ContractsProf Blog

Editor: D. A. Jeremy Telman
Valparaiso Univ. Law School

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Monday, March 30, 2015

On a Lighter Note: Valet Service Companies Needing to Take Crash Course on Contracts

Earlier this month, Los Angeles-area media reported a somewhat humorous of a valet service that gave away a relatively expensive new car to a random guy claiming that he had "lost the [valet] ticket."  Yup, the valet service actually just gave the car to the man who was sporting an Ohio state tattoo.  (Of course, this story is not funny for the frustrated car owner).

But wait, the story gets weirder than that (it is, after all, LA, where we worry a lot about our cars...): the valet service sent the responsible employee home and referred the customer to his insurance company.  Initial reports indicated that the insurance company did not want to pay for this loss as no theft had occurred... as is always the case, however, the media did not follow up on the end of this story, to the best of my knowledge.

Another valet contract that you must read and that was shared today on the AALS listserv for Contract Professors reminded me of this story.  Hat tip to Professor Davis!

Contract

Valet companies may have to brush up on their contract writing skills soon...

March 30, 2015 in Commentary, Contract Profs, Current Affairs, Famous Cases, In the News, True Contracts | Permalink | Comments (0) | TrackBack (0)

Thursday, March 26, 2015

Water Contracts and Adequate Assurances (to Continue Business as Usual)

Some weeks ago, I blogged here about water rights and shortages in drought-ridden California.  Of course, California is not the only state where contractual water rights interface with development and public health concerns. 

In Ohio, shale driller Gulfport Energy recently filed suit against the town of Barnesville for rights to extract water for Gulfport’s fracking operations.  Gulfport had a contract with Barnesville entitling it to draw water from a local reservoir at one cent per gallon.  Under the contract, Gulfport would be able to draw the water unless the village determined that such action would endanger public health.  Water rights were subsequently also issued to another driller.  In the fall of 2014, the village told Gulfport to stop drawing water from the reservoir because of too low water levels.  Gulfport’s suit now asks for adequate assurances of performance of the water contract to ensure that it can continue its fracking operations. 

Whether that is a good idea is another story.  From a short-term perspective: yes, we need energy preferably domestically sourced to avoid international supply interruptions and the geopolitical problems that are associated with importing energy raw materials.  But fracking and fossil fuel production in general are associated with other severe problems including heavy water usage in the case of fracking.  Such water, the argument goes, is better used for other things such as farming and household consumption. 

Business as usual for fracking companies may not be the best idea seen from a societal point of view.  Contracts rights are only a small part of this much bigger problem.  However, time seems to have come for governments to incorporate escape clauses not only for “public health concerns” into water contracts, but also for drought concerns.  This is not always done, as the above case shows, but such a relatively easy step could help solve at least some contractual disputes.  In times of increasing temperatures and decreasing rainfall in some areas, such contract drafting may well make sense.

March 26, 2015 in Commentary, Current Affairs, Food and Drink, Government Contracting, True Contracts | Permalink | TrackBack (0)

Where Congress Won't Act, Private Ordering Fills a Gap

ThermometerToday's New York Times reports that Microsoft will require the companies with which it partners, its contractors and vendors who employ more than 50 workers, to provide their employees who do work for Microsoft with 15 days of annual paid sick leave and vacation time.  Microsoft expects that it will have to increase its pay to these partners to help them with the added expense of the policy.  

As the Times points out, it is a very American approach to the protection of workers' rights.   Congress will not act and only a few state legislatures have done so.  Microsoft, like other large technology companies, can afford to provide decent wages and benefits to its workers.  However, companies increasingly prefer to contract work out to small companies that do not treat their workers nearly as well.  

The Times notes that the gap is not only between skilled computer programmers and unskilled or semi-skilled janitors or groundskeepers but also between whites and African Americans and Latinos.  While the latter, traditionally-underrepresented minorities account for our 3-4% of tech workers, they account for 75% of janitorial and maintenance workers.  Eschewing Google's and Facebook's approaches of replacing contract workers with its own employees, entitled to company benefits, Microsoft has explained its move in a manner also consistent with the great American tradition of enlightened self interest.  Microsoft general counsel explained that: 1) happy workers are more productive; and 2) sick workers who come to work can infect others.  

This move can have a big impact, especially if other major companies follow Microsoft's lead, but I'm not sure that the effects will all be good for workers.  If a contractor has some workers that work for Microsoft and some that don't, the Microsoft jobs suddenly become highly sought-after.  A company may try to stay below the 50-employee threshold to avoid the private regulation.  Or it may divide Microsoft work among its staff (in the interests of internal morale), which might dilute the effects of the regulation.  If you do only 20% of your work for Microsoft, do you only qualify for three days of vacation/sick leave?  It may take a few years (and a few contracts disputes) to work out the kinks.

