Monthly Archives: February 2020
In The Globalized Governance of Finance, David Zaring portrays an “emerging architecture” of financial regulation that lacks many of the traditional aspects of international law. There are no sovereigns or treaties or international courts. No heads of state or foreign ministers participate. Zaring’s key argument is that global financial regulation is nonetheless “a principled legal order founded on instruments of soft cooperation.” (P. 34.) Though full of institutions “ever-willing to claim that they are not lawmakers,” financial regulation is “hierarchical, procedurally regular, and politically supervised.” (Pp. 28, 100.) The regime is not precisely soft or hard law—it is “legalish.”
The book identifies “legalish” principles embedded in global financial regulation using specific examples of cooperation among global banking, securities, and insurance regulators. Key among these principles are reliance on regulatory networks and the use of techniques typical of administrative law. In Zaring’s account, global financial regulation works like both a network and “an administrative agency stretched across a global multilateral context.” (Pp. 6, 100.) Continue reading "“Legalish” Global Financial Regulation"
Nicole Huberfeld, Rural Health, Universality, and Legislative Targeting, 13 Harv. L. & Pol’y. Rev. 242 (2018).
Numerous challenges plague health care in America’s rural areas. These challenges, which manifest as health disparities and limitations on access, are worsening as rural hospitals continue to close across the country. As this is a problem particularly located in the American south (including in my home state), I was interested to read Rural Health, Universality, and Legislative Targeting by Nicole Huberfeld, one of the truly eminent scholars within health law, and an expert in rural health care, Medicaid, and the Affordable Care Act (ACA).
In the piece written for the Harvard Law & Policy Review, Huberfeld starts by documenting the health disparities that citizens living in rural America face—from lower rates of insurance coverage; to limited access to primary care; to higher rates of chronic diseases and poverty. After providing useful discussion about the definition of what it means to be “rural” and how spatial characteristics and population trends complicate and exacerbate rural health disparities, Huberfeld then skillfully weaves these data and trends into other data that reflect higher rates of deaths of despair, mental and public health challenges, and ultimately, differences amongst financial structures that negatively impact access to health care in rural areas. Coupled with lower employment and income, rural Americans exhibit higher uninsurance rates and lower rates of access to care. A detrimental feedback pattern develops, as these factors further negatively impact population health in these areas, which heightens the need for access to rural health care. In this section of the paper she provides a particularly salient example of the impact of access challenges on maternal health in rural America. Continue reading "What Ails Rural Health Care?"
Marc T. Moore, Designing Dual Class Sunsets: The Case for a Transfer-Centered Approach
, University College London Faculty of Laws Working Paper No. 9/2019, available at SSRN
The optimal balance of power between shareholders and boards of directors in public companies remains one of the most consequential and contested issues in corporate governance, and the debate has only intensified as share ownership has become more concentrated in the United States and U.S.-style shareholder activism has arisen in other capital markets around the world. Against this backdrop, as Marc Moore explores in the paper cited above, dual class stock (DCS) structures “have spread exponentially in recent years across much of America’s public company community,” and “certain jurisdictions that have traditionally been averse to permitting DCSs have come to recognize the potential benefits of taking a more permissive stance” – including Singapore and Hong Kong, two of the world’s most prominent financial centers. In his paper, Moore maps this complex terrain, providing a comparative analysis of various approaches to regulating DCS structures and calibrating associated incentives. Specifically, he focuses on “whether DCSs should be perpetual or rather should terminate (or ‘sunset’) at some point in time,” and “the most appropriate means of determining when and how time-limited DCSs should sunset.”
Moore observes that U.S. tolerance for DCS structures and associated deviation from the one share/one vote approach “would appear to be more international outlier rather than norm,” even relative to the United Kingdom where “London’s traditional capital market norms have proved considerably less tolerant in this regard.” Through a detailed discussion of extant literature, he contrasts proponents’ aim to give management “a degree of strategic breathing space … from the intense pressure exerted by quarterly financial reporting hurdles” with opponents’ concerns regarding various forms of controller agency costs borne by holders of low-voting stock. Continue reading "Dual Class Stock in Comparative Context"
Dorothy Roberts’s Abolition Constitutionalism is a monumental achievement and certain to become required reading on prison abolition. With little hesitation in calling the U.S. prison state an extension of slavery, the article is thoroughly and unapologetically abolitionist. It eschews criminal justice reform to “improve” the system in favor of “nonreformist reforms—those measures that reduce the power of an oppressive system.” It makes the case that “new abolitionists” should instrumentally utilize constitutional arguments in their efforts to eliminate imprisonment. This radical article is the foreword to the Harvard Law Review’s 2018 Supreme Court Term issue. Yes, that Harvard Law Review. Yes, this Supreme Court.
