Yearly Archives: 2010
May 14, 2010 Bill BrattonCorporate Law
Jeffrey N. Gordon and Christopher Muller,
Avoiding Eight-Alarm Fires in the Political Economy of Systemic Risk Management, Columbia Center for Law and Economic Studies Working Paper No. 369, available at
SSRN; Adam Levitin,
In Defense of Bailouts, 99
Geo. L.J. (forthcoming 2011), available at
SSRN.
The Goldman Sachs circus currently playing Washington certainly is energizing. And it’s a relief to see some life in the legislative process looking to financial reform. But the policy posturing is starting to get to me. Are you, like me, tired of all the claptrap? For a restorative, take out Jeffrey N. Gordon and Christopher Muller, Avoiding Eight-Alarm Fires in the Political Economy of Systemic Risk Management.
Gordon and Muller offer a learned, yet quite readable review of the financial crisis. I particularly recommend their treatment of the role played by credit default swaps and their recounting of the steps that ended in the TARP and the role played by Federal Reserve Act section 13(3) in the sequence of events. The authors know their economics, but in this paper the legal perspective dominates to the reader’s great benefit. There is also a clear-eyed and reasonable analysis of the policy choices. Here Gordon and Muller clear up much of the murkiness that surrounds discussions of “resolution authority.” That accomplished, they suggest that we get used to the prospect of future bailouts. Where a $50 billion fund raises hackles on the Hill, they think $1 trillion is more like it. Continue reading "Banking on Bailouts"
May 12, 2010 Stewart SterkTrusts & Estates
In the nearly 50 years since Norman Dacey’s How to Avoid Probate first hit the best seller list, law reformers have responded by making probate easier, faster, and less expensive – especially for families with modest means and modest needs. These legal reforms, however, have barely made a dent in the use, and growth of probate avoidance devices. In a recent article, Reconfiguring Estate Settlement, 94 Minn. L. Rev. 42 (2009), John Martin suggests replacing the probate system with a non-judicial registration system. Although his proposal builds on the UPC and other reform statutes, Professor Martin contributes some new insights – not the least of which is that any reform effort may be doomed if it retains the “probate” label.
Professor Martin describes the UPC’s flexible system for administration of estates, which allows interested parties to calibrate their contact with the judicial system to match their need for judicial protection, and also catalogs the small estate procedures enacted in states that have not adopted the UPC. Despite the availability of these modern probate systems, lawyers and their clients continue to seek out non-probate alternatives. Why is this a problem? Because, as Professor Martin points out, probate avoidance generates unnecessary expenditures on bypass devices and encourages unscrupulous peddling by “trust mills” that prey on fear of the probate process. In addition, the proliferation of probate avoidance devices requires co-ordination, and creates unexpected difficulties when the co-ordination is less than perfect. Continue reading "The End of Probate"
May 10, 2010 William FunkAdministrative Law
Bradford Mank, Summers v. Earth Island Institute
Rejects Probabilistic Standing, But a “Realistic Threat” of Harm is a Better Standing Test,
40 Env. L. 89 (2010), available at
SSRN.
The case of Summers v. Earth Island Institute, 129 S.Ct. 1142 (2009), is notable from several administrative law perspectives, but potentially its major impact is one that many commentators have missed – its rejection of “probabilistic standing.” In Summers, Justice Scalia, writing for the Court, rejected out of hand Justice Breyer’s suggestion that the plaintiff environmental groups had satisfied the “injury” prong of standing by showing “a realistic likelihood” of injury to one or more of their members. Characterizing this suggestion as “a hitherto unheard-of test for organizational standing,” Justice Scalia wrote that to accept as “injury” the fact that “there is a statistical probability that some of those members are threatened with concrete injury” would “make a mockery of our prior cases, which have required plaintiff-organizations to make specific allegations establishing that at least one identified member had suffered or would suffer harm.”
