduring Neighborhood Effect, Everyday Urban Mobility, And Violence In Chicago, Robert J. Sampson, Brian L. Levy

University of Chicago Law Review

A longstanding tradition of research linking neighborhood disadvantage to higher rates of violence is based on the characteristics of where people reside. This Essay argues that we need to look beyond residential neighborhoods to consider flows of movement throughout the wider metropolis. Our basic premise is that a neighborhood’s well-being depends not only on its own socioeconomic conditions but also on the conditions of neighborhoods that its residents visit and are visited by—connections that form through networks of everyday urban mobility. Based on the analysis of large-scale urban-mobility data, we find that while residents of both advantaged and disadvantaged neighborhoods …