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Central Clearing the U.S. Treasury Market
No full textThis Essay considers this regulatory response. It focuses on the introduction of mandatory central clearing for most trades in U.S. Treasuries-a proposal seeking to significantly reshape the day-to-day functioning of the Treasury market.10 Central clearing is a well-established means by which to reduce the risk of loss associated when trading parties default. It does so by providing a well-resourced and informed central counterparty (CCP) to step into and stand behind trades. CCPs help promote stability by reducing the probability of, and potential losses associated with, the default of a trading counterparty. But they also impose certain costs on market participants and heighten market reliance on a small number of highly systemic institutions. We analyze this mandate, detailing its likely advantages as well as its potential trade-offs from a public policy perspective
Private Equity’s Viable Path to College Athletics Investment: Potential Entity Mechanisms and Antitrust Considerations
No full textThe recent House settlement with the National Collegiate Athletic Association was another blow to traditional collegiate governance in an age of uncertainty in college athletics. In the wake of the House settlement and other recent decisions, multiple private equity funds have shown interest in investing on a school-by-school basis or buying out dozens of teams to form a new commercialized league in select sports. Many questions remain with the viability of private investment in college athletics. Unlike traditional private equity investment, schools are 501(c)(3) nonprofit organizations typically operating within an athletic conference. This creates an additional hurdle to for-profit investing because colleges want to protect their nonprofit status. This Note theorizes an entity creation mechanism that allows schools to maintain their tax status which could be scaled for investment on a school-by-school basis or through a league formation. Further, this Note postulates that if private funds elect to form a sports league, a key consideration will be the selection of entity form to minimize potential antitrust liability. This Note analyzes the decision between a single entity structure and joint venture seen in most professional sports leagues in the United States. Based on the entity formation and antitrust considerations, the most viable option for private investment is a full buyout leading to the league operating as a joint venture with traditional sports league collective bargaining
Data Portability Revisited: Toward the Human-Centric, AI-Driven Data Ecosystems of Tomorrow
No full textThis Article critically examines the contemporary regulatory framework and discourse surrounding data portability in the United States. Using recent regulatory developments in the European Union as an illustration, this Article suggests that although data access and portability are identified as vital issues in multiple policy instruments, in its current iteration, at least, legal conceptions of portability continue to reinforce the interests of service providers and data controller enterprises rather than individual end users. This Article argues that a paradigm shift toward a more human-centric data approach to data governance must occur, under which data would be recognized as fundamental to an individual’s identity in a digital age. Therefore, it should be placed in the hands of individuals rather than service providers or data controller enterprises. This Article considers technical and market trends in the European Union that reveal and facilitate such a change. It suggests that regulatory frameworks should better align with these technological and market developments to encourage change-inducing trends among market actors. In short, this Article identifies a transformative approach to data portability that empowers individuals with the freedom and ability to aggregate their data in secure personal spaces under their control or dominion. Such a human-centric perspective on data portability is crucial in building Artificial Intelligence (AI)-powered applications for individual consumers that can pave the way for the human-centric, AI-driven data ecosystems of the future
Domestic Stability and International Trade Order
No full textThis Article challenges the theoretical frameworks through which we have so far apprehended the crisis of the liberal international trade and economic order, precipitated by relentless unilateral action--whether tariffs or industrial policy--especally in the United States. It argues that the conventional concerns about unilateralism overlook the ways in which unilateraism has been--and can be-- a foundation for international order rather than its antithesis. Our contemporary difficulty is that we typically understand unilateral action as a breach of an international norm. This way of thinking follows from nineteenth-century liberal internationalism. But a deeper tradition in the law of nations shows that unilateral action--at least when it is designed to internally reform a state-- provides a basis for meaningful participation in international order. That insight,far from being abandoned in an earier time, was central to the emergence of a post-Wor/d War II international economic order, which was based on the idea of economic cooperation between states pursuing domestic policies of full employment. Thus, unilateralism of a certain form is valuable to the international order. This Article excavates that form and the internal criteria by which we might judge a states unilateral action. It shows that unilateral action should be endorsed as laying the foundations of a cooperative international trade and economic order only when the po/icies it embodies are designed to create domestic economic stability, especially by mitigating inequality between wage labor and capital
Original Discontent
Full text linkThere are many theories of constitutional interpretation. Most, but not all, assert that, in interpreting the U.S. Constitution’s provisions, we should start by taking seriously the intentions of the enactors, meaning, roughly speaking, its drafters, defenders, and ratifiers. This Article argues that, in doing so, judges, scholars, and policymakers have underestimated an important feature of the process of constitution-making: the discontent of the enactors themselves with the Constitution they were enacting. Time and again, during the Philadelphia Convention of 1787, during the penning of the Federalist Papers, and during the state ratifying conventions, the enactors expressed deep reservations about the structure and substance of the draft Constitution. They worried it would lead to anarchy and tyranny. They worried it would enshrine injustice into the policies of the new nation. And they worried it would foment civil conflict and violence. These were not mere quibbles, the ordinary outcome of the messy process of compromise and negotiation. Their discontent went to the very foundation of the Constitution. In short, many founders believed that the Constitution they created was not, in fact, good law.