If Justice Scalia had not heard of probabilistic injury before, he has not been reading the numerous circuit court decisions addressing the probability of injury and when it is sufficient for standing. But Professor Mank has, and even before Summers he authored an article, Standing and Statistical Persons: A Risk-Based Approach to Standing, 36 Ecology L.Q. 665 (2009), dealing with the subject. In his most recent article, however, he takes it a step further, addressing Justice Scalia’s opinion for the majority in Summers and Justice Breyer’s for the dissent, relating them to some of the lower court opinions dealing with probabilistic injury, in particular two D.C. Circuit decisions, Public Citizen v. National Highway Traffic Safety Administration, 489 F.3d 1279 (2007), modified on rehearing, 513 F.3d 234 (D.C. Cir. 2008), and Natural Resources Defense Council v. EPA, 440 F.3d 476, withdrawn, 464 F.3d 1 (D.C. Cir. 2006). In addition, Professor Mank explains how all these cases relate to the Supreme Court’s earlier decision in Friends of the Earth, Inc. v. Laidlaw Env. Services, Inc., 528 U.S. 167 (2000). Continue reading "“Probabilistic Injury”: The Odds Aren’t Good"
May 7, 2010 Michael LivingstonTax Law
Omri Marian,
The Discursive Failure in Comparative Tax Law, 58 Am. J. Comp. L. (forthcoming 2010), (available at
SSRN), Carlo Garbarino,
An Evolutionary Approach to Comparative Taxation: Theory, Methods and Agenda for Research, 12 Theoretical Inquiries in Law
(forthcoming 2010), and Hugh Ault & Brian Arnold, Comparative Taxation, A Structural Analysis, 3d Ed. (available at Amazon.com)
Why isn’t there more work on comparative tax law, and why hasn’t a more sophisticated methodology developed to address comparative law tax issues? A new book and two forthcoming articles deal with these questions.
The book is the third edition of Hugh Ault and Brian Arnold’s Comparative Income Taxation: A Structural Analysis, which appeared earlier this year. One of the few comprehensive works on the subject—Victor Thuronyi’s 2003 volume also stands out in particular—the new Ault and Arnold reflects several changes, now covering nine (albeit primarily advanced) countries and including an additional section that covers individual, business, and international tax rules in topical as opposed to country-by-country fashion. While the book remains primarily descriptive in nature, any comparativist will tell you that gathering information is half the battle, and much of what is needed, at least for the major OECD countries, is contained here. Continue reading "Recent Developments in Comparative Tax Theory"
May 5, 2010 John F. DuffyIntellectual Property Law
Michael Risch,
Reinventing Usefulness (forthcoming
2010 B.Y.U. L. Rev –), available at
SSRN.
In academic scholarship, it sometimes happens that an entire field of inquiry becomes neglected year after year—to the point that nearly everyone believes the area incapable of yielding anything much of intellectual interest. Such beliefs are almost always wrong, for it is the fallow fields of thought that are prime to be fruitful again. An excellent example is patent utility doctrine, and specifically the issue whether inventions must be proven commercially useful as a prerequisite to patentability. The conventional wisdom is that the law resolved this question against imposing such a requirement more than a century and a half ago. The issue is long dead; forgotten; abandoned. Until now.
In his new article Reinventing Usefulness, Michael Risch reexamines patent utility doctrine and advances creative and insightful arguments for requiring that all inventions demonstrate “commercial utility” prior to patenting. The highest compliment I can pay this article is not that I agree with it—I’m still somewhat doubtful—but that the article has forced me to think hard about an area I foolishly thought to be largely barren. The article is memorable precisely because its thesis is unsettling; it demands rethinking of utility doctrine and other aspects of the patent law. Continue reading "Patent Utility Reduxit"
May 3, 2010 Mary FanCriminal Law
Paul Butler’s new book Let’s Get Free is essential reading for those who care about American criminal justice, prosecutorial power, and doing justice from inside the system. It is also a beautiful rarity for a book of big scholarly ideas: page-turning reading. The writing hums with the rhythm, flow, and narrative of hip hop at its best—one of the inspirations for an intriguing chapter and the book’s subtitle: A Hip-Hop Theory of Justice. The intimate portrait of the prosecutor and the criminal justice system that Paul presents is an important contribution to the literature penetrating the opacity of prosecutorial power, practices and pressures.
It is a tribute to how successfully Paul liberates his scholarly ideas from the stilted prose that dooms legal scholarship to limited readership that one of my law students recommended this hot new book to me. He was moved and inspired by the book enough to spread the word and seek to discuss it. This is the power of great ideas, set in beautiful prose, made compelling through narrative. And narrative is the thread that binds this book of many big ideas. Continue reading "The Beautiful Struggle: A Prosecutor’s Redemption Story"
Apr 29, 2010 Paul OhmTechnology Law
M. Ryan Calo,
People Can Be So Fake: A New Dimension to Privacy and Technology Scholarship, 114
Penn. St. L. Rev. (forthcoming 2010), available at
SSRN.
To glimpse the future of information privacy law, you should look at the work coming out of two Stanford Law School centers, the Center for Internet and Society and the CodeX center. In the past few years, these centers have housed a steady stream of fellows and clinical professors who have written some of the most interesting, vibrant, and future-looking scholarship in this field. For example, Lauren Gelman’s article on “blurry-edged” boundaries—already lauded in these pages—is a significant contribution, one that has advanced our understanding of the complicated relationship between social networks and privacy. Another excellent example is Structural Rights in Privacy, written by Harry Surden—now my colleague at the University of Colorado—during his stint as a fellow at CodeX, about how technology sometimes protects privacy in ways we fail to appreciate until the technology changes. I write now to focus on another scholar in the Stanford centers, Ryan Calo, who has embarked on a fascinating project with an excellent article, People Can Be So Fake: A New Dimension to Privacy and Technology Scholarship, forthcoming in the Penn State Law Review.
