Legal Studies Research Paper Series

(From Legal Scholarship Network: Legal Studies Research Paper Series, University of North Carolina RSS)

Rethinking Victim-Based Statutory Sentencing Enhancements

Kevin Bennardo
Punishment enhancements that are triggered by some trait of the victim are deeply entrenched in American criminal statutes. The research underlying this Article identified over 120 distinct traits that a victim could possess that would statutorily enhance the offender’s punishment. These enhancements are often based on an inherent trait of the victim (e.g., age, disability), the victim’s occupation (e.g., law enforcement officers, utility workers), or a non-occupational role-based undertaking (e.g., jurors, visitors at a detention center). This Article argues that such victim-based statutory enhancements should be eliminated. First, they are dreadfully inegalitarian. These enhancements send the message that society prefers the victimization of individuals who do not happen to possess any of the protected characteristics. These enhancements create classes of “preferred victims” within society. Rational offenders are therefore incentivized to select victims who possess none of the triggering traits. In other words, such enhancements send the message that society wishes to protect some individuals more than others. Second, the Article identifies the four goals that these enhancements are meant to serve:
(1) deterring the victimization of vulnerable individuals,
(2) increasing punishment to account for the greater harm that results from victimizing certain individuals,
(3) incentivizing individuals to undertake certain occupations, and
(4) honoring certain types of individuals.
The latter two goals are simply not legitimate uses of the criminal law because they are unrelated to any of the theoretical purposes of punishment. The first two goals, while legitimate uses of the criminal law, are not well served by the existing legislation. The victim-based traits that trigger the enhancements are poor proxies for these legislative goals. For example, an enhancement triggered by victimizing a person over the age of sixty-five is both over- and under-inclusive to achieve the goal of deterring the victimization of vulnerable individuals because age is not necessarily correlated with vulnerability. Thus, these victim-based statutory sentencing enhancements should be repealed and replaced with legislation that better accomplishes the legitimate underlying goals.

-August 29, 2018

The SAFE, the KISS, and the Note: A Survey of Startup Seed Financing Contracts

John F. Coyle and Joseph M. Green

the past decade, there has been an explosion in seed financing for early-stage technology startups. Increasingly, this seed financing is channeled to these companies via an entirely new form of investment contract — the deferred equity agreement. One version of this agreement — the Simple Agreement for Future Equity (SAFE) — made its debut in 2013. Another version — the Keep It Simple Security (KISS) — first appeared in 2014. While these instruments have attracted extensive attention in the startup blogosphere, there exists remarkably little information about the role they play in the real world. Nobody seems to know, for example, precisely who is using these new contracts. It is likewise unclear where exactly these agreements are being used. In a very real sense, the discussion about these new contractual forms is occurring in an empirical black hole.

This Essay aspires to bring light to the darkness. Drawing upon original lawyer survey data collected in the spring and summer of 2018, it offers a snapshot of the current landscape for startup seed financing contracts. This snapshot will be of interest to legal scholars and practitioners for several reasons. First, it constitutes the first systematic attempt to document the spread of an important contractual innovation — the deferred equity agreement — throughout the United States and Canada. Second, it shows that the traditional dichotomy between “West Coast” and “East Coast” venture financing deal terms is rapidly being replaced by a new dichotomy between startup lawyering “aficionados,” who devote the majority of their practice to representing startup companies and their investors, and “dabblers,” who spend only a small portion of their time working in the startup space.

In addition, this snapshot offers important insights into the existing legal literature that views contracts as products. We argue that the SAFE and the KISS — whatever their legal merits — bear more than a passing resemblance to the branded swag that is commonly given away by companies to build brand awareness. This is a significant finding with implications that go well beyond this particular area of the law. Finally, the snapshot of seed financing contracts is relevant to practicing lawyers, particularly as these attorneys seek to advise clients on the extent to which these newer deferred equity contracts are actually being used by similarly situated companies and investors.

-September 20, 2018

Who Do You Work for? The Difficulty in Defining 'Employer' in the Modern Workplace

Jeffrey M. Hirsch
The most fundamental question in labor and employment law is whether an employment relationship exists. Often, this questions centers on whether a worker is classified as an employee covered by a relevant statute. But even when there is no issue about a statute’s jurisdiction over workers and firms involved in a dispute, determining whether an employment relationship exists can still pose challenges. This is especially true when multiple firms are involved in the supply or use of labor, such as through contracting, franchising, leasing, and other similar business models. Although these business forms can have legitimate and beneficial corporate justifications, they can also lead to a “fissured” employment relationship that is fraught with problems, including the inability of workers to hold their primary or official employers liable for workplace violations; exclusion of workers from the often superior working conditions and benefits enjoyed under traditional work relationships; a decrease in cooperation between workers and firms; an increase in workplace accidents; and frustration of workers’ attempts to engage in collective bargaining. The practice of firms using indirect or fissured labor is not a new one. Courts have long struggled to determine firms’ liability under various workplace laws pursuant to the joint-employer concept. Technology, however, has greatly exacerbated this issue, as it has made it easier for firms to use contingent workers and to enter into shared operational relationships like franchising. The salience of this issue was brought home by the NLRB General Counsel’s recent case against McDonald’s, arguing that the corporation was a joint employer along with many of its franchisees. This chapter explores these issues and proposes an alternative analysis that renews the focus on the primary purpose of labor law’s joint-employer doctrine—ensuring meaningful collective bargaining. The central inquiry under this test would be whether the official employer, by itself, is able to effectively bargain over the work conditions at issue or whether a third-party firm’s absence thwarts employees’ right to engage in good-faith bargaining over their work conditions. If a third party is needed for an employer to alter or make a concession over a term of employment, then that third party should be considered a joint employer and have to bargain over that term. This proposed test compares favorably to current common-law tests by maintaining more focus on the issues in dispute, by typically involving a more streamlined application, and by providing third-party firms more control over their potential status as a joint employer.

