June 28, 2014
icon Why the Government Should (Sometimes) Help Companies “Cheat” on their Taxes
Posted by Ted Sichelman

For this last guest post, I decided to eschew IP (well, to some degree, see below) and focus on a recent article of mine and Leandra LedermanEnforcement as Substance in Tax Compliance—that (in my biased opinion) deserves more press. (Though, to be certain, Leandra would strongly disagree with my catchy title—see more on that below.)

In the article, we argue that the failure of the tax authorities to perfectly enforce the tax laws in effect can alter the substance of the tax laws, at least to the extent that taxpayers know the penalties for non-compliance and can reasonably predict how often the tax authorities conduct audits for certain classes of taxpayers.

This claim is quite different from the one that audit rates merely affect the propensity of taxpayers to “cheat.” Rather, the effective tax rate can be intentionally adjusted downward (and not just to zero) by the taxing authorities from the nominal tax rate, in effect, yielding an entirely new substantive law.

For instance, suppose there is a sales tax of 5% and that given current audit strategies, the effective tax rate is 4% in all industries, because 20%  of the taxes go unpaid in each industry. Based upon the elasticity characteristics of the products in a given industry—in other words, the propensity of purchasers to continue buying as the price of a good increases—under certain circumstances, the tax authority can adjust its audit rates in one industry relative to another to change the compliance by taxpayers in each industry. This adjustment, in turn, can change the effective tax rates paid by a given industry. For instance, the tax authority might audit more heavily in an industry selling luxury cars than in one selling textbooks, yielding effective tax rates of 4.5% in the luxury car industry and 3.5% in the textbook industry.

The ability of the tax authority to generate different effective tax rates from the same nominal tax rate is an example of what we call “enforcement as substance,” namely the ability of differential enforcement strategies to effectively change the substantive law. A broader (and much less studied) question is whether “enforcement as substance” can be intentionally harnessed to improve social welfare.

Drawing upon work of mine in IP and others that shows that imperfect enforcement can decrease deadweight losses stemming from the issuance of patent rights, we show in our article that a “measured enforcement” policy (i.e., a conscious strategy to differentiate enforcement among different legal actors) can improve social welfare. In the tax context, measured enforcement can similarly be used to decrease deadweight losses caused by taxation, specifically by placing more of an onus on those industries with lower elasticities. Additionally, tax authorities can implement a quasi-Pigouvian tax on activities otherwise imposing negative externalities by upping enforcement of taxes on those activities.

Importantly, we show that under a variety of conditions, measured enforcement can yield welfare benefits while maintaining or even increasing the government’s total tax revenue. Some of these conditions are that the taxpayers be sophisticated and informed and respond rationally to incentives provided by the tax authority’s publicizing of its enforcement strategy. Generally, we believe large, sophisticated corporations—at least as an initial matter—would fit this bill.

Additionally, contrary to the title of this post—such a system should not be billed as one promoting “cheating.” Rather, like prosecutorial discretion in the criminal law context, here the tax authority would use its on-the-ground enforcement discretion to achieve optimal deterrence—namely, the use of its resources in those areas that most need it not solely to increase the public fisc, but to improve overall social welfare. Such allocation of resources of course is not tantamount to promoting cheating in the conventional sense (hence, the quotes around “cheat” in the title of this post).

One potential concern with such an approach is the possibility of abuse on the part of the taxing authority—adjusting enforcement not to benefit society, but as a means of political reward and punishment. Yet, our proposal yields no more room for abuse than under the current system. Indeed, under our framework, the taxing authority would publish its audit rates (otherwise, how could taxpayers adjust their behavior?), making its audit scheme much more transparent than it is now.

Of course, other potential concerns arise in such a scheme, such as separation of powers and horizontal equity (“treating like taxpayers alike”).  We address these and other potential issues in detail in the article, concluding (of course) that none are fatal.

On a final note, thanks again to Gordon Smith to letting me guest blog the last few weeks—now, it’s back to the run-of-the-mill life as a law professor in the summer: writing law review articles (most of the time spent on the footnotes), lamenting the decline in law school enrollment, and enjoying the World Cup, Wimbledon, and the occasional barbeque.

