ContractsProf Blog

Editor: Myanna Dellinger
University of South Dakota School of Law

Thursday, July 28, 2016

Weekly Top Ten SSRN Contracts Downloads (July 28, 2016)

Top-ten-books

SSRN Top Downloads For SSRN Logo (small)
Contracts & Commercial Law eJournal

Rank Downloads Paper Title
1 191 Is Rule of Law an Equilibrium Without Private Ordering?
Gillian K. Hadfield and Barry R. Weingast
USC Law School and Department of Economics and Stanford University, Department of Political Science
2 133 On the Surprising Use of Unenforceable Contract Terms: Evidence from the Residential Rental Market
Meirav Furth-Matzkin
Harvard Law School
3 110 Optimal Defaults in Consumer Markets
Oren Bar-Gill and Omri Ben-Shahar
Harvard Law School and University of Chicago Law School
4 70 Enhancing Moral Relationships Through Strict Liability
Seana Shiffrin
University of California, Los Angeles (UCLA) - School of Law
5 64 Consent in Online Contracts - Mindless or Mindful?
Dasuni Wijayasriwardena
Queen Mary University of London
6 60 Are Validation Notices Valid? An Empirical Evaluation of Consumer Understanding of Debt Collection Validation Notices
Jeff Sovern and Kate E. Walton
St. John's University - School of Law and St. John's University - Department of Psychology
7 58 Contractual Arbitrage
Stephen J. Choi, G. Mitu Gulati and Robert E. Scott
New York University School of Law, Duke University School of Law and Columbia University - Law School
8 58 The Art of Promise and Power of Contract
Robin Bradley Kar
University of Illinois College of Law
9 58 Form and Substance in Equitable Remedies
Stephen A. Smith
McGill University - Faculty of Law
10 107 The Moral Impermissibility of Efficient Breach
Adam Rigoni
Arizona State University (ASU) - Barrett, the Honors College

 

SSRN Top Downloads For SSRN Logo (small)
Law & Society: Private Law - Contracts eJournal

Rank Downloads Paper Title
1 191 Is Rule of Law an Equilibrium Without Private Ordering?
Gillian K. Hadfield and Barry R. Weingast
USC Law School and Department of Economics and Stanford University, Department of Political Science
2 133 On the Surprising Use of Unenforceable Contract Terms: Evidence from the Residential Rental Market
Meirav Furth-Matzkin
Harvard Law School
3 107 The Moral Impermissibility of Efficient Breach
Adam Rigoni
Arizona State University (ASU) - Barrett, the Honors College
4 100 The Jurisprudence of Paper Clips
Robert A. James
Pillsbury Winthrop Shaw Pittman LLP
5 84 Does High Auditor Litigation Risk Discourage Corporate Innovation?
Mahfuz Chy and Ole-Kristian Hope
University of Toronto, Rotman School of Management, Students and University of Toronto - Rotman School of Management
6 78 International Investment Law and ISDS: Mapping Contemporary Latin America
Katia Fach Gómez and Catharine Titi
University of Zaragoza and French National Centre for Scientific Research (CNRS)
7 78 The Legal Writer, Making Offers No One Can Refuse: Effective Contract Drafting — Part 5
Gerald Lebovits
Columbia University - Law School
8 70 Private Law and the European Constitutionalisation of Values
Martijn W. Hesselink
University of Amsterdam - Centre for the Study of European Contract Law (CSECL)
9 70 Enhancing Moral Relationships Through Strict Liability
Seana Shiffrin
University of California, Los Angeles (UCLA) - School of Law
10 64 Consent in Online Contracts - Mindless or Mindful?
Dasuni Wijayasriwardena
Queen Mary University of London

July 28, 2016 in Recent Scholarship | Permalink | Comments (0)

Wednesday, July 27, 2016

Forum Selection Clauses in Moving Contracts

 Moving Mess

As anyone who's ever moved knows full well, it's a fraught process. Finding good movers can be challenging, and untangling the relationships between the parties involved in your move even more challenging: which company is storing, which company is packing, which company is renting the truck being used, which company owns the truck being used, which company employs the movers, etc. I've had moves go poorly enough that I've left a couple of scathing "beware!" reviews in places, but I've never gone to court, and so I never really thought through fully the challenges in litigating issues that might arise during a move.

A recent case out of Ohio, Nieman v. Moving Insurance, LLC, Appeal No. C-150666, made me finally consider them. Not a lot of details are given about what happened during the Niemans' move to prompt them to sue, but what we do learn is that they are suing about a move from Chicago to Cincinnati. The Niemans have sued multiple companies, probably because of how many companies get involved in a major interstate move like this. For instance, it seems to me that they're suing a moving company, a trucking company, and an insurance company (again, details aren't really given in the case). The Niemans signed contracts, of course, with each of these entities. Each of the contracts had a forum selection clause. One contract required that suit be brought in New Jersey. The other contracts required that suit be brought in Florida. The court here found that the Niemans were bound by the forum selection clauses. Therefore, rather than bringing suit in their current state and the place where the move concluded, the Niemans have to bring two suits, one in New Jersey, one in Florida.

