27127 research outputs found
Sort by
Subjective Beliefs about Contract Enforceability
No full textThis article assesses the content, role, and adaptability of subjective beliefs about contract enforceability in the context of postemployment covenants not to compete (noncompetes). We demonstrate that employees tend to believe that even clearly unenforceable noncompetes are enforceable, including their own. We provide evidence for both supply- and demand-side stories that explain employees’ persistently inaccurate beliefs. Moreover, we show that believing that unenforceable noncompetes are enforceable likely causes employees to forgo better job opportunities and to perceive that their employer is more likely to sue them if they choose to compete. Finally, we use an information experiment to inform employees about the enforceability of their noncompete. While this information matters for employees’ beliefs and prospective behavior, it does not appear to eliminate an unenforceable noncompete as a factor in the decision to take a new job. We conclude with implications for the policy debate regarding the enforceability of noncompetes
The Radical Challenge to the Antitrust Order
No full textThe U.S. antitrust order is undergoing a radical challenge along three key dimensions. First, the challengers seek to denaturalize markets and replace a commitment to competition with an anti-domination norm. Second, the challengers seek to dramatically alter institutional arrangements, with Congressional legislation and agency rulemaking replacing antitrust\u27s longstanding commitment to judicial common law incrementalism. Finally, the challengers would replace the antitrust order\u27s preferred juridical approach-open-ended rule of reason analysiswith a return to bright-line prohibitory rules and a related demotion of economists as decision-makers. Each of these challenges entails significant consequences, many of them unintended, counter-productive, or perverse. Contrary to the broad consensus that antitrust should be apolitical, a shift to an anti-domination norm would require antitrust analysis to become more explicitly political, considering the relative deserts of different classes of stakeholders. It also threatens the antitrust agencies\u27 objectivity and independence by requiring them to coordinate policy decisions with other bodies. The bid to curtail judicial supremacy might work if Congress passed significant new legislation, but, failing that, the challengers\u27 strategy of suing and then refusing to settle in order to reform the law is putting judges ever more firmly in charge of antitrust norms. Similarly, an aggressive rulemaking strategy may backfire and further entrench the influence of judges. Finally, a push for rules of per se illegality may push courts to the opposite extreme-creating new rules of per se legality. Paradoxically, although antitrust reformers often cite Europe as a model of more aggressive antitrust enforcement, a return to formal per se rules and a demotion of economic analysis would move the United States in the opposite direction from trends in Europe
Preparing Future Lawyers to Draft Contracts and Communicate with Clients in the Era of Generative AI
No full textThank you all for coming today. This is, I think, a really important topic. Important enough that the conference has decided to have two talks on the same topic, and Mark will be presenting on this in the next session, too. I plan on attending because I don’t think you can get enough perspectives on it right now. And hearing this information, I had to attend several talks myself before I really digested it and understood what this was all about. So, I hope that I can give you a little bit of that today. My name is Kristen Wolff. I am Clinical Assistant Professor at the University of Michigan. I co-teach in the Zell Entrepreneurship Clinic, supervising students who are providing free transactional legal services to early-stage startups, mostly in the University of Michigan ecosystem. Today, I’m going to talk about integrating generative AI into transactional law classes. The first half of the talk I’m going to try to make the case for “why.” Why we should do this? And then, hoping that some of you all bought into it, the second half will explore how we might do it
Should Large Corporate Mergers Be Subsidized?
No full textOn March 21 Sens. Sheldon Whitehouse, DR. I., and J.D. Vance, R-Ohio, introduced the Stop Subsidizing Giant Mergers Act. They explained that large mergers have been increasing in recent years and that since 2007, up to 40 percent by value of all mergers have been structured as tax free. They argue that the tax breaks to mergers are a “wasteful subsidy.