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June 27, 2014
icon Gender and Conference Questions
Posted by Usha Rodrigues

Like Elizabeth I attended Seattle University's fantastic Berle VI conference.  The quality of the talks was uniformly high, and the tone of the conference was one of engagement and dialogue, not ideology.  In short, it was a great conference.

Unusually for me, I didn't present a paper, but was a mere participant (or, as I like to think of it, "invited guest").  I felt it my duty  as invited audience member to ask questions, even though I was always the last to raise my hand in elementary school, college, and even law school.

This is what I want to type next: here's the secret about law conferences--and, I'd be willing to guess, academic conferences in general.  The women in the audience are counting.  Always.  They're counting the number of women speakers.  They're counting the number of questions women ask.  Particularly if the speaker calls on his own questioners, they're aware of how many women he calls on and whether he ignores women who have had their hands up for some time to call on men who raise their hand later.  A constant back-of-the-mind tally is part and parcel of the woman academic's conference world.

I don't know if that's true, though--that's why I'm uncertain about the authoritative tenor of the prior paragraph.  It's something I've talked about with women academics many times.  Never with men.  But it's something I do almost subconsciously.  If I had my druthers I'd take a while to frame my question, hear what others have to say, see if I have anything to add, formulate and reformulate.  But if there's a 15-minute Q-and-A period and no woman has raised her hand at the 10-minute mark, I start to feel a lot of pressure to say something.  Anything.  Particularly at my home institution, since it's the deep South and I don't want it to look like we're some backwater where women are oppressed/unengaged/unintellectual.

Berle VI was an ideal conference in gender terms--centered around an article by 2 women academics, nearly half the attendees women, which is almost unheard of in corporate or securities law.  Thus it seems like a good time to voice these thoughts.  This is something  that feels quite personal, and something I've never blogged about--nor read about--but have thought about a lot.  Hence the title of this post-- I'm posing a question about conference questions and how others perceive them.  How many women feel this way?  How many men have any clue that they do?


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June 26, 2014
icon Human-Equity Investing
Posted by Elizabeth Pollman

And now for a fascinating development from the startup world …

Several companies have sprung up that allow investors to buy shares linked to the performance or future earnings of a human being.  What does that person get in return?  They typically get cash upfront for selling a piece of their future income.

For instance, on one of the platforms, Fantex, you can currently “reserve IPO shares” linked to the income of EJ Manuel, a quarterback for the Buffalo Bills.  You can click on “read the prospectus” and it links to a Form S-1 filed with the SEC.  The S-1 has some interesting language that explains the details and mechanics of the “tracking stock.”  The website says after the registration becomes effective and the IPO shares are allocated to investors, trading can begin on the platform.  Fantex says, “It’s real stock, real money, and real athlete brands.”

Other platforms have different models and purposes.

Enzi calls itself a “pioneer in people to people social investing.”  It explains that it “enable[s] ordinary people to become angel investors in the education of talented students, in exchange for a share in their future income.”

Upstart, which was founded by ex-Googlers, “finance[s] people based on signals of their potential, including schools attended, area of study, academic performance, and work history.”  The platform offers a 3-year loan with an underwriting model that “simulates thousands of scenarios in a few seconds to assign an APR between 6.5% and 22.5%, based on the borrower’s modeled likelihood of default.” The platform makes money by charging borrowers an origination fee between 1% and 6% of the amount they receive.  The front page of the site currently features a picture of a Harvard Law student, amongst others.   The company’s blog says it has its “sights set on disrupting the $3.2 trillion consumer credit industry.”

You might be thinking that these developments raise some interesting issues.  Indeed they do as I recently learned from reading Jeff Schwartz’s smart new article on what he calls “human-equity investing,” forthcoming in the Illinois Law Review.  Jeff presented this paper at last week’s National Business Law Scholars Conference at Loyola Law School, Los Angeles, and it stimulated a very lively discussion.  Jeff argues that securities law has a role to play in this arena and he also suggests “a complementary regulatory regime” to require certain disclosures and set some boundaries to deal with the broader public policy concerns these arrangements pose.  I hear that the paper, The Corporatization of Personhood, will be up on SSRN soon.

