Showing papers in "Loyola University of Chicago Law Journal in 2013"

The Patent Litigation Explosion

Abstract: This paper provides the first look at patent litigation hazards for public firms during the 80s and 90s. Public firms face dramatically increased hazards of litigation as plaintiffs and even more rapidly increasing hazards as defendants. The increase cannot be explained by patenting rates, R&D, firm value or industry composition, leaving legal changes as the most likely explanation. Firms that spend more on R&D are more likely to be sued and firms that acquire more patents are more likely to sue. The sharp increase in the probability of being sued per R&D dollar implies an increase in the “tax” that litigation imposes on innovation. Small firms face much higher marginal enforcement costs and marginal taxes on R&D. *Research on Innovation and Boston University School of Law, and Boston University School of Law, respectively. Thanks to Iain Cockburn, Bronwyn Hall, Jay Kesan, Zorina Khan, Jenny Lanjouw, Josh Lerner, Glynn Lunney Jr., Mark Schankerman and participant in seminars at BU, NBER and Napa for helpful comments. Thanks to Annette Fratantaro, Bob Hunt, Megan MacGarvie and Rosemarie Ziedonis for sharing data. Thanks to Debbie Koker for research assistance. Contact: jbessen@bu.edu Hosted by The Berkeley Electronic Press 1 – Patent Litigation Explosion Bessen & Meurer – 2/05

A behavioral View of Investor Protection

Abstract: When, in the early 1980s, I first began to think and write about legal issues, I did so as an assistant professor of economics. I had had firstrate training in that field and felt that I was on my way to fully understanding the discipline of microeconomics. The core tool in my explanatory toolkit was rational choice theory, the theory that human beings, at least in making economic decisions (such as what to buy and how much to pay for it, how much to work and how much to play, what to save from one’s income and what to consume, and so on), know their own tastes and preferences, inform themselves about matters relevant to their preference-satisfaction (up to the point at which the cost of a little more information is just equal to the expected benefit of that information), and plan and act so as to maximize their well-being, subject to income, time, and other constraints that they face. It is a powerful theory, and its application to economic analysis has yielded important results. The application of rational choice theory to legal analysis was, in the early 1980s, revolutionizing that discipline. Someone who had command of rational choice theory could throw new light on old issues in the law, such as the real differences between the negligence and strict liability standards in tort, or provide economic efficiency justifications for seemingly mysterious legal doctrines, such as the attorney-client privilege. There was, however, a nagging small voice that kept asking how appropriate it was to use rational choice theory to examine

Behavioral Economics Applied: Loss Causation

Abstract: Current securities fraud doctrine applying section 10(b) and Rule 10b-5 set a high bar for civil damages plaintiffs who must plead and prove both loss causation and transaction causation in order to prevail. Such a strict standard is not demanded by the law, given that the purpose of the Securities Act of 1933 and Securities Exchange Act of 1934 was to provide more protection for investors than had the common law of fraud. Nonetheless, the courts, especially the Supreme Court in Dura Pharmaceuticals v. Broudo, have chosen to impose this additional requirement. This Article examines the behavioral psychology literature, much of which is traceable to the work of Nobel Prize-winner Daniel Kahneman, in order to determine whether such a strict standard is warranted as a policy matter. As it turns out, there is substantial evidence that people often make less-than-rational judgments regarding causation, can be manipulated to find causation where none exists, and mis-assign causation. This evidence argues for a high standard for proving loss causation in order to protect securities fraud defendants from unwarranted liability. Yet, there is also evidence of a psychological tendency to “blame the victim,” which suggests that perhaps it is plaintiffs who need the law’s protection.

Behavioral Economics and Investor Protection: Reasonable Investors, Efficient Markets

Abstract: The judicial view of a “reasonable investor” plays an important role in federal securities regulation. Courts express great confidence in the reasonable investor’s cognitive abilities, a view not shared by behavioral economists. Similarly, the efficient market hypothesis has exerted a powerful influence in securities regulation, although empirical evidence calls into question some of the basic assumptions underlying it. Unfortunately, to date, courts have acknowledged the discrepancy between legal theory and behavioral economics only in one situation: class certification of federal securities class actions. It is time for courts to address the gap between judicial expectations about the behavior of reasonable investors and behavioral economists’ views of investors’ cognitive shortcomings, consistent with the central purpose of federal securities regulation: protecting investors from fraud.

