Showing papers in "Buffalo Law Review in 2006"

Pricing Death: Analyzing the Secondary Market for Life Insurance Policies and Its Regulatory Environment

Abstract: † Editor-in-Chief, Buffalo Law Review, 2005-2006; JD/MBA Candidate, State University of New York at Buffalo, 2006; BS, Industrial Engineering, State University of New York at Buffalo, 2002. I would like to thank Ronald J. Yoviene, ChFC and Maurice L. Naylon III, ChFC, CLU both of The Financial Architects (http://www.financialarchitects-usa.com) for their tremendous assistance while writing this Comment, Professor David Westbrook for his guidance and comments on an earlier draft, and the staff of the Buffalo Law Review for their editorial assistance. Any errors, however, are my own. I would also like to thank my family and Pooja Gulati for their incredible support in all of my endeavors. © 2006 by Sachin Kohli.

Can Direct Democracy Be Made Deliberative

Abstract: Every election cycle a great number of citizens take to the polls to vote on public policy matters directly. Direct democracy has problems. And an account of deliberative democracy — far from being a source to critique direct democracy — might provide a solution. I have three goals in this short Essay. First, I hope to identify some problems with the mechanisms of direct democracy that most states and many cities throughout the country employ: the initiative and the referendum. Next, I will offer a potential solution to these institutional problems using aspects of the theory of deliberative democracy, a theory often marshaled to undermine direct democracy. Finally, I will spell out why this design project should be of especial interest to lawyers.

Fast, Cheap, and Creditor Controlled: Is Corporate Reorganization Failing?

Abstract: Academic support for American-style corporate reorganization has been at an all-time high, or, at least, calls for the repeal of chapter 11 have been at an all-time low. Critics of chapter 11 now say, approvingly, that the process has become faster, cheaper, more creditor-controlled, and more integrated with market forces. World-renowned economists have looked to modern chapter 11 as the foundation of proposals to improve sovereign debt restructuring internationally. Endorsement of the modern chapter 11 is by no means universal, however. In Courting Failure: How The Competition for Big Cases is Corrupting the Bankruptcy Courts, Professor Lynn LoPucki, a well known academic with deep expertise in bankruptcy, portrays the bankruptcy system in a state of crisis. In this book, we learn that nearly half of the largest firms emerging from chapter 11 as publicly held companies are filing another bankruptcy petition in just a few years. LoPucki attributes the high repeat filing rate to the judges who compete for cases by appeasing case placers, the parties who guide a firm's decision regarding venue selection. A high repeat filing rate first afflicted two magnet venues, the District of Delaware and the Southern District of New York, then spread nationwide as other judges have tried to attract cases to their own courts. Courting Failure's policy prescription is to eliminate inter-venue competition by restricting firms' venue choice. Since the release of Courting Failure, LoPucki has convinced a prominent Senator to introduce legislation accomplishing exactly that. Courting Failure is rich with systematic empirical data, anecdotes, law, theories, allegations, and controversies, as would be expected from a researcher who has made critical contributions to our understanding of corporate reorganization for over two decades. Plenty of academics, lawyers, and judges are examining myriad aspects of Courting Failure, including whether LoPucki oversteps by characterizing the bankruptcy system as corrupted, whether a significant repeat filing is per se undesirable, whether LoPucki uses the ideal parameters to measure repeat filings and failure in bankruptcy, and how all of this affects the international market for judicial services. By contrast, I highlight other aspects of Courting Failure's ambitious thesis that ultimately cannot be sustained. First, Courting Failure cannot tell us enough about the pathways through which competition contributes to failed reorganizations for us to rely on the competition thesis to fuel policy change. Courting Failure's repeat filing data and his examples of competitive practices do not match up temporally or substantively, particularly with respect to the striking increase in repeat filings among firms emerging in 1997 and thereafter. Second, Courting Failure implicitly relies on an account of the drivers of court practices that does not square with the growing body of theoretical and empirical interdisciplinary research on the determinants of judicial politics and behavior. Others in the legal academy share LoPucki's assumption of judicial competition for large bankruptcy cases, although they have different views of its merits. Even if some judges do compete for large bankruptcy cases, however, the broader literature casts doubt that competition or the lack thereof is the dominant shaper of judicial practices in the way that Courting Failure suggests. In particular, Courting Failure takes insufficient account of the rise of the transactional model of chapter 11 and how the increasing recognition of this model might affect the evolution of judges' practices.