I've blogged a lot about arbitration clauses, but I haven't blogged much about forum selection clauses. The court is dismissive here of the Niemans' arguments, which it characterizes as a matter of inconvenience rather than injustice. But surely there's a point where something becomes so inconvenient that it's no longer worthwhile, from a cost efficiency perspective, to pursue it, and in that case isn't some kind of injustice being wrought? I'm not saying necessarily that the Niemans deserve some kind of recovery from the moving companies. However, I could see how, if it was me, faced with a ruling that I had to bring two separate cases, procuring lawyers, etc., in states that aren't even in my time zone, I might decide it wasn't worth the effort and just drop it.  And I don't think this is laziness on my part; I think this is practicality regarding the best use of my time and money at that point. Which, of course, means this definitely depends on the amount of damages I believed that I was owed, and therefore underlines that enforcing a forum selection clause in these circumstances means that there is some amount of liability that, as a practical matter, will almost never be assessed, even if it should be, because the costs of procuring that assessment are too high.

This is, naturally, an ongoing problem in the court system in general. Maybe because I am in the process of coordinating yet another move, this one really stood out to me today!

July 27, 2016 in Commentary, Recent Cases, Travel, True Contracts | Permalink | Comments (0)

Monday, July 25, 2016

Non-Competes: An Internet Show Is Not a Radio Show

A recent case out of the Eastern District of Michigan, Burke v. Cumulus Media, Inc., Case No. 16-cv-11220 (behind paywall), has some interesting things to say about the impact of the Internet on non-competes you may be drafting.

In the case, the plaintiffs had a radio show on a Michigan radio station owned by Cumulus. Cumulus terminated the plaintiffs, and they sued alleging age discrimination. In response, Cumulus counterclaimed alleging that the plaintiffs were violating their non-compete clause because they were hosting an Internet-based radio show together.

Unfortunately for Cumulus, though, the non-compete prohibited the plaintiffs from doing various things related to "radio stations." It said nothing about any other medium, including the Internet. Because the plaintiffs had shifted their show to an Internet stream, it was not covered by the non-compete.

If you're drafting non-competes in this context, keep this ruling in mind. Of course, I have no idea if a non-compete that included the Internet would have been considered enforceable or if it would have restricted the plaintiffs' ability to earn a livelihood too much.

Another interesting facet of this case is that only one of the plaintiffs' non-competes was at issue here. The other non-compete by its terms was only enforceable if Cumulus paid the plaintiff for the period of time he was prohibited from competing. Cumulus chose not to pay that plaintiff and so did not (and could not) seek to enforce his non-compete. Whenever I talk to my students about covenants not to compete, we talk about how easily they can be broadly drafted to possibly intimidate less legally knowledgeable employees, and one of the things we bring up is that making them have some cost to the employer could help judge the seriousness of the necessity of the covenant. Here, it apparently wasn't worth it for Cumulus to pay to keep one of the plaintiffs from competing.

July 25, 2016 in Commentary, Recent Cases, True Contracts, Web/Tech | Permalink

Thursday, July 21, 2016

Weekly Top Ten SSRN Contracts Downloads (July 21, 2016)

Top10DeskSign


SSRN Top Downloads For SSRN Logo (small)
Contracts & Commercial Law eJournal

Rank Downloads Paper Title
1 610 What We Buy When We 'Buy Now'
Aaron Perzanowski and Chris Jay Hoofnagle
Case Western Reserve University School of Law and University of California, Berkeley - School of Information
2 163 Is Rule of Law an Equilibrium Without Private Ordering?
Gillian K. Hadfield and Barry R. Weingast
USC Law School and Department of Economics and Stanford University, Department of Political Science
3 144 Immoral Promises
Enrique Guerra-Pujol
University of Central Florida
4 120 On the Surprising Use of Unenforceable Contract Terms: Evidence from the Residential Rental Market
Meirav Furth-Matzkin
Harvard Law School
5 117 Current Trends in Consumer Junk Debt Buyer Litigation
Peter A. Holland
The Holland Law Firm
6 105 The Moral Impermissibility of Efficient Breach
Adam Rigoni
Arizona State University (ASU) - Barrett, the Honors College
7 98 Reining in the Big Promise of Big Data: Transparency, Inequality, and New Regulatory Frontiers
Philipp Hacker and Bilyana Petkova
Humboldt University of Berlin and European University Institute
8 96 Optimal Defaults in Consumer Markets
Oren Bar-Gill and Omri Ben-Shahar
Harvard Law School and University of Chicago Law School
9 94 The Jurisprudence of Paper Clips
Robert A. James
Pillsbury Winthrop Shaw Pittman LLP
10 94 Once Upon a Transaction: Narrative Techniques and Drafting
Susan Chesler and Karen J. Sneddon
Arizona State University (ASU) - Sandra Day O'Connor College of Law and Mercer Law School

 

