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Joan Heminway

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Professor Heminway brought nearly 15 years of corporate practice experience to the University of Tennessee College of Law when she joined the faculty in 2000. She practiced transactional business law (working in the areas of public offerings, private placements, mergers, acquisitions, dispositions, and restructurings) in the Boston office of Skadden, Arps, Slate, Meagher & Flom LLP from 1985 through 2000.

She has served as an expert witness and consultant on business entity and finance and federal and state securities law matters and is a frequent academic and continuing legal education presenter on business law issues. Professor Heminway also has represented pro bono clients on political asylum applications, landlord/tenant appeals, social security/disability cases, and not-for-profit incorporations and related business law issues. Read More

The enticing facts of insider trading have me writing about the topic again (see an earlier post here) as the US Supreme Court prepares to hear oral argument in Salman v. US on October 5th.  In Salman, the Supreme Court is asked to draw some careful lines in the questions: what benefit counts and how to prove such a benefit under Dirks v. SEC.  

Recall that in Dirks, the Supreme Court focused the test on whether an insider benefitted—either by trading or by tipping in exchange for a benefit from the person to whom she tipped material nonpublic information. After Dirks, the 10b inquiry is whether the insider breached a duty by conveying the information for the insider’s personal benefit, and whether the tippee knows or at least should know of the breach. The Court explained that even in a case against a tippee who trades “Absent some personal gain [by the insider], there has been no breach of duty to stockholders. And absent a breach by the insider, there is no derivative breach [by the tippee].”

The Salman case highlights a circuit split:  the Second Circuit case United States v. Newman and the Ninth…

This Friday, I will co-present on a continuing legal education panel on “The New Crowdfunding Laws for Private Investors & Other Ways to Legally Raise Money For Your Project” at the Americanafest–the Americana Music Festival and Conference.   The program description is set forth below.

There have been significant changes in federal and state laws related to soliciting investors through crowdfunding and other types of investment activities.  These new changes are designed to make certain types of investments easier and more accessible to people and businesses who seek investors for their projects. This panel will discuss those new laws and strategies of how to seek small to moderate size investments under today’s federal and state law. The panel will also discuss “dos” and “don’ts” for those seeking out investors and what to look for when offered an investment opportunity.

I love cultivating this ground, even if I have done much of it in the past with different audiences.  I will prepare some specialized information relating to financing music and other creative projects, for example, for this program.  I also plan to discuss important traps for the unwary.

What I really want to know is: what else might folks working with and in the music…

Last spring, in the wake of Justice Scalia’s passing, I blogged about Justice Scalia’s final business law case: Americold Realty Trust v. ConAgra Ltd. The oral argument signaled that the Court’s preference for a formalistic, bright line test that asked whether the entity involved was an unincorporated entity, in which case the citizenship of its members controlled the question of diversity, or whether it was formed as an corporation, in which a different test would apply.  The Supreme Court issued its unanimous (8-0) opinion in March, 2016 holding that the citizenship of an unincorporated entity depends on the citizenship of all of its members. Because Americold was organized as a real estate investment trust under Maryland law, its shareholders are its members and determine (in this case, preclude) diversity jurisdiction.   

S.I. Strong, the Manley O. Hudson Professor of Law at the University of Missouri, has a forthcoming article, Congress and Commercial Trusts: Dealing with Diversity Jurisdiction Post-Americold, forthcoming in Florida Law Review.  The article addresses the corporate constitutional jurisprudential questions of how can and should the Supreme Court treat business entities.  What is the appropriate role of substance and form in business law?  Her article offers a decisive reply:

Commercial

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Interesting research has been done on overconfidence in business leadership (see, e.g., here, here, and here) and political behavior (see, e.g., here and here).  I periodically consult the literature in this area for use in my work.  It is fascinating and often helpful.

In my continuing career development advice to law students, and as a member of our faculty appointments committee at UT Law this year, however, I recently have come to notice and be concerned about overconfidence in job searches.  Specifically, I see law students who, in testing out a new confidence in their knowledge and skills, overdo it a bit and over-claim or come across as unduly self-important.  I also see faculty candidates who have registered for the Association of American Law Schools Faculty Appointments Register (FAR) puff and oversell–using the comment areas to make cringe-worthy self-aggrandizing statements about their teaching or scholarly background or abilities.

Most of us prefer to associate with confident people.  Confidence in a leader or colleague is an attractive trait–one that we associate with strong governance and high levels of performance.  Confidence wins appointments, elections, and jobs.  Yet overconfidence, if recognized, is unattractive and often means lost opportunities.

Overconfidence is common.  Don Moore…

As many of you already know, I regularly advise students (as so many of us do) on career planning and job searches.  This advice extends to communications in connection with career planning and job searches.  And I have blogged about all this.  I have posted in the past, for example, on networking letters (my post is here) and cover letters, for example (my most recent post is here). 

Yesterday, I got an email message from a student with a great question related to all this.  Here is the question: “What would you recommend as the subject line of an email to a contact you have been referred to by someone else?”  Nice.  Here’s what I ended up writing back, in pertinent part.

 . . . Email titles are tricky.

