I've been writing some about international financial regulation this year. Here's my take on what IFR tells us about international law, which it isn't, but which in practice it, in some ways, resembles. It's up at SSRN, and I hope you'll give it a look.
In an era riddled with critiques of the relevance of classic international law, some have loudly given up on the subject, while others have placed their hopes in alternative mechanisms of global governance. One alternative is “soft law,” and nowhere is soft law more successful than in international financial regulation (IFR). Today, almost every bank of any size across the world has to keep similar amounts of money in its emergency reserve, cannot stake its future on complex derivatives or other forbidden trades, and faces oversight that, no matter where the bank is located, will be conducted in roughly similar ways, with roughly similar tools. And yet the promulgators of these rules consistently disavow their status as binding law.
These disavowals are disingenuous, and unpacking the reasons why has useful lessons for how international governance works, whether backed by treaty and custom or not. IFR works like traditional international law in three ways. It, like international law, depends on domestic institutions for implementation, although traditional international law has often sought to ignore the importance of any institution below the level of the state. IFR reminds us that the coordination of international interests comes with winners and losers, and therefore that the “mere coordination exercise” that international governance represents should not be dismissed, though traditional international law occasionally has been critiqued for that reason. And IFR emphasizes the necessarily messy way that fundamental legal principles are arrived at in international governance of any stripe -- something I call the contestation principle. These features of both hard and soft law have been overlooked by both the traditionalists and critics of international law, but process-driven insights like them have much to tell us about both hard and soft law, which may not, in some ways, be so different after all.
Should you be so inclined, you can find the paper here.
Glom emeritus, friend, and tax guru Vic Fleischer is headed for Capitol Hill to become become co-chief tax counsel for Senate Finance Committee Democrats. Congrats to Vic--and to the Senate!
Readers, the University of Georgia is a terrific institution, and Athens is a lovely place to live. Interested in being my colleague? Send us a line!
The University of Georgia School of Law invites applications to fill one or more full-time, academic, tenure-track faculty positions at the rank of assistant professor, associate professor, or professor. Positions will begin August 2017. Applicants in the curricular areas of criminal law and procedure, evidence, business law, or finance will be considered. Applicants must be committed to producing world-class scholarship, providing first-rate legal training and engaging in meaningful service.
Applicants should have a J.D. from an accredited university. Applicants seeking the rank of assistant professor must have superior academic credentials and a demonstrated potential for excellence in scholarship, teaching, and service. Applicants seeking the rank of associate professor must have (1) superior academic credentials, (2) a record of scholarly excellence and impact, (3) superior teaching ability, and (4) a record of participation in institutional and professional service. In addition to meeting the requirements for appointment at the rank of associate professor, applicants seeking the rank of professor must be nationally or internationally recognized in the relevant field and likely to maintain that stature.
Applications will be considered until the positions are filled. All interested persons should submit a letter of interest and curriculum vitae/resume at http://facultyjobs.uga.edu/postings/935.
The University of Georgia is an Equal Opportunity/Affirmative Action employer. All qualified applicants will receive consideration for employment without regard to race, color, sex, sexual orientation, gender identity, ethnicity or national origin, religion, age, genetic information, disability, or veteran status.
The announcement is below, do tell your friends, and we welcome applications from JDs.
The Wharton School of the University of Pennsylvania invites applications for a tenured or tenure-track position in its Department of Legal Studies and Business Ethics. The Department has nineteen full-time faculty who teach a wide variety of business-oriented courses in law and ethics in the undergraduate, MBA, and Ph.D. programs and whose research is regularly published in leading journals. The Wharton School has one of the largest and best-published business school faculties in the world. In addition, the school has a global reach and perspective, as well as an interdisciplinary approach to business issues (embracing ten academic departments and over twenty research centers).
Applicants must have either a Ph.D., J.D., or both, from an accredited institution (an expected completion date no later than July 1, 2018, for the Ph.D. is acceptable) and a demonstrated interest in ethical issues relevant to business -- for example, the nature of corporate responsibility, the ethical significance of markets, sustainability, business philanthropy, manipulation and deception in advertising, just compensation, etc. We welcome applications from people with training in the humanities, the social sciences, and/or law. The appointment is expected to begin July 1, 2017.