SSRN Top Downloads For SSRN Logo (small)
Law & Society: Private Law - Contracts eJournal

Rank Downloads Paper Title
1 610 What We Buy When We 'Buy Now'
Aaron Perzanowski and Chris Jay Hoofnagle
Case Western Reserve University School of Law and University of California, Berkeley - School of Information
2 163 Is Rule of Law an Equilibrium Without Private Ordering?
Gillian K. Hadfield and Barry R. Weingast
USC Law School and Department of Economics and Stanford University, Department of Political Science
3 144 Immoral Promises
Enrique Guerra-Pujol
University of Central Florida
4 120 On the Surprising Use of Unenforceable Contract Terms: Evidence from the Residential Rental Market
Meirav Furth-Matzkin
Harvard Law School
5 105 The Moral Impermissibility of Efficient Breach
Adam Rigoni
Arizona State University (ASU) - Barrett, the Honors College
6 94 Once Upon a Transaction: Narrative Techniques and Drafting
Susan Chesler and Karen J. Sneddon
Arizona State University (ASU) - Sandra Day O'Connor College of Law and Mercer Law School
7 94 The Jurisprudence of Paper Clips
Robert A. James
Pillsbury Winthrop Shaw Pittman LLP
8 77 Does High Auditor Litigation Risk Discourage Corporate Innovation?
Mahfuz Chy and Ole-Kristian Hope
University of Toronto, Rotman School of Management, Students and University of Toronto - Rotman School of Management
9 75 The Legal Writer, Making Offers No One Can Refuse: Effective Contract Drafting — Part 5
Gerald Lebovits
Columbia University - Law School
10 74 International Investment Law and ISDS: Mapping Contemporary Latin America
Katia Fach Gómez and Catharine Titi
University of Zaragoza and French National Centre for Scientific Research (CNRS)

July 21, 2016 in Recent Scholarship | Permalink | Comments (0)

Wednesday, July 20, 2016

The MoneyGram Case: Commercial Law at the United States Supreme Court

MoneyGram LogoHow often do those of us in the contracts realm get to string together "commercial law," "U.S. Supreme Court," and "original jurisdiction" in the same sentence? If your answer is, "not nearly often enough!" then you may want to keep tabs on a lawsuit filed last month by Arkansas, Texas, and 19 other states against Delaware and MoneyGram.  At issue is the appropriate recipient of unclaimed property, the property in this case being the proceeds from unused MoneyGram payment instruments, which, after a time, are ultimately subject to escheat to the state.

The Dallas Morning News described basic facts in covering the rollout of the litigation by the Texas Attorney General:

Attorney General Ken Paxton today accused the state of Delaware of swiping up to $400 million in unclaimed checks that rightfully belong to Texas and the 48 other states.

Texas’ share, he said, would be about $10 million.

FTexas Shaped Flagor the last four or five years, Paxton said, announcing a lawsuit against Delaware that was filed directly at the U.S.  Supreme Court, Delaware has been requiring financial institutions incorporated under its laws — in particular MoneyGram – to turn over unclaimed funds only to Delaware.

But under a 1974 federal law, Paxton asserted, such funds belong to the state in which a transaction originated. MoneyGram lets people pay a fee to purchase a check they can send to someone else.

“The state of Delaware elected to begin playing by a different set of rules,” Paxton said, calling the practice both illegal and unfair. “Delaware has our money.”

He cited an audit released in February 2015 that found that Delaware had claimed more than $150 million in unclaimed checks that originated in 20 other states. Extrapolating to  the whole country, he said, the tally could be $400 million.

This group of 21 states is not the first to take issue with Delaware's appropriation of the unclaimed property. Wisconsin and Pennsylvania brought a similar lawsuit in federal district court in which defendant Delaware ultimately invoked the original jurisdiction of the Supreme Court to resolve disputes between states. SCOTUSblog provides some helpful detail on the legal background and procedural posture of these state-v.-state cases:

The core legal issue in each of the new filings is whether a 1974 law with an assignment of priority of state ownership for unclaimed tangible property applies to the new instrument, which some 1,900 banks or other institutions across the country are using instead of cashier’s or teller’s checks.  Delaware says the law does not apply; the other states disagree.

SCOTUSbuilding_1st_Street_SEThe Supreme Court has issued three rulings on competing state claims to unclaimed intangible property; Congress has overruled one of those, in a 1974 law known as the Disposition of Abandoned Money Orders and Traveler’s Checks Act.  That law is at the center of the cases that have reached the Court under its “original” jurisdiction — that is, its authority to decide, in the fashion of a trial court, a legal dispute not decided by a lower court.  This jurisdiction is often implicated in resolving disputes between states — as in the new filings over unclaimed property.

The Court has no binding obligation to take on such a case.  However, if it does, it customarily names a “special master” to act like a junior judge to gather facts and make a recommendation for a decision.  A special master’s report is not final unless it becomes the ruling of the Supreme Court.

