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Valparaiso Univ. Law School

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Friday, January 31, 2014

Aberrant Contracts Symposium

The AALS Commercial and Related Consumer Law section program at the 2013 AALS Annual Meeting was on the topic of Aberrant Contracts:  Fringe Economy Lending and Other Atypical Consumer Agreements.  The Chicago-Kent Law Review just published a symposium issue on the topic with the following contributions (including one from yours truly):

Chicago-Kent Law Review 

Vol. 89, Issue 1

Symposium on Fringe Economy Lending and Other Aberrant Contracts

SYMPOSIUM EDITOR
Sarah Howard Jenkins,
Charles C. Baum Distinguished Professor of Law

Articles

Table of Contents (Full Listing of PDF Articles)

Symposium Introduction
Sarah Howard Jenkins
89 Chi.-Kent L. Rev. 3 (2014)

I. Fringe Economy Lending—The Problem, Its Demographics, and Proposals for Change

Third Party Funding of Personal Injury Tort Claims: Keep the Baby and Change the Bathwater
Terrence Cain
89 Chi.-Kent L. Rev. 11 (2014)

An Economic Perspective on Subprime Lending
Michael H. Anderson
89 Chi.-Kent L. Rev. 53 (2014)

Females on the Fringe: Considering Gender in Payday Lending Policy
Amy J. Schmitz
89 Chi.-Kent L. Rev. 65 (2014)

II. Other Solutions for Fringe Economy Lending

Interest Rate Caps, State Legislation, and Public Opinion: Does the Law Reflect the Public’s Desires?
Timothy E. Goldsmith & Nathalie Martin
89 Chi.-Kent L. Rev. 115 (2014)

An Economic Investigation of Rent-to-Own Agreements
Michael H. Anderson
89 Chi.-Kent L. Rev. 141 (2014)

III. Securitization of Fringe Economy Receivables—A Lender’s Issue

Securitization of Aberrant Contract Receivables
Thomas E. Plank
89 Chi.-Kent L. Rev. 171 (2014)

IV. Other Aberrant Contract Concerns

Legal Uncertainty and Aberrant Contracts: The Choice of Law Clause
William J. Woodward Jr.
89 Chi.-Kent L. Rev. 197 (2014)

Some Economic Insights Into Application of Payments Doctrine: Walker Thomas Revisited
James W. Bowers
89 Chi.-Kent L. Rev. 229 (2014)

V. Atypical Consumer Agreements as Aberrant Contracts

Situational Duress and the Aberrance of Electronic Contracts
Nancy S. Kim
89 Chi.-Kent L. Rev. 265 (2014)

Tax Ferrets, Tax Consultants, Bounty Hunters, and Hired Guns: The Property Tax Netherworld Fueled by Contingency Fees and Champertous Agreements
J. Lyn Entrikin
89 Chi.-Kent L. Rev. 289 (2014)

Tenure, the Aberrant Consumer Contract
James J. White
89 Chi.-Kent L. Rev. 353 (2014)

Are You Free to Contract Away Your Right To Bring a Negligence Claim?
Scott J. Burnham
89 Chi.-Kent L. Rev. 379 (2014)

January 31, 2014 | Permalink | Comments (0) | TrackBack (0)

Sperm Donor Ordered to Pay Child Support Despite Agreement

I like to remind my 1Ls Contracts students that a contract is private law between two parties, but it doesn't override public law.  This story is last week's news, but I thought I'd blog about it anyway because it provides a pretty good example of this point.  In 2009, William Marotta responded to a Craigslist ad posted by two women for a sperm donor.  All three parties agreed - and signed an agreement to the effect - that Marotta waived his parental rights and responsibilities.  The Kansas Department for Children and Families sought to have Marotta declared the father and responsible for payments of $6,000 that the state had already paid and for future child support. 

Unfortunately for Marotta, a Kansas state statute requires a physician to perform the artificial insemination procedure.  The Shawnee County District Court Judge Mary Mattivi ruled that because the parties "failed to conform to the statutory requirements of the Kansas Parentage Act in not enlisting a licensed physician...the parties' self-designation of (Marotta) as a sperm donor is insufficient to relieve (Marotta) of parental rights and responsibilities."

Note that the couple was not seeking to invalidate the contract - it was the Kansas state agency. 

It's unclear whether the parties will appeal.

 

[Nancy Kim]

 

January 31, 2014 in Current Affairs, In the News, Miscellaneous, True Contracts | Permalink | Comments (0) | TrackBack (0)

Wednesday, January 29, 2014

Motley Crue "Death Pact"

Motley Crue, the rock band with the best VHI Behind the Music episode, has agreed to disband after one final tour.  According to CNN

All four members of Motley Crue signed an agreement Tuesday that will permanently dissolve the legendary rock group after a final tour.

Vince Neil, Mick Mars, Nikki Sixx and Tommy Lee appeared in a Hollywood hotel Tuesday for a signing ceremony for a "cessation of touring agreement," which their lawyer said would bring a peaceful end to the group.

"Other bands have split up over rancor or the inability of people to get along, but this is mutual among all four original members and a peaceful decision to move on to other endeavors and to confirm it with a binding agreement," attorney Doug Mark said.

Motley Crue has sold more than 80 million albums since hitting the road in 1981, but drummer Tommy Lee said, "Everything must come to an end."

"We always had a vision of going out with a big f**king bang and not playing county fairs and clubs with one or two original band members," said Lee, who is the youngest member at 51. "Our job here is done."

Guitarist Mick Mars, the oldest band member at 62, said the group's 33 years have had "more drama than 'General Hospital.'"

Vocalist Vince Neil, 52, said he'll miss the group, but it's not an end to his rock career. "I feel there are a lot of great opportunities and exciting projects after Motley."

The first leg of "The Final Tour" starts in Grand Rapids, Michigan, on July 2.

The termination agreement becomes effective at the end of 2015, after a global tour that will include Alice Cooper.

"Motley Crue and Alice Cooper -- A match made in Armageddon?" said Cooper.

I'd love to see a copy of the contract (...wherefore Motley Crue hereby f***g agrees fortwith to cease any and all  rock band activities of any kind...).   In the main, it sounds like a hard one to breach: I promise not to show up for band stuff anymore! 

January 29, 2014 in Celebrity Contracts, In the News, Teaching | Permalink | TrackBack (0)

Ruling on Privity of Contract in Indiana

This is the second in a series of posts that draw on Michael Dorelli and Kimberly Cohen's recent article in the Indiana Law Review on developments in contracts law in Indiana.   This post will discuss State of Indiana Military Department v. Continental Electric Company, which was decided by the Indiana Court of Appeals in 2012.  