Daniel Kahneman's Influence on Legal Theory

Abstract: The story of Daniel Kahneman’s extraordinary influence on the legal academy begins in the 1960s and early 1970s, when the field of law and economics revolutionized legal theory. The field, as such, was launched by Ronald Coase’s The Problem of Social Cost1 and Guido Calabresi’s The Cost of Accidents,2 and it became a substantial force in the academy with the publication of the first edition of Richard Posner’s famous treatise, Economic Analysis of Law.3 The seminal insight of law and economics was very simple and straightforward, but at the same time quite powerful: like prices, laws and regulations act as incentives for behavior, and people who are subject to the law can be expected to respond to these incentives. There are a couple of important corollaries to this basic insight. One is that the law can be used to encourage socially desirable conduct and discourage socially undesirable misconduct.4 Another is that the law has important efficiency implications; that is, law creates costs as well as benefits, and it is important to consider both effects when evaluating its efficacy.5 In order to operationalize these powerful concepts, a theory concerning how exactly law will shape the behavior of the governed is necessary. For its behavioral assumptions, law and economics imported

Behavioral Science and Scienter in Class Action Securities Fraud Litigation

Abstract: INTRODUCTION Daniel Kahneman and Amos Tversky’s groundbreaking work in prospect theory and the subsequent body of related research has important implications for proof of scienter in section 10(b) cases.1 In fact, because scienter involves inquiry into cognition and perception in the context of fraud allegations, we have perhaps been remiss until now in not asking directly how this now well-established psychology research affects the way we define and infer scienter, especially recklessness, given the Private Securities Litigation Reform Act’s (PSLRA) heightened pleading standards.2 This Essay asks that pointed question, in the hopes of encouraging further debate on the topic. Part I briefly summarizes most of what others have concluded about the interplay between cognitive biases and heuristics, issuer communications, and the financial markets generally. Then, Part II describes somewhat less familiar behavioral concepts, namely System 1

Behavioral Finance before Kahneman

Abstract: Although the psychologist Daniel Kahneman has had a profound effect on economics, including the field of applied economics usually called “law and economics” (the application of economics to law), I don’t think he’s responsible for the fundamental insights into the psychology of financial markets. We owe those insights to economists, such as Frank Knight, John Maynard Keynes, Robert Shiller, and Andrei Shleifer. This is worth emphasizing lest it be thought that economists have just awakened to the complexities of human psychology and consequent limitations of the model of man as a rational maximizer of his satisfactions. The model was long criticized as presenting an unduly pessimistic picture of man as selfish, selfinterested, Darwinian. The criticism was moral. The criticism that the model is unrealistic in neglecting psychology is different and is the criticism that I focus on in this brief paper on “behavioral finance,” a term for analyzing financial behavior with due awareness of the psychological dimension of such behavior.1 The other contributors to this Conference focus on the application of behavioral finance to specific legal doctrine. I do not. It is important to distinguish between what I’ll call the micro and macro levels of finance as analyzed from a psychological perspective. By the micro level I mean the day-to-day behavior of the unsophisticated investor, who corresponds to the average consumer in nonfinancial product and service markets and whose lack of sophistication makes him prone to blunders and a prey to sharpies.2 At that level, “investors follow the advice of financial gurus, fail to diversify, actively trade stocks and churn their portfolios, sell winning

Diverging Doctrine, Converging Outcomes: Evaluating Age Discrimination Law in the United Kingdom and the United States

Abstract: This article compares age discrimination law in the United Kingdom and the United States to discern convergences, and divergences in legal doctrine, the law's normative underpinnings, and societal outcomes.