The large dollar amount in dispute arises from an aggregation of small transactions that will be familiar to anyone who has studied the "money order" species of negotiable instrument:

While Delaware’s claims are at the center of this new financial fight between the states, the controversy actually turns on the specific financial instrument involved, and the Texas company that has been issuing those items, which it calls “official checks.”   That company, MoneyGram Payments Systems, Inc., has its main business office in Texas but it is incorporated in Delaware.  It does business in all fifty states.

Its main business is as a kind of financial partner to banks and other institutions that prefer not to issue cashier’s checks or teller’s checks in their own name.  MoneyGram does it for them, so it acts as the financial backer of its “official checks.”

That kind of transaction is conducted for some of the same reasons that stores do a business in money orders or traveler’s checks.  The idea is that, in the form of a money order or traveler’s check, the piece of paper is a guaranteed form of payment that works like cash; in other words, it won’t “bounce” for lack of sufficient funds behind it.  Typically, this kind of instrument is in fairly small amounts.

The Supreme Court does not frequently consider issues intersecting with commercial law in quite the way that this case does, so the outcome will certainly bear watching.

July 20, 2016 in Current Affairs, E-commerce | Permalink | Comments (0)

More Adventures in Leasing: Persistent Apartment Flooding Edition

Here is a good case for illustrating equitable estoppel in a way that students, frequently renters, will probably appreciate: Pinnacle Properties Development Group, LLC v. Daily, Court of Appeals Case No. 10A01-1512-SC-2275, out of Indiana.

You may recognize Pinnacle's name. I previously blogged about them here. I stated in that blog entry that the case seemed straightforward and not worth the money to appeal, but apparently they have a habit of appealing relatively small (here, $752.37) judgments against them.

In this case, Daily was a tenant at a Pinnacle property. About eight months after moving into his apartment, Daily's apartment flooded. He reported the flooding using Pinnacle's emergency telephone number, which Pinnacle told its tenants to use in such circumstances. When no one answered the emergency number, he left a message and then dealt with the flooding himself, borrowing a wet/dry vacuum and removing thirty gallons of water from his unit. 

In the month of July, the apartment flooded three more times. The first two times, Daily again called the Pinnacle emergency number. He was told that someone would be sent out to his apartment, but no one ever came. Daily continued to deal with the flooding himself, removing another fifty-two gallons of water using the borrowed wet/dry vacuum.

The third time in July that the apartment flooded, Daily went personally to the Pinnacle office, rather than calling the number. Pinnacle submitted a work order into the system but still no one came out to Daily's apartment. Daily bought himself his own wet/dry vacuum and continued to remove gallons of water from his apartment. A week later, he filed a complaint against Pinnacle and was awarded his rent for the month of July, the cost of the wet/dry vacuum he purchased, and some costs and interest. (The amount he was awarded was considerably less than the three-thousand-plus dollars he was originally seeking.)

Pinnacle's main argument on appeal was that the lease required Daily to give Pinnacle written notice of the flooding, which he never did. The court wasn't sure written notice was required under the lease but it stated that, even if that was true, Pinnacle was equitably estopped from asserting the written notice requirement because it was undisputed that Pinnacle had actual notice of Daily's flooding issue. It would be unjust under these circumstances to force Daily to pay rent for an apartment that was partially uninhabitable, where Pinnacle knew that Daily was suffering this problem and provided Daily with false assurances that it would deal with the problem, on which Daily relied, justifiably, to his detriment. As the court says, "We can hardly imagine a more appropriate application of the equitable estoppel doctrine." The court affirmed the award of the July rent, plus the cost of the wet/dry vacuum as a consequential damage.

July 20, 2016 in Commentary, Recent Cases, True Contracts | Permalink | Comments (0)

Tuesday, July 19, 2016

Scholarship Spotlight: "Custom in the Courts" as to UCC Trade Usage (Lisa Bernstein - Chicago)

Contract-InterpretationEmpirical analysis testing the desirability of norms of contract doctrine is a welcome thing, and an recent article by Lisa Bernstein (University of Chicago), "Custom in the Courts," draws upon an impressive quantity of data in contradicting one of the pillars of the received wisdom of Article 2 of the Uniform Commercial Code. As it happens, flexible contract interpretation relying on norms of trade usage is not necessarily beneficial.

Here is Professor Bernstein's abstract:

BernsteinLisa (Chicago)This Article presents an empirical study of the trade usage cases decided under the Uniform Commercial Code from 1970 to 2007. It then draws on the study’s findings to revisit the debate over the desirability of the trade usage component of the incorporation strategy — the interpretive approach that directs courts to look to course of dealing, course of performance, and usage of trade to interpret contracts and fill contractual gaps. Although the strategy is generally defended on the grounds that, as compared to a more formalistic adjudicative approach, it will reduce specification costs without unduly increasing interpretive error costs, the study reveals that the empirical assumptions on which this defense is based are highly questionable. More specifically, it shows that usages are not typically demonstrated through the introduction of the types of “objective evidence” that the strategy’s defenders suggest will reduce the risk of interpretive error — such as expert witness testimony, industry trade codes, or statistical evidence that a particular practice is widely observed. Rather, usages are most commonly established solely through the testimony of the parties or their employees. Expert testimony is introduced in at most 31.5% of the cases, the introduction of trade codes is rare, and there were no cases in the study in which the regularity with which a practice was observed was demonstrated through statistical evidence rather than the mere assertion of a witness.