Gary Airport MapIn 2006, Continental Electric Company (Continental) submitted a bid as a subocontractor on the construction of an avaiation facility at the Gary/Chicago Internaional Airport (see the image at left).  Continental's submitted a bid of about $1.8 million to do the electrical work on the project, noting in its bid that $335,000 should be added to its bid under "Alternative 2," which was designated "Diesel Generator."  The State of Indiana Military (the State) which had issued the bid hosted a pre-bid meeting at which it sought to clarify that costs relating to Alternative 2 should be included in the base bid, but Continental did not do so, relying on its understanding of the written bid documents.  The State provided a written version of its clarification of Alernative 2, but Continental claims that the written version did not reflect what was said at the pre-bid meeting.

The Larson-Danielson Construction Company (Larson) was awarded the project and chose Continental to do its electrical work.  Continental began work in October 2006.  It dealt only with Larson and there was no contractual relationship between it and the State.  Continental billed Larson for an extra $207,000 worth of work associated with Alternative 2.

Continental complained throughout the process that it was entitled to payment for the work done under Alternative 2, but both Larson and the State believed that no extra payment was required, since both interpreted the bid documents as requiring that work associated with Alternative 2 be part of the base bid.  Getting no satisfaction from Larson, Continental brought suit against the State, claiming $207,000 in damages for breach of contract or quantum meruit.  The trial court found for Continental and the State appealed.

The Court of Appeals reversed.  It found that Continental could not bring a breach contract claim against the State because it was not in a contractual relationship with the State.  Nor had the State agreed to hear appeals arising out of controversies between Larson and its subcontrators.  

The Court then moved on to Continental's unjust enrichment claim.  Under Indiana law, four criteria must be met to establish such a claim: 

1)Whether the owner impliedly requested the subcontractor to do the work; 2) whether the owner reasonably expected to pay the subcontractor, or the subcontractor reasonably expected to be paid by the owner; 3) whether there was an actual wrong perpetrated by the owner; and 4) whether the owner’s conduct was so active and instrumental that the owner “stepped into the shoes” of the contractor.

The Court concluded that because Larson was paid in full, the trial court erred in finding that the State had retained a benefit for which it did not pay.  Basically, the Court agreed with Larson and the State the the bid documents and the clarification established that the costs associated with Alternative 2 were to be included in the base bid.  The Court concluded as follows:

In sum, we conclude that Continental Electric had no right to recover against Indiana Military. Continental Electric failed to establish that a measurable benefit was conferred on Indiana Military and that its retention of a benefit without payment would be unjust. Indeed, Indiana Military did not receive a measurable benefit from Continental Electric that it had not already paid for.

All concerned, including Continental Electric, knew long before Continental Electric ever entered into a subcontract with Larson that the wiring in question was part of the base contract with Larson and that Indiana Military would expect Larson to install the wiring between the facility building and the concrete generator pad. Larson 28completed the work, and was fully paid for that work. In short, Indiana Military has not unjustly retained a benefit without payment. 

The Court of Appeals set aside the trial court's ruling on quantum meruit and reversed its judgment.

January 29, 2014 in Government Contracting, Recent Cases | Permalink | Comments (0) | TrackBack (0)

Tuesday, January 28, 2014

Weekly Top Tens from the Social Science Research Network

SSRNRECENT HITS (for all papers announced in the last 60 days) 
TOP 10 Papers for Journal of Contracts & Commercial Law eJournal 

November 29, 2013 to January 28, 2014

RankDownloadsPaper Title
1 331 Unsettledness in Delaware Corporate Law: Business Judgment Rule, Corporate Purpose 
Lyman Johnson
Washington and Lee University - School of Law
2 199 Where the FCRA Meets the FDCPA: The Impact of Unfair Collection Practices on the Credit Report 
Mary Spector
Southern Methodist University - Dedman School of Law
3 153 An Economic Theory of Fiduciary Law 
Robert H. Sitkoff
Harvard Law School
4 140 The Contract Management Body of Knowledge: Understanding an Essential Tool for the Acquisition Profession 
Steven L. SchoonerNeal J Couture
George Washington University - Law School, George Washington University - Law School
5 124 Executive Benefits Insurance Agency V. Arkison: Does Party Consent Render Bankruptcy Court Adjudication Constitutionally Valid? 
Elizabeth GibsonJonathan M. Landers
University of North Carolina (UNC) at Chapel Hill - School of Law, Scarola Malone & Zubatov LLP
6 104 Beyond International Commercial Arbitration? The Promise of International Commercial Mediation 
S.I. Strong
University of Missouri School of Law
7 97 Whither Symmetry? Antitrust Analysis of Intellectual Property Rights at the FTC and DOJ 
Douglas H. GinsburgJoshua D. Wright
George Mason University - School of Law, Faculty, George Mason University - School of Law, Faculty
8 93 The Practice of Promise and Contract 
Liam B. Murphy
New York University (NYU) - School of Law
9 88 Promises and Expectations 
Florian EdererAlexander Stremitzer
Yale University - School of Management, UCLA School of Law
10 65 Sovereign Pari Passu and the Litigators of the Lost Cause 
Joseph Cotterill
Financial Times

RECENT HITS (for all papers announced in the last 60 days) 
TOP 10 Papers for Journal of LSN: Contracts (Topic)  

November 29, 2013 to January 28, 2014

RankDownloadsPaper Title
1 140 The Contract Management Body of Knowledge: Understanding an Essential Tool for the Acquisition Profession 
Steven L. SchoonerNeal J Couture
George Washington University - Law School, George Washington University - Law School
2 93 The Practice of Promise and Contract 
Liam B. Murphy
New York University (NYU) - School of Law
3 88 Promises and Expectations 
Florian EdererAlexander Stremitzer
Yale University - School of Management, UCLA School of Law
4 75 Private Law: Commutative or Distributive? 
Dan Priel
York University - Osgoode Hall Law School
5 65 Sovereign Pari Passu and the Litigators of the Lost Cause 
Joseph Cotterill
Financial Times
6 63 Unpopular Contracts and Why They Matter: Burying Langdell and Enlivening Students 
Jennifer Taub
Vermont Law School
7 55 Expressive Remedies in Private Law 
Andrew S. Gold
DePaul University - College of Law
8 54 Forward: Review of Baird, Eisenberg & Bix on Contract Doctrine 
Lisa Esther Bernstein
University of Chicago - Law School
9 49 Lawmaking in the Shadow of the Bargain: Contract Procedure as a Second-Best Alternative to Mandatory Arbitration 
Charles W. Tyler
Yale Law School
10 48 Protecting Reliance 
Victor P. Goldberg
Columbia Law School

January 28, 2014 in Recent Scholarship | Permalink | TrackBack (0)

And Still More on Tipping

WaitressLast week, Myanna Dellinger posted about tipping and Uber.  One piece of information she provided in that post that was new to me was that servers were tipped only about 10% on the West Coast until about ten years ago.  It seemed odd to me that there should be a more stingy tipping culture in the West.  After all, one does not imagine Hollywood players threatening one another with "You'll never tip 10% in this town again."  