Please submit electronically your letter of introduction, c.v., and one article or writing sample in PDF format via the following website by November 1, 2016: http://lgst.wharton.upenn.edu. Some decisions for interviews will be made before the deadline; so candidates are encouraged to apply early.
Questions may be addressed to Tamara English, firstname.lastname@example.org.
The University of Pennsylvania is an equal opportunity employer. Minorities, women, individuals with disabilities, and veterans are encouraged to apply.
I've posted on SSRN my article on the way Dodd-Frank deals with our new era of global capital markets.
Financial reform has rebalanced the power of international engagement, reducing the role of the President and his diplomats, and increasing that of Congress and independent agencies. In so doing, the reforms have readjusted a balance that many believe was skewed by the government’s response to the financial crisis. The international policy of financial reform has doctrinal implications as well: Congress has supplemented traditional international law with an endorsement of international regulatory cooperation. Because of this supplementation, the things that customary international law used to do — in particular enabling international cooperation and creating innovation in human rights — are now being done by financial regulators wielding the power of informal agreements. The privileging of regulatory cooperation, and the entry into human rights through financial regulation, is evidenced by the so-called Conflict Minerals and Resource Extraction Rules that Congress has directed the Securities and Exchange Commission to promulgate.
Do give it a look, and let me know if you have comments or thoughts.
The AALS Section on Transactional Law and Skills is seeking paper proposals for its program on "Ethics in Business Transactions" at the 2017 Annual Meeting in San Francisco, California. This program will feature a panel discussion to be followed by scholarly presentations selected from the Call for Papers, which is reproduced below.
The program on Ethics in Business Transactions is co-sponsored by the Section on Professional Responsibility and is scheduled to take place on Friday, January 6, 2017 from 1:30-3:15 pm.
The Section on Transactional Law and Skills is also hosting a second program entitled "Transactional Law and Entrepreneurship," which is scheduled to take place on Saturday, January 7, 2017 from 8:30-10:15 pm.
In the case of People v. Harris, the Michigan Supreme Court became the first state supreme court in the United States to embrace corpus linguistics. (I have written here about Justice Thomas Lee's concurrence in the Utah Supreme Court's Rasabout case, which is cited in this Michigan opinion.) The consolidated cases relate to the "Disclosures by Law Enforcement Officers Act" (DLEOA), which bars the use in a subsequent criminal proceeding of all "information" provided by a law enforcement officer under threat of any employment sanction. While the act does not distinguish between true and false statements, the court used corpus analysis to investigate whether "information" must be true. The majority concludes, "false or inaccurate information cannot be used against a law enforcement officer in subsequent criminal proceedings. To hold otherwise would defeat the Legislature's stated intent...."
Three police officers in Detroit were involved in the assault of Dajuan Hodges-Lamar. In a Garrity hearing, all three officers lied about the incident. As the majority noted, "A video recording of the incident [that] surfaced after defendants had made their statements ... is wholly at odds with the statements provided by defendants." The officers were subsequently charged with various crimes, including obstruction of justice, but they moved to dismiss these charges on the ground that the only evidence against them was their false statements, which were excludable under DLEOA. The district court excluded the statements, and a divided court of appeals reversed. The Michigan Supreme Court reversed, holding that DLEOA prohibits the use of all officer statements, whether true or false.
In reaching this conclusion, the majority opinion by Justice Brian K. Zahra relied on corpus linguistics:
Keeping in mind that we must interpret the word "information" as used in the DLEOA "according to the common and approved usage of the language," we apply a tool that can aid in the discovery of "how particular words or phrases are actually used in written or spoken English." The Corpus of Contemporary American English (COCA) allows users to "analyze ordinary meaning through a method that is quantifiable and verifiable." [Citing Stephen Mouritsen, Hard Cases and Hard Data: Assessing Corpus Linguistics as an Empirical Path to Plain Meaning, 13 Colum Sci & Tech L Rev 156, 202 (2012).]