After presenting the study’s findings, the Article reexamines the core justifications for the strategy in light of them. It concludes that because the strategy is likely to increase both specification costs and interpretive error costs, and has particularly negative effects on contracts between large multi-agent firms as well as on the types of outsourcing contracts and contracts for innovation that are increasingly important parts of the modern economy, it should be abandoned in favor of a more formalist approach to contract interpretation, at least in contracts between businesses.

Professor Bernstein's article is published in the Northwestern University Law Review at 110 Nw. U. L. Rev. 63 (2015) and is available for SSRN download here.

July 19, 2016 in Recent Scholarship | Permalink | Comments (0)

Registration Open for Central States Law Schools Association 2016 Scholarship Conference

CSLSA 2016 Conf

Registration is now open for the Central States Law Schools Association 2016 Scholarship Conference, which will be held on Friday, September 23 and Saturday, September 24 at the University of North Dakota School of Law in Grand Forks, ND. We invite law faculty from across the country to submit proposals to present papers or works in progress.

CSLSA LogoCSLSA is an organization of law schools dedicated to providing a forum for conversation and collaboration among law school academics. The CSLSA Annual Conference is an opportunity for legal scholars, especially more junior scholars, to present on any law-related topic in a relaxed and supportive setting where junior and senior scholars from various disciplines are available to comment. More mature scholars have an opportunity to test new ideas in a less formal setting than is generally available for their work. Scholars from member and nonmember schools are invited to attend. 

Please click here to register. The deadline for registration is September 2, 2016.   Hotel rooms are now available for pre-booking. The conference hotel is the Hilton Garden Inn in Grand Forks. The hotel phone number is (701) 775-6000. When booking, identify yourself as part of the “UND School of Law” block to receive a daily rate of $89. Please note that conference participants are responsible for all of their own travel expenses including hotel accommodations.

H/T: CSLSA

July 19, 2016 in Conferences | Permalink | Comments (0)

Monday, July 18, 2016

Contracts Law and the Case of the Super Bowl Jewelry Heists

 

Brillanten.jpg
By Mario Sarto - Self-photographed, CC BY-SA 3.0, https://commons.wikimedia.org/w/index.php?curid=1015397

Here's a case with some interesting facts: Jacobsen Diamond Center, LLC v. ADT Security Services, Inc., Docket No. A-1578-14T1, out of New Jersey.

The plaintiff in the case is a jeweler, who suffered two consecutive thefts on Super Bowl weekends in 2010 and 2011. The first Super Bowl theft involved cutting through the wall that bordered a retail store next door and removing a safe positioned against the wall. Because the thieves cut through the wall, they didn't set off the ADT alarm system linked to the jeweler's doors.  

After this robbery, the jeweler then moved its safes to the middle of the store, away from the walls. The second Super Bowl theft (perhaps by the same people, emboldened by their previous success?) involved the disabling of the ADT security system in place.

The Super Bowl thieves have never been apprehended, and the jeweler did not have any insurance on the stolen jewels, so the jeweler has sued ADT and a number of other companies that were involved with the jeweler's security systems, alleging various misrepresentations about the security, fraud, negligence, and breaches of contract. The jeweler lost on all of its claims, either by summary judgment or by jury verdict, and the jeweler now appeals.

Of special interest to this contracts law blog is the ruling on the limitation of liability clause in ADT's contract with the jeweler. This was a standard form contract used by ADT that limited its liability to $1,000 (far below the alleged worth of the stolen jewels). These limitations of liability clauses are enforceable and reasonable; the policy behind this stance is supposed to encourage the purchaser of the security system to maintain insurance coverage of its valuables, as it is the purchaser in the best position to know what the value is of the things it is seeking to protect. The court found that the jeweler knew it should have had insurance and it was not ADT's fault that the jeweler failed to obtain such insurance; therefore, ADT should not be held responsible for the jeweler's failure.

July 18, 2016 in Recent Cases, True Contracts, Web/Tech | Permalink

Sunday, July 17, 2016

Contract Formation According to My Cousin Vinny

 My Cousin Vinny (1992) is a cute film starring Joe Pesci and Marisa Tomei.  There is a great scene where Joe Pesci describes an offer and counteroffer in order to diffuse a fight.  Here is the clip:

  

 

July 17, 2016 | Permalink | Comments (0)

Friday, July 15, 2016

Failure to Comply with Internal Investigations Can Be Cause for Termination

At least where the internal investigation concerns actions you took within the scope of your employment that are exposing your employer to possible criminal liability.