Yesterday's New York Times provides a timely explanation of this anomaly.  It turns out, tips may be lower on the West Coast because wages are higher.  While the federal minimum wage for waiters who earn tips is only $2.13, states are free to mandate higher miniumum wages, and states in the West are most likely to do so.  In Washington State, a waiter's base pay is $9.32/hour.

Myanna has lived in Europe so she knows that the real solution to the problem is to pay servers a living wage.  If restaurant patrons want to reward them for especially fine service, they are welcome to do so, but with many servers living below the poverty line, they should be protected against economic surges and depressions that are beyond their control.  

The restaurant industry protests against any rise in the minimum wage and is fighting legislation supported by the Obama administration that would incrementally increase the minimum wage for tip-earners to $7.25/hour.  But restaurants can learn from cabbies.  Pass increased costs onto customers by increasing menu prices, but then recommend that patrons tip only 10%.   Across the nation, people with math phobia will delight in the ease of calculation.

January 28, 2014 in Commentary, In the News | Permalink | Comments (0) | TrackBack (0)

The Behavioral Economics of Tipping

Myanna's post about Uber got me thinking about a recent trip to New York City.  New York City was the first city in which I took the occasional cab.  I went to college and to law school there.  When I was in college, some kindly relative told me that cabbies should get a 10% tip, and I have lived by that ever since.  Turns out my kindly relative was a cheapskate. 

As this article from The New York Times from about a year ago indicates, as early as 1947, cabbies expected at least 12½%, and until recently average tips exceeded 20%.  Tips have come down as fares have gone up, and as of a year ago they averaged just over 15%.   

New York City cabs are now equipped with credit card readers that offer riders the option to leave a tip.  The reader will automatically add a tip, and it gives riders the option of tipping 15%, 20% or 25%.  Behavioral economics suggests that most people will choose the middle one, and so it seems that the aim of the screen is to get cabbies' tips back up to where they were before the fares increased.  When I saw these three options, I felt oppressed and manipulated, since I was still operating on the assumption that 10% is what is expected.  Now I feel guilty that I did not tip more reasonably.  In my own defense, I didn't save myself any money, since the my law school reimbursed me for my travel expenses on that trip.  So you see, I wasn't being cheap; I was being a responsible steward of my law school's resources.  But no more stingy tips for me. 

I am a work in progress.  I was as astonished as was Jerry Seinfeld (the character) to learn that chambermaids expect $5 a night (see the scene below, starting about 1:40 in).  

 

Ann Landers is an even bigger cheapsake than my relative.  Before we saw this, I would tip $2 a night, and I still think $5 a night is rather high.  After all, Jerry Seinfeld (the character) is an experienced traveler, and he seems pretty free with his money.  If he gives $1, $2 seems okay.  But my wife and daughter agree with the suspected serial killer.  Five dollars it is.  It would have been interesting to see if chambermaids noticed an increase in generosity following the airing of this episode.  And I wonder if they now wish that cable channels would stop showing Seinfeld reruns.  The episode is now at least fifteen years old, so if $5 a night was a good tip then, one should expect $10 /a night now. 

January 28, 2014 in About this Blog, Commentary, Travel | Permalink | Comments (0) | TrackBack (0)

Monday, January 27, 2014

GLOBAL K: Apples and Oranges?

Offshore friends and colleagues are often confused or frustrated by the U.S. approach to resolving financial exploitation or manipulation of consumers. Why is it assumed that private remedies are the appropriate response to such pervasive problems, they ask. How is it that U.S. consumer protection law is so often merely a matter of perfunctory disclosures that noone reads, they complain. Certainly, much of the run-up to the capital markets collapse of 2008 involved rather blatant abuse of consumers, but when the Great Reccession emerged, only the high end of the economy received massive government support, while affected mortgagors were left largely to whatever remedies or defenses they could fashion from applicable transactional law. One might legitimately wonder at these official responses.

 

A recent decision, In re Late Fee and Over–Limit Fee Litigation, issued by the Ninth Circuit on January 21, 2014, offers an interesting variation on this problem. The case also highlights the limits of ordinary principles of contract law in addressing contemporary issues of consumer protection.

 

A group of credit cardholders, who had allegedly paid excessive late fees and over-limit fees to issuing banks, brought a class action against the issuers, claiming on a flurry of legal grounds that the fees should not be enforceable. Some of these grounds were regulatory. Others sought to align the judicial treatment of torts remedies with that of contracts remedies. Among other things, the plaintiffs argued that the fees violated usury limits under the National Bank Act, 12 U.S.C. §§ 85–86, or were otherwise excessive under the corresponding provisions of the Depository Institutions Deregulation and Monetary Control Act (“DIDMCA”), 12 U.S.C. § 1831d(a), which applied to state-chartered, FDIC-insured banks. Even if seemingly in compliance with these regulatory statutes, plaintiffs asserted, the fees were so excessive as to be unconstitutionally punitive. They also made a try at arguing that the issuing banks had conspired to fix prices and maintain a price floor for late fees in violation of the Sherman Act, 15 U.S.C. § 1 et seq. Furthermore, the plaintiffs alleged, the fees violated the California Unfair Competition Law, Cal. Bus. & Prof.Code § 17200 et seq.

 

The district court found it hard to accept these challenges given the routine practices of the issuers. In accordance with federal law, the fees had been disclosed in the contracts between the issuers and the cardholders, and were fairly uniform and typically between $15 and $39 – amounts that the plaintiffs argued still vastly exceeded the harm the issuers actually suffered when their customers charged beyond their credit limits or made late payments. The Northern District of California dismissed the action for failure to state a claim.