21st-Century Environmental Challenges and Revitalizing EPA Enforcement
No full textThis is a profound moment for environmental protection efforts in our country. Over the past half-century, under presidents of both parties, we have made great progress addressing the challenges that led to the enactment of our environmental laws during the 1970s. Our air is cleaner, our rivers and streams are healthier, and we have far fewer hazardous waste sites. We have achieved those successes because of conscientious companies across America who meet their environmental obligations and the vigilance of the U.S. Environmental Protection Agency (EPA) and the Justice Department when companies break the law and put their profits before the health of our communities.
Despite those successes, we face numerous challenges, starting with the existential threat of climate disruption, the scourge of per- and polyfluoroalkyl substances (PFAS) contamination, and the reality that, for too long, the worst effects of pollution have been visited upon overburdened communities. The steps we take today to address these 21st century environmental challenges will shape our legacy—and will determine whether we provide a sustainable future for our children and our grandchildren.
Environmental protection should not be partisan. A changing climate, with searing heat, wildfires, worsening storms, and increasing drought does not care whether we are conservatives or progressives, Republicans or Democrats. The obligation to protect military families and farming communities from PFAS contamination likewise should not be a partisan issue
Are Exit Taxes Discriminatory?
No full textIn a recent column, Tax Notes’ Robert Goulder analyzed case law in Europe on the constitutionality of exit taxes. Many EU member states impose exit taxes on individual residents who move to lower-tax jurisdictions, but the Court of Justice of the European Union has repeatedly struck them down as inconsistent with freedom of movement unless they allow for deferral until realization or death with no interest charge, which is equivalent to having no exit tax at all. Goulder cogently argues that this issue is similar to the Moore problem in the United States, especially since the U.S. exit tax on expatriation (section 877A) is a prime candidate for a post-Moore constitutional challenge
Rethinking Taxing Excess Profits
No full textThis article discusses the application of excess profit taxes (EPTs, also referred to as windfall taxes) that have gained renewed interest and popularity over the past several years. The revival of these windfall taxes gained renewed interest following the COVID-19 outbreak, which led to a sharp price increase in corporate revenues of medical equipment and within pharmaceutical industries. However, the revival of such taxes was also used following the recent rise in energy prices mainly in Europe, leading to a sharp increase in corporate revenues of energy corporations and the recent surge in borrowing interest rates that was not accompanied by a corresponding increase in lenders’ interest rates which, in turn, led to a sharp increase in the corporate revenues of the banking sector.
Not only are these taxes viewed as a means to finance governmental needs, but they also assist the federal government in supervising large scale and sophisticated cross-border taxpayers that possess significant economic and political powers. The main criticism is that the corporations that become exceptionally profitable do not hesitate to exploit their monopolistic powers and inflate their prices.
This article therefore questions the extent to which EPTs can be used to combat the “curse of bigness” (in paraphrase to Louis Brandeis’ greatest critique on the “curse of bigness,” which he viewed as a menace to liberty and democracy) and restore one of the principal justifications in the legislation of the corporate tax code as a “supervisory control of corporations which may prevent a further abuse of their power[s].”
The introduction of windfall taxes dates back more than a century ago to the early phase of World War I (WWI)—a period in which corporate income tax was in its infancy—by more than dozens of countries that adopted some kind of above standard/normal returns, primarily in Europe but also by North American countries. The first imposition of EPTs on food exporters was by Denmark in 1915, which imposed taxes on Danish food exporters that received an exceptional trade permit to trade with Germany during the first World War. More countries followed suit and imposed similar taxes The notion was that such taxes minimize the enrichment that had been attributed to taxpayers who traded on the “world’s misery” and, as such, were viewed as important means to increase governments’ tax revenues when governments desperately needed to increase their revenues to support national efforts.
However, as soon as the period of war/crisis ended, many of the countries that imposed EPTs repealed them because they were highly controversial and sharply criticized by business and commercial sectors. These taxes were not revived or re-imposed unless crisis conditions existed, and for this reason, many of the windfall taxes that were imposed by different countries, following the period of the two world wars, were imposed on a temporary basis.