Abolition Constitutionalism will doubtlessly have wide readership within the academy. I hope that it will also be widely read by nonacademics. Roberts writes accessibly and beautifully, and as evidenced by her meticulous citations, she has encyclopedic knowledge of the racial history of policing and punishment, the modern American prison abolition movement, and the Supreme Court jurisprudence on the reconstruction amendments. But, at 120 pages, the article is an undertaking for those unaccustomed to law reviews. Here, I offer a truncated overview in the hope of sparking even greater readership. I will pepper the overview with my impressions and analyze Roberts’s conclusion that “instrumental” constitutionalism is helpful to abolitionism. Continue reading "Do Abolitionism and Constitutionalism Mix?"
A recently published empirical study by Diana Onu, Lynne Oats, Erich Kirchler, and Andre Julian Hartmann compares taxpayer attitudes towards acceptable tax planning, aggressive (yet legal) tax avoidance, and illegal tax evasion. While the study itself examines small business owners subject to income tax in the U.K., its implications should be of great interest to policymakers concerned about legal avoidance strategies with respect to any tax base. For example, aggressive but legal tax avoidance might be an important concern under recent wealth tax proposals in the United States.
As noted by the study’s authors, tax compliance literature has traditionally focused on the binary choice between compliance and evasion. That literature explores the various underpinnings of the decision to evade, from deterrence theory, to social norms, to attitudes that evasion is a victimless crime. But largely absent from this literature on individual taxpayers are studies of the motivations underlying aggressive, yet legal, tax avoidance strategies. In thinking about the U.S. tax system, this makes sense. Aggressive avoidance strategies are typically attributed to firms, where individual attitudes and other psychological factors are arguably less relevant. Evasion, on the other hand, is typically attributed to individual taxpayers (most often, sole proprietors), who often lack the resources to employ aggressive yet legal avoidance strategies. But if the U.S. were to adopt a wealth tax like the one proposed by Elizabeth Warren, the stakes or potential payoffs from avoidance might grow. If so, individual level avoidance strategies would presumably become much more commonplace.
So what do we know about the psychological factors that motivate legal tax avoidance, as distinct from evasion? It turns out, not much, but the study by Onu, Oats, Kirchler, and Hartmann sheds some light on this question. Continue reading "How Should We Think About Wealth Tax Avoidance?"
1986 wasn’t just a big year for Mets fans. It was a big year for civil procedure. The Supreme Court decided the summary judgment trilogy—Anderson, Celotex, and Matsushita—two of which would go on to become the most frequently cited Supreme Court cases in history. Earlier that year—but with considerably less fanfare at the time—Monmouth County Superior Court Judge William Wichmann issued an unusual order in a case about alleged contamination from the Lone Pine Landfill in Freehold Township, New Jersey. He set a deadline by which the plaintiffs had to provide documentation supporting their exposure to substances from the landfill and the injuries that were caused as a result. Later that year—just three weeks after Jesse Orosco struck out Marty Barrett for the final out of Game 7—Judge Wichmann found the plaintiffs’ submissions inadequate and dismissed their claims with prejudice.
Judge Wichmann’s order would come to bear the name of that case (and that landfill) and it spawned a revolution in civil procedure—particularly in the mass-tort context. As Nora Freeman Engstrom’s excellent article explains at the outset, Lone Pine orders have featured in a “Who’s Who” of mass-tort cases—including “Love Canal, asbestos, Vioxx, Fosamax, Rezulin, Celebrex, Zimmer NexGen knee implants, Baycol, Avandia, Fresenius, and the Deepwater Horizon oil spill.” Her must-read piece is a comprehensive dive into the use of Lone Pine orders, their advantages and disadvantages from a practical and theoretical perspective, and the lessons that can be drawn for civil litigation more broadly. Continue reading "The Forest, the Trees, and Lone Pine Orders"
Yonathan A. Arbel & Andrew Toler, All-Caps
(January 15, 2020), available at SSRN
A strange thing has been happening in the world of consumer contracts. “Contract” is being elbowed–roughly–aside by “notice.” While contract requires offer, acceptance, mutual assent and consideration, notice seems to require only conspicuousness. Accordingly, it is ihttps://contracts.jotwell.com/?p=862&preview=truemportant that we get conspicuousness right. Unfortunately, too often, we get it wrong. One of the most common ways we get it wrong, as Yonathan A. Arbel and Andrew Toler explain in their article, ALL-CAPS is by relying upon the effectiveness of capitalized text. Their article, the first to test the effect of capitalized text upon consumer perception, shows that all-caps not only fails to improve the quality of consent, it may diminish it for some consumers.