The Law is a Fractal: The Attempt to Anticipate Everything

Abstract: id=2139205d D Minoli, Combinatorial Graph Complexity, in ATTI. ACAD. NAZ. LINCEI REND. 59, 651–61 (1976). Like many seemingly fundamental ideas, legal “complexity” has no universally accepted meaning. It has been defined by some commentators to include the idea of “judgmental complexity,” which is the inability to predict how courts will rule on a question. Miller, supra note 32, at 12–13. See also Bittker, supra note 77, at 2; Surrey, supra note 35, at 693. This meaning does not fit particularly well, in the author’s opinion, with the ordinary usage of the term “complexity.” Another writer defines the complexity of a rule with reference to the cost of accessing it, which seems to come closer to the intuitive meaning, albeit indirectly. See infra note 100. 86. See Colliton, supra note 50, at 283 (“[C]ongress simply tried to clear up troublesome little problems. The solutions Congress enacted were invariably rational. These statutory solutions are only troublesome when viewed as part of the current massive and intricate Internal Revenue

A New Philosophy For Financial Stability Regulation

Abstract: The financial crisis of 2007–2008 revealed many inadequacies in the pre-crisis approach to financial stability regulation. In the United States, Congress responded by enacting the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Act calls for government agencies to make numerous rules regulating activities that have the potential to harm financial stability, but there has been no real effort to rethink how these rules should be assessed. The cost-benefit analysis standard used to evaluate financial stability regulation prior to the crisis persists today, and both the courts and Congress have sought to further entrench that standard. However, cost-benefit analysis gives too much primacy to the short-term interests of the financial industry and too little to financial stability. This Article therefore rejects strict costbenefit analysis and develops a substitute precautionary standard for assessing financial stability regulation, drawing analogies from the literature on the use of the precautionary principle in regulating complex environmental systems. A precautionary approach is more responsive than strict cost-benefit analysis to the complexity and fragility of the financial system, directing financial regulators to err on the side of caution and to prioritize the stability of the financial system over the short-term profitability of the financial sector. This Article also considers a practical framework for precautionary review of innovative financial products as a concrete illustration of how the precautionary approach might be operationalized. The key practical implication of such an approach is that it will shift the regulatory burden to the financial industry to demonstrate why regulation of a new product is unnecessary. As this Article demonstrates, this burden-shifting entails many benefits, including

Efforts to Fix a Broken System: Brown v. Plata and the Prison Overcrowding Epidemic

Abstract: Excessive incarceration is a national problem. Across the country, prisons face dangerous levels of overcrowding, which has led to unconstitutional conditions of confinement and the inability of states to effectively rehabilitate their inmates. Ardent public support of “tough on crime” policies inhibits state legislatures from enacting successful reforms. In turn, states spend large percentages of their budget to sustain failing and ineffective corrections systems. By some estimates, states could save hundreds of millions of dollars annually if they reduced prison populations through proactive reforms, such as early release programs and diversionary tactics. In light of these factors, a consideration of the U.S. Supreme Court’s decision in Brown v. Plata to uphold an unprecedented prisoner release order is both timely and necessary as the case approaches its two-year benchmark.This Note argues that the Court’s holding in Brown did not overstep the judicial boundaries imposed by the Prisoner Litigation Reform Act (PLRA), but rather was a step in the right direction toward acknowledging and remedying constitutional violations occurring in California’s severely overcrowded prison system. Moreover, the Court’s analysis of PLRA will help courts navigate the statute’s procedural requirements.While California has made progress toward complying with Brown’s prisoner release order, this seminal case sheds light on the need for proactive reform in prison systems nationwide to prevent unconstitutionally high levels of overcrowding in the first place. As states are confronted with this new “release or reform” reality, this Note will facilitate the much-needed discussion surrounding long-term solutions to the overcrowding epidemic in U.S. prisons.

Patent Law is, at Best, Not Worth Keeping

Abstract: Does patent law really promote progress and innovation? More importantly, does it benefit society in general? Does it cause a major injustice? This Essay looks at the purported benefits of patent law, examines whether they are really benefits, and then compares them with the harm that it does. Progress and innovation are not the same thing, and innovation facilitated by the patent system limits our freedoms. This Essay rebuts the arguments in favor of keeping the patent system, and ultimately concludes that patent law should be abolished. To think clearly about patent law, we must first reject the misguided tendency to lump it together with many other disparate laws under the term “intellectual property.” Those who fancy that term apply it to ten or more laws, most of which are unrelated and have little in common. U.S. copyright law does have one very general point in common with U.S. patent law—one sentence in the Constitution1—but that doesn’t apply to the rest of these laws. Notwithstanding those facts, use of the term “intellectual property” leads many to suppose that all of these laws are similar. Even law professors are led to disregard facts they know when they make generalizations using that term. For instance it is quite common to say that “intellectual property laws are meant to promote innovation,” even though copyright law and trademark law are not concerned with innovation at all.2 Patent law is concerned with innovation, but the

