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Full-Text Articles in Law
The Moral Hazard Problem With Privatization Of Public Enforcement: The Case Of Pharmaceutical Fraud, Dayna Bowen Matthew
The Moral Hazard Problem With Privatization Of Public Enforcement: The Case Of Pharmaceutical Fraud, Dayna Bowen Matthew
University of Michigan Journal of Law Reform
This Article takes a law and economics approach to exploring some of the costs that arise when governments rely on private enforcement to accomplish the goals of public law. The analysis focuses on qui tam enforcement under the Civil False Claims Act, because a remarkable body of empirical data demonstrates the expansive role private qui tam relators are playing in enforcing Medicare and Medicaid fraud and abuse laws. The Article further focuses on the application of these laws to the pharmaceutical industry. This focus is enlightening because the Government, as well as private enforcers, have recently targeted this industry so …
Rewarding Outside Directors, Assaf Hamdani, Reinier Kraakman
Rewarding Outside Directors, Assaf Hamdani, Reinier Kraakman
Michigan Law Review
While they often rely on the threat of penalties to produce deterrence, legal systems rarely use the promise of rewards. In this Article, we consider the use of rewards to motivate director vigilance. Measures to enhance director liability are commonly perceived to be too costly. We, however demonstrate that properly designed reward regimes could match the behavioral incentives offered by negligence-based liability regimes but with significantly lower costs. We further argue that the market itself cannot implement such a regime in the form of equity compensation for directors. We conclude by providing preliminary sketches of two alternative reward regimes. While …
Now, Later, Or Never: Applying Asymmetric Discount Rates In Nuisance Remedies And Federal Regulations, Yang Wang
Michigan Law Review
Part I of this Note reviews recent literature on the need for asymmetric discount rates in cost-benefit analysis. It observes that even though scholars disagree on the precise value of the appropriate discount rate, many agree that future costs and benefits must be discounted at different rates. Part II then constructs a simple model, consisting of two activities competing for the same resource, and analyzes the consequences of asymmetric discounting under this model. This Part proposes that, to maximize the joint social utility, the resource should be time divided between the competing activities rather than permanently allocated to one or …
The Social Construction Of Sarbanes-Oxley, Donald C. Langevoort
The Social Construction Of Sarbanes-Oxley, Donald C. Langevoort
Michigan Law Review
Part I will take a close look at the legitimacy of SOX by examining the two plausible stories of SOX's origins and considering the early post-SOX evidence on its costs and benefits. There is no clear-cut answer to the question of how much SOX benefits investors; both positive and critical positions are plausible. Costs have been far greater than expected, but more from SOX's implementation than from the legislative text. Before turning to how and why implementation has occurred that way-which to me is the central question of interpretation-Part II considers whether there is an alternative interpretation of SOX that …
Habermas, Legal Legitimacy, And Creative Cost Awards In Recent Canadian Jurisprudence, Michael Fenrick
Habermas, Legal Legitimacy, And Creative Cost Awards In Recent Canadian Jurisprudence, Michael Fenrick
Dalhousie Law Journal
Access to justice continues to be a live issue in Canadian courtrooms. While state-sponsored initiatives that promote access continue to flounder in Canada or in some cases, are cancelled altogether, the pressure is mounting to find creative solutions that facilitate greater participation in formal dispute resolution processes. The price of failing in this regard is very high. To truly flourish, both social cohesion and individual liberties require a more participatory and inclusive legal system than the one that currently precludes all but the wealthiest from accessing our courts. Drawing on the legal philosophy of Jargen Habermas, the author examines access …
Legal Fictions In Pierson V. Post, Andrea Mcdowell
Legal Fictions In Pierson V. Post, Andrea Mcdowell
Michigan Law Review
American courts and citizens generally take the importance of private property for granted. Scholars have sought to explain its primacy using numerous legal doctrines, including natural law, the Lockean principle of a right to the product of one's labor, Law & Economics theories about the incentives created by property ownership, and the importance of bright line rules. The leading case on the necessity of private property, Pierson v. Post, makes all four of these points. This Article argues that Pierson has been misunderstood. Pierson was in fact a defective torts case that the judges shoe-horned into a property mold …
2006 Government Contract Decisions Of The Federal Circuit, David W. Burgett, William F. Ferreira, Allison D. Pugsley, Deborah A. Raviv
2006 Government Contract Decisions Of The Federal Circuit, David W. Burgett, William F. Ferreira, Allison D. Pugsley, Deborah A. Raviv
American University Law Review
In 2006, the Federal Circuit issued over two hundred and fifty precedential opinions and orders. This article discusses sixteen precedent-setting opinions involving government contract law issues, setting forth the relevant facts, the Federal Circuit’s analysis, and key points for practitioners to glean from each case. This article also includes a discussion of the Federal Circuit’s September 2006 opinion regarding the TRICARE Pharmacy Benefits Program (“TPBP”) refund program, a case that the pharmaceutical industry watched closely. The decisions have been grouped into the following categories: jurisdiction, contract interpretation, costs, contract termination, bid protests, and patent rights.
Fixing 404, Joseph A. Grundfest, Steven E. Bochner
Fixing 404, Joseph A. Grundfest, Steven E. Bochner
Michigan Law Review
Although debate persists as to whether the costs of Sarbanes-Oxley's Section 404 regulations exceed their benefits, there is broad consensus that the rules have been inefficiently implemented. Substantive and procedural factors contribute to the rules' inefficiency. From a substantive perspective, the terms "material weakness" and "significant deficiency" are central to the implementing regulations and are easily interpreted to legitimize audits of controls that have only a remote probability of causing an inconsequential effect on the issuer's financial statements. As a quantitative matter the literature suggests that a control with a remote probability of causing an inconsequential effect has an expected …