Touro University, Jacob D. Fuchsberg Law Center, professors Meredith R. Miller and Laura A. Dooley discuss the complexities of federal jurisdiction in cases involving limited liability companies (LLCs), suggesting an amendment to the diversity statute to simplify determining an LLC’s citizenship based on its state of creation and principal place of business. Professors Miller and Dooley evaluate the strategic implications of such a change from both procedural and business law perspectives, considering the impact on litigants’ access to federal courts, the influence of recent legislative efforts on ownership transparency, and the balance between offering fair legal proceedings and maintaining the advantages of state versus federal litigation.
Kathryn Robb, executive director of CHILD USAdvocacy, critically observes that Chapter 11 of the U.S. Bankruptcy Code has been misused by entities like Purdue Pharma, Boy Scouts of America, and the Catholic Church to shield themselves from liability, particularly in cases involving the opioid epidemic and child sexual abuse. Ms. Robb calls for Congress and the U.S. Supreme Court to take immediate action to rectify these abuses, with the recent delay in the Purdue Pharma settlement presenting an opportunity for Congress to pass legislative amendments that serve justice and protect victims.
NYU Law professor Samuel Estreicher and 3L Zachary Garrett comment on a notice of proposed rulemaking by the Federal Trade Commission (FTC) that purports to ban non-compete clauses in employment agreements. Professor Estreicher and Mr. Garrett argue that the authority of the FTC to do so, based on its broad interpretation of Sections 5 and 6(g) of its authorizing statute, is dubious at best.
UF Levin College of Law professor and economist Neil H. Buchanan offers yet another illustration of why we need not worry about the national debt—the biggest businesses do it. Professor Buchanan points out that nearly every Fortune 500 company carries debt because doing so is good financial management, and if our country were to be running a surplus, that would mean that the government is collecting more in taxes than it needs to cover current spending.
Cornell Law professor Michael C. Dorf comments on Twitter’s lawsuit against Elon Musk over Musk’s announcement that he was terminating his April agreement to purchase the company for $44 billion. Professor Dorf describes how Musk’s bully-like behavior is reminiscent of Donald Trump’s and describes the possible (and likely) remedies the Delaware court might deem appropriate.
NYU Law professor Samuel Estreicher and 3L Ryan Amelio comment on the unusual move by the U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA) decision to require employee vaccinations for employers with a total of 100 or more employees. Estreicher and Amelio explain why it is unclear whether the Agency has authority to mandate vaccinations and testing.
NYU law professor Samuel Estreicher and adjunct professor Zachary Fasman comment on the U.S. Supreme Court’s decision earlier this week in NCAA v. Alston, in which the Court held that the NCAA’s attempt to limit compensation to student athletes to preserve their amateur status is subject to the normal rule of reason analysis applied in antitrust cases. Professors Estreicher and Fasman note that the effect of conflicting and competing state name, image and likeness (NIL) regulation on the consumer market—the market at the core of the Court’s analysis in Alston—remains to be seen.
NYU law professor Samuel Estreicher and Elena J. Voss, associate general counsel for the Metropolitan Museum of Art, provide a roadmap of how employers can ready their workplaces for post-pandemic life. Professor Estreicher and Ms. Voss describe the importance of employers determining their workplace vision, communicating that vision to employees, defining what a “flexible” workplace means, setting clear policies with definitive maximums and minimums.
NYU law professor Samuel Estreicher and adjunct professor Zachary Fasman comment on two bills passed by the New York City Council that would mandate detailed and extensive labor protections for fast-food workers in New York City. Professors Estreicher and Fasman praise the intent behind the laws but explain why the City Council is not the place where binding agreements governing private workplaces in the City should be enacted.
BU Law emerita professor Tamar Frankel explains the law of preemption as it pertains to broker-dealers and their investor clients. She predicts, among other things, that either the clients will demand that broker-dealers adhere to a fiduciary duty, or else that states will impose that duty on them.
BU Law emerita professor Tamar Frankel discusses the Securities and Exchange Commission (SEC)’s Regulation Best Interest (BI), which imposes on broker-dealers a commitment to act in the best interests of their clients. Specifically, Frankel addresses the SEC’s treatment of client waivers of the Regulation BI, which goes even further than general fiduciary law to prohibit any waiver of the broker-dealer’s conflicting interests.
BU Law emerita professor Tamar Frankel discusses an emerging issue affecting financial advisers—when a client may exercise control over the actions of the adviser. Frankel relates the story of an investment adviser that did not follow the client’s orders to cease certain investments, at a cost of almost $5 million to the client. As Frankel explains, the Securities and Exchange Commission (SEC) got involved, resulting in the investment adviser’s settlement for a significant payment to the client and other conditions.
BU Law emerita professor Tamar Frankel discusses risk and uncertainty to explain people’s decision making as to investments. Frankel points out that people have varying degrees of tolerance for risk and uncertainty, due in part to cultural and individual differences.
BU Law emerita professor Tamar Frankel describes two advertisements by Charles Schwab ostensibly praising independent investment advisers, who are fiduciaries. Frankel explains why this development may lead to a separation of advice from execution of trade in a way that offers greater protections to investors.
Cornell law professor Michael C. Dorf comments on Argentina’s national elections last month, in which the country elected as Vice President Cristina Fernández de Kirchner, who had previously served as President of Argentina from 2007 to 2015. Dorf considers why Kirchner, and indeed anyone, would accept a lower position than what she has previously held. Dorf argues that due to the Peter Principle—which states that workers in a hierarchical organization tend to rise to their level of incompetence—we would do well as a society to abandon the whole concept of a demotion.
BU Law emerita professor Tamar Frankel discusses the legal and ethical duty of an employer to discuss separation packages with an employees who is quitting. Frankel argues that while the disclosure of relevant information does not involve the law, it involves the employer’s relational culture and affects the employer’s financial situation and future plans with other employees.
Guest columnist and UC Hastings adjunct professor Samuel R. Miller considers whether Amazon is violating antitrust laws if it is (as is alleged) misusing data it obtains from third-party transactions. Miller explains two potential theories of antitrust liability—the “essential facilities” doctrine and the “monopoly leveraging” theory—and discusses the extent to which Amazon might be liable under each theory.
BU Law emerita professor Tamar Frankel discusses the dangers of allowing non-government entities—such as Facebook and its affiliates—to issue a “basket” of crypto-currency. Frankel explains the importance of government regulation of currency and cautions that we should seek a clearer understanding of any technology or currency that can potentially destabilize the nation’s economy.
BU Law emerita professor Tamar Frankel explains how seemingly small hidden transaction fees can add up to a significant cost to the investor, particularly in long-term investments. Frankel explains that strictly literal interpretations of the regulations of broker-dealers lead to this unfair and costly result for investors and argues that society should focus on reinforcing brokers’ fiduciary duties of care (expertise) and loyalty (avoiding conflicts of interest).
BU Law emerita professor Tamar Frankel argues that while private ordering—that is, rules of behavior without the backup of law—works well in some situations, such as among diamond traders and farmers, it cannot work in other situations, including the financial system. Frankel provides a brief review of the literature on private ordering and explains why the financial system cannot work under this model, and indeed why applying it would cause dangerous trends and damaging consequences.