Composition of Innovative Activity in ICT Equipment R&D

Abstract: Has the market structure for inventive ideas in the Information and Communications Technology (“ICT”) equipment industry undergone dramatic changes in the last three decades in the United States? What does statistical evidence from U.S. patent activity suggest about change to the concentration of sources of inventive ideas? This Study characterizes levels, and changes in those levels, in the concentration of sources of new invention from 1976 to 2010. The analysis finds pervasive deconcentration across a wide set of areas. It also finds that the deconcentration takes place despite the role lateral entry by existing firms plays in driving concentration levels up. Furthermore, the evidence suggests that the deconcentration trend cannot be attributed to a single supply factor in the market for ideas, such as the breakdown of AT&T during the deregulation of the telecommunications industry.

The Mysterious Lockstep Doctrine and the Future of Judicial Federalism in Illinois

Abstract: INTRODUCTION 966 I. THE JUDICIAL FEDERALISM DEBATE 967 A. Evolution of Judicial Federalism in the United States 967 B. The Arguments in the Dependent-Independent Debate 969 II. ANALYZING THE LOCKSTEP DOCTRINE IN ILLINOIS JURISPRUDENCE 971 A. Gardner’s Hypothesized Influences over a State Court’s Decision to Accept or Reject Judicial Federalism 971 B. Does Illinois Jurisprudence Support Gardner’s Hypotheses and Observations? 974 C. Why Does Illinois Prefer a Lockstep Approach? 978 1. Theories of the Judicial Decision-making Process 978 2. Other Commonly Asserted Factors External to the Court 987 3. What Does the Illinois Supreme Court Say? 989 a. Legislative History of the Illinois Bill of Rights ........ 989 b. Major Illinois Supreme Court Cases Considering the Lockstep Doctrine Prior to Caballes 992 c. People v. Caballes 1001 III. WHERE DO THE ILLINOIS COURTS GO FROM HERE? 1003 A. Application of the “Limited Lockstep” Doctrine 1003

Patent Variation: Discerning Diversity Among Patent Functions

Abstract: This Article describes and analyzes qualitative interview data collected over a five-year period. The goal of the interviews was to explore the roles of intellectual property (“IP”) in IP rich fields. Interviews were with diverse actors in a wide-range of industries: film, book publishing, visual arts, internet commerce, biology, engineering, chemistry, computer science. The data described and analyzed in this Article focuses on the specific question about the diverse functioning of patents in the subset of interviewees who are scientists and engineers, their lawyers and business partners. The Article proceeds in two parts. Part I describes the empirical dimension of the research in more detail, highlighting the unique qualitative aspect of this research and comparing it to the more common quantitative method. Part II describes the variation across the interviews, culling from the data the diverse ways patents function beyond the doctrinally orthodox and predominantly singular explanation that patents facilitate the recuperation of research and development costs through exclusivity. The Article concludes with some thoughts on the implications of this diversity in light of the traditional and largely monolithic explanation for patent rights in the United States.

Patent Law's Disclosure Requirement

Abstract: The requirement that recipients of patents disclose information about their inventions is a fundamental attribute of patent systems. Yet, despite being a core element of patent law, the disclosure requirement is rarely thought of in those terms; rather, it is conventionally approached by first dissecting it in two ways: in terms of its doctrinal mechanisms (primarily enablement and written description) and in terms of its theoretical basis. While this dissection can be useful in understanding issues within the disclosure requirement, the resulting compartmentalization also imposes limits on this approach. This Essay approaches patent law’s disclosure requirement from a more holistic perspective, treating it as a foundational component of patent law that can be studied and analyzed as a collective whole. In doing so, this Essay brings together different perspectives on the disclosure requirement, explaining how its seemingly independent purposes are actually closely intertwined and exploring the consequences for the patent law that flow from that relationship.