This Article argues that “original discontent”—that is, the discontent of the enactors with the Constitution they were creating—is both underestimated and essential for understanding our Constitution. Original discontent carries important implications for many of the most common methods of constitutional interpretation. For originalists, it suggests that we should take the public statements of proponents of the Constitution for what they were: more propaganda than heartfelt statement of belief. For living constitutionalists, it suggests that even if we accept that judges should interpret the Constitution as laying down broad principles subject to evolving norms and moral beliefs, we must recognize that the founders were skeptical of those basic principles. For common good constitutionalists, it provides essential context about the original understanding of the Constitution and its effects on the nature of the political communit
Reversing Perverse Incentives and Aligning Interests: A Statutory Approach to Combatting Sex Trafficking in the Hospitality Industry
Full text linkThe hospitality industry has a sex trafficking problem: Seventy-five percent of sex trafficking victims report coming into contact with a hotel at some point during their trafficking. Though hotel franchisors publicly tout their efforts to combat sex trafficking, they are not properly or adequately incentivized to intervene in a meaningful way. The majority of hotels in the United States are franchised, and for every franchised room that is rented out—whether for sex trafficking or otherwise—hotel franchisors receive royalties. Further, franchisors are motivated to dictate material consistency, like what brand of soap to use, but not safety measures, because it allows them to benefit from uniform marketing while avoiding traditional vicarious liability claims for sex trafficking at their franchisee hotels.
Hotel franchisors publicly disclose in environmental, social, and governance reports their efforts to combat human trafficking, but such reporting lacks standardization. Despite franchisors’ awareness of the prevalence of sex trafficking in the industry, when victims pursue legal action, they often find that the hotel franchisors deny awareness as to that individual plaintiff. Franchisors’ use of this “ostrich defense” has prevented sex trafficking victims from recovering damages from companies that have financially benefited from their trafficking. This Note advocates for an amendment to 18 U.S.C. § 1595, the federal statute intended to combat sex trafficking, that would require hotel franchisors to collect and publicly report indicia of sex trafficking at their properties, as well as what steps they are taking to combat sex trafficking. This would allow plaintiffs to more effectively demonstrate knowledge on the part of hotel franchisors—one of the requirements under § 1595—and in turn incentivize hotel franchisors to avoid liability by effectively intervening in sex trafficking at their franchisee hotel
Retaliation and Confrontation of the State
Full text linkPopular resistance to the weaponization of government has eroded in America. On the political Right, the post-Reagan consensus favoring limited government has given way to a new generation of leaders—like Vice President J.D. Vance and Florida Governor Ron DeSantis—who openly advocate for using state power against their political opponents. Collectively they are the New Right: a populist, antiestablishment, conservative movement opposing pluralistic systems, institutions, and cultural elites. While both political liberals and conservatives have wielded state power against their adversaries, leveraging state power to reward friends and punish enemies is fundamental to the New Right’s worldview. Following German jurist Carl Schmitt’s political theory, the New Right frames government as a tool for waging cultural and political battles. In this environment, politicians explicitly declare their intent to retaliate against critics for exercising their First Amendment rights, yet their official retaliatory actions often escape judicial scrutiny by maintaining facial neutrality. Current First Amendment retaliation doctrine, complicated by the principle set forth in United States v. O’Brien, is ill-suited to address this movement. The O’Brien principle holds that courts cannot invalidate an otherwise constitutional statute solely based on alleged improper legislative motives. This Note critiques O’Brien’s rigid framework while offering one of the first analyses of National Rifle Association of America v. Vullo, where Justice Ketanji Brown Jackson’s concurrence offered First Amendment retaliation doctrine as a possible analytical framework for the government retaliation in that case. Drawing on the factors established in Village of Arlington Heights v. Metropolitan Hosing Development Corp., this Note proposes a more holistic approach to retaliation claims that considers both government actions’ effects and officials’ statements in uncovering retaliatory intent. By reconsidering the application of O’Brien, this Note aims to safeguard free speech against the backdrop of a political environment increasingly characterized by the strategic use of state power for partisan purposes