 

On appeal, the cardholders argued that the fees should be treated like the punitive damages that were subjected to substantive due process limits in the Supreme Court’s 1996 decision in BMW of North America, Inc. v. Gore and its 2003 decision in State Farm Mut. Auto. Ins. Co. v. Campbell. Hence, even if permitted by federal regulatory law, the fees should be refused enforcement on constitutional grounds. Nevertheless, the Ninth Circuit affirmed, holding that substantive due process principles – developed in the context of jury-awarded punitive damages in tort cases – did not apply to liquidated damages clauses in contracts cases. As the court explained, “[t]he jurisprudence developed to limit punitive damages in the tort context does not apply to contractual penalties, such as the credit card fees at issue in this case.” It also held that the banks could not be liable for excessive charges under the state unfair competition law, since the late fees and over-limit fees were charged by banks in conformity with federal law. As Judge Nelson observed in her opinion for the court, “[b]ecause we conclude that the issuers' conduct did not violate the National Bank Act or the DIDMCA, there is no derivative liability under the Unfair Competition Law.”

 

Judge Nelson recognized that the case turned on the relative similarities and differences between liquidated damages and punitive damages. It is a commonplace of contracts remedies that “liquidated damages” are enforceable if the damages are likely to be difficult to determine at the time of agreement and the liquidated sum represents a good faith effort by the parties to quantify. See, e.g., UCC § 2–718(1). However, if the liquidated damages provision were “unreasonably large,” it would be treated as an unenforceable penalty.

 

Judge Nelson also acknowledged that “[l]ike the common-law rule against contractual penalty clauses, punitive damages have an ancient provenance.” The key to the case was the plaintffs’ attempt to meld these two historical traditions to invalidate otherwise enforceable contractual fees, on a constitutional basis. This the court refused to do. “[C]onsidering that the penalty clauses at issue originate from the parties' private – albeit adhesive – contracts, they are distinct from the jury-determined punitive damages awards,” Judge Nelson concluded. “Adhesive” though the contracts may be, the court was not prepared to invalidate fees ostensibly permitted by federal law.

 

Ironically, the problem seems to be that contracts law had already long assimilated excessiveness as a ground for unenforceability of a penalty clause without the invocation of due process notions. Hence, if a regulatory statute interevened – as the National Bank Act and DIDAMCA provisions arguably had – to permit a standardized fee that might otherwise be argued to be excessive, the question was whether a litigant could resuscitate the excessiveness argument with a jolt of due process. The basic reason for not exploring this possibility is that this had only been done in tort remedies theory, not contracts.

 

I am not sure that that is a very compelling reason. Apparently, neither did the Ninth Circuit. Judge Reinhardt concurred in the judgment “reluctantly.” In his view, the Supreme Court would be “well advised” to apply the prinicples of BMW of North America, Inc. and State Farm Mut. Auto. Ins. Co. “to prevent disproportionate penalties from being imposed on consumers when they breach contracts of adhesion.” He reluctantly admitted that the opinion of the court was correct in recognizing that due process constraints in the Constitution had not yet been interpreted so widely, but he gave a stirring and persuasive analysis of why it should be.

 

Judge Reinhardt’s separate opinion deserves the serious attention of contracts scholars and practitioners, as a possible map of future developments. Apparently, Judge Nelson, the author of the court’s opinion, agrees with me, because – in an extraordinary gesture – Judge Nelson also wrote separately to join Judge Reinhardt's concurrence, “although [she] agree[s] that the district court reached the correct result under currently applicable law and should be affirmed.” Are they suggesting the need for further judicial review?

 

 

Michael P. Malloy

 

January 27, 2014 in Commentary, Recent Cases | Permalink | TrackBack (0)

Severe Economic Disruptions from Climate Change

Severe Economic Disruptions from Climate Change

For many, climate change remains a far off notion that will affect their grandchildren and other “future generations.”  Think again.  Expect your food prices to increase now, if they have not already.  Amidst the worst drought in California history, the United Nations is releasing a report that, according to a copy obtained by the New York Times, finds that the risk of severe economic disruptions is increasing because nations have so dragged their feet in combating climate change that the problem may be virtually impossible to solve with current technologies. 

The report also says that nations around the world are still spending far more money to subsidize fossil fuels than to accelerate the urgently needed shift to cleaner energy.  The United States is one of these.  Even if the internationally agreed-upon goal of limiting temperature increases to 2° C, vast ecological and economic damage will still occur.  One of the sectors most at risk: the food industry.  In California, a leading agricultural state, the prices of certain food items are already rising caused by the current drought.  In times of shrinking relative incomes for middle- and lower class households, this means a higher percentage of incomes going to basic necessities such as food, water and possible medical expenses caused by volatile weather and extreme heat waves.  In turn, this may mean less disposable income that could otherwise spur the economy. 

Disregarding climate change is technologically risky too: to meet the target of keeping concentrations of CO2 below the most recently agreed-upon threshold of 500 ppm, future generations would have to literally pull CO2 out of the air with machinery that does not yet exist and may never become technically or economically feasible or with other yet unknown methods.

Of course, it doesn’t help that a secretive network of conservative billionaires is pouring billions of dollars into a vast political effort attempting to deny climate change and that – perhaps as a consequence – the coverage of climate change by American media is down significantly from 2009, when media was happy to report a climate change “scandal” that eventually proved to be unfounded.

The good news is that for the first time ever, the United States now has an official Climate Change Action Plan.  This will force some industries to adopt modern technologies to help combat the problem nationally.  Internationally, a new climate change treaty is slated for 2015 to take effect from 2020.  Let us hope for broad participation and that 2020 is not too late to avoid the catastrophic and unforeseen economic and environmental effects that experts are predicting.

Myanna Dellinger

Assistant Professor of Law

Western State College of Law

 

January 27, 2014 in Current Affairs, Food and Drink, In the News, Legislation, Science, Television | Permalink | Comments (1) | TrackBack (0)

Sports Contracts with Middle Schoolers

NCAA_Women's_LacrosseToday's New York Times has a long story about college coaches in non-money sports, like soccer and lacrosse, recruiting middle schoolers.  Like most intersections between amatuer athletics and money, this phenomenon is bad for everyone.  According to the Times, the new trend is an unintended consequence of Title IX.  There is lots of scholarship money chasing relatively few talented athletes, especially female athletes, in the non-money sports.  As a result, players of promise get snatched up very early, so now schools offer scholarship money to eighth graders in the hope that they will commit to play for them when they go to college.  

The result is bad for everyone for obvious reasons.  Coaches cannot really predict which 13-14 year olds will be All-American athletes.  Even if athletic potential is there, injuries, loss of interest or other factors (e.g., life outside of sports) can intervene.  The dynamic hurts young athletes because it forces them to focus on one sport very early, playing that sport year round and increasing the likelihood of injury.  Then, many athletes recruited in middle school are not top players in college, so they spend their college years as frustrated bench warmers, has-beens at the age of 18.  The coaches hate it as well.  They've got better things to do with their time than endless telephone converstions with middle schoolers, and they hate the dynamic of having to commit to student athletes before they are confident of the students' potential.

