Contracts Commons^™

Breach Agents: The Legal Liability Of Third Parties For The Breach Of Reputational Ndas, Mark Fenster

UF Law Faculty Publications

Nondisclosure agreements intended to keep secret information that could harm one or both parties’ reputations have proliferated over the past decade. Many of them have been breached, some quite famously. Does a third party who assists a contracting party in breaching such an agreement — a member of the press or a family member, for example — risk liability for tortious interference with performance of a contract? This article asserts that the answer is no in most instances, in part because of limitations inherent in the tort and in part because such liability would violate the defendant's First Amendment rights. …

Strategically Restated Defaults, Wendy Gerwick Couture

William & Mary Business Law Review

Business and commercial statutes are composed almost entirely of default rules, which parties may override via agreement or adopt via silence. Drafters of these statutes, and theories about the substance of default rules, assume that parties indeed adopt statutory default rules via silence.

Against this backdrop, this Article examines unexpected behavior by parties to business and commercial agreements: parties often restate statutory default rules in their agreements rather than adopting those rules via silence. Based on a review of actual limited partnership agreements and security agreements, this Article identifies five unique species of restatement—bald, tweak, refill, baseline, and context restatements—and …

Read But Not Understood? An Empirical Analysis Of Consumer Comprehension In Homeowners Insurance, Daniel Schwarcz, Brenda J. Cude, Kyle D. Logue, German Marquez Alcala

Law & Economics Working Papers

Modern contract law assumes that consumers meaningfully assent to the standard forms that govern their daily lives. However, this assumption is widely regarded as a legal fiction for two key reasons: first, most consumers do not read standard forms, and second, even those who do often struggle to fully comprehend their terms and implications. While the lack of consumer reading has been well-documented through empirical research, consumers’ ability to comprehend standard form contracts has received surprisingly little attention.

This Article addresses the latter issue by empirically examining whether providing excerpts from the dominant standard form homeowners insurance policy improves consumer …

Fruit Street Health, P.B.C., V. Sharecare, Inc., Order On Motion For Reconsideration, Kelly L. Ellerbe

Superior Court of Fulton County: Metro Atlanta Business Case Division Opinions

No abstract provided.

The Paradoxical Solution To Enforce Resale Royalties And Keep The Nft Market Decentralized, Katelyn Holcomb

Washington Journal of Law, Technology & Arts

This article examines the role of resale royalties in maintaining decentralization in the NFT ecosystem and supporting financial sustainability for artists. Although resale royalties, also known as creator royalties, are widely valued by NFT artists, they have been frequently undermined by the centralized policies of large NFT marketplaces. These include zero-royalty policies that are driven by the competitive pressure to gain market share, where platforms allow buyers and sellers to bypass creator royalties. This behavior has led to a destructive race to the bottom and the overall erosion of resale royalties. To address this problem in the NFT market, this …

The Great War (Taylor's Version): Examining The New Era Of Recording Artists & Master Recording Ownership, Victoria B. Villanueva

Journal of Legislation

In 2019, Taylor Swift took to social media to voice her unease with the recent sale of her entire master recording catalogue to Ithaca Holdings, a sale that allegedly occurred without her explicit permission. Following a series of negotiations, holdouts, and ultimate deadlock, Swift made the critical and costly decision to re-record and re-release each of those six albums under her sole ownership in an effort to reclaim them as her own work—re-recordings publicly denoted by “Taylor’s Version”. This highly-publicized feud brought to the public’s attention a decades-long conflict between the recording artist and the recording company, one that has …

Consumer Protection And The Illusory Promise Of The Unconsciounability Defense, Benjamin C. Zipursky, Zahra Takhshid

Sturm College of Law: Faculty Scholarship

The United States Supreme Court’s notorious decision in AT&T Mobility LLC v. Concepcion seems to display impatience with the idea of an unconscionability defense to the enforcement of a contract. At the core of Justice Antonin Scalia’s opinion, however, was not an argument against the idea of unconscionability per se, but an argument against using “unconscionability” as a cover for a broader public policy agenda. This interpretation is confirmed by the Court’s little-known decision in Marmet Health Care Ctr., Inc. v. Brown, handed down the term after Concepcion was decided. Plaintiffs were allowed to move forward in Marmet because the …

Empirical Essays On Mobility-Restricting Covenants, Lorenzo G. Luisetto

SJD Dissertations

This thesis, which consists of four essays, uses empirical methods to study questions on the use of mobility-restricting covenants in business and employment contracts.