This article also argues that exceptional corporate profitability primarily results from a monopoly or quasi-monopoly status, a political crisis, or natural disasters that are a significant extent “undeserved” (i.e., the result of luck or political power) and cannot be attributed to corporate behavior. However, the imposition of EPTs does not lead to behavioral changes, especially when the goods or services that the corporations provide are viewed as essential (that is, they meet the population’s basic needs). Therefore, the EPTs’ corporate incidence is shifted to the end customers, potentially increasing regressivity. This article also argues that EPTs may unintentionally discourage corporations from innovative, entrepreneurial decision-making, especially in respect of activities that are inherently risky, and thus may disincentivize investments in research and development.
This article therefore examines the recently enacted (or proposed to be enacted) EPTs by dozens of countries (both developed and developing) and proposes certain necessary adjustments to an archaic design, which might have worked well a century ago but no longer does, and will decrease unintended spillover effects to alleviate concerns about EPTs base erosion and tax competition
The Case Against Expensing R&E
No full textOn January 16 Senate Finance Committee Chair Ron Wyden, D-Ore., and House Ways and Means Committee Chair Jason Smith, R-Mo., introduced a bipartisan tax package that would revive the child tax credit and modify three provisions in the Tax Cuts and Jobs Act. Under the proposal, the 30 percent limit on interest deductions would be relaxed by including depreciation and amortization in calculating deductible interest, expensing of corporate investment would be extended, and expensing of research and experimentation would be restored in lieu of amortization
What Matters in Moore
No full textWhy does the pending Moore case in the Supreme Court matter? The obvious answer is that if the Court decides that realization is a constitutional requirement for an income tax, the holding will have significant implications for the existing income tax regime. Depending on how broad the decision is, it could enable constitutional challenges to subpart F, the global intangible low-taxed income regime, partnership and subchapter S taxation, and sections 275, 877A, 1256, and 1259, to name just a few. And even if most or all of these challenges are ultimately decided against the taxpayers (for example, because realization does not apply to corporate taxpayers, because partnership taxation is just about aggregation, because subchapter S is generally elective, and because the other sections mentioned above are excise, not income, taxes), this will take time. Meanwhile, taxpayers would rely on Moore as substantial authority and not pay tax on a lot of income
Applying Strict Scrutiny in Termination of Parental Rights Proceedings: Why Alabama’s Jurisprudence Should Reshape Child Protection Practice
No full text“Our decision in [Pierce] holds that parents have a fundamental constitutional right to rear their children . . . . I would apply strict scrutiny to infringements of fundamental rights.” “[S]trict scrutiny leaves few survivors.” Termination of parental rights (TPR) stands as “a unique kind of deprivation” that results in the state irrevocably severing a parent’s fundamental right to care for their child. In The Ties that Bind Us, we scrutinized the child protection system’s overuse of TPR, employing clinical, empirical, and constitutional perspectives. This Article advocates for a constitutionally anchored framework aimed at enforcing strict scrutiny when considering TPR petitions or reviewing TPR decisions. Grounded in constitutional principles, the proposed framework requires courts to ensure the state demonstrates that TPR is the least restrictive means of accomplishing a compelling governmental interest. Drawing from Alabama’s steadfast application of strict scrutiny in TPR cases for over four decades, the framework comprises three components: proof of constitutionally sufficient statutory grounds for TPR, exploration and rejection of less restrictive alternatives, and a determination that TPR is in the child’s best interests. Each component independently serves as a basis for denying TPR petitions or reversing TPR decisions. Child protection administrative data reveal that Alabama’s application of strict scrutiny to TPR decisions did not negatively impact safety and permanency outcomes for children in foster care. A consistent application of strict scrutiny to TPR actions offers a safe path towards reversing the child protection system’s overreliance on TPR, ensuring family courts comply with well-established constitutional principles that safeguard children and parents’ fundamental rights. A uniform application of strict scrutiny to TPR decisions should significantly reduce the rate at which the child protection system permanently severs the legal relationship between a parent and their child and would support a long overdue paradigm shift in the child protection system by prioritizing relationships over legal dispositions