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Does Crime Pay? Cartel Penalties and Profits
Get PDFThis article seeks to answer a fundamental antitrust question: does crime pay? Do the current overall levels of U.S. cartel sanctions adequately discourage firms from engaging in illegal collusion? Seven years ago our research showed that the unfortunate answer was clearly that, yes, criminal collusion usually is profitable! The expected costs (in terms of criminal fines and prison time, civil damages, etc.) was significantly less than expected gains to the price fixers. Sadly, the most recent data re-affirm this conclusion.
The great majority of companies participating in illegal cartels make a profit even after they pay all the penalties. The current level of sanctions is only 9 to 21 percent of optimality, so it follows that current overall sanction levels should be quintupled. To move modestly in this direction, we propose five specific recommendations. Only the first and possibly the last would require new legislation.
First, legislation should add prejudgment interest to both private treble damage actions and criminal fines. Second, the U.S. Sentencing Commission should double its current presumption that cartels raise prices by an average of 10 percent. (Hundreds of independent estimates show that median cartel overcharges since 1990 have averaged 23 percent, and the mean overcharge has been more than 35 percent for domestic cartels, and 56 percent for international cartels.) Third, the budget of the Antitrust Division should be increased significantly. Fourth, as Judge Douglas Ginsburg and others have recommended, the DOJ should insist, in its plea bargaining negotiations, that corporate defendants agree not to hire or re-hire anyone who has been convicted of price fixing for a specified (and long) period. Finally, the United States should implement a whistleblower reward or bounty system for individuals who turn in cartels.
Together, these proposals would more nearly deter price fixing optimally. They would save victimized consumers and businesses from paying billions of dollars per year in cartel overcharges
Traffic Stop Federalism: Protecting North Carolina Black Drivers from the United States Supreme Court
Get PDFBlack drivers face a different constitutional reality than whites the moment they step behind the wheel in North Carolina. Although black drivers represent only about twenty-two percent of the North Carolina population, thirty-two percent of all traffic stops involve black drivers. This racial disparity may raise suspicion of either implicit or explicit racial profiling on the part of police departments, but the reality is that North Carolina law does not expressly prohibit racial profiling. Instead, so long as the police officers have an objective basis to stop a driver—and they may choose from any of the hundreds of misdemeanor traffic regulations—their implicit or explicit racism is largely irrelevant. Once stopped, the power dynamic only increases in favor of the police. Police officers may request a drug dog to “sniff” around a driver’s vehicle with no suspicion, knowing that should the dog alert to the presence of drugs, there would then be probable cause to search the entirety of the vehicle without a search warrant. If the drug dog does not arrive prior to completing the objective of the traffic stop, the police officers may continue to hold the driver if there is reasonable suspicion of wrongdoing. The police officers may develop this reasonable suspicion through seemingly innocent behavior on the part of the driver, including nervousness or disrespectfulness towards the police officers. The police officers may also expand the scope of the stop by asking for consent to search the vehicle. Minimal consideration is given to whether a black driver, shaped by prior personal and historical experiences with law enforcement, can refuse consent or to terminate the encounter with the police.
This article argues that the racial disparities for traffic stops and searches are the fault of two supreme courts: first, the United States Supreme Court for creating a traffic stop framework built on a number of supposed objective standards that give excess deference to police officers’ subjective beliefs and expectations while ignoring the realities and experiences of black drivers; second, the North Carolina Supreme Court for its blind acquiescence to the framework established by the U.S. Supreme Court. This Article proceeds to argue that North Carolina may protect its own drivers by exercising traffic stop federalism and interpreting its own constitution to consider the experience of its black drivers. Lastly, the Article concludes by arguing that North Carolina may serve as an example to other states who seek to protect their own black drivers from the U.S. Supreme Cour
Environmental Refugees? Rethinking What’s in a Name
Get PDFThe phrase “environmental refugee” summons a compelling image of someone forced to relocate due to climate change. The phrase has been used effectively to raise awareness of such diverse problems as the rising sea levels that are submerging some Pacific islands, as well as the increased impact of natural disasters like hurricanes and earthquakes which cause a mixture of temporary and permanent migration. As climate change accelerates, and its human costs become ever clearer, it is completely appropriate and necessary to respond to these migrations, and a number of international initiatives are underway to do so.
As these initiatives go forward, however, it will be increasingly important to be careful and precise about the phrase “environmental refugee.” First, as a legal term, the phrase is dubious. It implicitly harnesses the language, norms, and protections of the United Nations Convention Relating to the Status of Refugees (Refugee Convention), which fits only a small subset of climate change migrants. Second, at a time when the Refugee Convention itself is under enormous strain, the phrase, with its expansive umbrella of applicability, is also problematic from a policy standpoint. Regional refugee instruments are often broader than the Refugee Convention itself, but the Convention is the particular focus of this Article.
This Article begins with an assessment of the circumstances in which the word “refugee” is appropriate for climate change migrants and demonstrates that while the Convention can and will cover individuals in some limited settings, it will be utterly inadequate to protect the broader range of populations needing to migrate. Having established these limitations, the Article then considers the costs of using the word in other contexts. Those costs include the diversion of resources into the project of expanding the Convention, through the slow and arduous work of developing new precedents and understandings to protect climate change. There is also a great risk of weakening the international system’s support for the Convention itself as it stretches to address problems for which it was never designed. The Article ends with a justification for a complementary protection regime, and a brief examination of what such a regime might look like
The Maryland Trust Act: The Fate of the Unknowledgeable Beneficiary
Get PDFWhen adopting its version of the Uniform Trust Code (the UTC ), Maryland
made two modifications to the UTC that potentially reduced the ability of trust
beneficiaries to enforce their rights. First, the Maryland Trust Act ( MTA )
did not include the UTC requirement that a trustee shall keep beneficiaries
reasonably informed about the administration of the trust and of material facts
necessary to protect their interests regardless of whether the beneficiary
requests such information. Second, Maryland added to the “virtual
representation” provisions of the MTA that a settlor can designate a
representative regardless of the beneficiary\u27s age or capacity to receive notice
and provide consent on behalf of the beneficiary. These provisions taken
together could significantly impair a beneficiary\u27s ability to enforce a trust.
This article examines the implications of this shift away from a well-informed
beneficiary including whether it defeats the purpose of a trust, accomplishes
its stated goal, and whether these sections successfully abrogate the common
law
