Monday, January 13, 2014
I have spent a great deal of my academic life in the relative obscurity of Securities Act registration exemptions. It’s an important area of the law, especially for startups and other small businesses, but not one that has attracted a great deal of academic attention until recently. I could count the academics who specialize in the area on one hand.
From Obscurity to Slightly Less Obscurity
The JOBS Act, and the debate about crowdfunding that preceded the JOBS Act, have brought my academic specialty into the limelight. Dozens of papers and countless blog posts have appeared in the last couple of years discussing crowdfunding, general solicitation, Regulation A and Regulation A+, and a number of other aspects of exempted securities offerings. People have finally become interested in issues I have been writing about for over twenty years.
The Benefits (and Costs) of Being Less Obscure
In some ways, that’s great. People are reading my scholarship more and citations to my articles are increasing. I have been invited to speak at a number of seminars and webinars. I even got to testify before a Congressional subcommittee. It’s nice to know that people care what you think. (That’s not an unmitigated good. Even though I write on a public blog, I’m a private person, and I actually enjoy obscurity.)
The sudden explosion of scholarship in my field has also exposed me to the scholarship of people I might not have otherwise read: scholars like Usha Rodriguez and Joan Heminway, to name just a couple. If not for crowdfunding and the JOBS Act, I would not have had the pleasure of reading their work.
I have also learned a couple of important lessons about academic research.
Citation counts and invited presentations are not the same as academic merit
People are now citing my work more often and inviting me to speak more. As much as I would like to think that means I’m really good, it means nothing of the sort. My scholarship now is no better or worse than it was before this sudden surge of popularity. The only thing that has changed is that more people are interested.
The lesson to be drawn from that? Citation counts and the number of invited presentations are not very precise measures of academic merit, and we should be very hesitant to use them for that purpose.
Faddish scholarship is often disconnected from the past
I have been very disappointed in how disconnected some of the new scholarship is. In the rush to publish, some (but definitely not all) scholars have failed to connect what they’re writing both to the existing law and to previous scholarship.
This area of the law has a long history and a very specialized terminology. (For example, how many of you who aren’t securities specialists know what the integration doctrine is?) Neither that history nor the current law is easily accessible. SEC no-action letters and unwritten lore dominate the field.
Some of the new authors haven’t taken the time to master that material. They are, for the most part, conversant with the language of the applicable regulations, but not that familiar with the terminology or the regulatory history.
In addition, some of the new scholars are not fully aware of, or at least do not acknowledge, the existing scholarship, often presenting ideas as novel that were anticipated decades earlier. (I don’t care if they cite me, but there’s a long history of scholarship that predates my contributions.)
Here’s an example. The JOBS Act required the SEC to amend Rule 506 to allow general solicitation in unregistered offerings to accredited investors. Practitioners and scholars have been arguing for the elimination of the general solicitation requirement from Rule 506 since before Rule 506 was passed. I don’t think I have attended a meeting of the ABA Federal Regulation of Securities Committee where the idea didn’t come up in some form. But some of the new scholarship ignores that earlier debate and presents the idea as if it sprung newborn out of the heads of the drafters of the JOBS Act.
I understand the incentives. It takes a significant amount of time and research for a scholar new to a field to review and fully understand its history. But the result of not doing so is scholarship that is much shallower and much less effective than it might have been.
(I hope that sounds curmudgeonly enough. I'm doing my best to retain my spot in the old curmudgeon rankings, but there are so many curmudgeons in legal academia that it's difficult.)