But it's actually hard to have that much sympathy for the coaches, since this is a world they have created by exploiting loopholes in NCAA rules.  They could voluntarily self-regulate or simply work at getting a reputation for being a school that only accepts students who arrive at a particular sports program as a result of more mature deliberation.  Perhaps it won't work and then a school might have to suffer the ignominy of not having, for example, a top ten women's soccer team.  The horrors.  University administrators should focus more an graduation rates, employment rates and student well-being and less on rankings.  

But the reason I am posting about this is of course the relevant contacts issues.  The Times is silent on how the minors bind themselves to particular universities.  Since these middle schoolers cannot bind themselves contractually, there must be parents involved.  Still, I wonder what the remedy is if a student athlete decides not to attend the university to which she has pre-committed.  Of course, the student will sacrifice her scholarship, but if a recruited soccer player decides that she wants to play at a different school, will it really be  impossible for her to find a school that will offer her a scholarship when she is a senior?  Given that the coaches know that they will make mistakes in recruiting 14-year-olds, they ought to hold a few scholarships in reserve so that they can make offers to late bloomers.  

But students may be unwilling to renege on their commitments.  As the closing line of the Times article suggests, students may be happy to simply be done with the process, even though they know that they are pretty poor predictors of what they will want for themselves in four years' time.  The disservice we do to student athletes is obvious.  But the process also disserves colleges and universities.  There are lots of reasons to go to college, but the chief reason for almost all students ought to be educational.  By forcing to middle schoolers to pick a school based on a sport which will almost certainly never be anything more than a hobby for them, we present a distorted picture of the purposes of higher education -- or perhaps we simply contribute to a realistic picture of higher education which is in fact a disfigurement of education.

January 27, 2014 in In the News, Sports | Permalink | Comments (0) | TrackBack (0)

Bid Case in Indiana

Last week, we noted Michael Dorelli and Kimberly Cohen's recent article in the Indiana Law Review on developments in contracts law in Indiana.   This week, we will be summarizing some of the important cases discussed in that article.  

SchoolEast Porter County School Corporation v. Gough, Inc. is a pretty typical bid case.  Gough, Inc. (Gough) submitted a bid of around $3 million to the East Porter County School Coporation (the County) on some additions, presumably to school buildings.  Just after the deadline for the submission of bids, but likely before the bids were unsealed, Gough tried to withdraw its bid, claiming that its bid was the result of an inadvertent clerical error.  One month later, the County awarded the contract to Gough.  Gough's president notified the County that the bid was incorrect and stated that Gough would not accept the contract.  Gough returned the contract to the County unsigned.

When the County tried to enforce the contract, Gough brought suit, seeking a declaration that its bid be rescinded and its bid bond released.  The County counterclaimed, alleging breach of contract by both Gough and its bid bonding agency, Travelers Casualty and Surety Company of America (Travelers).  The trial court granted the Gough and Travelers summary judgment, citing a 1904 case that permitted excuse of a contractor's bid based on mistake.  

The law in Indiana excuses bids based on mistakes in calculation or clerical errors but not based on errors in judgment.  Gough's presidnet submitted an affidavit in which he stated that on the day that Gough submitted its bid, its total of the bids of its subcontractors and its own cost estimates came to just over $3.3 million.  "For psychological reasons," Gough wanted to get the bid below $3.3 million, but they spoke of trying to get to 299 or 2998.  They thus mistakenly wrote down a bid of $2.998 million, which they then arbitrarily cut down to $2,997,900, when they apparently intended $3,299,700.  Gough then quickly realized that the error would result in a $200,000 loss on the project, so Gough attempted to pull the bid.

The Court of Appeals found that, as a result of the error, the minds of the parties never met and the County "would obtain an unconscionable advantage" as a result of Gough's mistake.  Because Gough timely notified the County of the mistake, the County was not in any way harmed by its withdrawal of its bid.  As a result, the Court ruled that the County had no right to enforce Gough's erroneous bid, nor did Traveler's have any obligation to pay its bid bond.  

I have no problem with this result, but the "meeting of the minds" language strikes me as misplaced in this context.  Many contracts professors dislike the phrase "meeting of the minds" because it suggests that subjective agreement on terms is what is required when the test for whether or not a contract formation is objective.  Twenty bishops could attest to Gough's president's veracity and still he would be bound if a contract had actually been formed.  But here no contract was formed because the bid was withdrawn before it was accepted.  In this circumstance, courts should really only ask two questions.  First, was the bid irrevocable?  If so, Gough should bear the burden of its own mistake -- and the existence of the bond suggests that the parties have allocated the burden.  If not, the second question is whether the bid was relied upon, and it was not.  So really the case should turn on whether or not the bid was irrevocable and not on whether the parties "minds" met or on how the court categorizes Gough's mistake.

This is not to find fault with the Court in this case, which simply followed Indiana precedent.  But the case nicely illustrates the difficulties in distinguishing between clerical or calculation errors and errors of judgment.  Sure, Gough's principals made a clerical mistake reducing their bid by $330,000 when they meant to reduce it by only $30,000, but one could also argue that the decision to reduce the bid is a judgment, especially when one does so for "psychological reasons."  Once they made the decision to reduce their bid, the fact that they committed a clerical error in carrying out that judgment is epiphenomenal.  

January 27, 2014 in Commentary, Recent Cases, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Wednesday, January 22, 2014

A $1 Billion Dollar Unilateral Offer

Warren Buffett and Quicken Loans have teamed up to help make teaching about unilateral contracts and interpretation so much more interesting.  The offer?  One billion dollars to anyone who fills out a perfect 2014 NCAA tournament bracket.

Say what?  Is this serious?  Or is it like that Pepsi commercial - you know the one.

Although at first, this might sound like a joke, once you learn the odds are, by one estimate, one in 9.2 quintillion, you --a reasonable person -- would realize this offer was serious.

All you have to do is fill out a perfect bracket.  (Now might be the time for me to mention that I once won my law firm's pool one year.  Strange but true).

But wait - there's more.  The Business Insider reports that Quicken, which is actually running the contest, will award $100,000 to 20 of the most accurate but not perfect brackets "submitted by qualified entrants in the contest to use toward buying, refinancing or remodeling a home."  The company will also donate $1million  to Detroit and Cleveland non-profit organizations. 

Get ready for March Madness....