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June 25, 2014
icon While We Are On The Subject Of Empirical Research....
Posted by David Zaring

...I'll weigh in with a holiday-style observation about this article in the really improving 538 on the possibility that minimalist running shoes are better for you than regular shoes.  It's by an excellent and serious economist, and yes, it's just a column, not rigorous, peer-reviewed work.  But the argument is that, if you just look at studies, it's possible that minimalist running shoes, or barefoot running, is better for you than the kind with shoes.

Now I enjoy running, and firmly believe that you can really overdo it on the space age shoe technology.  But this is an argument in the face of two facts:

  • One of the companies selling minimalist running shoes settled a case for millions of dollars facing claims that it had oversold the health benefits of minimalist running shoes.
  • At a first approximation, 0.0% of runners who run lots of miles per week use these shoes.  Sure, some race in so-called "racing flats."  But those aren't minimalist, and they don't train in them.  Go see how many of the 35,000 people finishing the New York marathon this year are running in these shoes.  Isn't that a bit of a market test?

The problem with trusting the data is that no one ever collects all the relevant data; I suspect that the above data is more relevant than the health studies.  I predict that minimalist running shoe sales will crater in the next three years.  So note this in your calendar, and email me in 2017 if I turn out to be wrong.  But I think the jury is no longer out on the health benefits of minimalist running shoes and that arguing otherwise just makes empiricists look naive.

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June 24, 2014
icon What Do Great Speakers Do?
Posted by Elizabeth Pollman

Many thanks to Gordon and the Glom for the invitation! As Gordon mentioned in his kind introduction, I’m an associate professor at Loyola Law School, Los Angeles, where I teach Business Associations, Corporate Governance, and Contracts. My research focuses primarily in 2 areas: the constitutional rights of corporations and law and entrepreneurship/securities/private company issues. In the next couple of weeks, I hope to blog about some issues in these areas as well as highlight the work of others that I’ve been enjoying.

To start on a lighter note, as it’s conference season I’ve been thinking about the art of presenting a paper or more generally speaking to a law audience.

What sparked my thinking about this was the outstanding keynote speech that Professor Frank Partnoy gave at the National Business Law Scholars Conference that we hosted last week at Loyola LA. Professor Kristin Johnson gave a wonderful introduction, noting Frank’s rock star status with examples of great things he has done in the media, briefly remarking on some of his key works, and thanking Frank for his mentorship over the years. It had all the ingredients of a great speaker introduction…it gave concrete examples, it was warm and connected the people in the room, and it built a feeling of anticipation. Then Frank started his keynote and it was clear that it was something special, thoughtfully planned for the audience, and that he is simply a terrific speaker.

So this got me thinking…what are great speakers doing?

Well, first, a terrific topic is always a great start, of course. In his keynote, Frank Partnoy spoke to the group of 80+ business law professors about who is our audience when we write and what are our motivations. He used a framework for his discussion from George Orwell’s essay, “Why I Write.” (Orwell identified 4 reasons why a writer writes: 1. Sheer egoism; 2. Aesthetic enthusiasm for beauty in the world or the beauty of language; 3. Historical impulse: to see things as they are and to set it out for posterity; and 4. Political purpose: a desire to change the world. Orwell said, “They exist in different degrees in every writer, and in any one writer the proportions will vary from time to time, according to the atmosphere in which he is living.”) This struck me as a wonderful choice of topic because it gave some interesting food for thought for the entire audience, at various career stages. I don’t think a tailored topic is required, though. I remember seeing a faculty workshop talk once about services like Mechanical Turk. I went into that talk not even knowing what the topic was and I left feeling really interested in the social and legal implications.

