Archive for May, 2012

May 23, 2012

Sovern on Disclosure in Consumer Credit Regulation

On Saturday, May 19, Professor Jeff Sovern spoke at a conference at the University of Houston Law Center entitled “Teaching Consumer Law in an Evolving Economy.” Jeff participated in a panel focused on substance and disclosure in consumer debt. You can find the conference brochure here.

May 23, 2012

Honors for Professors Parella and Baynes

For the details, visit the Dean’s Docket (here). Congratulations to Bob and Len.

May 23, 2012

DeGirolami Discusses Legal Challeneges to Birth-Control Mandate

In the Healthwatch column of The Hill, Marc DeGirolami assesses legal challenges brought under the Religious Freedom Restoration Act to the White House’s birth-control mandate. Marc thinks “the odds are pretty good for the plaintiffs .” You can find the full article here.

May 18, 2012

Perino Provides Historical Perspective on JP Morgan Scandal

Bloomberg’s James Pressley interviewed me about my book, The Hellhound of Wall Street, financial reform in the wake of scandals, and what the recently disclosed JP Morgan $2 billion trading loss might mean for the Volcker Rule. You can find the interview here.

May 15, 2012

Now in Print: Mary Lyndon on Trade Secrets

Mary Lyndon has recently written a chapter in a book called The Law And Theory Of Trade Secrecy: A Handbook of Contemporary Research. You can find more information on the book here. Mary’s chapter (you can find a version here) is “Trade Secrets and Information Access in Environmental Law.” Here is the abstract:

Exposure to chemical risks is widespread, as trillions of pounds of chemical substances are released annually. Only a small number have been well characterized for potential toxicity, though many are thought to pose health risks. Secrecy is pervasive in chemicals regulation, in part because agencies have deferred to claims that chemical ingredients are covered by the law of trade secrecy. The resulting deficit of data impedes health and ecological research, distorts market responses and suppresses innovation incentives. This chapter argues that secrecy is out of place in environmental regulation: information that describes environmental externalities is not “trade” or “commercial or financial” information within the meaning of trade secret law and discharging pollutants without sufficient research abandons secrecy entitlements that might otherwise attach. Property law does not legitimate harming third parties or avoiding duties to them; also, secrecy reverses the appropriate relationship between property and resources by hiding social costs and blocking efficient allocation. The better rule would be “no secret exposures,” giving firms the choice to avoid exposures, invest in research to prove that their products are reasonably safe, or resort to the patent system or other legitimate strategies.

May 15, 2012

Sovern on Subprime Borrowers

Jeff Sovern has an op-ed in the Pittsburgh Post-Gazette entitled “Subprime Borrowers Need More Protection. You can find the piece here. In it, Jeff advocates for the use of financial counselors to aid borrowers who have difficulty understanding the terms of the loans they are being offered.

May 9, 2012

Now in Print: Perino on Institutional Investors in Securities Class Actions

My article, “Institutional Activism Through Litigation: An Empirical Analysis of Public Pension Fund Participation in Securities Class Actions,” has just been published in the Journal of Empirical Legal Studies. JELS was recently ranked as one of the top ten peer-reviewed law journals in the country. Here is the article abstract:

The PSLRA’s lead plaintiff provision enlisted institutional investors to monitor class counsel in order to curb the agency costs endemic in securities class actions. This paper uses a sample of 731 settlements to examine the efficacy of this provision. It finds that, even when controlling for institutional self-selection of potentially easier or higher quality cases, cases with public pension lead plaintiffs have larger recoveries and lower fee requests and fee awards than cases with other lead plaintiff types. The paper also finds evidence consistent with the existence of a significant positive externality associated with public pension participation. Over time, fee requests and fee awards have on average declined significantly even in cases without such lead plaintiffs. These findings suggest that public pensions act as more effective monitors of class counsel than traditional plaintiffs and that the lead plaintiff provision has substantially reduced the transactions costs associated with securities class actions.

Access to JELS requires a subscription, but you can find a version of the article here.

May 4, 2012

Sheff on New York’s New Pro Bono Rules

Over at PrawfsBlawg, Jeremy Sheff raises important concerns about the pro bono requirements that New York will begin imposing on budding lawyers. Here is the relevant part of the post:

Chief Judge Jonathan Lippman of the New York Court of Appeals has just announced that all candidates for admission to the Bar of the State of New York will soon be required to prove that they have performed at least 50 hours of law-related pro bono service prior to being admitted. I’m a firm believer in the value of pro bono service, and did quite a bit of pro bono work in my past life as an associate at Cravath. And as Jason Mazzone notes over at Balkinization, all these person-hours could well produce some serious social good. But this new rule strikes me as seriously problematic, particularly in light of the challenges facing legal education and the prevailing economic climate, both of which are the topic of so much current discussion and angst.