The dissent claims that, in ordinary usage, "we should not think of someone who provided inaccurate statements as having imparted `knowledge' or `information' ...." Empirical data from the COCA, however, demonstrates the opposite. In common usage, "information" is regularly used in conjunction with adjectives suggesting it may be both true and false.* This strongly suggests that the unmodified word "information," can describe either true or false statements. Moreover, by reading each identified use of the word "information" in its surrounding context, it is clear that "information" is often used to describe false statements. Quite simply, "information" in common parlance describes perceptions conveyed about the world around us, which may be true or false.
*The footnote states:
In conducting a COCA search, the word "accurate" is the most common adjective collocated with "information" to bear a meaning that refers to truth or falsity. The words "false" and "inaccurate" are also commonly collocated with "information."
Ok, that's interesting enough, but it gets much more interesting when Justice Stephen Markman in dissent engages the majority's corpus analysis:
The majority relies on the Corpus of Contemporary American English (COCA), a truly remarkable and comprehensive source of ordinary English language usage compiled by linguistic scholars at Brigham Young University, in particular Professor Mark Davies. The COCA, available at (accessed June 7, 2016), is an online "resource [that can be used by courts] for assessing the ordinary meaning of a statutory term." State v Rasabout, 2015 Utah 72, ¶ 72; 356 P3d 1258 (2015) (Lee, A.C.J., concurring in part) (assessing with an impressive thoroughness, in ¶¶ 40-134, the strengths and limitations of using a corpus to facilitate the interpretive processes of the judiciary). By using the COCA, "we can access large bodies of real-world language to see how particular words or phrases are actually used in written or spoken English." Id. at ¶ 57. However, notwithstanding the majority's invocation of the COCA, I believe that the COCA actually supports the proposition set forth in this dissent that the common and most reasonable understanding of the term "information" excludes false statements.
The term "information" is found within the COCA 168,187 times and yet it is only modified by the term "truthful" 28 times, "true" 18 times, "accurate" 508 times, "inaccurate" 112 times, and "false" 271 times. In other words, the term "information" is modified by one of these adjectives 937 times. The other 167,250 times that the word "information" is used it is unmodified by one of these adjectives. That is, 99.44% of the time "information" in the COCA is unmodified by any of these adjectives related to veracity. Therefore, I disagree with the majority's contention that the COCA affords support for the proposition that the term "information" is "regularly" or "commonly" modified by one of these adjectives. I find to the contrary. And where "information" is unmodified by one of these adjectives, I believe it is overwhelmingly used to refer to truthful information....
I do not believe that a judicial interpretation of "information" drawn from use of the term in ½ of 1% of all of its appearances in a corpus constitutes an ordinary, common, or reasonable interpretation of the term. There is no word that cannot be abused, misused, or employed in an exotic or puzzling way in everyday discourse, and a corpus will reflect this reality; it is not, however, the purpose of a corpus to transform every such use of a word into a reasonable construction of the words of the law....
Furthermore, the reader may wish to peruse at random any number of the 167,250 uses of "information" in the COCA and assess whether the term was reasonably used and understood as indistinguishably referring to true and false information. When, for example, the doctor is offered "information" from a patient concerning the latter's condition, would either party suppose that the latter was not intending in a reasonably accurate manner to describe his symptoms as he then believed them to be? Or, by further example, when a "contract" or "trade-off" of some kind is delineated by the elected representatives of the people in the Legislature, with an explicit quid pro quo defined in terms of the production of "information," and presumably with some measure of public benefit to be derived by the production of that "information," could that Legislature genuinely have been disinterested in whether such information was true or false?
Here we see judges struggling with the rules of application under corpus analysis, an issue that was a central topic of conversation in the recent Conference on Corpus Linguistics held at BYU. We clearly have a long way to go before corpus analysis is regularized in judicial proceedings, but this case represents an nice step forward, where both majority and dissenting justices agree that corpus linguistics could inform their interpretation of the statute.
I am working with the BYU Law Review to organize a symposium on corpus linguistics to be held next winter semester. If you would like more information about the symposium, please do not hesitate to contact me.
