Friday, January 30, 2009
Meredith Miller posted a little clip to accompany the teaching of Frigaliment, Judge Friendly's great chicken coup. I suppose we all have our favorite visual tools to aid in conveying the import of that case. For the last couple years, I've been sharing this video with my students, although I must admit, neither my students nor I find it as funny as do the people who heard it live. If you lose patience, you should skip to the end, because the Q & A is one of the funnier bits.
The pdf version of the paper is also available.
Thursday, January 29, 2009
I am teaching Frigaliment tomorrow. While I am not going to class in costume, I did "happen upon" this priceless clip, which I intend to share. Perfect at the end of a Friday class:
Best lyric: "No, I am no dumb cluck..."
[Meredith R. Miller]
The Michigan appeals court says Annie Keegan broke a no-compete clause by cutting hair 4.16 miles from her former employer, Lockworks.
Keegan's agreement with Lockworks barred her from working within 5 miles for a year after leaving the salon in 2006. An Ingham County judge said 4.16 miles seemed far enough away. But the appeals court this week overturned that decision, saying 5 miles means 5 miles.
[Meredith R. Miller]
Last year, we reported on legal battles swirling around Fisk University's (thus far unsuccessful) attempt to sell its collection of Georgia O'Keeffe paintings. It seems Fisk was a bit of a trend setter. As The New York Times reports, now Brandeis University is seeking to sell the entire holdings of its Rose Art Museum. The Times reports that Massachusetts' Attorney General is reviewing wills and agreements between donors and the Museum and/or the University to see if such a sale violates the terms on which donations were made. As the Times and other reports have noted, it is a bad time to be selling art, but Brandeis seems to be especially hard-hit by the current economic downturn, as several of its reliable donors had invested money with Bernard Madoff.
Yes, it seems only yesterday that we were marking the 500,000th visitor milestone (actually it was May 14th). But today, if form holds, our blog will host its 600,000th visitor. And, as you can see, our many German readers are as elated as they would be if, say, I don't know, their soccer team had won the FIFA cup or something. Well, to all our readers around the world, we take this opportunity to welcome you anew.
Tuesday, January 27, 2009
Harvard's Lucien Bebchuk has done great work to advocate that corporate executives' pay be linked to their actual performance. His 2004 book, co-authored with Jesse Fried, Pay Without Performance has had a huge impact in the academy, in the halls of government and even in board rooms. Today, I read a New York Times article that reported that the Yankees' Andy Pettitte is going to return for one season for a measly $5.5 million. His contract is loaded with incentives that could boost his annual salary to $12 million. And this set me to thinking . . . . Why not structure all sports contracts this way, but do so even more aggressively?
After all, we posted earlier about rookies being signed to large contracts so that their teams could avoid having to pay megabucks to keep them later. And one often hears of players working hard in seasons when their contracts are due for renewal and then becoming less focused once the pressure is off. Well, how about paying all players a basic based salary and then giving them huge financial incentives for reaching certain individual and team goals. These goals can vary widely, but there could be standard items on the menu, which would obviously vary from sport to sport. And then there can be some tailor-made incentives. For Alex Rodriguez: clutch hitting. For Shaq: free throw percentage over 55%, over 60%, over 65%, etc. I would advocate paying the Bulls' Ben Gordon not to shoot at the end of quarters or when the game is on the line. It's an opportunity to get creative and also an opportunity to motivate players in very focused ways.
Monday, January 26, 2009
This case always generates a lively discussion. It addresses the limitations on a corporation's obligations to distribute proposals of ordinary shareholders along with proxy materials in advance of a shareholder meeting. In this case, Lovenheim, the shareholder, proposed that the corporation investigate the processes by which its suppliers of pâté de fois gras produced their product. Lovenheim was concerned for the well-being of French waterfowl and wanted to make certain that they lived happy lives before they were slaughtered so that American gourmands could gorge themselves on their distended livers.
SEC Rule 14a-8(i)(5) permits a corporation to refuse to distribute a shareholder proposal if it relates to operations that account for less than 5% of the firm's assets earnings or sales or it not otherwise significantly related to the firm's business. Pâté actually accounted for a tiny portion of the firm's business -- well below the 5% threshold -- so the only question was whether it was otherwise significantly related to the firm's business. The court held that the phrase "significantly related" is not limited to economic significance. A policy issue may also be raised through a shareholder proposal. So, the question becomes: is force-feeding of geese and ducks a sufficiently significant policy issue that a corporation must be required to circulate a proposal relating to that issue as part of its proxy materials? The court, citing regulations intended to prevent cruelty to animals dating back to colonial times, found that it is.
Lovenheim v. Iroquois Brands, Ltd.
Does Iroquois have to police
Whether pâté requires force-fed geese
Yes, western culture protects
Fish, beasts and insects.
The proposal is no mere caprice.