 

[Nancy Kim]

 

 

January 22, 2014 in Current Affairs, Games, In the News, Miscellaneous | Permalink | Comments (0) | TrackBack (0)

New in Print, Including Books

Pile of BooksRandall S. Davidson & Andrew D. Martin, Mineral Lease Division Revisited-- An Old Doctrine with New Applications, 2 LSU J. Energy L. & Resources 1 (2013)

Michael A. Dorelli & Kimberly L. Cohen, Recent Developments in Indiana Business and Contract Law, 46 Ind. L. Rev. 943 (2013) [we'll be mining this for blog fodder in the weeks to come]

Robert Downey, Edward K. Gross & Stephen T. Whelan, Leases, 68 Bus. Law. 1191 (2013)

Jennifer S. Martin, Sales, 68 Bus. Law. 1173 (2013) [more mining to do here]

And new in books

 

RiceWilly E. Rice, Contract Law: Practice, Interpretation, and Enforcement teaches common-law principles regarding the formation, interpretation and enforcement of contracts and stand-alone promises. More specifically, the casebook discusses theories of recovery, and explains the practicable application of those theories in legal complaints and answers. In addition, the casebook covers Article 2 of the Uniform Commercial Code, which governs the formation and enforcement of sale-of-goods contracts.

Most legal casebooks generally focus on the theoretical. Contract Law, however, covers legal and statutory theories as well as civil procedures, and the practice of law in everyday life. Therefore, the casebook gives first-year students valuable skills that they can use throughout their legal careers.

Contract Law is literally two textbooks in one and can be used for a full year of instruction. Therefore, it is ideal for law school courses in contracts. And, to re-emphasize, the text teaches students how to construct plaintiffs’ complaints, and defendants’ answers using common-law and UCC-related theories of recovery and affirmative defenses.

Robert D. Brain, Brain's Exam Pro on Contracts, Essay

This Exam Pro consists of essay questions actually given by Contracts professors throughout the United States. Every question contains a detailed explanation, along with analytical steps explained in easy-to-understand, basic language, and a step-by-step guide on how to analyze each major issue. Both Professor “model” answers and student “actual” answers are provided to allow students to get a feel for all the issues that could have been discussed on some questions, and what is realistic for a student to actually answer under timed conditions. The Preface includes tips on how to take essay exams. A general “List of Issues” covered on each question is provided, so the student can decide whether or not to use a particular question given the course coverage in the student’s Contracts class. Similarly, an “Index of Issues” is provided so the student can easily find all the questions that deal with a particular substantive issue which allows for repetitive testing on a troublesome issue. Each answer includes cross-references to the applicable sections of the Restatement (Second) Contracts and the Uniform Commercial Code, and citations to the more important cases in Contracts law, allowing the student to easily match the subject matter of the question to his or her outline and class discussion. Cross-references are included in every answer to relevant portions of Sum & Substance: Quick Review of Contracts, allowing for easy reference if more substantive knowledge is either needed or desired.

January 22, 2014 in Books, Recent Scholarship | Permalink | TrackBack (0)

Tuesday, January 21, 2014

GLOBAL K: July Conference in Athens

There is a Call for Papers from the Athens Institute for Education and Research (ATINER) that readers of Global K might be interested in. The 11th annual International Conference on Law will be held 14-17 July 2014, in Athens, Greece, and there is usually a number of panels and presentations related to contracts and transactional law. Sponsored by ATINER’s Law Research Unit, this is a distinctly interdisciplinary and international event, with scholars from around the globe and all career levels exchanging views in both formal and informal venues. Panels will be organized around the expressed interests of those submitting abstracts. A post-conference, peer-review process will lead to publication of a volume(s) of final conference papers. The general deadline to submit abstracts for the law conference was 15 December 2013, with acceptance decisions within four weeks of submission. However, if you are interested in presenting, please send me your abstract, and I shall submit it to the organizing committee, of which I am a member.

 

In the eight years that I have been attending the conferences and events sponsored by ATINER, I have found the programs and the participants to be fascinating and refreshing. The interdisciplinary edge of the conferences and the genuinely cosmopolitan spirit that pervades them has made these a source of intellectual inspiration and friendship among academic colleagues from around the world.

 

ATINER was established in 1995 as an independent academic association with the mission to become a forum where academics and researchers from all over the world could meet in Athens to exchange ideas on their research and to discuss future developments in their disciplines. Since 1995, ATINER has organized more than 200 international conferences, symposia and events. It has also published approximately 150 books. Academically, ATINER consists of  twenty-seven Research Unitsorganized under six Research Divisions. Each Research Unit organizes an annual conference and undertakes various large and small research projects. Academics and researchers are more than welcome to become members and contribute to ATINER's objectives. If you want to become a member, you download the membership form. For more information about ATINER, you can visit the ATINER website or email to info@atiner.gr.

 

Michael P. Malloy

 

January 21, 2014 in Conferences | Permalink | TrackBack (0)

Tips on the Rise... but Who Benefits?

After a night on the town, you decide to hire not a traditional taxi company, but rather a new and similar service provider that uses third-party private drivers operating their individually owned, unmarked cars and smart application payment technology.  The app says, “Gratuity is included.”  Would you expect the tips you give to go in full to the drivers or for the tips to be shared with the taxi-like company?  Probably the former, although tipping tactics and expectations seem to be changing.

The question of whether the drivers in the above situation have a viable claim to the full amount of the tips will soon be resolved in California in O’Connor v. Uber Techs, 2013 BL  338258 (N.D. Cal. Dec. 5, 2013).  After determining that no implied-in-fact contract can be said to exist between the drivers and the taxi-like company “Uber,” the court so far determined that Uber and its passengers may have entered into an implied agreement regarding the tips from which the drivers were ultimately intended to benefit as third parties to the contract between Uber and passengers.

In the USA, tipping is widely considered a fair way for service personnel to earn a more decent living than if they had to rely on base salaries.  This intersects with the current debate about whether the federal minimum wage should be increased.  According to recent CNN TV news, if salaries reflected the productivity levels of United States workers, the minimum salary should be $28/hr.  It is currently $7.25

But what about consumers?  Tipping seems to rising more rapidly than both salaries and inflation rates in general.  Not long ago (ten years or so), tipping 10% in restaurants was considered the norm, at least in California and parts of the Western USA.  Now, food servers, the drivers in the above case and undoubtedly others expect 20%; a 100% increase in ten years or so.  Many Los Angeles restaurants have begun to automatically add this 20% gratuity to their guest checks (some still leaving an additional line open for tips…).  In comparison, the average inflation rage was 2.5% per year over the past ten years.  During the 12-month period ending November 2013, inflation was 1.2%.  Of course, salaries may be a more accurate yardstick.  According to the Social Security Administration’s Average Wage Index, salaries increased by approximately 33% over the past ten years (approx. 3% from 2011 to 2012).