Arbel and Toler argue that capitalization of contract clauses is treated by judges, legislators and consumer agencies as “strong evidence, often dispositive, that the text was read and understood by the consumer.” (P. 5.) Consequently, all-caps is “used to show meaningful consent to especially onerous terms that would not be enforced but-for the use of all-caps.” (P. 10.) They review the background surrounding this faith in all-caps and find that, despite its pervasiveness, it is based upon “speculation and intuition.” (P. 6.) They explain how the focus on conspicuousness was intended to be a sort of compromise, the idea being that even if consumers don’t read all the terms in form contracts, they could read conspicuous key terms. All-caps became “a widely endorsed method of making a term conspicuous and thus rendering it enforceable.” (P. 5) But the evidence for this support of all-caps, they note, was nowhere to be found. Continue reading "Hidden In Plain Sight and In All-Caps"
In 2001, Elena Kagan published Presidential Administration—her now well-known account of presidents’ increasingly aggressive efforts to control agencies’ regulatory decisions. In the nearly two decades since her article appeared in the pages of the Harvard Law Review, presidents have exerted more and more control over agencies. Indeed, in recent years, the entrenchment of presidential administration has been evident simply by reading the nation’s news headlines. In 2015, for example, the New York Times trumpeted that “Obama Announces New Rule Limiting Water Pollution,” and then in 2019, the same paper announced: “Trump Administration Rolls Back Clean Water Protections.” Similar headlines about other presidentially influenced regulatory reversals abound.
In response to the entrenchment of presidential administration, many scholars have written about potential counterweights that might come from various federal actors, such as the federal courts, Congress, or the executive-branch bureaucracy. Largely missing from this scholarly discourse, however, has been a focus on the important role that the states can and have played in both furthering—and counteracting—presidential administration. In her forthcoming article titled Administrative States: Beyond Presidential Administration, Professor Jessica Bulman-Pozen seeks to remedy this scholarly void. Specifically, Professor Bulman-Pozen seeks to bring the states into the modern day account of presidential administration. Continue reading "Don’t Forget the States"
Richard H. Fallon, Jr.’s Bidding Farewell to Constitutional Torts is an important article at many levels. The provision by a leading constitutional scholar of a thoughtful and rigorous overview of the field, recent Supreme Court decisions within it, and new trains of scholarship criticizing those decisions is itself of great value. But there is much more here, and some of it is surprising. One might have expected a robust defender of the rule of law such as Fallon to excoriate the Supreme Court’s repeated expressions of skepticism about the principle that “where there’s a right, there is a remedy.” Instead, Fallon shares much of the Court’s skepticism and, in principle, shares its view that, in a range of scenarios, it is sensible to permit anticipated social costs to defeat the ability of victims of constitutional rights violations to hold those who have victimized them accountable. While the article ultimately defends the landmark Bivens decision itself, and a certain notion of state accountability to victims before courts of law, this too is something of a surprise in a piece purporting to “bid farewell” to the entire field.
In a manner consistent with his sensitivity to a range of constraints on legal interpretation, Fallon subdivides his article into three parts: (1) a doctrinal descriptive section; (2) the articulation of normative considerations relevant to the establishment of an attractive framework of liability rules for government actors and a proposal for such a framework; and (3) an analysis of which institutions are well-suited to adopt and implement that framework. Each of these inquiries is thoughtful, defensible, and important. Continue reading "Getting Reacquainted with Constitutional Torts"
Slavery is deeply imbedded in our nation’s history, economy, and law. The legacy of slavery is readily apparent in the disproportionate poverty of people of color and the new Jim Crow regime in our nation’s criminal justice system. Yet our country has never engaged in any sort of reconciliation process, let alone a reparation process. Recent years, however, have been marked by attempts to reckon with the history and legacy of slavery in the United States. In southern cities, local officials are debating whether to remove statues of confederate officials from public spaces. Those statues symbolize, and arguably celebrate, our nation’s legacy of slavery and racial discrimination. Removing the statues may ease the dignitary harm they cause but mask the ongoing impact of the legacy that the statues represent. In Citing Slavery, Justin Simard reveals how the legacy of slavery in our common law is hidden in plain sight. Lawyers and legal scholars know the legacy of slavery in our society but have failed to confront its impact on our common law.
Historians and legal scholars have been commemorating the 150th anniversary of the abolition of slavery and the establishment of fundamental rights for freed slaves during the Reconstruction Era. As part of this commemoration, historians are currently engaged in an ongoing debate over the extent to which slavery permeated our nation’s founding, and our constitution. In The New York Times, the 1619 Project commemorates the 400 years since the beginning of the slave trade in the U.S., fostering a debate over whether the focus on race sidelines the economic exploitation of the system of slavery. In Citing Slavery, Justin Simard makes a crucial contribution to the conversation about the impact and meaning of slavery on our legal system by pointing out the extent to which slavery permeates our nation’s basic principles of law. Like the confederate statues which force us to confront our past, Simard’s revelations force us to confront the question of how to treat law based on the tainted foundation of slavery. Continue reading "Reckoning with Slavery"