Oct 10, 2016 JotwellJotwell
Today we inaugurate a new Jotwell section on Contracts, edited by Professor David A. Hoffman and Professor Nancy S. Kim. Together they have recruited a stellar team of Contributing Editors.
The first posting in the Contracts section is What Does “Buy Now” Really Mean? by Robert A. Hillman.
Please look at our Call For Papers, and get in touch if you have suggestions for a new section, or if you have a review you would like to contribute to any existing section of Jotwell.
Oct 7, 2016 Ezra MitchellCorporate Law
Sarah Baumgartel,
Privileging Professional Insider Trading,
Ga. L. Rev. (forthcoming 2016), available at
SSRN.
Just when you thought it was safe to avoid yet another article on insider trading comes Sarah Baumgartel’s imaginative and insightful paper. Baumgartel’s point of entry is several recent and pending cases that in some ways extend, and in other ways limit, the peculiar misappropriation theory, a judicial development that continues to prove not only that bad cases make bad law but that they also can make for good scholarship.
Before I get into a few of the details, here’s the bottom line: The misappropriation theory, and especially the Commission’s redaction of “confidential relationship” in Rule 10b5-2, are yet another example of facilitating the economic inequality that has achieved such prominence in contemporary discourse. Baumgartel doesn’t quite put it this way, but she does argue that the manner in which the misappropriation theory has come to impose liability on traders who received their information in the context of personal and often intimate relationships while providing exculpation for professionals and managers who trade on that information satisfies neither the information-protective function of modern insider trading law nor the market fairness rationale that often is invoked. Instead, it sends your golf buddy or your sister to jail while allowing business professionals to reap harvests from fields that ordinary people can’t even locate. Continue reading "Friends Don’t Let Friends Trade on Inside Information"
Oct 6, 2016 Helen NortonConstitutional Law
Katie Eyer,
Ideological Drift and the Forgotten History of Intent, 51
Harv. C.R.-C.L. L. Rev. 1 (2016), available at
SSRN.
Legal history can help us overcome the distortions of time and distance that too often obscure our understanding of struggles both past and present. Katie Eyer’s Ideological Drift and the Forgotten History of Intent exemplifies this kind of legal history. Through painstaking analysis of a century of equal protection decisions by the Supreme Court, she seeks to explain a “perplexing feature of the Court’s early 1970s jurisprudence: the Court’s race liberals’ failure to pursue effects-based approaches to Equal Protection liability at a time when such approaches were gaining credence elsewhere.”
In Washington v. Davis, 426 U.S. 229 (1976), for example, the Court held that the Constitution does not forbid the government’s facially neutral actions that create racial disparities, even if such disparities have the effect of reinforcing traditional racial hierarchies. Rejecting a challenge to the District of Columbia’s examination for police officers that had the effect of disproportionately excluding African-American applicants, the Court held that the equal protection clause addresses only intentionally discriminatory government actions. No member of the Court—including Justices Brennan and Marshall—dissented from this constitutional holding. Continue reading "Recovering Forgotten Struggles Over the Constitutional Meaning of Equality"
Oct 5, 2016 Christopher WalkerAdministrative Law
Aditya Bamzai,
The Origins of Judicial Deference to Executive Interpretation, 126
Yale L.J. (forthcoming 2017),
available at SSRN.
In his concurrence in Perez v. Mortgage Bankers, Justice Scalia reiterated his historical justification for Chevron deference (first articulated in his Mead dissent): “the rule of Chevron, if it did not comport with the [Administrative Procedure Act], at least was in conformity with the long history of judicial review of executive action, where ‘[s]tatutory ambiguities . . . were left to reasonable resolution by the Executive.’” In a must-read article forthcoming in the Yale Law Journal, Aditya Bamzai casts serious doubt on Justice Scalia’s (and many others’) understanding of Chevron’s origin story..