The first chapter investigates the spillover effects of the so-called “No-Poach Initiative,” an enforcement action launched by the Antitrust Division of the State of Washington Attorney General’s Office in January 2018 that led 237 franchisors to agree to stop using no-poaching clauses—i.e., provisions in franchise contracts that prohibit franchisees from hiring each other’s employees—nationwide. I document that approximately one third of the franchisors not targeted by the No-Poach Initiative removed the no-poaching clause from their franchise …

Risk, Reimagined: The Untold Story Of Liability Laddering In Modern Commercial Dealmaking, Carrie Stanton

Scholarly Articles

In commercial contracting, bargaining parties regularly allocate risk in various ways, including contractual limitations of liability. However, it can be difficult to appropriately apportion responsibility for high-risk contingencies such as data breach. A seller may be unwilling to accept uncapped liability for a contingency whose cost could exceed the expected value of the transaction. Conversely, a buyer may be unwilling to live with only a general damages cap established as a rough-and-ready compromise for more ordinary contingencies. To surmount this impasse, which typically arises toward the end of a negotiation, deal lawyers have begun to craft elevated dollar caps, or …

Through A Glass Darkly: How Securities Disclosures Give A Distorted View Of The Economy, Gerald F. Davis

Seattle University Law Review

Our understanding of the American economy often relies on stylized facts derived from mandatory disclosures by listed corporations. Data vendors like Standard & Poor’s vacuum up 10Ks and proxy statements into databases, and scholars distill these into tentative maps. This may have been adequate for a postwar economy centered on asset-heavy manufacturers, but it is increasingly out of step with an information-based economy. Companies listed on the stock market are fewer in number and less representative than they were, light in tangible assets and people, and heavy on IP. Basic facts such as what industry they are in are increasingly …

The Small Business Dilemma, Rachel G. Ngo Ntomp

Faculty Articles

Small businesses face a unique and challenging dilemma in today’s business landscape. On the one hand, they are typically and rightfully considered the more powerful party in their contractual relations with consumers, thus prompting a need to protect consumers against unfair contractual terms. On the other hand, when engaging with larger businesses, small businesses typically find themselves in the position of the weaker, more vulnerable party, possibly in need of greater protection themselves from unfair terms. This Article addresses the inherent dilemma faced by small businesses and argues that the prevailing perception of businesses as sophisticated and experienced, based exclusively …

Abuse Of Contract: Boilerplate Erasure Of Consumer Counterparty Rights, Andrea Boyack

Faculty Publications

Contract law and the new Restatement of the Law of Consumer Contracts generally treats the entirety of a company’s boilerplate as presumptively binding. Entrusting the content of consumer contracts to companies creates a fertile legal habitat for abuse through boilerplate design.

There is no consensus on how widespread or severe abuse of contract is. Some consumer law scholars have warned of dangers inherent in granting companies unrestrained power to sneak waivers into their online terms, but others contend that market forces adequately constrain potential abuse. On the other hand, in the absence of adequate consumer knowledge and power, market competition …

Decentral Intelligence Agency: The Law And Autonomous Artificial Intelligence, Dr. Andrew W. Torrance , Ph. D., Dr. Bill Tomlinson , Ph.D.