What Kahneman Means for Lawyers: Some Reflections on Thinking, Fast and Slow

Abstract: INTRODUCTION As academic lawyers, we are meant to extol rational thinking. After all, one of the main purposes of law school is to enable students to “think like a lawyer,” meaning logically, rationally, and unencumbered by “emotion” or irrelevant considerations. Law and economics is similar—it is predicated upon the premise that “economic man” acts rationally and consistently. In the case of law and economics, of course, acting rationally also means acting to increase utility. But these models do not always reflect the reality of human life. Aristotle famously emphasized that man is a rational animal.1 Aristotle, however, also understood that human beings are not moved by logic alone; that different kinds of subjects are susceptible to different kinds of proof and can be known with differing degrees of certainty; that different audiences are persuaded by different kinds of arguments; and that one who wishes to persuade must be mindful, among other things, of who his audience is.2 Aristotle was interested in how people think

Could the American Psychiatric Association Cause You Headaches? The Dangersous Interaction between the DSM-5 and Employment Law

Abstract: INTRODUCTION Since its first publication in 1952, the American Psychiatric Association’s (“APA” or the “Association”) Diagnostic and Statistical Manual of Mental Disorders (“DSM” or the “Manual”)1 has long served as the primary reference for mental health disorders not only for medical practitioners, but also for state and federal courts and government agencies like the Social Security Administration and Veterans Administration. In 1994, the APA published the fourth edition of the DSM, or DSM-IV, with only minor “text revisions” in 2000. In May 2013, for the first time in nearly twenty years, the APA plans to publish an entirely new edition.2 As proposed, the DSM-5 (the Association plans to abandon using Roman numerals)3 would significantly expand a number of existing psychological disorders and add several new ones. The DSM-IV, like previous editions of the DSM, has long served as a primary authority for the legal community. The new Manual is still somewhat of an unknown, both in terms of content

The Swinging Pendulum of Equity: How History and Custom Shaped the Development of the Receivership Statute in Illinois

Abstract: INTRODUCTION 1020 I. THE ORIGINS OF THE COURTS OF CHANCERY 1024 A. Anglo-Saxon Influence on the Common Law 1024 B. Norman Influence on English Law 1029 C. The Development of Chancery in England 1030 D. The Establishment of Chancery in America 1033 II. THE DEVELOPMENT OF MORTGAGE LAW AND THE RIGHT TO REDEEM 1035 A. The Theory of Redemption in England 1035 B. The Right to Redeem in Illinois 1040 C. Three Theories of Mortgage Law in Illinois 1041 III. DEVELOPMENT OF RECEIVERSHIPS 1043 A. Origins of Receivers in England 1044 B. Receiverships in Illinois 1044 1. Early Chancery Decisions 1045 2. Changes in the Early Twentieth Century 1048 C. Creating the Receivership Provision in the Illinois Mortgage Foreclosure Statute 1048 IV. MODERN DAY RECEIVERS IN ILLINOIS 1050 A. General Overview 1050 B. The Benefit of Appointing a Receiver 1050 C. The Basis for Appointing a Receiver 1051

Antitrust Law and Economic Theory: Finding a Balance

Abstract: Over the past forty years, the federal courts have relied more and more on economic theory to inform their antitrust analyses. Economic theory has indeed provided guidance with respect to antitrust issues and assisted the courts in reaching rational outcomes. At the same time, infusion of economic evidence into antitrust cases has made these cases more complex, lengthier, more expensive to litigate, and less predictable. This Article argues that courts need to restore the balance between facts and economic theory in undertaking antitrust analysis. The problem is not that judges and juries cannot reach good outcomes in antitrust cases, but rather that courts have become too reliant on economic theory in deciding them. Just as courts of an earlier generation became too enamored of per se rules in antitrust cases, some courts today have become too enamored of economic theory in addressing and resolving antitrust issues. Some courts have lost sight of basic antitrust goals and have gotten bogged down in arcane economic tests—relevant market and proof of common impact in class action cases are two examples—which have become obstacles to, instead of tools for, resolution of antitrust disputes. Antitrust is a body of law enacted by Congress and construed by the courts; it is not a compendium of the latest thinking in economic theory. The role of the courts is not to decree economic policy, but rather to implement antitrust policies enacted by Congress. Antitrust has always been a fact-specific enterprise, and courts need to restore the proper balance