There is so much to like about this article, and one should really read the full article. But I’ll highlight four main takeaways. Continue reading "Chevron’s Origin Story"
Oct 4, 2016 Matt BodieWork Law
How should we apply constitutional protections to public employees? The state action doctrine exempts private employers from constitutional scrutiny. However, public employers are bound to abide by the Constitution in their exercise of power. Governments must protect the free speech and privacy rights of not only ordinary citizens but their own employees as well. The difficulties in matching up these rights with the employment relationship have long bedeviled courts. If a worker’s speech in the workplace had the same protections as a citizen’s in the square, or an office had the same protections against searches as a home, governments’ workforce management could quite easily break down. As a result, courts have increasingly turned to private sector norms to guide their application of these rights in the public sector.
In her article Market Norms and Constitutional Values in the Government Workplace, Pauline Kim critically evaluates this trend toward the “privatization” of constitutional norms. Kim argues that the Constitution is designed to provide important protections to governmental employees—protections that are justified by the differences between private and public employers. Focusing on First and Fourth Amendment protections, the article explains why speech and privacy rights are particularly important to public employees. Although Kim does not reach hard and fast doctrinal solutions, she does provide specific theoretical contributions to the literature for courts and academics to use in developing a deeper approach. Continue reading "When Big Brother Is Your Boss"
Oct 3, 2016 Kent D. SchenkelTrusts & Estates
Nancy A. McLaughlin,
Conservation Easements and the Valuation Conundrum, 19
Fla. Tax Rev. 225 (forthcoming 2016), available at
SSRN.
In this practical and timely article, Nancy McLaughlin undertakes a comprehensive analysis of the case law addressing valuation disputes of conservation and façade easements (conservation easements that are designed to maintain the historic character of a building’s façade). She reveals a number of ways in which taxpayers overvalue their easements, and uses what she finds to propose common-sense reforms.
Valuing property for purposes of determining a tax base is usually subjective and often contentious, so valuation-based taxes like the federal transfer taxes are vulnerable to valuation abuse. But property valuation also forms the basis for certain income tax deductions. Section 170(h) of the Internal Revenue Code, enacted in 1980, permits a deduction against the income tax for taxpayers who permanently contribute certain conservation or façade easements to governmental entities or charities. This provision is famously subject to abuse, and McLaughlin points out that valuation abuses have likely worsened over time, while the IRS has also become more adept at identifying abuses. According to McLaughlin’s calculations drawn from the case law, façade easement overvaluation by taxpayers in reported cases has increased from an average of about twice the court-determined value in the early cases to more than four times the court-determined value in the more recent cases. In the conservation easement category, overvaluation as determined from the case law has jumped from an average of about twice the court-determined amount to a whopping ten times over that amount in the more recent cases. Continue reading "Reducing Valuation Error"
Sep 30, 2016 Neil H. BuchananTax Law
Lisa Philipps,
Registered Savings Plans and the Making of Middle Class Canada: Toward a Performative Theory of Tax Policy, 84
Fordham L. Rev. (forthcoming 2016), available at
SSRN.
Analyses of tax policy are typically based on a familiar cost-benefit framework. There are important debates about which costs and benefits should be included (and which are measurable), but the standard formula is simple: (1) Describe the policy goal; (2) Present the costs and benefits of a policy that is meant to achieve that goal; and (3) Conclude that the policy is good or bad, depending on whether benefits exceed costs or vice versa.
In her important new article, Professor Lisa Philipps uses a Canadian tax policy debate to show that this approach is fundamentally misleading. Standard cost-benefit analysis—even if it is focused on inequality or other social outcomes— ignores the effect that adopting policies has on, as Philipps puts it, “the range of policy options considered thinkable.” (P. 102.) Tax policies can become embedded in the social system in a way that cannot be explained by standard cost-benefit analysis, and the resulting changes in social expectations can lead to self-defeating policy inertia. Continue reading "Telling the Middle Class How to Be Middle-Class: Tax Incentives for Saving"
Sep 29, 2016 Gregory KeatingTorts
In The Structure of Tort Law, Revisited: The Problem of Corporate Responsibility, Benjamin Ewing, a visiting assistant professor at Duke Law School, breaks fresh ground by stitching together contemporary tort theory and recent philosophical work on responsibility. By knitting these threads together, Ewing’s fluent, sophisticated paper shows that imputing moral responsibility to artificial legal persons is an eminently plausible enterprise. The Structure of Tort Law, Revisited shows us that it makes eminently good sense to think about corporations not merely as institutions that we may manipulate to pursue valuable social objectives, but as institutions that bring responsibility upon themselves by their actions. In doing so, the paper broadens the horizons of normative non-instrumental tort theory.
