Legal Studies Research Paper Series

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

How Good Is the Public Data on Sovereign Bond Contracts?

Andrea E. Kropp, G. Mitu Gulati and Mark C. Weidemaier
Commercial databases now make available to paying clients information about the legal terms in sovereign loan contracts. This information is important to academic researchers, to policy institutions such as the International Monetary Fund, and to investors and other market actors. For random sample of ten countries, we compare this data to a hand-coded sample of bond terms. We find significant error rates in the commercial databases, which vary significantly by country and by the legal term at issue. In some cases, we document error rates well over 75 percent. We also describe important limitations in the data, especially the use of binary coding schemes that obscure important differences in the rights conferred by different sovereign loan contracts.

-July 11, 2018

State Standing to Constrain the President

F. Andrew Hessick and William Marshall
In Federalist 51, James Madison said that the ambition of Congress would check the President. But in recent times, Congress has failed to play that role. Presidential ambitions now frequently overwhelm the ambitions of Congress. Against this backdrop, states have become increasingly aggressive in checking the President by filing suit in federal courts. But these suits have raised important questions of Article III standing. This symposium essay argues that, because states are particularly well suited to bring these suits, Article III standing law should accommodate them. At the same time, however, to avoid overly politicizing the courts, the essay suggests that courts develop prudential doctrines, such as limiting state suits that rest on partisan instead of structural interests.

-May 8, 2018

Lenders’ Roles and Responsibilities in Sovereign Debt Markets

Susan Block-Lieb and Mark C. Weidemaier
Debates about sovereign debt markets presume these markets are unique, because sovereign governments are unique borrowers. To the extent observers look elsewhere for guidance, it is to corporate debt markets. We argue that this conventional view—though useful to a point—has substantially and unjustifiably limited the academic and policy agenda. Rather than dwell on the unique characteristics of sovereign borrowers, we examine the practices and incentives of lenders. We show that, when viewed through this lender-focused prism, sovereign debt has as much or more in common with consumer than with corporate debt. Using consumer debt as a metaphor, we reveal gaps in the debate over how to reform sovereign debt markets. First, assessments of the sustainability of sovereign debt presently—and unjustifiably—overlook the negative consequences of excessive debt for the borrower’s citizens. Second, reform initiatives designed to promote “responsible lending” lack clearly-articulated goals, an omission that will impair the development of a coherent reform agenda. While not a perfect metaphor, experience with consumer lending and financial regulation can help fill these gaps, producing a clearer vision of the roles and responsibilities of lenders in sovereign debt markets.

-May 9, 2018

Consumer Remedies for Civil Rights

Kate Elengold
This article considers whether the consumer protection doctrine offers a more promising avenue to remedying certain forms of discrimination than the anti-discrimination doctrine. Using a housing discrimination story as a case study, it breaks down the doctrinal trade-offs between seeking redress through a consumer protection claim and an anti discrimination claim. This Article argues that a consumer protection claim is not only a viable avenue to remedying certain forms of discrimination but has fewer hurdles to clear and a higher likelihood of success than a traditional anti-discrimination claim. Consumer protection claims might appear undesirable because they lack the important anti-subordination and group equality norms at the root of civil rights law. This Article argues that this is something of an illusion. Civil rights advocacy historically focused on economic citizenship, but formal civil rights doctrine came to omit economic protections. Rather, the antidiscrimination doctrine developed narrowly, constraining the reach of its remedies. Antidiscrimination statutes thus have failed to reach advocates’ aspirations for achieving group equality. Consumer protection law, solidly grounded in the protection of economic citizenship, is well-suited to those aspirations. Consumer protection claims therefore usefully align with and supplement the objectives of civil rights law.

-May 8, 2018

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