The current recession has not been kind to the young, particularly those without a broad support network. The deck is stacked against them in a contractionary economy, both because they haven’t yet had the chance to acquire sufficient resources to see them through hard times, and because in periods of scarcity (like the current one), those who do have such resources guard them ever more jealously, making it difficult for those just starting out to get on their feet. Chief Judge Lippman’s proposal notably declines to impose pro bono requirements on current members of the bar on grounds that it would not be “workable,” in part because there are “lawyers who can’t make a living on what they are doing now.” This special pleading seems to be of a piece with the current trend of muddling through hard times by demanding more sacrifice from those who have less, while failing to make comparable demands of otherwise similarly situated people who are fortunate enough–often due to nothing more than the historical accident of having been born at the right time–to have more.

As my former colleague Brian Tamanaha and others have argued at length, law school is an increasingly bad deal for many students. The looming spectre of unmanageable debt and the fierce competition for legal employment have created all sorts of opportunities for incumbents in the legal profession to take advantage of those who seek to enter the profession as a means to a better life. I’m sure I’m not alone in having been somewhat concerned at the contortions that law schools and legal employers alike are willing to go through to steer a course between the ABA’s Standard 305 (governing externships) and the recently reinvigorated enforcement of the Fair Labor Standards Act. Even federal judges and US Attorneys Offices appear to be hungry for free labor from those who are desperate to get a foot on the ladder to a successful legal career. The fact that we incumbents are increasingly demanding these types of sacrifices of those who seek to climb up the ladder behind us strikes me as at best uncharitable and at worst venal. Certainly it strikes me as inconsistent with the values underlying a commitment to pro bono service. If the stewards of the legal profession really think pro bono service is important enough to be made mandatory–and I’m not opposed to that idea–then we should be mandating it across the board, not singling out already disadvantaged new entrants for treatment we don’t have the stomach to impose on ourselves.

An editorial in the New York Times the other day took a more charitable view of the requirement, arguing that the rule would give soon-to-be lawyers “some degree of real-world experience” and would “foster a stronger culture of public service in the legal profession, while providing more assistance for the many hundreds of thousands of people without lawyers in the state’s civil court system.” Even the Times recognized that:

This initiative, however, is no substitute for more federal and state support of legal aid for the poor, or for other moves, like expanding law school loan-forgiveness programs to help graduates who work in legal services offices. Still, requiring new lawyers to demonstrate their commitment to the profession’s ideals of service is a worthy step in the right direction.

I am somewhat dubious about how much practical experience this requirement will really give law students and I wonder about the culture we are creating when, as Jeremy notes, we create a two-tier system where only those not yet admitted to the bar are obligated to perform such services. I also worry that the Times is too optimistic when it suggests that this is only the first step. Won’t the same political pressures that yielded this compromise apply equally to any attempts to extend it?

What do you think about these new obligations? Feel free to add your comments below to weigh in on this important debate.

May 3, 2012

McGuinness Analyzes Strauss-Kahn Opinion

Over at Opinio Juris, Margaret (Peggy) McGuinness provides a brief analysis of the Bronx Supreme Court opinion finding that Dominique Strauss-Kahn was not protected by diplomatic immunity.

May 3, 2012

Now in Print: Cavanagh on Twombly and Litigation Culture

Edward (Ned) Cavanagh has two new articles in print. The latest issue of Litigation (the journal of the Litigation Section of the American Bar Association) features Ned’s take on the U.S. Supreme Court’s recent civil pleading decisions. Entitled “Twombly’s Seismic Disturbances,” the article concludes that the decisions in Bell Atlantic Corp. v. Twombly and Ashcroft v. Iqbal, continue “an unfortunate trend in the case law pushing the process of outcome determination to an ever-earlier point on the litigation time line.” There is no online version of the article.

Ned’s second article is called “Rulemaking, Litigation Culture and Reform in Federal Courts” and appears in the American Journal of Trial Advocacy. Here is the abstract:

Culturally based litigation practices are central to the policies of federal courts.  Unlike the Federal Rules of Civil Procedure, cultural based practices are neither uniform nor explicitly defined among the federal courts.  These practices are specifically tailored to ensure judicial efficiency, and in turn, they heavily influence practice and procedure in federal courts.  This Article examines the significance of cultural litigation practices and their influence on amending or establishing new Federal Rules of Civil Procedure.  The author proposes that rulemaking must complement cultural practices in order to be successful and concludes that when conflict exists between these practices and rulemaking, cultural practices will ultimately establish standards for the conduct of litigation in the federal courts.

The article is not yet available online.

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