This recent case out of the Second Circuit, Gilman v. Marsh & McLennan Cos., Docket No. 15-0603-cv(L), is the latest chapter in a long saga. The plaintiffs were employees of Marsh & McLennan who were executives being investigated for criminal charges by then-New York Attorney General Eliot Spitzer. The employees were eventually indicted and convicted of some of the charges but the convictions were thrown out because of "newly discovered contradictory evidence."

As you might have anticipated, this chain of events led to a number of lawsuits by the accused employees, including this one against former employer Marsh & McLennan, who had terminated the employees after they refused to submit to internal interviews about the allegations in Spitzer's criminal investigation.

The employees had brought claims for abuse of process against Marsh & McLennan but those had been dismissed. The employees were no more successful with their breach of contract claims against Marsh & McLennan. The court found that the employees' employment contracts with Marsh & McLennan were governed by Delaware law, which finds proper cause for termination where the employee refuses a direct and reasonable order by the employer. In this case, the court found that Marsh & McLennan's order that the employees sit for internal interviews to discuss allegations that implicated criminal liability for Marsh & McLennan and regarded the employees' actions during the scope of their employment was a reasonable request. Marsh & McLennan needed to take such measures to protect itself, and, indeed, had a duty to its shareholders to investigate any potential criminal conduct that could have harmed the company. In fact, the court terms Marsh & McLennan's behavior here as "unassailable, even routine." The employees were personally free to refuse to be interviewed, but, in so doing, they provided Marsh & McLennan with proper cause for termination under their employment contracts.

July 15, 2016 in Recent Cases, True Contracts | Permalink | Comments (0)

Thursday, July 14, 2016

Weekly Top Ten SSRN Contracts Downloads (July 14, 2016)

Top-10 Scrolling

SSRN Top Downloads For SSRN Logo (small)
Contracts & Commercial Law eJournal

Rank Downloads Paper Title
1 601 What We Buy When We 'Buy Now'
Aaron Perzanowski and Chris Jay Hoofnagle
Case Western Reserve University School of Law and University of California, Berkeley - School of Information
2 136 Immoral Promises
Enrique Guerra-Pujol
University of Central Florida
3 133 Is Rule of Law an Equilibrium Without Private Ordering?
Gillian K. Hadfield and Barry R. Weingast
USC Law School and Department of Economics and Stanford University, Department of Political Science
4 112 Current Trends in Consumer Junk Debt Buyer Litigation
Peter A. Holland
University of Maryland Francis King Carey School of Law
5 109 On the Surprising Use of Unenforceable Contract Terms: Evidence from the Residential Rental Market
Meirav Furth-Matzkin
Harvard Law School
6 102 The Moral Impermissibility of Efficient Breach
Adam Rigoni
Arizona State University (ASU) - Barrett, the Honors College
7 93 Assessment of Damages: Three Specific Problems – The Draft Common European Sales Law in Context
Reinhard Zimmermann
Max Planck Institute for Comparative and International Private Law
8 91 Once Upon a Transaction: Narrative Techniques and Drafting
Susan Chesler and Karen J. Sneddon
Arizona State University (ASU) - Sandra Day O'Connor College of Law and Mercer Law School
9 90 Reining in the Big Promise of Big Data: Transparency, Inequality, and New Regulatory Frontiers
Philipp Hacker and Bilyana Petkova
Humboldt University of Berlin and European University Institute
10 88 Optimal Defaults in Consumer Markets
Oren Bar-Gill and Omri Ben-Shahar
Harvard Law School and University of Chicago Law School

 

SSRN Top Downloads For SSRN Logo (small)
Law & Society: Private Law - Contracts eJournal

1 601 What We Buy When We 'Buy Now'
Aaron Perzanowski and Chris Jay Hoofnagle
Case Western Reserve University School of Law and University of California, Berkeley - School of Information
2 136 Immoral Promises
Enrique Guerra-Pujol
University of Central Florida
3 134 Is Rule of Law an Equilibrium Without Private Ordering?
Gillian K. Hadfield and Barry R. Weingast
USC Law School and Department of Economics and Stanford University, Department of Political Science
4 109 On the Surprising Use of Unenforceable Contract Terms: Evidence from the Residential Rental Market
Meirav Furth-Matzkin
Harvard Law School
5 102 The Moral Impermissibility of Efficient Breach
Adam Rigoni
Arizona State University (ASU) - Barrett, the Honors College
6 93 Assessment of Damages: Three Specific Problems – The Draft Common European Sales Law in Context
Reinhard Zimmermann
Max Planck Institute for Comparative and International Private Law
7 93 Equity in LLC Law?
Mohsen Manesh
University of Oregon School of Law
8 91 Once Upon a Transaction: Narrative Techniques and Drafting
Susan Chesler and Karen J. Sneddon
Arizona State University (ASU) - Sandra Day O'Connor College of Law and Mercer Law School
9 87 The Jurisprudence of Paper Clips
Robert A. James
Pillsbury Winthrop Shaw Pittman LLP
10 70 The Legal Writer, Making Offers No One Can Refuse: Effective Contract Drafting — Part 5
Gerald Lebovits
Columbia University - Law School