Second, there’s the matter of style… here’s where some of the magic seems to happen. Some people just seem charming and well spoken, or funny or captivating. I recently read a great book about effective communication that I’ve found helpful for some teaching ideas and I think it’s relevant here too – Made to Stick: Why Some Ideas Survive and Others Die, by Chip Heath & Dan Heath. The authors are brothers – Chip Heath is a Stanford Business School professor and Dan Heath is a senior fellow at Duke's CASE center which supports social entrepreneurs. The book argues that the following principles can help make your ideas stick:

  • Simplicity (the authors talk about this principle as finding the core of an idea)
  • Unexpectedness (including a small element of surprise or breaking a pattern to get your audience to pay attention)
  • Concreteness (how many times have you sat in a talk where someone in the Q&A asks for a concrete example if the speaker didn’t already provide one?)
  • Credibility (this reminds me a bit of Aristotle’s idea of ethos)
  • Emotions (the authors talk about this as making your audience care… I think you could more broadly understand this as the answer to the “so what” question)
  • Stories (we’re human and absorb ideas and information well in story form)

Fun summer reading.

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June 23, 2014
icon Welcome Guest Blogger Elizabeth Pollman
Posted by Gordon Smith

We are excited to welcome Elizabeth Pollman as a guest blogger for the next two weeks. Elizabeth is an Associate Professor of Law at Loyola Law School in Los Angeles, where she teaches business law courses and write about the entity status and constitutional rights of corporations, as well as on law and entrepreneurship. If you are interested in the trading of private company stock, you must read her excellent article on Information Issues on Wall Street 2.0, published last year in the Penn Law Review. Welcome, Elizabeth!

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June 20, 2014
icon The "Law and" Question
Posted by Usha Rodrigues

Steve Bainbridge is not afraid to stake a claim.  Yesterday he took aim  at both empirical legal scholarship and the law & PhD. folks.  How not to win friends and influence people at a law professor conference, indeed.

I'm not singing Steve's tune, but I will hum a few bars.  I've done some empirical work, and I see real value in its insistence on seeing what's actually out there--how things work in the real world.  Especially in the corporate and securities fields, we can count things and measure the effects of changes in the law.  To ignore that ability to measure and test law's impact seems foolhardy.

Still, we are law professors.  Law must come first.  I remember in my earliest days in the academy listening with disbelief to a fellow newbie law prof: "I just want to do empirical work, and law pays better than economics.  I don't care about the law at all."  He laughed.  I didn't.

There does seem to be a "race to economics" in ELS these days, to see whose works is most rigorous--meaning most like that of real economists.  I think "Law and"s --including economics PhDs, but also myriad other disciplines--can contribute to a law faculty, but their value is that  legal training enables them to pursue questions that would not occur to straight PhD's.  One of the projects I'm working on is a hybrid constitutional law, securities law, political science piece.  It may all come to naught, but it's an inquiry a political scientist wouldn't make,.  That's my comparative advantage as a lawyer.

In the comments to his post Steve laments that "the legal academy is not producing scholarship that is relevant to the bench and bar or that our graduates (especially at the T14 schools) are coming out of school better versed in theory than professional skills."  This is a problem.  Even than for the general law prof, for  "Law and"s I  think that practice is vital.

To put it bluntly, Harvard/Yale/Chicago/Columbia/Stanford can hire whoever they want, because they're in the business of pedigreeing elite students.  They can hire professors who haven't practiced law and who  write about theoretical topics.  It doesn't effect their students' job prospects.   All the other law schools have lemming-like followed their lead, accepting without question that the way up the USN&WR rankings is to look as much like possible as the T5.  That worked fine during boom times, but in this legal market, it  seems a lot like walking off a cliff.


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icon The Tricky Business of Tesla’s Patent “Give-Away”
Posted by Ted Sichelman

Last week, Elon Musk—CEO of Tesla Motors—announced on the company’s blog “All Our Patent Are Belong To You” (apparently an homage to a late 90s, ungrammatical internet meme--thx Brian Gividen for pointing this out). Musk claims to adopt an “open source” policy for Tesla’s patents. He elaborates, “Yesterday, there was a wall of Tesla patents in the lobby of our Palo Alto headquarters. That is no longer the case. They have been removed, in the spirit of the open source movement, for the advancement of electric vehicle technology.”

Musk’s move has been hailed widely in the blogosphere as an act of altruism (e.g., here & here). Most of this sentiment has been fairly unreflective. (However, for a certain-to-be prescient analysis that focuses more on the business implications of Musk’s move, see my colleague Orly Lobel’s comments over at Prawfsblawg and Harvard Business Review blog. While I’m quite sympathetic to most of Orly’s observations, as I explain below, I’m quite skeptical of her view that the move will be “good for faster industry innovation.”)