The Virtue in Bankruptcy

Abstract: In response to a gap in the corporate bankruptcy literature, this Article offers a new positive theory of corporate bankruptcy law based on virtue ethics. The dominant theory of corporate bankruptcy law—the creditors’ bargain model—is necessarily incomplete because it does not account for bankruptcy courts’ equitable and discretionary powers, or for bankruptcy courts’ need to consider decision-making criteria other than economic efficiency. By contrast, virtue ethics offers insights about these features of corporate bankruptcy law for at least three reasons. First, bankruptcy courts appear to give content to bankruptcy laws by using virtue ethical principles. Second, virtue ethics’ decisionmaking process—practical wisdom—provides insights into how bankruptcy judges balance concerns about efficiency, justice, and fairness when reaching decisions. This is particularly true when the bankruptcy court’s equitable jurisdiction or discretionary powers are implicated. Third, virtue ethics’ symbiotic consideration of means and ends parallels the process bankruptcy judges are called on to use when exercising their discretionary or equitable powers under numerous provisions of the Bankruptcy Code.

Regretting Roth ? Why and How the Supreme Court Could Deprive Tenured Public Teachers of Due Process Rights in Employment

Abstract: INTRODUCTION 593 I. PREVAILING LAW: THE ROTH/PERRY APPROACH 595 A. Before Roth and Perry 595 B. Setting the Standard: Board of Regents of State Colleges v. Roth 596 C. Elaborating the Standard: Perry v. Sindermann 597 D. “Discretion Formulation” of the Roth/Perry Approach 598 II. REGRET AND RETRENCHMENT 599 A. Seeds of Regret: Dissatisfaction with Roth/Perry in Due Process Cases 600 1. Sandin v. Conner 600 2. Town of Castle Rock v. Gonzales 602 B. Signs of Retrenchment: Restricting Public Employees’ Constitutional Rights 605 1. Speech: Garcetti v. Ceballos 605 2. Equal Protection: Engquist v. Oregon Department of Agriculture 606 3. Implications: Common Trend, Separate Traditions 608 III. SELECT STATE PERFORMANCE-BASED PUBLIC TEACHER EMPLOYMENT STATUTES 610 A. Illinois 610 B. Michigan 612

The Dangers of Missing the Forest: The Harm Caused by VeriFone Holdings in a Tellabs World

Abstract: INTRODUCTION “A complaint [alleging securities fraud] adequately pleads scienter under the PSLRA [(“Private Securities Litigation Reform Act”)] only if a reasonable person would deem the inference of scienter cogent and at least as compelling as any opposing inference one could draw from the facts alleged.”1 The Supreme Court’s decision in Tellabs, Inc. v. Makor Issues & Rights, Ltd. (“Tellabs”)2 definitively set the standard for evaluating allegations of scienter in securities fraud class action

Am I My Brother’s Keeper? A Tax Law Perspective on the Challenge of Balancing Gatekeeping Obligations and Zealous Advocacy in the Legal Profession

Abstract: In recent years the question of whether lawyers have a general ethical obligation to serve a gatekeeping function has been raised in a number of legal contexts. The reaction of the practicing bar generally has been unenthusiastic. While asserting that a gatekeeping function should be generally applicable to all attorneys is a relatively recent stance, such an obligation historically has been acknowledged to various degrees in several specific practice areas, including particularly in the field of federal income taxation. This piece examines the gatekeeping question, and how the practicing bar should react to it, through an examination of the gatekeeping role historically asserted as applicable to tax lawyers, including how modern pressures (e.g., literalist statutory interpretation, profit maximization law firm models, changing business and societal ethical norms, etc.) have altered that historically asserted ethical norm. The article then suggests avenues for combating these modern trends in the tax arena in order to strengthen and reestablish the historic balance in a tax lawyer’s planning role (e.g., by creating intentional conflicts of interest to create a “divide and conquer” dynamic between clients and attorneys in aggressive transactions, emphasizing the ethical training of tax attorneys, clarifying the proper approach for statutory interpretation in the tax context, creating disincentives for a legal race to the bottom among attorneys competing for business, highlighting the importance of individual trend setters, channeling the competitive pressures in the legal marketplace in the government’s favor, etc.). The piece concludes with some closing thoughts regarding the lessons that the practicing bar might take from the tax gatekeeping example in their future reactions to gatekeeping initiatives in other areas of the law and accepting gatekeeping as a generally applicable ethical norm. * Professor, University of Akron School of Law; Dartmouth College, A.B.; Cornell University, J.D.; New York University, LL.M. (Taxation). I appreciate the helpful comments of the members of the Law, Society, and Taxation Collaborative Research Network on an earlier draft of this article. AM I MY BROTHER’S KEEPER? A TAX LAW PERSPECTIVE ON THE CHALLENGE OF BALANCING GATEKEEPING OBLIGATIONS AND ZEALOUS ADVOCACY IN THE LEGAL PROFESSION

