A while ago, I wrote a post decrying multitasking. Travis Bradberry at Forbes has an excellent post discussing some research of multitasking conducted at Stanford University. My favorite takeway: “They found that heavy multitaskers—those who multitask a lot and feel that it boosts their performance—were actually worse at multitasking than those who like to do a single thing at a time.”

Alibaba dominated the September business press coverage with its record-breaking IPO last month, and news of its stock price, trading at a 30% premium, continues to dominate coverage.  I have been using the headline-hogging IPO in my corporations class to discuss raising capital, which I am sure many of you are doing as well.  Here are a few creative uses for the class-friendly headlines:

  • I used coverage of the IPO and its short-lived halo effect on other tech IPO’s as a companion to the E-bay stock spinning case (taught under director fiduciary duties).  

As we move into securities next week,

Please add to the list of uses in the comments section if you have any new ideas or suggestions.

-Anne Tucker

Georgetown University Law Center invites applicants interested in establishing and teaching in a transactional clinic.  This position is tenure track. The successful applicant will begin on July 1, 2015.  Georgetown seeks to add to its spectrum of business related clinics. Currently we offer clinics that teach business formation in the field of social entrepreneurship, community development and strategic planning, and that assist low income residents in the acquisition, renovation, and operation of their buildings as long-term affordable housing.

At Georgetown Law, professors dedicated to clinical teaching are fully integrated into the faculty. Both entry level and lateral hires are urged to apply. The person selected for this position would join our large clinical community, develop the clinic, be assisted by a clinical fellow and teach the clinic each semester.

The successful applicant will have a strong commitment to promoting access to justice and a demonstrated interest in nurturing student development.  Candidates must demonstrate intellectual engagement including scholarly promise (for entry-level candidates) or be a proven scholar (for lateral candidates).  Successful applicants will also have subject-matter expertise and a positive reputation in the field, the communication, organizational and collaborative skills necessary to direct and manage a clinic and a commitment to teaching clinically over the long term. Georgetown values excellent teaching and a successful applicant will have pedagogical skills, creativity, and enthusiasm for the academic endeavor.  This law school is committed to diversity, and candidates of diverse backgrounds are encouraged to apply.

Please send a resume, including the names of references and a statement of interest to Hope Babcock, the Chair of the Clinical Subcommittee of the Appointments Committee. Her email is Babcock@law.georgetown.edu.

[Posted at the request of Haskell Murray, who is traveling today.]

Maryland State Senator and American University Washington College of Law professor Jamie B. Raskin recently wrote an opinion piece for the Washington Post, A shareholder solution to ‘Citizens United’. In the piece, he explains that 

Supreme Court Justice Anthony M. Kennedy’s majority opinion in Citizens United essentially invites a shareholder solution. The premise of the decision was that government cannot block corporate political spending because a corporation is simply an association of citizens with free-speech rights, “an association that has taken on the corporate form,” as Kennedy put it. But if that is true, it follows that corporate managers should not spend citizen-shareholders’ money on political campaigns without their consent.

Senator Raskin further notes that the Congress doesn’t appear interested in moving forward with the Disclose Act, and the Securities and Exchange Commission has not pursued requiring campaign spending disclosures.  In response, the senator has a proposal:

Our best hope for change is with the state governments that regulate corporate entities throughout the year and receive regular filings from them. I am introducing legislation in January that will require managers of Maryland-registered corporations who wish to engage in political spending for their shareholders to post all political expenditures on company Web sites within 48 hours and confirm that any political spending fairly reflects the explicit preference of shareholders owning a majority interest in the company.

Further, if no “majority will” of the shareholders can form to spend money for political candidates — because most shares are owned by institutions forbidden to participate in partisan campaigns — then the corporation will be prohibited from using its resources on political campaigns.

Back in early 2010, as a guest blogger here, I wrote a post, Citizens United: States, where I noted my reaction to the case, which was that I wondered how states would react and that the case made the issue “an internal governance issue, which is a state-level issue.” (Please click below to read more.)