However, like most patent “give-aways,” legal loopholes usually spoil the party. Specifically, Musk stated that “Tesla will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology” (emphasis added). Of course, “good faith” is a legal term of art large enough to drive a diesel-spewing, 18-wheeler through, much less a zero-emissions Tesla (and this loophole has been roundly noted by a few observant journalists).

Most importantly, is Musk (or his lawyers) expecting that others that use Tesla’s patented technology also make their patents available to Tesla? In more narrow terms, is the result similar to Twitter’s supposed “give-away” that reserved to Twitter the right to sue a competitor if the competitor sued Twitter? Probably so.

Thus, like Twitter, Tesla’s giveaway appears ultimately to boil down to a generalized offer to cross-license with competitors, including potential entrants. As such, Musk’s “give away” is not terribly radical, because cross-licensing in the high-tech and auto industries is fairly commonplace (veritable “keiretsus” in Scott Kieff’s words).

In this regard, as Michael Schallop, an IP attorney recognized, Tesla “wants to encourage others to develop on a common platform, and to the extent that they’re doing so, Tesla is not going to stop that by using its patents offensively.” Indeed, as I have described elsewhere, forcing smaller competitors and potential entrants to cross-license typically provides the incumbent (here, Tesla) a strong advantage, because the incumbent often controls “complementary assets” that provide competitive advantages aside from IP, like robust sales & marketing channels, access to capital, and the like. So, at worst blush, Tesla’s putative altruism could actually keep small, innovative entrants out of the commercial marketplace by effectively forcing them to license their patents to Tesla.

Furthermore, as others have noted, much of the Tesla patent portfolio does not seem particularly strong, nor does it appear to include much of its fundamental technology (which appears to be kept largely as trade secrets). Like IBM’s giveaways of several years ago, one wonders if Tesla found that giving away its patents would yield more revenue by seeding its technology widely—benefiting not only from potential infrastructure effects, but also from the consulting and joint venture dollars that go along with actually explaining to licensees how to implement the technology (specifically by using Tesla’s trade secrets and know-how, which Musk is not divulging). So perhaps Tesla is “patent washing” to offer the proverbial “Trojan horse” (sorry, last cliché) to the larger auto manufacturers (and even lure gullible “anti-patent” engineers to Tesla—see Orly Lobel’s points on these issues).

Or maybe Musk truly thinks he’s being altruistic. Unfortunately, contrary to Musk’s proclamation, “giving away” patents (even putting aside the “good faith” loophole) usually doesn’t mean “open source.” The reality is that Musk’s act is likely to redound much more to his self-interest than society’s.

If Musk were truly concerned about society being able to use Telsa’s technology, he’d specifically agree to the following terms: a royalty-free license to all Tesla current and future patents to any comer in writing with the single exception of maintaining an enforcement right against incumbents or large entrants (but not startups or small entrants) who sue Tesla for infringement. Additionally, Tesla would disclose all of its trade secrets under similar terms and use vigorous efforts codify Tesla’s know-how in so doing.

Of course, Tesla’s “give-away” is quite a ways from this much more thoroughly “open source” approach. As such, I’m not particularly optimistic that Tesla’s current policy will ultimately promote faster innovation or the more rapid adoption of electric vehicles. Perhaps even more unfortunate is the general inability of the press even to spot these issues, much less analyze their ramifications.

Permalink | Entrepreneurs, Entrepreneurship, Innovation, Intellectual Property, Social Responsibility | Comments (View) | TrackBack (0) | Bookmark

icon What The Conflict Minerals Rule Means For Congress And The SEC
Posted by David Zaring

Over at the National Law Journal, I've got a view:

The U.S. Securities and Exchange Commission's long-awaited rule requiring some users of so-called "conflict minerals" to disclose that use went into effect on June 2. The rule is interesting not because of what it does — it is a modest, targeted effort aimed somewhat indirectly at reducing civil unrest in a part of Africa — but because of what it represents. It allows Congress and financial regulators to strike interesting new poses: one as a protector of human rights, and one as a maker of foreign policy.

