Monthly Archives: July 2012

The Negative Externalities of Claiming Property

Peter S. Menell & Michael J. Meurer, Notice Failure and Notice Externalities, (Boston Univ. School of Law, Public Law Research Paper No. 11-58, 2011), available at SSRN.

In Notice Failure and Notice Externalities, Peter S. Menell and Michael J. Meurer coin a new term—a “notice externality.”  In the process, they do nothing less than turn the conventional story about property rights and externalities on its head and reconceptualize many of the inefficiencies of contemporary intellectual property regimes.

The externality part of the term should be familiar by now, given the extent to which economic thinking has permeated intellectual property discourse.  An externality arises whenever one party’s conduct has consequences for other parties that are not considered—read “internalized”—by the decision maker.  In some of the classic examples, the externalities are negative: the conduct of sending pollution out a smokestack generates negative externalities for neighbors.  In other classic examples, the externalities are positive: the conduct of inventing new technologies generates benefits for all those whose lives are improved by using the technology. Continue reading "The Negative Externalities of Claiming Property"

Going Public before the IPO

Darian M. Ibrahim, The New Exit in Venture Capital, 65 Vand. L. Rev. 1 (2012).

For some employees and investors, Facebook did not make the decision to pursue an initial public offering (IPO) fast enough. So when a former employee of Facebook needed to sell some shares in the company, he approached SecondMarket, which describes itself as “the leading marketplace for alternative investments.” In 2009 Facebook shares began trading on SecondMarket and SharesPost, another leading market for shares in companies that are moving toward an IPO. These new markets – called private secondary markets – are the hottest new development in securities trading.

Although we have much to learn about private secondary markets, the first article out of the gates is well worth reading. In The New Exit in Venture Capital, Darian Ibrahim relies on interviews, trade publications, blog posts, and newspaper stories to study these emerging markets. He focuses most of his attention on the so-called “direct market,” which involves the trading of stock in startup companies, as opposed to the trading of interests in investment funds. Ibrahim aims to contribute to the still vibrant literature on venture capital investing, but his description of direct private secondary markets should have a much broader audience. Continue reading "Going Public before the IPO"

Trust as Contract? Organization? Property!

M. W. Lau, The Economic Structure of Trusts (Oxford University Press, 2011).

This fascinating book stems from the author’s Ph.D. dissertation at the University of London, supervised by Professor (now the Honorable Mr. Justice) David Hayton and Professors James Penner and Paul Matthews.

The book is a response to academic writing from the United States emphasizing the contractarian or organizational basis of trust law.1 As Dr. Lau explains, his book sets out to achieve two purposes: “The first is to introduce and defend a property-based economic account of trusts. … The second is to influence legal scholarship on and developments of trusts” (P. 17). Continue reading "Trust as Contract? Organization? Property!"

A Hug From the State: Recognizing Stillbirths

In the not too distant past, it was taboo for women (and men) to speak openly about miscarriages, infertility, or anything having to do with the delicate business of giving birth.  More recently, however, the social anxiety around these topics has receded.  Many of us now speak openly about the pain of a miscarriage or an unsuccessful round of IVF.  Indeed, some find it cathartic to broadcast their grief to a wider audience, blogging about their experiences or discussing it with friends (broadly defined) on social media.  But it is one thing to enlist friends and social media in the grieving process.  It is quite another thing to involve the state.  Or is it?

That is the question that Carol Sanger takes on in “The Birth of Death”: Stillborn Birth Certificates and the Problem for Law.  In this penetrating and thought-provoking Essay, Sanger takes on the taboo subject of stillbirth—the act of delivering a dead child—and the emergent movement that seeks to enlist law to help the parents of stillborn children deal with their grief and loss.  Specifically, Sanger considers “Missing Angel” legislation—laws that authorize the state to issue parents a birth certificate for a stillborn child.  The whole thing sounds at once macabre and incongruent—issuing a birth certificate for a child that was born dead?  But, as Sanger observes, it makes perfect sense to grieving parents, for whom the standard issue fetal death certificate fails to capture the magnitude and profundity of their loss. Continue reading "A Hug From the State: Recognizing Stillbirths"

Corporate Tax Reform in Theory and in Politics

To find out what is going on with corporate tax reform, read Martin Sullivan. Read his columns, and read his book, Corporate Tax Reform: Taxing Profits in the 21st Century . Read him because he squarely tackles the interaction of theory and politics in the area of tax policy.

Academic theories of legislative process make more sense in context. Daniel Shaviro’s analysis of the 1980’s individual base-broadening, rate-lowering reform package is a case in point.  In the area of corporate tax reform, scholars have worked with the understanding, developed for example by William Eskridge, Philip Frickey and Elizabeth Garrett, that the U.S. legislative process favors the status quo.  Against this backdrop, Jennifer Arlen and Deborah Weiss argue that agency costs further hamper reform because managers favor policies like accelerated depreciation that provide targeted incentives for new corporate investment, even though shareholders prefer policies that also enrich existing investment.  Michael Doran builds on the Arlen and Weiss analysis with a public choice account of heterogeneity of interests among different corporations.  The result, he argues, is an incentive for corporations that disproportionately benefit from a certain tax break, for example the research and development credit, to lobby energetically to keep that tax break rather than supporting more general reform proposals like base-broadening and rate-lowering. Continue reading "Corporate Tax Reform in Theory and in Politics"

The Player of Games

Daithí Mac Síthigh, Legal Games: The Regulation of Content and the Challenge of Casual Gaming, 3 J. Gaming & Virtual Worlds, no. 1 at 3-19 (2011) available at SSRN.