The first thing I would do is ask if the person making the connection can e-introduce you with an email message and copy you in.  I have done that many times.  My script usually goes something like this:

[X], e-meet [Y].  As I explained to you earlier today, [Y] is the [title & affiliation].

[Y], [X] is a [year] at UT Law who is considering [career goal].

Stock pricing in the securities market responds to supply and demand.  This is intuitive with regard to individual securities.  We understand that if more people want to buy a stock (demand) than sell it (supply), then the price moves up. Conversely, the price decreases if more want to sell than buy.  I wonder to what extent regulators have examined the role of retirement saving plans in flooding the market with demand to buy new securities and which can drive up stock prices overall.  Consider this historical graph of the NYSE trading average.  Observe the sharp rise beginning in the late 1980’s with the introduction of individual retirement savings plan and the beginning of the defined contribution society. 

Nyse-composite-may

chart source: Forecast Chart

New Department of Labor regulations open the door for state governments to sponsor retirement savings plans for non-government workers.  See for example, California’s proposed plans.  The rules, proposed in 2015, became final on August 30, 2016.  You can read a summary of the proposed plans published by The Brookings Institute and a DOL interpretive bulletin.  Also being considered are proposed rules authorizing high-population cities to sponsor similar plans in states that don’t create the non-government worker retirement savings plans.  Collectively, these regulations…

I originally was going to write about overconfidence today.  But I will reserve that post for a later date.  Instead, for today, I am sharing with you a Tennessee legislative drafting issue on which my voice (together with the voices of others) has been solicited and asking for your views and comments.

A committee of the Tennessee Bar Association has been working on proposed revisions to the Tennessee Revised Uniform Limited Partnership Act.  Several thorny issues remain for consideration and final decision making, among them, whether Tennessee law, like Delaware limited partnership and limited liability company law, should allow for the elimination of general partner fiduciary duties.  The committee soon will be voting on this issue, and we are circulating among us our current views (having earlier debated the matter in telephone conference calls).  I took a shot at writing down my views for the group and circulated them last night.  I am including the main substantive part of what I wrote here, minus some typos that I caught after the message was sent (and please forgive the disfluencies in places), and requesting comments from you:

Although I knew that Labor Day was a creation of the labor movement (about which I have mixed views), I had never looked up the history of the holiday in the United States.  The Department of Labor, unsurprisingly, has a nifty, short webpage with some nice historical facts.  Among them: the holiday has roots back into the 1880s and was originally a municipal creation, then became a state holiday in a number of states before Congress approved the holiday in 1894.  The brief history on the webpage concludes with the following paragraph:

The vital force of labor added materially to the highest standard of living and the greatest production the world has ever known and has brought us closer to the realization of our traditional ideals of economic and political democracy. It is appropriate, therefore, that the nation pay tribute on Labor Day to the creator of so much of the nation’s strength, freedom, and leadership — the American worker.

Great stuff.  

Labor and employment lawyers have focused commentary over the past week on legal matters relating to their spheres of influence in acknowledging Labor Day.  Proskauer partner Mark Theodore posted a piece on a pair of recent NLRB decisions, and…

House Representative Carolyn B. Maloney, Democrat of New York, sent a formal request to a slew of federal agencies to share trading data collected in connection with the Volcker Rule. The Volcker Rule prohibits U.S. banks from engaging in proprietary trading (effective July 21, 2015), while permitting legitimate market-making and hedging activities.  The Volcker Rule restricts commercial banks (and affiliates) from investing investing in certain hedge funds and private equity, and imposes enhanced prudential requirements on systemically identified non-bank institutions engaged in such activities.

Representative Maloney requested  the Federal Reserve, Federal Deposit Insurance Corporation, Commodity Futures Trading Commission, Office of the Comptroller of the Currency, and the Securities and Exchange Commission to analyze seven quantitative trading metrics that regulators have been collecting since 2014 including: (1) risk and position limits and usage; (2) risk factor sensitivities; (3) value-at-risk (VaR) and stress VaR; (4) comprehensive profit and loss attribution; (5) inventory turnover; (6) inventory aging; and (7) customer facing trade ratios.

Representative Maloney requested the agencies analyze the data and respond to the following questions:

  • The extent to which the data showed significant changes in banks’ trading activities leading up to the July 21, 2015 effective date for the prohibition on

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Imagine this: Professor walks into Business Associations class Monday morning at 8:00 am having prepared to cover 14 pages of reading when she assigned only three (intending, when creating the syllabus, as she later recalled, to use the time to summarize, contrast, and compare agency law rules that will again come into play in partnership and other entity law–and to catch up, if need be).  OK.  The professor is me.  First lesson (which I thought I had learned many moons ago): always double-check the syllabus on what you’ve assigned.
 
So, what happened in class?  Well, the students didn’t let on that the outline for the class plan that I scripted out on the whiteboard seemed to go beyond the reading.  But they might not have recognized that, since it was only an outline.  However, once I started covering the unassigned material, someone did alert me to my error.  Shocked (!), I told them that I had been too nice (weak response) and that–obviously–I had not checked the syllabus to confirm the day’s reading assignment before scripting out the class plan and preparing for class.
 
I didn’t then let the students go after learning of the mistake (having covered

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