Continue Reading The Internal Affairs Doctrine, State Power, and Citizens United

As on-campus interviews slow down, a lot of students now are coming to me looking for cover letter advice.  Since co-blogger Haskell Murray more-or-less asked me to write on this topic in response to a comment on his super post on resumes and interviews, I thought I would take the bait.  My principal thoughts on the subject are set forth below the fold.  Some of my observations and elements of my advice are conservative and anally compulsive, I know.  But consider the source:  I worked in Big Law for fifteen years before I started teaching law and served on a number of office hiring committees over that time. 

Thee are many good websites out there on cover letter drafting.  Most of the advice they give is good, but it is somewhat varied.  There are some things common and traditional in law job cover letters that may help students sift through the Internet prattle and settle on specific approaches.  That’s the overlay I hope to offer here.

Continue Reading Cover Letters for Legal Job Applications

There has been much discussion recently about the SEC’s use of administrative proceedings, rather than court proceedings, for enforcement purposes. Both Peter Henning  and Gretchen Morgenson  have addressed the issue in the New York Times. And Jay Brown at Race to the Bottom has devoted several posts to the issue. See here,  here,  here, and here. (This final post claims to be part 5, but I believe this was a numbering error.)  .

I do not want to rehash that discussion, but I do want to bring your attention to an excellent new book I have been reading, Is Administrative Law Unlawful?, by Philip Hamburger.  Hamburger is a Columbia Law School professor who specializes in constitutional law and history. The book is an extensive examination of the history of administrative legislation and adjudication in England and America, going back to the Magna Carta. He constructs a convincing argument that current administrative practice is inconsistent with both English and American history and practice.

This is not beach reading. The book is well-written, but the arguments and the history are complex and require serious thought. It is, however, worth the effort. The book is fascinating. It has given me an entirely new perspective on issues of administrative law, and that includes a great deal of what a securities law professor like me teaches and writes about. If you have some time and are willing to make the effort, I strongly recommend this book.

Here are more detailed reviews from The Economist and The Wall Street Journal,  if you’re interested. In addition, a podcast interview of Professor Hamburger is available here.

My colleague Mark Phillips recently published a short article in the Nashville Bar Journal entitled Can Entrepreneurial Education Restore Faith in Legal Education? (pgs. 6-7). Mark primarily teaches entreprenuership classes in the undergraduate and graduate business schools at Belmont University, but has a JD from NYU Law, in addition to his MBA from NYU (Stern) and his PHD from George Washington University. 

For local readers, Mark will be speaking at a Nashville Bar Association breakfast on Nov 11th (at 8 am at Noshville restaurant at 1918 Broadway, Nashville, TN 37203). Mark has also started a website (www.eEsquire.net), which may be of interest to readers.

A portion of Mark’s recent Nashville Bar Journal article is below:

A great deal was lost in legal industry during the recent recession, but perhaps the most lasting damage was inflicted upon the reputation of law schools. When news broke in 2011 that a significant number of law schools had distorted their placement figures to increase enrollment and rankings, both current and prospective law students were shocked. After a stretch of bad publicity, coupled with some inevitable lawsuits, law schools worked to erase their new-found stigma through greater disclosure and transparency. Yet despite these acts of contrition, the relationship between students and law schools remains fractured.

 

One method for repairing this relationship that has not been widely discussed may take the unlikely form of enhancing students’ awareness and preparedness for entrepreneurship within the legal industry—namely, by preparing them for solo practice. Shining a brighter light on solo practice as a viable post-graduate career option would not, as many may fear, be a concession that students cannot get high-paying jobs, but rather a reflection of a longstanding reality. Consider for a moment the fact that solo practice is the most consistent and largest sector of legal employment in the United States.  Luz Herrera, Assistant Professor of Law at Thomas Jefferson School of Law, drew upon historical employment data to conclude that approximately three-fourths of attorneys work in private practice, and of those, over half identify as solo practitioners while another 14% work in offices with five or less attorneys.   So rather than treating the pursuit of solo practice as a second-tier career choice, schools could elevate the discussion of solo practice to better align it with the reality of the legal employment market.