Touro Law Review

Artificial intelligence (“AI”) is rapidly gaining autonomy across a range of domains, such as business, education, social relationships, and warfare. This article examines the legal and policy implications of autonomous AI agents, a rapidly evolving technology that challenges existing regulatory frameworks. Drawing from tort, agency, property, contract, privacy, human rights, and constitutional law, we propose a comprehensive approach to govern these increasingly independent entities. Our analysis begins with a historical perspective, tracing both the evolution of autonomous computational systems and of legal responses to such technologies. We then conduct a comparative study of AI governance across jurisdictions, highlighting regulatory gaps …

Table Of Contents, Seattle University Law Review

Seattle University Law Review

Table of Contents

Corporate Scenarios: Drawing Lessons From History, Madison Condon

Seattle University Law Review

As corporations are increasingly pressed to reveal information about their exposure to climate-related risks, they are often asked to undertake and disclose the outcome of “scenario analysis.” In this exercise, corporations, including financial institutions, examine how their business would fare under different pathways the future may take. One oft-used scenario, for example, is the International Energy Agency’s “Net-Zero by 2050: A Roadmap for the Energy Sector.” This Essay presents a history of the use of scenarios as a corporate planning tool, particularly in the oil industry, arguing that it is key for understanding our present moment and the role of …

Shareholder Expression In A Time Of Heightened Political Tension, Aaron A. Dhir

Seattle University Law Review

In this article, I provide context for my forthcoming research project on shareholder proposals and racial equity audits. Since the murder of George Floyd in May of 2020, progressive shareholder actors have increasingly used the proposal mechanism to advance diversity, equity, inclusion, and justice-related goals. These proposals have frequently gone beyond requesting the usual corporate fare of diversity trainings, intersectionality workshops, affinity groups, etc. Instead, a more ambitious type of proposal asks corporate America to conduct racial equity audits, defined as “an independent, objective and holistic analysis of a company’s policies, practices, products, services and efforts to combat systemic racism …

Corporate Governance Speech, Sarah C. Haan

Seattle University Law Review

The State has always regulated the intra-firm communications that make corporate governance possible, most commonly by mandating disclosures of information by a corporation to its shareholders. Some such laws are labeled “securities regulation,” but securities regulation is a broad category that extends to speech by actors who are outside the corporate enterprise as well. Also, the conventional securities regulation category does not capture all such laws; other examples, including informationforcing mandates, can be found in state corporate law. This Article uses the term “corporate governance speech” to describe the communications among shareholders, directors, and officers through which corporate governance is …

Dark Accounting Matter, Colleen Honigsberg

Seattle University Law Review

Physicists calculate that approximately 85% of the matter in the universe is composed of “dark matter” that “does not absorb, reflect, or emit electromagnetic radiation and is therefore difficult to detect.” The S&P 500 currently trades at a price-to-book value of 4.2, suggesting that book value accounts for less than 20% of the S&P 500’s market value. The remaining 80% appears nowhere in these firms’ balance sheets—it is invisible to contemporary accounting techniques and constitutes “dark accounting matter.”

Some “dark accounting matter” is composed of factors commonly described as components of “ESG.” Human capital, for example, is an intangible asset …

The Employees’ Dilemma: Balancing Internal Reporting, Whistleblowing, And Insider Trading Risks, Geeyoung Min

Seattle University Law Review

The Essay examines how recent developments in insider trading regulations and whistleblower reward programs can lead to unintended and counterproductive results of discouraging employees from using internal reporting channels within corporate compliance programs. While the presence of a robust and well-functioning corporate compliance program is a critical factor both in mitigating the level of public enforcement actions against companies and in protecting corporate managers from liability in private litigation, these programs often provide little incentive for employees to report potential misconduct internally.

Corporate compliance programs are designed to promote the upward information flow within the company, which is essential for …

How The Antidiscrimination Law Of Commercial Transactions Really Works, Helen Norton

Seattle University Law Review

A variety of businesses now cite 303 Creative when seeking First Amendment protection for their refusal to serve certain customers based on those customers’ protected class status. How this litigation will play out remains to be seen. But future courts need not, and should not, repeat the 303 Creative Court’s misunderstanding of how the antidiscrimination law of commercial transactions actually works.

Part I of this Essay explains the Court’s longstanding understanding of the antidiscrimination law of commercial transactions, and then describes the Court’s failure to engage with this precedent in 303 Creative. Part II then identifies the 303 Creative decision’s …