Last night, as part of the NPR Marketplace series "The Price of Profits," a report by Scott Tong provided an intellectual history of shareholder primacy, from Milton Friedman through Gordon Gekko and on to the present. The overview was fairly long for a news program -- my wife wondered if we had stumbled into a podcast -- and sought to provide an in-depth look at the shareholder primacy phenomenon. Lynn Stout was quoted in her role as the loyal opposition. Perhaps the newsiest part of the segment was the perspective of Michael Jensen, long one of the intellectual godfathers of primacy. Although Jensen defended the initial discipline that shareholder primacy imposed on markets, he backed away from any sort of muscular approach to the doctrine. Here's the excerpt:
“Has it happened the way I wanted it to happen? Eh, probably not,” Jensen said. “There’s always going to be some people who take it too far. And then cause damage.”
Jensen said focusing solely on stocks and stockholders is a “misreading” of his scholarship. He wrote in 1990 that CEOs should “do what’s in the shareholders’ best interests.”
“I wouldn’t put shareholders at the center," he said. "I’m still unhappy about the situation where people end up thinking that shareholders are primary. That they are our only bosses. No.”
Jensen has backed away from his scholarship -- or, at least, the commonly understood ramifications of his scholarship -- before. In 2007, he told the New York Times that "I would never award the standard executive stock option again," despite his early advocacy for such compensation packages.
See below: it's a good group there:
The Bentley University Law Taxation and Financial Planning Department has been approved to hire a tenure-track Assistant Professor. The position is funded to begin teaching in the fall of 2017, with a July 1, 2017, start date. Here is a direct link to the Assistant Professor job posting:
If you are interested in the position and believe yourself to be qualified, please apply electronically. Please note that, although the deadline for submission of applications is September 30, we hope to interview at the ALSB annual conference in San Juan in August due to our limited budget for bringing candidates to campus in Massachusetts. To that end, we will begin reviewing applications in July so as to schedule San Juan interviews. Therefore, if you plan to attend the August ALSB conference in San Juan, we encourage you to apply by mid-July to ensure that your application can be reviewed before the conference.
I've got a post on the increasing efforts to create voluntary, or in some cases mandatory, responsibility for businesses regarding human rights up over at RegBlog. Here's a bit of it:
International businesses must now decide whether to sign on to a lengthy and disparate list of principles and standards that aim to promote human rights. Sometimes associations of regulators promulgate these human rights standards for businesses; other times non-governmental organizations promulgate them and ask businesses to sign them. Regardless of who adopts them, these “voluntary” standards constitute a different form of regulation, and not just because of their subject matter. In promulgation, content, and authority, these efforts do not entail traditional rulemaking or adjudication.
But human rights standards are a growth industry. In fact, it is fair to say that the obligation of businesses to consider human rights is at a turning point. Although business-based standards to improve human rights are all less than a decade old, they are gaining adherents, even among regulators. Even the U.S. Securities and Exchange Commission (SEC) and the European Union have now announced rules that discourage the use of conflict minerals in manufacturing. Other countries are following suit in restricting trafficking in conflict diamonds, a phenomenon which I examine further in this paper.
You can find the rest over here, if it's the sort of thing you like.
Over at DealBook, I try to forecast the most likely prominent challenges to the Consumer Financial Protection Bureau's Payday Lending Rule. Here's the start:
The new payday lending rule, once complete, will force many payday lenders out of business. That means that a legal challenge is certain, and also the courts, which worry about regulations that require bankruptcies, will take it seriously.
That is good news for challengers of the rule. The bad news is that their claims will probably fail.
Payday lenders will challenge the authority of the Consumer Financial Protection Bureau to issue the rule, the cost-benefit analysis behind the rule and the constitutionality of the consumer agency itself.
When they fail, we will know that we have a new and powerful financial regulator, one that can touch not just banks but any source of credit, including credit cards, payday lenders and other informal ways to get money.
Go give it a look!
The Dodd-Frank Wall Street Reform Act allowed the Securities and Exchange Commission (SEC) to bring almost any claim that it can file in federal court to its own administrative law judges (ALJs). The agency has since taken up this power against a panoply of alleged insider traders and other perpetrators of securities fraud. Many targets of SEC ALJ enforcement actions have sued on equal protection, due process, and separation of powers grounds, seeking to require the agency to sue them in court, if at all. This Article evaluates the SEC’s new ALJ policy both qualitatively and quantitatively, offering an in-depth perspective on how formal adjudication— the term for the sort of adjudication over which ALJs preside—works today. It argues that the suits challenging the SEC’s administrative proceedings are without merit; agencies have almost absolute discretion as to whom and how they prosecute, and administrative proceedings, which have a long history, do not threaten the Constitution. The controversy illuminates instead dueling traditions in the increasingly intertwined doctrines of corporate and administrative law: the corporate bar expects its judges to do equity; agencies and their adjudicators are more inclined to privilege procedural regularity.