If it is meant to end a civil war, it will be unsuccessful. But the rule is still an important new precedent for Congress and its new agent of diplomacy, the SEC.

You can find more here.

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June 19, 2014
icon Sovereignty Mismatch And The New Administrative Law
Posted by David Zaring

I've been on a bit of an international and administrative law kick these days, but as always, the case study is financial regulation.  If you're interested in Sovereignty Mismatch And The New Administrative Law, available from the Washington University Law Review and here, you know what to do.  Here's the abstract:

In the United States, making international policymaking work with domestic administrative law poses one of the thorniest of modern legal problems — the problem of sovereignty mismatch. Purely domestic regulation, which is a bureaucratic exercise of sovereignty, cannot solve the most challenging issues that regulators now face, and so agencies have started cooperating with their foreign counterparts, which is a negotiated form of sovereignty. But the way they cooperate threatens to undermine all of the values that domestic administrative law, especially its American variant, stands for. International and domestic regulation differ in almost every important way: procedural requirements, substantive remits, method of legitimation, and even in basic policy goals. Even worse, the delegation of power away from the United States is something that our constitutional, international, and administrative law traditions all look upon with great suspicion. The resulting effort to merge international and domestic regulatory styles has been uneven at best. As the globalization of policymaking is the likely future of environmental, business conduct, and consumer protection regulation — and the new paradigm-setting present of financial regulation — the sovereignty mismatch problem must be addressed; this Article shows how Congress can do so.

Comments and concerns welcome.

Permalink | Administrative Law, Finance, Financial Institutions, Globalization/Trade | Comments (View) | TrackBack (0) | Bookmark

June 16, 2014
icon The IP Transaction "Gap"
Posted by Ted Sichelman

Thanks to Gordon Smith for inviting me to guest blog—and kudos to Gordon for inviting Michael Burstein, who penned several insightful guest blogs here a few weeks ago—to generate some buzz about the intersection of IP and business law. In my posts over the next two weeks, I’ll follow on Michael’s outstanding foray into the overlap—and as I’ll describe, the “gap”—between IP and business law.

As Michael explained, IP and business law often intersects in three key areas: (1) Law & Entrepreneurship; (2) Markets for Technology; and (3) Innovation and Corporate Performance. Each of these areas has been growing at tremendous rates both in terms of academic study and real-world deals.

As an IP law professor and former founder of a .com-era software company, it’s greatly refreshing to see this newfound interest in IP & business law in the legal academy and practice. Yet, both domains still often suffer from what I term the IP transaction “gap”—namely, the lack of a deep understanding on the part of academics and lawyers of both the “IP of Business” and the “Business of IP.”

In simple terms, business lawyers often fail to appreciate the important details of IP and IP lawyers often fail to understand the business of their clients. As a client, my difficulties stemmed in finding business-savvy lawyers who had a sufficient grasp of IP—particularly the business aspects of IP—to ink the kinds of nuanced licensing, assignment, and acquisition agreements that would suitably account for the structure and risks unique to IP deals. The same sorts of “gaps” between IP and business law pervade law review articles that attempt to tackle this thorny intersection.

Of course, there are notable exceptions among scholars and practitioners alike. For instance—in addition to Michael Burstein—Ashish Arora, Stuart Graham, Richard Gruner, Bronwyn Hall, Jay Kesan, Josh Lerner, and David Teece represent an abbreviated list of some of the scholars with deep knowledge in both fields. Similarly, there are well-known (and lesser-known) attorneys with the same sort of cross-disciplinary aptitude. How do scholars—and practitioners and students—acquire this kind of knowledge? I have a few suggestions.

First, law schools should offer more cross-over courses in IP and business law. For example, at the University of San Diego School of Law, David McGowan and I have focused on expanding our cross-disciplinary IP offerings, which now include IP & Business, IP Strategies, Technology Transfer, and a Technology Entrepreneurship Law Clinic. Based on a survey of IP courses performed by William Mitchell Law School, fewer than 20 law schools offer any IP transactional courses other than IP licensing. Relatedly, law schools should provide certificates or concentrations in IP Transactional Law, as well as more opportunities for joint MBA/JD programs, with a special emphasis on technology-focused business and law.