Catholic Moral Teaching and Natural Law: Changing the Way We Think About and Teach Professional Legal Ethics

Abstract: Lawyers have had a hand in virtually every financial scandal in recent news. These lawyers are hired to advise clients about how to structure hedge funds, financial products, and financial transactions. Because global economies are becoming more interconnected, when large and risky financial transactions fail, they shake the stability of markets around the world. The “hired gun” mentality is prevalent throughout the legal profession. In this mindset, lawyers believe that because they are engaged by a client, they must do their client’s bidding, and must be singularly focused on their client’s sole interests. Can we do anything to encourage lawyers to consider not only the interests of their individual clients, but also the ramifications of their actions on the common good? A lawyer’s conduct is deemed “unethical” if it fails to meet standards set forth in the professional ethics rules of the states in which they practice. If the bar association of any state wants to deter additional forms of conduct, the mechanism in place today would require the enactment of higher statutory standards. Our society and our profession should demand more than the present overly narrow focus on the individual good of the client, especially where such focus has serious negative repercussions on the good of society. We should demand that lawyers act not only as competent legal professionals, but also as good citizens and morally upright human beings. On this score, our Catholic moral tradition—which teaches that human flourishing comes through the development of good moral

Over the Borderline--A Review of Margaret Price's Mad at School: Rhetorics of Mental Disability and Academic Life

Abstract: This Article is about “madness” in higher education. In Mad at School: Rhetorics of Mental Disability and Academic Life, Professor Margaret Price analyzes the rhetoric and discourse surrounding mental disabilities in academia. In this Article, I place Price’s work in a legal context, discussing why the Americans with Disabilities Act fails those with mental illness and why reform is needed to protect them. My own narrative as a law professor with Borderline Personality Disorder frames my critique. Narratives of mental illness are important because they help connect those who are often stigmatized and isolated due to mental illness and provide a framework for them to overcome barriers limiting their equal participation in academic life.

Conjoining "Recklessness" in Securities Fraud Cases to Moral Culpability

Abstract: First, I would like to express my thanks for being invited to speak at this Conference on “Behavior Economics and State of Mind: Pleading and Proving Scienter in Securities Fraud Cases.” I am delighted to be part of the Conference, not least because it is at Loyola University Chicago. My wife is from Chicago, I love my wife, and therefore I love Chicago. I believe that is what Daniel Kahneman would call “System 1 Thinking.”1 I want to express a little bit of skepticism, with apologies, to much of what was presented at the Conference today (all of which was extremely interesting) about the role of behavioral economics in law. First, I think that the sciences—social sciences, neurosciences, and behavioral sciences—that are being cited are not as strong as they are sometimes assumed to be and, even where they are strong, do not necessarily provide implications for the legal system.2 As Arthur Leff once said, law and economics may be “elegant, attractive, and useful,” but it is “ultimately doomed” as an “attempt to present a total picture.”3 Or as Grant Gilmore claims, “So far as we have been able to learn, there are

Rewiring the DNA of Securities Fraud Litigation: Amgen's Missed Opportunity

Abstract: INTRODUCTION American judges and policymakers are of two minds when it comes to securities fraud litigation. On the one hand, private class action lawsuits to enforce the anti-fraud provisions of the federal securities laws are viewed as a necessary supplement to limited governmental resources in an era of ever-increasing complexity in the financial industry.1 On the other hand, securities litigation is viewed as parasitic,2 ineffective at compensating those who have actually suffered harm,3 and as a cumbersome and expensive tax on publicly traded companies levied by powerful (but not always publicly minded) plaintiff’s’ securities firms.4 Which of these views is right? The unsurprising answer is likely both, to a degree. The clear consequences of our schizophrenic view of securities litigation can be found both in legislation and case law. On