The Substantive Politics of Formal Corporate Power

Abstract: Corporations increasingly dominate the U.S. civil justice system, as Marc Galanter explains in his recent article, Planet of the APs: Reflections on the Scale of Law and its Users, 53 Buffalo L. Rev. 1369 (2006). My article builds on Galanter's discussion of corporate legal power by subjecting it to a critical legal perspective. In the conventional legal framework, corporations' privileged position appears to be an intractable puzzle, not an urgent injustice. That is because corporate power seems to be the generally necessary byproduct of a generally benign form (large, complex, legalistic organizations) or of generally benign, widely-shared normative principles (economic efficiency or proceduralism). Critical analysis, in contrast, opens the door to substantive change by exploring how substantive political conflict and subordination permeates and supports particular dilemmas of form and formal principle. This article explores the particular substance of the contemporary U.S. corporation not as the natural and necessary modernization of economics and law but as a contingent result of political conflict - and more specifically and substantively, as the result of class and caste hierarchy. The article traces how this substantive politics of class and caste became institutionalized as seemingly neutral corporate form in the nineteenth century, and also became constitutionalized through Supreme Court decisions affording corporations increasing protections from democratic process. The article argues that the Supreme Court's recent decision in State Farm Mutual Automobile Ins. Co. v. Campbell further constitutionalizes class hierarchy through a revived substantive economic due process doctrine that has implications beyond the narrow question of punitive damages at issue in the case. Inverting the reasoning of Carolene Products footnote four, the Court construed large corporations as persons deserving special protection from substantive political and legal accountability, despite - or perhaps because of - corporations' particular power to subvert the political and legal process in the interest of the most privileged. The article concludes by explaining that progressive reforms should aim not to supplement the corporate form (or judicial formalism) with more moral and social substance, but instead to challenge and change both the particular substantive values and the technical institutional forms that structure the corporate-centered U.S. legal and economic system.

The Iraq Paradox: Minority and Group Rights in a Viable Constitution

Abstract: On October 15, 2005 an Iraq ravaged by a civil war spawned by the 2003 American invasion and subsequent occupation voted to decide the fate of a permanent constitution for the country. Although many Sunni Arabs took part in the vote, the referendum lost in the three governorates where they form a majority. But the constitution was approved because opponents only succeeded in recording "no" votes larger than two-thirds in only two of Iraq's eighteen provinces, in effect one province short of a veto. A two-thirds rejection in three provinces would have doomed the charter and the transition to a regime more autonomous of the American occupation forces. However, Iraq teeters on collapse months after the referendum, national elections, and the formation of a so-called national government. Only a popularly legitimate accommodation of minority and group rights in a democratic constitutional framework, a virtually impossible challenge, can avert the disintegration of Iraq. The legislature, which is dominated by the Shia, ought to step back from the temptation of a theocracy, and instead look to equal protection and anti-discrimination norms for minorities as it constructs a lasting constitutional framework. Otherwise, the failure to address the question of minority and group rights will result in the disintegration of Iraq.

European Implications of Bankruptcy Venue Shopping in the U.S.

Abstract: For decades, the U.S . debate over states' efforts to attract corporations-and over Delaware's success in that endeavor-was mostly a sideshow for European companies and scholars. To be sure, there have long been worries that charter competition might emerge in the European Union and generate a regulatory \"race to the bottom.\"l But the \"real seat\" doctrine, which assured that the country where a corporation's principal operations are located would supply its corporate law, was strongly entrenched. Whereas U.8. companies that would prefer a different regulatory framework need only reincorporate in the jurisdiction they wish to be governed by, European companies were stuck with the laws of the country where most of their operations were located . As a result , European companies did not have a dog in the U .S . skirmishes over charter competition in corporate law and venue shopping in corporate bankruptcy .2