July 14, 2016 in Recent Scholarship | Permalink | Comments (0)

Wednesday, July 13, 2016

New Book: Damages and Human Rights

I promised our friends at Hart Publishing to post the following notification about a new book by Jason Varuhas: Damages and Human Rights is a major work on awards of damages for violations of human rights that will be of compelling interest to practitioners, judges and academics alike. Damages for breaches of human rights is emerging as an important and practically significant field of law, yet the rules and principles governing such awards and their theoretical foundations remain underexplored, while courts continue to struggle to articulate a coherent law of human rights damages. The book's focus is English law, but it draws heavily on comparative material from a range of common law jurisdictions, as well as the jurisprudence of international courts.
The current law on when damages can be obtained and how they are assessed is set out in detail and analysed comprehensively. The theoretical foundations of human rights damages are examined with a view to enhancing our understanding of the remedy and resolving the currently troubled state of human rights damages jurisprudence. The book argues that in awarding damages in human rights cases the courts should adopt a vindicatory approach, modelled on those rules and principles applied in tort cases when basic rights are violated. Other approaches are considered in detail, including the current 'mirror' approach which ties the domestic approach to damages to the European Court of Human Rights' approach to monetary compensation; an interest-balancing approach where the damages are dependent on a judicial balancing of individual and public interests; and approaches drawn from the law of state liability in EU law and United States constitutional law.
The analysis has important implications for our understanding of fundamental issues including the interrelationship between public law and private law, the theoretical and conceptual foundations of human rights law and the law of torts, the nature and functions of the damages remedy, the connection between rights and remedies, the intersection of domestic and international law, and the impact of damages liability on public funds and public administration. - See more here.

July 13, 2016 in Books | Permalink

Tuesday, July 12, 2016

Johnny Manziel's Rookie Contract - It Pays To Cover Yourself

The Cleveland Browns do not draft players well.  Fortunately for the franchise, they do draft contracts well.  The Browns were able contractually relieve themselves from owing the quarterback the guaranteed money under his rookie deal before cutting him.  According to Pro Football Talk, the team could void the guaranteed money if Johnny Manziel received or did any of the following:

(1) a suspension imposed by the league under any policy;

(2) a suspension imposed by the team;

(3) failure or refusal to report, practice, or play;

(4) leaving the team without prior written consent.

Given Johnny Football's well documented indiscretions and the four game suspension by the NFL, it could be any of the above.  The full article can be found here.

July 12, 2016 | Permalink | Comments (0)

Monday, July 11, 2016

Do Law Profs Breach a Commercial Educational Agreement by Wearing T-Shirts with a Social Message?

A group of 1L students recently caused a stir-up at an anonymous law school by posting an anonymous complaint after their criminal law professor wore a "Black Lives Matter" t-shirt "on campus" (not "to class," apparently).   See the letter and the professor's great response here.  (For full disclosure, our colleagues on the TaxProf Blog also wrote about the story here Images).

Do students, because they enter into a contract with a private law school (or even a public one), have a legitimate reason to complain that their professors wear t-shirts with a socially and legally provocative or at least thought-provoking message?  The students wrote, "We do not spend three years of our lives and tens of thousands of dollars to be subjected to indoctrination or personal opinions of our professors."

Is this reasonable, in your opinion?  First, this comparison is not apt.  In fact, it is an extreme over-exaggeration that barely needs commenting on.  The students also comment that the "BLM" movement does not have anything to do with the law, which demonstrates the sad state of ignorance about the law and society in which many of our students - and perhaps especially those in conservative areas such as Orange County, California - find themselves (that's where the anonymous law school is thought to be located).  The movement is clearly about very little but the law and policy.  Second, students can and should expect to get a quality legal education when attending an ABA-accredited law school, but simply because they pay money for it does not entitle them to only hear about the version of the law that _they_ prefer.  In fact, as the professor so correctly notes in his response, the consumer theory should not apply to the content of one's legal education. In other words, students don't pay to only hear part of the message.  And as the professor said: students certainly don't pay us _not_ to have an opinion about the classes we teach (note that the Tshirt was worn in connection with a criminal procedure class).

What are your thoughts on this?  And why does the law school not publish its name?

July 11, 2016 in Commentary, Contract Profs, Current Affairs, In the News, Law Schools, True Contracts | Permalink | Comments (0)

A Very Good Blog on the Supreme Court of the United Kingdom

I want to recommend an interesting British blog that follows the decisions of the UK Supreme Court including contract law.  It is called the UKSC Blog.

July 11, 2016 | Permalink | Comments (0)

Should English Contract Law Be Persuasive Precedent in American Cases?

International law has been finding its way into American common law as persuasive precedent for some time now.  For example, in the U.S. Supreme Court decision in Lawrence v. Texas, Justice Kennedy cited to the European Court of Human Rights in support of the majority.  But what about looking to recent decisions of British courts, the UK Supreme Court in particular, for persuasive precedent in U.S. law?  The foundations of American contract law are found in the English common law.  