Mainstream coverage of gaming regulation has usually centered on the possible danger of violent games to children, usually accompanied by stills from the latest Grand Theft Auto, Call of Duty, or Mortal Kombat to instil a righteous level of outrage in the public. The underlying message in most of these stories ranges from “something must be done about this” to “ban this filth.” Thankfully, such often uninformed commentary has not been translated into legal scholarship, where the coverage has been more nuanced. With few exceptions, authors dealing with the nascent field of gaming regulation have produced a growing body of work that is both thorough and well-written. A recent addition to the group of scholars interested in games is Daithí Mac Síthigh from the University of East Anglia in the UK, and soon to join the University of Edinburgh.

In Legal Games: The Regulation of Content and the Challenge of Casual Gaming, Mac Síthigh tackles both the public perception of games regulation in the UK, and the actual practice of such regulation. He comments that most legal studies into games fall into three categories: the study of game production and development, studies into the debate on the effects of video game violence, and more rarely discussions about copyright. Mac Síthigh accurately comments that some of the higher level discussions in gaming studies, for example, the literature that studies the ludic nature of the gaming experience, has been somewhat left out of legal and regulatory commentary in general. So, Mac Síthigh’s article is in part a response against this trend. Continue reading "The Player of Games"

Is Alabama the New California? Civil Rights History through a Multiracial Lens

Recently, thousands of people participated in the forty-seventh anniversary of the historic 1965 marches from Selma to Montgomery.  Now, as in 1965, voting rights were front and center: marchers protested against the recent passage of restrictive voting laws in many states, arguing that such provisions disproportionately disenfranchise voters of color.  This was familiar ground for civil rights organizers in the South.  This year, however, there was a new theme: immigrant rights.  Those marching joined in opposition to Alabama’s H.B. 56, which targets undocumented immigrants in the state.  The tone, as recounted by Trymaine Lee for the Huffington Post, was one of solidarity: marchers commented on the shared struggle and shared aims of those of African, Asian and Latin American descent, of citizens and non-citizens.

Alabama is in a new phase of its own civil rights history, but this multiracial rights frontier itself is not new.  The deep South now grapples with issues of inter-group coalition building that were at the forefront in California more than a half-century ago.  In his impressive new book, The Color of America Has Changed: How Racial Diversity Shaped Civil Rights Reform in California, 1941-1978, Mark Brilliant demonstrates that California experienced the challenges and rewards of “multiracial civil rights making” starting in the 1940s. (p. 12.)  He chronicles the post-World War II struggles for civil rights of African Americans, Asian Americans and Mexican Americans, as they attempted to dismantle segregation and legislate antidiscrimination.  In its diverse population, California was not an outlier in the history of civil rights but rather the vanguard. Continue reading "Is Alabama the New California? Civil Rights History through a Multiracial Lens"

Mechanisms of Discrimination

Everyday Injustice is an empirical study of Latino and Latina attorneys.  The book examines the lawyers’ cultural, socioeconomic and family backgrounds: it compares and contrasts their law school experiences, socialization into the profession, career paths and ideological and professional commitments with that of their non-Latino peers; it explores the intersection of racial, class, gender and professional identities; and it documents the political leanings, activities and political values of Latino and Latina attorneys. Everyday Justice investigates shared perceptions and experiences of negative stereotyping encountered by Latino and Latina attorneys as well as their sense of marginalization and professional isolation.  It is a rich and revealing account of the professional lives of minority lawyers striving to overcome discrimination in a profession purporting to adhere to the highest standards of equality.

The book represents an important addition to the scholarship of the legal profession.  As the profession continues to struggle, notwithstanding its increased diversity, with persistent under-representation of women and minority lawyers within its elite ranks, growing scholarly attention has been given to the experiences of gender, racial and class minorities.  To date, however, insufficient attention has been paid to the experiences of the fastest growing ethnic minority group in the United States, Latinos and Latinas.  Moreover, following recent US Supreme Court decisions that have eroded affirmative action policies, placed procedural limitations on Title VII litigation, and restricted avenues for recovery, some commentators have expressed concern that the Court’s emphasis on the impact of affirmative action on African-Americans and Caucasians, its focus on intentional past discrimination and its inattention to Latinos, and implicit discrimination might cause it to prematurely strike down affirmative action policies altogether.  Exploring in great detail the professional lives of Latino lawyers, including their discriminatory experiences, Everyday Injustice is especially important and timely and provides a rich and detailed context against which the wisdom of affirmative action policies as well as other diversity measures may be evaluated on an informed basis. Continue reading "Mechanisms of Discrimination"