As Ewing notes at the outset of his article, “moralized accounts of tort law” seem “particularly impotent” (whereas economic approaches to tort “seem especially powerful”) in tort cases in which corporate defendants are either held vicariously liable for the torts of their employees, or are themselves held directly liable for the marketing of defective products. (P. 2.) “It is obvious that tort law may affect corporations’ incentives but it is not self-evident that tort liability can be meaningfully understood as a form of moral accountability when it is imposed upon corporate rather than human persons.” (Id.) The central insight of Professor Ewing’s paper is that a particular form of responsibility— namely, “attributive responsibility”— is fundamental to accountability in both law and morals, and that corporations are attributively accountable agents. Continue reading "Are Corporations Responsible Agents?"
Sep 28, 2016 Nicole Stelle GarnettProperty
Ronit Levine-Schnur & Gideon Parchomovsky,
Is the Government Fiscally Blind? An Empirical Examination of the Effect of the Compensation Requirement on Eminent Domain Exercises, 45
J. Legal Stud. (forthcoming 2016), available at
Penn Law: Legal Scholarship Repository Paper 1595 (Oct. 13, 2015).
This article delves into the issue of compensation, which looms large in debates about eminent domain for two reasons. The first reason is the concern that owners may be systematically undercompensated when property is taken by eminent domain because the constitutionally mandated “fair market value” measure of compensation, articulated in United States v. Miller (U.S. 1943), does not take account of subjective losses.
The second is the presumption, especially prevalent among law and economics scholars, that the compensation requirement cures the “fiscal illusion” problem (i.e., the fact that government actors presumably ignore costs that are not reflected in their budgets). According to this view, compensation ought to deter excessive takings by forcing “takers” to internalize the financial cost of their actions. This assumption is reflected in post-Kelo v. New London (U.S. 2004) state eminent domain reforms that mandate above-market compensation for certain categories of takings. It is also offered as a justification for compensating certain categories of “regulatory takings.” Continue reading "Does Compensation Deter Takings? New (and Surprising) Evidence"
Sep 27, 2016 Wendy Anne BachLexPoverty Law
Every day, across the criminal justice system, state and private actors wield discretion in making decisions: Is a girl standing before a police officer, prosecutor, child welfare official, or social worker a victim in need of protection or a perpetrator, in need of punishment? Does she need harsh correction or gentle, resource-rich protection? Is she a prostitute or is she a victim of trafficking? In (E)Racing Childhood: Examining the Racialized Construction of Childhood and Innocence in the Treatment of Sexually Exploited Minors, Priscilla Ocen presents compelling data suggesting that these discretionary decisions open a door to the exercise of implicit bias and lead to devastating outcomes, disproportionately removing Black girls from the realm of protection embodied by anti-trafficking laws and placing them squarely in the hands of the punitive mechanisms of the juvenile justice system. These facts are tremendously important but, sadly, not surprising. They only add to the wealth of information definitively establishing the disproportionate negative outcomes for Black women, men, boys, and girls in the social welfare, child welfare, criminal, and juvenile justice systems.
While the statistics are jarring, the important questions to ask are causal: Given that Black girls are disproportionately vulnerable to exploitation and disproportionately victimized, why, as a society, do we tolerate them being disproportionately punished? Why are they not, as both the data and intersectionality theory might suggest they should be, at the very center of our efforts to protect girls? Continue reading "Looking Intersectionally and Seeing Structural Bias"