To be sure, service personnel and other workers deserve a decent income for their efforts in a wealthy, industrialized nation such as the USA.  The question is whether the burden of this should be placed on consumers in the form of more or less “hidden” costs such as tax and tips in somewhat uncertain amounts or whether the employers should be expected to more openly list the true bottom-line costs of their services as is the case in other nations.  A better route may be to increase the federal minimum salary to the much-discussed (e.g., here) “living wage.”  At a minimum, it would seem that all tips given should go to the workers and not be a mere way for companies to award themselves more money.

Myanna Dellinger

Assistant Professor of Law

Western State College of Law

January 21, 2014 in Food and Drink, Legislation, Web/Tech | Permalink | TrackBack (0)

Weekly Top Tens from the Social Science Research Network

SSRNRECENT HITS (for all papers announced in the last 60 days) 
TOP 10 Papers for Journal of Contracts & Commercial Law eJournal 

November 22, 2013 to January 21, 2014

RankDownloadsPaper Title
1 783 The Paper Chase: Securitization, Foreclosure, and the Uncertainty of Mortgage Title 
Adam J. Levitin
Georgetown University - Law Center
2 327 Unsettledness in Delaware Corporate Law: Business Judgment Rule, Corporate Purpose 
Lyman Johnson
Washington and Lee University - School of Law, 
Date posted to database: November 26, 2013 
Last Revised: November 29, 2013
3 195 Where the FCRA Meets the FDCPA: The Impact of Unfair Collection Practices on the Credit Report 
Mary Spector
Southern Methodist University - Dedman School of Law
4 134 An Economic Theory of Fiduciary Law 
Robert H. Sitkoff
Harvard Law School
5 133 Protecting Consumers from Zombie-Debt Collectors 
Neil L. Sobol
Texas A&M University - School of Law
6 132 The Contract Management Body of Knowledge: Understanding an Essential Tool for the Acquisition Profession 
Steven L. SchoonerNeal J Couture
George Washington University - Law School, George Washington University - Law School
7 122 Executive Benefits Insurance Agency V. Arkison: Does Party Consent Render Bankruptcy Court Adjudication Constitutionally Valid? 
Elizabeth GibsonJonathan M. Landers
University of North Carolina (UNC) at Chapel Hill - School of Law, Scarola Malone & Zubatov LLP
8 97 Beyond International Commercial Arbitration? The Promise of International Commercial Mediation 
S.I. Strong
University of Missouri School of Law
9 92 Whither Symmetry? Antitrust Analysis of Intellectual Property Rights at the FTC and DOJ 
Douglas H. GinsburgJoshua D. Wright
George Mason University - School of Law, Faculty, George Mason University - School of Law, Faculty
10 86 The Practice of Promise and Contract 
Liam B. Murphy
New York University (NYU) - School of Law

RECENT HITS (for all papers announced in the last 60 days) 
TOP 10 Papers for Journal of LSN: Contracts (Topic)  

November 22, 2013 to January 21, 2014

RankDownloadsPaper Title
1 132 The Contract Management Body of Knowledge: Understanding an Essential Tool for the Acquisition Profession 
Steven L. SchoonerNeal J Couture
George Washington University - Law School, George Washington University - Law School
2 86 The Practice of Promise and Contract 
Liam B. Murphy
New York University (NYU) - School of Law
3 82 Promises and Expectations 
Florian EdererAlexander Stremitzer
Yale University - School of Management, UCLA School of Law,
4 72 Private Law: Commutative or Distributive? 
Dan Priel
York University - Osgoode Hall Law School
5 64 Sovereign Pari Passu and the Litigators of the Lost Cause 
Joseph Cotterill
Financial Times
6 60 Unpopular Contracts and Why They Matter: Burying Langdell and Enlivening Students 
Jennifer Taub
Vermont Law School
7 54 Expressive Remedies in Private Law 
Andrew S. Gold
DePaul University - College of Law
8 48 Lawmaking in the Shadow of the Bargain: Contract Procedure as a Second-Best Alternative to Mandatory Arbitration 
Charles W. Tyler
Yale Law School
9 46 Supreme Court on 'Works Contract': Analysis and Ramifications of 'Larsen & Toubro' Decision 
Tarun Jain
Supreme Court of India
10 46 Protecting Reliance 
Victor P. Goldberg
Columbia Law School

 

January 21, 2014 in Recent Scholarship | Permalink | TrackBack (0)

Monday, January 20, 2014

Is Disney to Yahoo! as Tragedy Is to Farce?

Mad StacksIn the mid-1990s, the Walt Disney Company hired Michael Ovitz to be its #2 executive.  After slightly over a year in the position, Disney's Board of Directors fired Ovitz, having determined that he was an ineffective executive for the company.  He received over $100 million in severance pay.  After years of litigation, the Delaware courts found that Disney's Board of Directors did not breach its duty of care in approving an excecutive compensation scheme that made Ovitz better off for having been terminated than he would have been had he stayed on the job.  The Delaware Supreme Court noted that Disney's corporate governanace was far from optimal and should not pass muster in a post-Enron/WorldCom etc., world.  I have written about the case here.

According to this article in The New York Times, Yahoo! was not paying attention.  In 2012, Yahoo! hired Henrique de Castro to be its #2 executive.  He lasted a little over a year and is now walking away with at least $88 million.  The Times quotes Charles M. Elson, director of the Weinberg Center for Corporate Governance at the University of Delaware, who says that such hiring decisions are usually made by the corporation's CEO and that the Board can't tell the CEO whom to hire.  However, Professor Elson also notes that Boards have an obligation to "ask hard questions," especially when executive compensation seems "out of whack."  Mr. de Castro was the eighth highest paid executive in the region, earning more than Yahoo!'s CEO.  

I suppose it is usually true that a Board cannot tell a CEO whom to hire, but the Board and its Compensation Committee do set executive pay.  And nobody at that level can be hired without Board approval.  In order to lure an executive of de Castro's experience, a corporation must offer "downside protection."  That is, a business person of de Castro's experience is not going to leave a secure, well-compensated position without a guarantee that he will be well-compensated at the new position, even if the relationship sours.  However, as the Times points out, de Castro's record at Google was mixed.  He had been demoted and then promoted again, which suggests his position was not that secure.  In any case, his compensation seems to have been well in excess of what was necessary to protect his potential downside.  