The entire article is here. 

As I previously posted, this semester I’m co-teaching a seminar with an old law school friend, Tanya Marsh (well, seminar-ish – we ended up with 17 students) on the financial crisis.

A couple of weeks ago, I dedicated a class to the concept of “regulation by deal” – inspired Steven Davidoff Solomon and David Zaring’s article with that title.  We talked about how Treasury and the Fed used dealmaking approaches to save individual firms, and thus the economy as a whole, and the corporate law issues that the government’s approach raised (lots of great inspiration also came from Marcel Kahan and Edward Rock’s When the Government is the Controlling Shareholder).  I assigned excerpts of the Regulation by Deal article, as well excerpts from the complaint filed by Fannie & Freddie shareholders, the AIG complaint, and the SIGTARP report on AIG’s payments to counterparties.  We also talked about the mergers between JP Morgan and Bear Stearns, and between Bank of America and Merrill Lynch.

Well, it was lucky timing, because that class – by sheer happenstance – was scheduled just before the AIG trial began, and then earlier this week, the Fannie & Freddie complaint was dismissed.  So now I have even more to talk about with the students.

One point I see in a lot of the commentary on the AIG trial is that the shareholders’ claims are pretty weak, but at least the trial itself will shed some light on one of the unanswered questions about the crisis, namely, why did Geithner and the NY Fed agree to pay AIG’s CDS counterparties 100 cents on the dollar, instead of demanding that they take a haircut?  I.e., one of AIG’s major problems was that it had sold credit default swaps (CDS) on mortgage-backed assets held by a number of banks – it had sold insurance, essentially, against a drop in value of those assets.  AIG promised to pay out if those assets failed.  And when asset values began falling, the counterparties demanded that AIG post collateral – and those demands contributed to AIG’s liquidity crisis.  To solve that problem, the NY Fed bought the assets underlying the CDS contracts – allowing the counterparties (banks like Goldman Sachs, Morgan Stanley, etc) to collect 100 cents on the dollar for assets that were, at the time, pretty toxic. 

This is, of course, the subject of the SIGTARP report, which concluded that the decision was not particularly well thought out, but was essentially foreordained by the NY Fed’s own self-imposed restrictions on its behavior, which limited its ability to apply any leverage in negotiations.

Among other things, the NY Fed was uncomfortable using its status as regulator to extract concessions on the CDS contracts when it was acting as a creditor of AIG, a more “private” sort of role. 

(Also, the phrase phrase “sanctity of contracts” appears so many times in the SIGTARP report that I wondered if I was going to start seeing graven idols.  But that’s me.)

The problem, of course, was that the NY Fed refused to use its regulatory power while wearing its “private creditor” hat, but at the same time, it also refused to truly behave as a private creditor – making it neither fish nor fowl.  For example, a private actor might have threatened bankruptcy – which the NY Fed was unwilling to do because, in its role as regulator, it could not allow AIG to declare bankruptcy.  A private actor would have been fine with striking different deals with different counterparties – which again, the NY Fed as regulator was unwilling to do, allowing any one counterparty to veto deals with the others.

And perhaps even more strikingly to me as a former litigator, the NY Fed also agreed not to sue any of the counterparties for fraud/misrepresentation.  That doesn’t strike me as anything like what a private actor would have done – which we know for a fact, given lawsuits filed by entitles like MBIA and Syncora.  A private actor could have at least demanded concessions in exchange for not filing a lawsuit – claiming, say, that the counterparties misrepresented the quality of the mortgages backing the assets – and dragging the matter out in court for years.  But the last thing the NY Fed as regulator wanted was that kind of publicity.

Anyway, however it shakes out, it’ll make for a fun follow-up class.