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A Case for Further Environmental Protections of Endangered Animals’ Habitats and a Limitation of State Agency Power
No full textThe Merging of Ownership and Control
No full textWhat if shareholders controlled every decision their company makes? This seemingly simple idea threatens to upend the modern corporation.
Shareholders own the corporation and directors and officers manage the corporation—a “separation of ownership and control” that has become a defining characteristic of our modern economy. As per conventional wisdom, the law enables separation of ownership and control by not prohibiting owners and employees from exercising their contractual freedom to hire and work for one another.
This Article demonstrates that this widely held view is incomplete and detrimental to the economy. Much of the economic activity that utilizes the corporate form has relied on a legal mandate, rather than permission, to establish the separation between ownership and control.
While ordinary employer-employee contracts, such as an agreement between a store owner and store clerk, rely on the parties’ ability to contract for and alter fiduciary arrangements on an ongoing basis, many shareholders pool their money together to hire directors for the exact opposite reason. They rely on the mandatory separation of ownership and control in order to effectively combine their assets under the direction of a fiduciary who answers only to the firm, and not any individual investor. Absent the ability to rely on a legally mandated independent director, such shareholders would not be able to coordinate and combine their assets. The shareholders’ various competing interests and rights would be too conflicting and complex to organize contractually.
Yet, an amendment signed into law in July 2024 is set to unravel this economically essential legal mechanism—it promises to merge ownership and control. This legislation was able to pass at least partly because extant scholarship lacks a theory to explain why a mandatory separation of ownership and control is an indispensable mechanism. This Article fills this gap and calls for the repeal of this watershed amendment
Transforming Constitutional Doctrine Through Mandatory Appeals from Three-Judge District Courts: The Warren and Burger Courts and Their Contemporary Lessons
No full textJudicial interpretations of the Equal Protection and Due Process Clauses of the Fourteenth Amendment underwent significant change, both expanding and retrenching in various ways, in Supreme Court doctrine during the Warren and Burger Courts. An underappreciated influence on the change is the method by which those cases reached the Court’s docket. A significant number of the cases reached the Court’s docket not by discretionary grants of writs of certiorari, as occurred in most other cases, but by mandatory appeals directly from three-judge district courts. This article makes several contributions regarding the important changes in these doctrines during the Warren Court (1954-1969) and the early Burger Court (1969-1976), before Congress in 1976 limited the scope of three-judge courts and the concomitant mandatory appeals. It documents the number of such cases during the time periods in question; addresses the quantitative and qualitative changes in Equal Protection and Due Process (and other) doctrines influenced, at least in part, by the availability of mandatory appeals; and normatively addresses the propriety of this influence in light of the renewed interest in reestablishing at least some mandatory appeals in current proposals to “reform” the Supreme Court
A Neo-Federalist View of the Supreme Court’s Docket: Analyzing Case Selection and Ideological Alignment
No full textFor more than 70 years, scholars have engaged in an intense debate over a core constitutional question: what restraints does the Constitution place on Congress’s power to limit the jurisdiction of the federal courts? Far less attention has been given to an equally important real-life question: how does the operation of the jurisdiction, as defined by Congress and the Supreme Court, comport with the assigned role of the federal courts in the system of government established by the Constitution? This Article takes a novel approach: it draws on constitutional theory to devise a set of tools for addressing the operational question empirically. The theory derives initially from Professor Akhil Reed Amar’s landmark article focused on the constitutional debate. In that article, Amar developed and defended a “neo-Federalist view” of Article III. This view emphasizes “the Federalists’ reliance on federal judges” to enforce federal law and “the critical role of judicial review in Federalist theory.” The present Article builds on Amar’s insights as well as my own empirical studies to offer a neo-Federalist view of the Supreme Court’s docket. It also takes account of two key developments that have occurred since the Founding. A century ago, Congress enacted the “Judges’ Bill”; in its aftermath, as Robert Post has written, the Supreme Court took on a new role as “the proactive manager of the system of federal law.” More recently, the Court has come to be viewed from a perspective that is centered on ideology. There is a narrative, and it is framed as a conflict between “liberal” and “conservative” positions. The purpose of the Article is to provide a set of analytical tools for analyzing the Court’s work from both neo-Federalist and post-Founding perspectives. To that end, it outlines an objective, transparent case classification system for empirical research focused on both input (the selection of cases for plenary consideration) and output (the outcomes of the resulting decisions). Such research can show how the Court has carried out its managerial function and thus enable us to reach sound conclusions about current or future proposals for reform – for example, adding new categories of cases to the Court’s mandatory jurisdiction. And the system is uniquely well designed to map the ideological divide in the federal courts today. That is because, in broad terms, what defines that divide is that both liberals and conservatives embrace a strong commitment to judicial review to protect individuals against government overreaching, but they disagree profoundly over where and how that power should be deployed. An important contribution of the Article is the distinction it draws between issue polarity – for example, did the court rule in favor of the constitutional claim or against it? – and ideological direction. Only by recognizing and applying that distinction, the Article argues, can one fully understand the shifts in ideological alignment over time – or the contours of the ideological divide today
Judicial Review of Settlements Under the Class Action Fairness Act and Deference Due to the Department of Justice and State Attorneys General
No full textThe Class Action Fairness Act of 2005 (CAFA) made it easier to remove consumer class actions from state to federal court, and among other things regulates the procedure of federal court approval of settlements of those cases. CAFA requires that before any court approval or disapproval, the parties must notify the Attorney General of the United States, and the attorneys general of states where members of the class live, of the pending settlement in order to receive any objections or other input. While such notice is frequently sent, since most class action cases settle out of court, it appears that the U.S. AG and state AGs rarely formally object to proposed settlements. Perhaps not surprisingly, the provision has been the subject of little commentary and analysis.
This Article fills that gap by focusing on how state AGs process and evaluate such notices under CAFA, using as a case study over ten years’ worth of unpublished data obtained from the Ohio Attorney General, regarding the Ohio AG’s review of thousands of CAFA settlement notices. The Article also addresses whether states should also be permitted to intervene as parties in CAFA suits, and the legal and policy issues regarding how much weight or deference a federal court should give to objections or input (or lack thereof) from the DOJ and state AGs, usually through amicus curiae briefs, to proposed settlements
Automatic Reaction - What Happens to Workers at Firms that Automate?
No full textWe provide the first estimate of the impacts of automation on individual workers by combining Dutch micro-data with a direct measure of automation expenditures covering firms in all private non-financial industries over 2000-2016. Using an event study differences-indifferences design, we find that automation at the firm increases the probability of workers separating from their employers and decreases days worked, leading to a 5-year cumulative wage income loss of about 8% of one year’s earnings for incumbent workers. We find little change in wage rates. Further, lost wage earnings are only partially offset by various benefits systems and are disproportionately borne by older workers and workers with longer firm tenure. Compared to findings from a literature on mass layoffs, the effects of automation are more gradual and automation displaces far fewer workers, both at the individual firms and in the workforce overall