Calo focuses on “technologies designed to emulate people,” such as robots with expressive eyes or software assistants designed to look like people. We’ve come a long way since Microsoft’s Clippy the paperclip first annoyingly noticed that it looked like I was writing a letter. Computer scientists, roboticists, and companies have poured time and creative energy into designing interfaces and devices that look and act human, and they’ve made great strides in the process. To document these advances, Calo cites with care a rich, emerging, technical literature, importing dozens of studies and papers into law, saving the rest of us a lot of heavy research lifting. Continue reading "I Always Feel Like Somebody’s Watching Me"
Apr 26, 2010 Dennis PattersonJurisprudence
It is a staple of the international law literature that international law is not or might not “really be law” because, among other things, it lacks what H.L.A. Hart refers to as a “rule of recognition.” The contrast is most stark when one compares international law with domestic or municipal law. In the case of the latter, there is widespread convergence of opinion on valid sources of law and even relative agreement about how to construe those sources. It is the absence of such convergence that leads some (e.g., “realists” who maintain that power is the best explanation for the behavior of states) to conclude that international law is not law at all.
And what of constitutional law? The conventional wisdom is that domestic constitutional law is not only law, it is perhaps the most important example of domestic law. Constitutional law may not be as “solid” as municipal law, but it is certainly much more like “law” than international law could ever hope to be. As Goldsmith and Levinson unassumingly put the matter, “[t]his Article questions whether these apparent differences between international and constitutional law really run as deep as is commonly supposed.” (1794) Continue reading "Rethinking “International Law”"
Apr 20, 2010 Jeffrey CooperTrusts & Estates
Stewart E. Sterk,
Rethinking Trust Law Reform: How Prudent is Modern Prudent Investor Doctrine?,
95 Cornell L. Rev. (forthcoming 2010),
available at SSRN.
Jeffrey Cooper
With the stock market of recent years dashing so many hopes and dreams, investors are all asking the same questions: How could we have let this happen? How can we be sure it won’t happen again? Included among those asking these questions are the beneficiaries of countless trusts who have witnessed significant declines in the value of their trust portfolios. In his article “Rethinking Trust Law Reform: How Prudent is Modern Prudent Investor Doctrine?,” Professor Stewart E. Sterk joins this search for answers, ultimately concluding that modern prudent investor laws fail to adequately protect trust beneficiaries in troubled economic times.
Professor Sterk’s article consists of three major Parts. In Part I, Professor Sterk lays the historical framework for his analysis by summarizing the evolution of laws governing trust investment management. In particular, he explores how two widely-accepted economic theories regarding the behavior of financial markets, modern portfolio theory (“MPT”) and the efficient capital market hypothesis (“ECMH”), came to influence trust investment law. Sterk chronicles how both the Restatement (Third) of Trusts and the Uniform Prudent Investor Act wholeheartedly embraced MPT and ECMH in a quest to encourage the investment of trust funds in the manner these theories suggested would maximize the economic interests of trust beneficairies. Continue reading "Time to Rethink Prudent Investor Laws?"
Apr 15, 2010 Christopher SloboginCriminal Law
All commentators agree that the Fourth Amendment’s second, “Warrant Clause”—providing that search and arrest warrants be based on probable cause and describe with particularity the place to be searched and person or items to be seized—was meant to do away with general warrants. The general warrant is still very much with us today, however. Without any individualized suspicion, homes and businesses are subject to health and safety inspections, school children must undergo drug testing, motorists are stopped at roadblocks and checkpoints, important documents maintained by banks, credit card companies and other entities are mined for data, pedestrians in our major cities are monitored by camera systems, and everyone’s personal effects are uniformly scanned and searched at borders, airports, and various other major travel hubs.
The Supreme Court has pretty much allowed all of this to go on without any constitutional restriction. In the case of drug interdiction, roadblocks, and drug testing of pregnant mothers, it has declared that individualized suspicion is needed. But otherwise the Court has either held that the Fourth Amendment does not apply because the government action is not a search (as with data mining) or concluded, in effect, that any government search and seizure program that avoids irrationality is permissible. Many commentators have deplored this state of affairs and proposed a number of alternatives, usually either requiring some sort of individualized suspicion (which would probably put an end to all general searches and seizures) or adopting a variant of strict scrutiny analysis, which would require courts to determine whether the program is narrowly tailored to meet a compelling state need (and would involve some very difficult, and arguably improper, judicial calculations about programmatic costs and benefits). Continue reading "Government Dragnets"