Second, legal academics writing in IP & business should more frequently read and cite literature from outside the law review canon. In my view, often the best law review articles in IP draw upon scholarly works from business, economics, management, marketing, and related journals. One excellent way to quickly learn about the latest thinking in these fields is to attend conferences in these disciplines, such as the Academy of Management or American Economic Association annual meetings.

In this vein, academics and practitioners alike should cease the frequent practice of pigeon-holing certain issues as “legal” and others as “business,” relegating the latter to the expertise of non-lawyers. At my software company, we eventually fired every lawyer who made such hidebound distinctions. In their place, we hired transactional lawyers who understood our business well—not only our goals in a specific deal, but also overall—and who thus could provide integrated business and legal advice. In order to have this deep level of knowledge, transactional lawyers—especially those who practice in the tech space—need to immerse themselves in the business of their clients. In many situations, this might mean self-educating by reading a client’s business plan and fundraising slides, as well as general business magazines, books, blogs, and journals.

Last, and perhaps most importantly, we in legal academia—in addition to training students to “think like lawyers”—should give today’s transactional law students a head-start on “thinking like businesspeople.” By doing so we can help ensure clients receive the kinds of lawyering they increasingly demand (and need).

Permalink | Innovation, Intellectual Property, Law & Entrepreneurship, Technology, Transactional Law | Comments (View) | TrackBack (0) | Bookmark

June 15, 2014
icon Welcome Guest Blogger Ted Sichelman
Posted by Gordon Smith

According to his web bio, Ted Sichelman of the University of San Diego School of Law "writes in the areas of intellectual property, law and entrepreneurship, empirical legal studies, law and economics, and computational legal studies, and tax law." Of course, you don't have to believe the bio ... you can also read his work for yourself. It's good stuff. I especially like the work at the intersection of law and entrepreneurship, like "Why Do Start-ups Patent?" and "Commercializing Patents." Ted will be guest blogging with us over the next two weeks, and we are very eager to see what is currently occupying his thoughts. Welcome, Ted!

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icon Father's Day
Posted by Gordon Smith

Father's Day has special meaning to me this year because my son Conrad will be giving his "farewell" talk at church before commencing his missionary work in Berlin, Germany. He enters the Missionary Training Center on Wednesday, and we will not see him (except via Skype twice a year) for two years. This morning, we made our traditional trek to the Provo Temple for some family photos, and here I am with Conrad ...


Conrad is a twin, and his brother Christian is planning to serve a mission after attending fall semester at BYU. After 18 years of inseparability, I will miss seeing these two goofing together for the next two and a half years ...


Earlier this week, I had another father moment, as my oldest daughter gave birth to our first grandchild, Esther Anne Randle. Here is Esther at three days old:


Being a law professor is a great job, but it is nothing compared with being a father. Reflecting on all of this, I actually got a bit teary watching this Father's Day message ...

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June 13, 2014
icon Family Film Blogging: Maleficent
Posted by Christine Hurt

The summer blockbusters keep coming, and I predict Maleficent to be one of the biggest.  In my own opinion, it is one of the best.  On its face, the movie doesn't seem that new.  There have been other live-action re-tellings of animated fairy tales (Snow White and the Huntsman; Mirror, Mirror), both with Academy Award winning female leads playing the evil role.  But Maleficient seems different, more important.  The premise is not just that a silly fairy tale has more nuance or detail to it but that an important story has been intentionally mistold to whitewash a powerful man's guilt and villainize a victim.  Moreover, evil exists in the world, and we all must account for how we respond to it and let it shape our actions.  Now don't get me wrong, kids will like it as much as other scary, dark Disney movies (the original Sleeping Beauty, Beauty and the Beast).  But, on another level, its a PG-version of Extremities.