Continue reading

July 11, 2016 | Permalink | Comments (0)

Big Legal Issues Surrounding "The Little Couple"

Little Couple

Source: tvguide.com

The circumstances surrounding this lawsuit, LMNO Cable Group, Inc. v. Discovery Communications LLC, Case No. 2:16-cv-4543 (behind paywall), in the Central District of California, could be a television show in its own right.

LMNO, a producer of a number of reality television shows (most importantly for this case "The Little Couple"), allegedly found itself the victim of embezzlement by its accountant, who then later, according to the complaint, threatened to destroy LMNO's professional relationships unless LMNO kept quiet about the alleged embezzler and gave him $800,000. LMNO apparently refused to comply with this request, instead reporting the alleged embezzler to the authorities.

In the meantime, however, the accountant had evidently been in contact with Discovery Communications, whose station broadcasts "The Little Couple." LMNO alleges in this lawsuit that Discovery used the accountant's help to try to drive LMNO out of business by stealing "The Little Couple" from LMNO.

The alleged stealing of "The Little Couple" involved the alleged breach of a number of contracts between LMNO and Discovery about "The Little Couple." As usual with entertainment contracts, they're complicated, consisting of many amendments, and there's an implied contract angle as well. And, predictably, there are copyright and trademark implications, too.

According to the complaint, Discovery directly employs the actors in "The Little Couple," but the contract has a clause preventing Discovery from using these actors to produce shows without LMNO. Allegedly, that is exactly what Discovery is now attempting to do. Specifically, Discovery and LMNO had discussed making a special episode of "The Little Couple" set in Scotland and England. LMNO alleges that Discovery went ahead and filmed the episode without LMNO's involvement, in violation of an additional implied contract between them with regard to that particular episode. In addition, LMNO is alleging that Discovery's actions have breached the covenant of good faith and fair dealing and interfered with LMNO's abilities to obtain all of its benefits under the contracts.

It will be interesting to see how this all plays out. If you'd like to read more about the case, I found articles here and here.

July 11, 2016 in Current Affairs, Recent Cases, Television, True Contracts | Permalink | Comments (0)

Saturday, July 9, 2016

Arbitration Clauses: Gogo Internet Edition

The rise of Wi-Fi on airplanes means that you never have to be without the internet if you don't want to be...which also means that you never have to be without terms of use! A recent case out of the Eastern District of New York, Salameno v. Gogo Inc., 16-CV-0487 (behind paywall), reinforces that those terms of use are binding on you, and, as could probably be predicted, leads to the enforcement of an arbitration provision contained in them.

In this case, the plaintiffs had purchased Gogo's in-flight Internet access multiple times. They claimed that the Internet access didn't work as advertised, with allegations that it was incredibly slow, crashed frequently, or sometimes didn't work at all. (Anecdotally, I have heard people around me on flights complain about this, although I don't know if Gogo was at issue there or if in-flight Wi-Fi is simply fraught with complications.) Despite these alleged ongoing issues, the plaintiffs kept buying Gogo's Wi-Fi, perhaps in eternal hope that it would someday work properly? At any rate, this all culminated in plaintiffs' lawsuit here.

A judge recently found that the plaintiffs are bound by the arbitration clause in Gogo's Terms of Use. All of the plaintiffs used Gogo's Internet access multiple times, and each time they had to indicate that they agreed to the Terms of Use. This wasn't just a one-time thing, which maybe would have made the court more sympathetic, but multiple times of clicking "Agree" without looking at the Terms of Use. And, the court said, those who seek Internet access in the air are experienced Internet users who should be expected to know how to read the Terms of Use contained in the hyperlink.

How to click on a hyperlink, yes, most Internet users know how to do; whether or not the average Internet user necessarily understands all of the legalese found at that hyperlink is another question entirely, of course, but not one addressed in this case. Possibly because the court assumes that all laypersons understand the difference between litigation and arbitration, although in my experience I am not entirely sure that's true. At any rate, the court here held this arbitration clause to be binding.

July 9, 2016 in Commentary, Recent Cases, Travel, True Contracts, Web/Tech | Permalink | Comments (2)

Friday, July 8, 2016

Should I Go to Law School?

While this topic is much discussed on the blogosphere, Professor Mitchell H. Rubinstein over at Adjunct Law Profs Blog has an excellent discussion, which can be found here.  In it he  discusses an article in the New York Times titled "An Expensive Law Degree, and No Place to Use It," which can be found here.

I would add to the discussion that those who wish to pursue a law degree must first be passionate about the law.  Given not only the post-graduate challenges in the legal job market, a legal education is a rigorous discipline.  You have to be ready to turn down 50 yard line Dallas Cowboys tickets on Thanksgiving to study for your Property final (true story).  I have met both students cavalier about entering law school, and those whose dream is to become a lawyer.  I think, whether elite law school or not, the latter will ultimately succeed.  

 

 

July 8, 2016 | Permalink | Comments (0)