Trouble, Trouble, Trouble: Taylor Swift, Ticketmaster, and Arbitration
Full text linkThrough Ticketmaster’s use of arbitration and the controversy surrounding Ticketmaster’s botched sale of tickets for Taylor Swift’s The Eras Tour, this Article explores problems with the broad use of arbitration in the United States. Arbitration, a private contractual method of resolving disputes in a binding manner, is a neutral process that can provide many benefits. However, under the current broad scope of arbitration law, virtually every type of claim can be arbitrated. A more limited arbitration law could provide more robust enforcement of laws, greater accountability and transparency, and stronger development of precedent within our legal system. Stronger parties (like large corporations) sometimes view arbitration as a means to suppress claims and limit liability. Thus, instead of trying to resolve disputes in good faith, stronger parties may try to disadvantage weaker parties (like individual consumers) through the drafting of unfair arbitration clauses with harsh, one-sided terms. Arbitration is supposed to be based on the consent of the parties, but in many consumer and worker transactions, meaningful, voluntary consent is often lacking. The live-ticketing industry’s use of arbitration illustrates these broader concerns with arbitration, and this Article suggests reforms and solutions to alleviate the troubled use of arbitration in the United States
Generative Al\u27s Illusory Case for Fair Use
Full text linkPointing to Authors Guild, Inc. v. Google Inc., Authors Guild, Inc. v. HathiTrust, Sega Enterprises Ltd. v. Accolade, Inc. and other leading technology-driven fair use precedents, artificial intelligence (AI) companies and those who advocate for their interests claim that mass unauthorized reproduction of books, music, photographs, visual art, news articles, and other copyrighted works to train generative AI systems is a fair use of those works. Though acknowledging that works are copied without permission for the training process, the proponents of fair use maintain that an AI machine learns only uncopyrightable information about the works during that process. Once trained, they say, the model does not incorporate or make use of the content of the training works. As such, they contend, copying for the purposes of AI training is a fair use under US law.This Article challenges the above narrative by examining generative AI training and functionality. Despite wide employment of anthropomorphic terms to describe their behavior, AI machines do not learn or reason as humans do. Instead, they employ an algorithmic process to store the works they are fed during the training process. They do not “know” anything independently of the works on which they are trained, so their output is a function of the copied materials.More specifically, large language models (LLMs) are trained by breaking textual works down into small segments, or “tokens” (typically individual words or parts of words), and converting the tokens into vectors—numerical representations of the tokens and where they appear in relation to other tokens in the text. The training works do not vanish, as suggested, but instead are encoded, token by token, into the model and relied upon to generate output. AI image generators are trained somewhat differently through a “diffusion” process in which they learn to reconstruct particular training images in conjunction with associated descriptive text. Like an LLM, however, an AI image generator relies on encoded representations of training works to generate its output
State and Regulatory Agency Approaches to Limiting Deepfakes in Political Advertising
Full text linkWith recent advancements in artificial intelligence (AI), regulators have turned their attention to the issue of how—and whether—to regulate the use of AI in political advertisements. While nineteen states have passed legislation regulating AI in political advertising, such regulations may be challenged as violations of the First Amendment. Furthermore, federal agencies also dispute which regulatory agency has jurisdiction to address the problem, with the Federal Election Commission (FEC) and the Federal Communications Commission (FCC) both claiming authority. Beyond issues of jurisdiction, agency action is also limited by the US Supreme Court’s recent decision in Loper Bright Enterprises v. Raimondo.As deepfakes in political advertisement present the clearest threat of electoral confusion and deception, lawmakers should focus on deepfakes and craft content-neutral regulations of the manner of speech that can be used in AI-generated political advertisements. Such regulations would advance the strong government interest of preventing misrepresentation and electoral confusion. These regulations should be narrowly tailored to require labeling of deepfakes, while leaving open ample channels of alternative communication. The FCC and FEC should exercise complementary roles, with the FCC focusing on deepfakes in robocalls, television, and radio, and the FEC focusing on prohibiting fraudulent misrepresentation