The trailer doesn't give much up about the plot of the movie, and if you want everything to be a surprise, you may want to stop reading.  From the trailer, we know that Maleficent, played by Angelina Jolie, alludes to the fact that she used to have wings.  In the first scenes of the movie, we see a young Maleficent happily winging (not really flitting -- her wings are huge) over the moors, where the fairy creatures live in harmony with one another, out of the way of humans.  There is some suggestion that humans have warred with them before.  Maleficent is anything but evil -- she is happy, strong, forgiving, and playful.  Then she meets Stefan, who we know from watching Disney movies grows up to be King Stefan, father of Aurora.  But in opening scenes he is a peasant, dreaming of being king, who becomes quite close to Maleficent as they grow up together.  When she is 16, he kisses her, calling it "true love's kiss."  She obviously loves him, but does not pine for him as he goes out to find his fortune, something she does not understand but does not seem to resent.

So, at this point we know that something is going to happen to turn Maleficent against Stefan.  I was really, really hoping that it would not be a romantic betrayal -- that he finds love elsewhere, marries, etc.  And it's not.  (You may want to stop reading now.)  The human King promises to give his throne to whichever of his loyal soldiers can vanquish Maleficent.  Stefan wants to be king.  He pretends to warn Maleficent of the King's reward offering, then drugs her.  He does not kill her, but he takes her wings, her identity, the physical embodiment of her soul.  You can see this as sort of the Snow White-Huntsman compromise or as something much more insidious.  Maleficent's pain on waking without her wings is very hard to watch.  Anyway, Stefan becomes King, and Maleficent becomes, well, Maleficent, with a single purpose -- to destroy King Stefan.

The christening scene is almost word-for-word a rendition of the animated movie's scene, which makes the differences even more rich.  Maleficent curses the baby, leaving King Stefan to descend into madness over the next 16 years, knowing that he has brought this on his house.  The baby is taken to the cottage in the glen by the three "good" fairies, who are comic relief in a much different way than in the original.  Then the amazing part of the movie begins -- the relationship between Maleficent and Aurora, and how Maleficent finds redemption without revenge.  The entirety of the movie is played out on Jolie's face, from Stefan's betrayal to the end.

The movie will undoubtedly find its audience both with moms of this generation who have elevated loving one's children to an art form and with teenage girls who would rather have Angelina Jolie as a Fairy Godmother than a boyfriend.  (Prince Philip here looks like he mistakenly wandered off the set of a Disney channel show.)  That's fine with me -- I think it's nice to have a crop of movies that tell teenage girls that love at first sight with a stranger isn't really love at all (Frozen, Brave).

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June 12, 2014
icon Call for Papers: AALS Securities Regulation
Posted by Erik Gerding

Call For Papers
AALS Section on Securities Regulation - 2015 AALS Annual Meeting

Saturday January 3, 2015, Washington, DC

The AALS Section on Securities Regulation invites papers for its program on "The Future of Rule 10b-5" for the AALS Annual Meeting in Washington, D.C. The AALS Section on Securities Regulation program will be held on Saturday January 3, 2015 from 3:30-5:15 PM.

TOPIC DESCRIPTION: This panel discussion will explore the current and future role of Rule 10b-5 in public and private offerings, public enforcement efforts, and private litigation. Participants also will discuss the manner in which Rule 10b-5 relates to expectations regarding public companies and their directors. Participants will explore these issues in light of recent court decisions (including, e.g., Halliburton), the Securities and Exchange Commission's enforcement priorities, and changing rules related to public disclosure obligations.

ELIGIBILITY: Full-time faculty members of AALS member law schools are eligible to submit papers. Pursuant to AALS rules, faculty at fee-paid law schools, foreign faculty, adjunct and visiting faculty (without a full-time position at an AALS member law school), graduate students, fellows, and non-law school faculty are not eligible to submit. Please note that all faculty members presenting at the program are responsible for paying their own annual meeting registration fee and travel expenses.

PAPER SUBMISSION PROCEDURE: Up to three papers will be selected from this call for papers. There is no formal requirement as to the form or length of proposals. Both shorter proposals and substantially complete papers will be considered.

Papers will be selected by the Section's Executive Committee in a double-blind review. Please submit only anonymous papers by redacting from the submission the author's name and any references to the identity of the author. The title of the email submission should read: "Submission - 2015 AALS Section on Securities Regulation."

Please email submissions to the Section Chair Lisa M. Fairfax at: lfairfax@law.gwu.edu on or before August 21, 2014.

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