-September 3, 2018

Schooling at Risk

Barbara Fedders
For much of the nation’s history, states excluded entire groups of students from mainstream public-school classrooms based on classifications of race or disability. Although Brown vs. Board of Education and its progeny, as well as the Individuals with Disabilities Education Act, now prohibit the most blatant and egregious forms of this type of exclusion, a new version has emerged. Over the last thirty years, schools have suspended, and transferred into separate schools known as Alternative Education Programs (“AEPs”), a significant and growing number of students. Proponents of this new version of exclusion argue that these practices can help to curb misbehavior, promote school safety, and assist students in obtaining academic success. Yet research shows that suspending students does little to improve behavior; nor does it necessarily improve school safety. And while policymakers intend for AEPs to re-engage students at risk of educational failure, they are often demonstrably inferior to regular public schools and thus unable to accomplish these stated objectives. Perhaps most troubling, the individual students at greatest risk of suspension and transfer to AEPs are from those groups once subject to de jure segregation and outright bans from classrooms: African-American students and students with disabilities. This Article contextualizes suspension and AEP transfer within the longer history of exclusion of Black students and students with disabilities. It describes how pre-civil rights school districts justified group-based exclusion of African-American students and students with disabilities on the basis that they were undeserving of the full promise of public education. It then analyzes the rise in suspensions and growth of AEPs and outlines their problematic features, while drawing important parallels between the new exclusion and the historical trope of the underserving child. It shows the ways in which suspension resists legal challenge, as well as how traditional tools for promoting educational equity are likely to be inadequate in addressing the flaws of AEPs. Looking forward toward possible solutions, the Article commends the small but growing number of schools finding non-exclusionary ways to address misbehavior and suggests that rather than seek to reform AEPs, policymakers should consider abandoning this failed educational innovation.

-August 13, 2018

Kemp: Field Notes from 1977-1991

John Charles Boger
This Essay is an expanded version of a keynote address to a Symposium hosted by the Northwestern University School of Law. It examines the handiwork of the Supreme Court in the McCleskey v. Kemp (1987) case and the adverse impact of McCleskey on the subsequent judicial consideration of statistical evidence -- even of widespread racial discrimination -- in the capital and criminal justice systems. As one member of the legal team who brought the McCleskey case, my contribution was to speculate on how and why the Court might have disregarded such meticulously documented and unrebutted patterns of racial disparities in capital sentencing, despite the Justices’ formal condemnation of racial discrimination in principle and their occasional intervention to curb particularly egregious acts of racial injustice. This Essay ends by encouraging social scientists and legal scholars to continue to uncover and oppose patterns of racial discrimination that remain widespread in the administration of criminal justice.

-August 13, 2018

Corporate Bankruptcy Hybridity

Melissa B. Jacoby
This Article contends that corporate bankruptcy is a hybrid form of law, best understood as a public-private partnership. Using the analytical tools of administrative law and privatization scholarship, I interrogate the common, but erroneous, assumption that corporate bankruptcy is best understood as a species of private law - an assumption that has dramatically limited the field methodologically, ideologically, and doctrinally. Having established the public-private partnership concept, the Article next explores disparate features of modern Chapter 11 that, taken together, distort the system's balance, particularly in larger cases. In addition to extensive control of private lenders that already has been well documented, the discussion here includes subtler factors, such as the doctrine of equitable mootness, permissive venue laws, the disabling of the threat of trustee appointment, and the erosion of debtor-in-possession responsibilities through derivative standing. The final task of the Article is to offer ideas for system improvement inspired by the public-private partnership model. First, I argue that all repeat players that shape the system, including private parties, must attend to procedural justice concerns. In a hybrid system, maintaining legitimacy cannot be the sole obligation of government actors. Second, I propose a non-profit Sunlight Fund. It could finance particular acts and causes of actions in a bankruptcy that are important to furthering public objectives yet potentially antagonistic to the interests of deep-pocketed private parties. Perhaps the biggest advance, however, would come from rethinking who gets a seat at the table in shaping the future of the field. In legal academics, those who have redistricted the corporate bankruptcy field to include only private law concerns mainly have been white men, most of whom work within a subset of law and economics. Particularly given the range of people and communities affected by the bankruptcy system, and the research on matters such as cognitive bias, diversifying the voices and experiences of the contributors is essential.

-September 10, 2018

The Standard Business Deduction

Kathleen DeLaney Thomas
This paper describes a proposal for a standard business deduction ("SBD") for small businesses. The SBD would work like the regular standard deduction. The latter is a fixed amount that is claimed in lieu of claiming itemized deductions below the line. The SBD would be a fixed amount that is claimed above the line in lieu of deducting actual business expenses. Taxpayers claiming the SBD would report their gross business earnings, subtract the SBD, and arrive at net business income. No Schedule C would be necessary. Like the regular standard deduction, claiming the SBD would be optional for the taxpayer. If a taxpayer’s actual business expenses exceeded the SBD, he could instead opt to claim those expenses. An SBD would greatly simplify the tax system for small business owners. Taxpayers who chose to claim it could be relieved of the burden of tracking business expenses during the year and could self-prepare their tax returns without the need for expensive tax preparation assistance. Not only would the SBD reduce socially wasteful taxpayer compliance costs, but it would also reduce IRS enforcement costs. Such simplification should be attractive to policymakers on both sides of the aisle and would benefit the government and taxpayers alike.

-August 9, 2018

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