Board capture apparently is still a major problem in U.S. public companies, and the Times suggests that the problem is especially bad in Silicon Valley.  The real problem is that executive pay remains absurdly, stratospherically high in this country.   No pay package should be structured to guarantee millions in dollars of severance even in cases of abject failure.

January 20, 2014 in Commentary, In the News, True Contracts | Permalink | Comments (0) | TrackBack (0)

Friday, January 17, 2014

A Lesson in Relational Contracts from James Joyce

JoyceThe main character of James Joyce's short story, "A Mother" (beginning on p, 103 of the link), is a naturally pale woman with  an unbending manner who made few friends at school.  She became Mrs. Kearney out of spite, Joyce tells us, when her friends began to loosen their tongues regarding her impending spinsterhood.  Hoppy Holohan had been attempting for nearly a month to arrange a series of concerts for the Eire Abu Society, but he had no success until he came across Mrs. Kearney, who then "arranged everything."  

She did so because she desired that her daughter, Kathleen, perform as accompanist at the Society's concerts.  Once Mr. Holohan approached her, Mrs. Kearney "entered heart and soul into the details of the enterprise, advised and dissuaded: and finally a contract was drawn up by which Kathleen was to receive eight guineas for her services as accompanist at the four grand concerts." 

The relationship sours as soon as the concerts begin.  Wednesday's concert is poorly attended.  Thursday's concert is better attended, but the audience "behaved indecorously, as if the concert were an informal dress rehearsal."  Moreover, as Mrs. Kearney noted, and Mr. Holohan conceded, "the artistes" were not good. But the real conflict arose over a decision by the "Cometty" of the Society to reduce the number of concerts from four to three.  Mrs. Kearney attempted to protest to Mr. Holohan that any such decision did not alter the contract, and her daughter would be paid for all four concerts.  

 We none of us can help our natures, and Mrs. Kearney's frosty and haughty disposition, coupled with Mr. Holohan's well-intentioned ineptitude combine to form the equivalent of Chekhov's gun introduced in Act I which must be fired in Act III.  When Mrs. Kearney threatens that her daughter be paid in advance or she will not perform in the final contract, Mr. Holohan attempts to disclaim all authority and refers her to the elusive Mr. Fitzpatrick.  

One Mr. O 'Madden Burke was to write a notice of the concert for The Freeman.  Joyce describes him as "a suave, elderly man who balanced his imposing body, when at rest, upon a large silk umbrella. His magniloquent western name was the moral umbrella upon which he balanced the fine problem of his finances. He was widely respected."  After a few rounds of haggling over Ms. Kearney's pay, Mr. O 'Madden Burke declared that "Ms. Kathleen Kearney's musical career was ended in Dublin."

There are dangers in insisting that contractual promises are irrevocable.  

January 17, 2014 in Books, Commentary | Permalink | Comments (0) | TrackBack (0)

Wednesday, January 15, 2014

Bridge & Tunnel

Bridge: It hasn't been a good week for New Jersey governor Chris Christie who is embroiled in a scandal ("bridgegate") after one of his aides arranged to close lanes to the George Washington bridge, causing traffic in Fort Lee, a town where a democratic mayor did not support Christie's re-election.  

Tunnel: Over in Washington, Seattle may see traffic delays of its own.  The State Department of Transportation has declared that the Highway 99 tunnel team in “material breach of contract” because of different barriers than lane closings -- barriers to participation by small, minority-owned contracting firms.  The Seattle Times reports:

The DOT threatens sanctions unless Seattle Tunnel Partners (STP) makes rapid improvement and the team leaders participate in meetings with DOT. Disadvantaged Business Enterprises (DBEs) led by minorities and women are supposed to receive 8 percent of the work, but as of last fall, by some measurements the rate was less than 2 percent, according to a scathing federal civil-rights review.  The tunnel contractors are led by the U.S. arm of Spanish-based Dragados, and by California-based Tutor-Perini.

Lynn Peterson, the DOT secretary, released a letter Monday that recognizes efforts by STP to improve, but demands more.

What sanctions will mean is not yet clear.  The DOT could exert leverage by reducing or delaying progress payments that STP periodically receives for tunnel work. Peterson mentions that as one option in her letter, which follows a state review by attorney Richard Mitchell.

STP has the leverage of already having a tunnel machine in the ground, and already collecting more than $700 million to date. The most extreme outcome, to switch prime contractors, could easily run up tens or hundreds of millions of dollars, and cause delays. Peterson writes that she would prefer collaboration to litigation. An excerpt:

DBE_snip

Among other ideas, the state now recommends breaking contracts into smaller pieces so minority and women-led firms have a better chance to compete.

The federal investigation was prompted by a complaint by Elton Mason, owner of Washington State Trucking in Kirkland, who tried unsuccessfully to bid on a contract to transport excavated dirt.  STP awarded the prime trucking contract to a larger company, Grady Excavating of Mukilteo, which DOT later disqualified from its DBE status. The KING 5 Investigators have aired several stories aboutfailures in the minority contracting programs for Highway 99 and other projects.   Although Initiative 200 forbids quotas in minority hiring, the tunnel job is one-third federally funded, and therefore subject to hiring goals under federal affirmative-action rules.

Mason vented his exasperation Monday at what looks to him like another round of process. Mason said he’s had two meetings recently with state DOT and STP, but not a job offer.  All it should take is for Peterson to make a phone call and demand that Mason and other minority contractors be hired immediately, he said.

 Christie could only hope for a Seattle tunnel scandal to eclipse his coverage in the news cycle.  Not likely.

January 15, 2014 in Current Affairs, In the News | Permalink | Comments (0) | TrackBack (0)

Minnesota Orchestra Agrees to New Contract, Ends Lock-out

As The New York Times reports, the Minnesota orchestra has ended "one of the most contentious labor battles in the classical music world."  The musicians agreed to a new contract, with smaller pay cuts than management had previously proposed, ending a fourteen-month lock-out.  Concerts are due to resume in Minneapolis's newly-renovated Orchestra Hall (pictured) in February. 

Orch_hall

The musicians accepted a fifteen percent pay cut, having successfully fought off a proposed 30% pay cut, and management has promised pay increases in the coming years so that by year three musicians will only be about ten percent below were they were in 2012.  Musicians also must share a larger burden of their health insurance costs.  

Some of these musicians might consider a change of careers.  Stagehands seem to do pretty well.

January 15, 2014 in In the News, Labor Contracts | Permalink | Comments (0) | TrackBack (0)