You can find the article here or here. The constitutional claims against SEC ALJs are coming fast and furious, so it's worth taking a step back and seeing how the program actually works. So do give it a look!
I'm co-chairing ASIL's biennial conference on international economic law this year, and I hope that many friends of the Glom will consider attending, and even giving a paper. You can find the call for papers here, and Georgetown's International Law Journal is willing to serve as a publication outlet for those interested in pursuing that, their announcement is here. As we say in the call,
We encourage submissions on all aspects of international economic law, including those that do not focus on cross-cutting issues. The themes listed below are illustrative only and non-exhaustive. If your paper fits within one or more of these themes, please make a note of it in your proposal. Illustrative Themes:
Cross-fertilization opportunities between trade, tax, monetary and finance law: How does monetary law impact trade and finance, and vice-versa?
Soft law in international economic law: Are there lessons to be drawn from financial regulation for trade and investment? How does regionalism shape and challenge international economic law?
Dispute resolution in the face of trade and investment treaty convergence: What are the opportunities and challenges raised by recent innovations? Is a unified system possible or desirable?
International economic law and systemic risk
Public-private partnerships in international economic law
I hope you'll consider joining me in DC in September (it is a great time to be there, inter alia).
Georgia Law's graduation ceremony is tomorrow. We do commencement well here at Georgia-- on our historic North Campus, under the shade of old oak trees. Professors have funny roles on graduation day. The ceremony is not about us, of course, although we do play an important part in it. (I mean, surely they'd miss us if we weren't there?) It came to me while watching another ceremony, Tamika Montgomery-Reeves' investiture--the professors are the repeat players at commencement.
Now, the phrase "repeat player" has a particular connotation in the legal academy, one stemming from Marc Galanter's excellent article "Why the 'Haves' Come out Ahead: Speculations on the Limits of Legal Change."1 Whether in litigation or in transactions, those who repeatedly interact with a given legal system have an advantage over "one-shotters" that engage with it only once. The more I learn about the law, the more explanatory power Galanter's insight seems to hold.
Luckily, faculty and students are not adversaries at graduation. Nor are professors the only repeat players in the ceremonies of our lives. As I reflected on Vice-Chancellor Montgomery-Reeve's investiture, where Chancellor Bouchard and other Chancery Court employees guided us expertly through the ceremony, I recollected myself being helped at ceremonies where I played the one-shotter. Weddings, funerals, christenings. Sit here, step to the podium, wait for the music. Priests, rabbis, and ministers, often serve as the repeat players in these ceremonies, singular for the participants, familiar for them.
Familiar, but not routine. Sometimes my students ask, "It's probably no big deal for you, Professor Rodrigues, right? After all the graduations you've attended?" No, it's still a big deal. But it's different kind of deal. Being the repeat player at commencement grants us the luxury of observing the students and their families-- chuckling self-consciously over their old fashioned robes and mortar boards, nervous and uncertain. We know they'll adjust their caps at least 6 times, and fidget with their tassels. It's a big day for them and their families, and although they've longed for it, when it comes to it, they're a little unsure of what they're supposed to do and what it all will mean.
Perhaps this is the value of the repeat player in a ceremony. For each graduate, there is a sense of joy and singularity, but overlaying it is a sense of tradition and continuity. I think perhaps that combination is what makes these ceremonies so meaningful. We celebrate the singular nature of this particular day, these celebrants--be they graduates, bride and groom, or judge. But we celebrate with the knowledge that the ceremony-- with its rituals, words, and trappings-- has unfolded more or less like this many times in the past, and will continue in the future. It's a link to celebrants past and future, and the repeat player can appreciate that in a way that those enveloped in the giddiness of the moment cannot.
No matter the reason, it's still one of my favorite days of the year. Congratulations, Class of 2016.