March 26, 2015 in Commentary, In the News, True Contracts | Permalink | Comments (0) | TrackBack (0)

Thursday, March 19, 2015

When Contractual Consent Isn't Enough

The problem with constructive consent, or substituting "manifestations of assent" for actual assent, in consumer contracts is that consumers often aren't aware what rights they've relinquished or what they have agreed to have done to them.  Too bad for consumers, right?  Well, it's also too bad for companies.  Companies that rely on contracts to obtain consumer consent may find that what suffices for consent in contract law just won't cut it under other law that seeks actual consumer consent.  Michaels, the arts and crafts store chain, found that out the hard way.  They were recently hit with two class action lawsuits alleging that their hiring process violates the Fair Credit Reporting Act (FCRA).  Job applications clicked an "I Agree" box which indicated "consent" to the terms and conditions which authorized a background check on the applicant.  As this article in the National Law Review explains, the FCRA requires that job applicants receive "clear and conspicuous" standalone notice if they are seeking consent from applicants to obtaining a background report.  A click box likely won't (and shouldn't) cut it.  Contracts that everybody knows nobody reads shouldn't be considered sufficient notice.  It would, of course, be much simpler if contractual consent were more aligned with actual human behavior....

March 19, 2015 in Commentary, Current Affairs, Labor Contracts, Legislation | Permalink | Comments (0) | TrackBack (0)

Monday, March 16, 2015

Facebook Cares about Privacy (for Facebook Executives)

The New York Times reported yesterday on the rise of a new type of non-disclosure agreement in connection with home construction.  Basically, rich people associated with the tech industry are making everyone who works on their homes sign sweeping non-disclosure agreements.  

Times reporter Matt Richtel posed a number of questions to workers outside a home that, court documents from a different case reveal, is being renovated for an undisclosed Facebook executive (pictured).  He was able to extract only answers like, "I'm an electrician working on a house."  As to which house, workers would gesture towards a neighborhood and say "one of the ones over there."  But the mystery was not too difficult to solve, as workers swarmed "like ants" on the home, and they have been working on it for two years.  

Matt Richtel does a great job highlighting the irony of the situation.  He quotes Facebook founder Mark Zuckerberg, commenting on Facebook's privacy policies, as follows:  “People have really gotten comfortable not only sharing more information and different kinds, but more openly and with more people.”  And yet, in correspondence disclosed in the other case referenced above, Mr. Zuckerberg's attorney wrote, "Mr. Zuckerberg goes to great lengths to protect the privacy of his personal life.”

There is no necessary contradiction between Mr. Zuckerberg's desire to maintain his own privacy and his belief that other people choose not to protect their own.  But Facebook has been pretty aggressive in eroding privacy, in part through a libertarian paternalism in which all the default choices lead to a surrender of privacy, or through extracting waivers of privacy rights by contractual means that do not rise to the level of meaningful, knowing consent.

So yeah.  This is ironic.

March 16, 2015 in Commentary, In the News | Permalink | Comments (0) | TrackBack (0)

Friday, March 6, 2015

Twitter and Cyberbullying - Can Contracts Help?

The always excellent Bob Sullivan recently wrote a post on his blog about the nastiness that resulted from Curt Schilling's proud daddy post.  (The nastiness is seriously nasty).  As Sullivan points out, and which I've argued here and here, online companies like Twitter have a business responsibility to make sure the services they offer are safe.  Online, of course, everything turns into a debate about free speech, even when the so-called speech is obviously obscenity (and please, don't argue with me about this one - if you saw the tweets, you would agree that a "reasonable person" would think they were obscene) and even though the billion dollar companies are not state actors.  The problem is that Section 230 of the Communications Decency Act has been construed very broadly by courts to protect websites like Twitter from liability for content posted by others.  That gives these companies little incentive to invest resources into policing their sites.  But as Sullivan notes, if they don't start to clean up their sites, people might start leaving in droves. 

So what should businesses do?  One thing they could do is start taking their contracts seriously.  We are all familiar with clickwrap and browsewrap agreements that nobody reads.  They often contain codes of conduct or, in the case of Twitter, "content boundaries."  Companies can start making these agreements more readable and salient.  They can start by actually enforcing them.  For example, Twitter can enforce their content boundaries by kicking users off the site or charging them a fine for violating the rules (maybe after a warning) which may help defray the costs of policing the site....They can also design their contracts so they are more readable and post a "warning" that abusive tweets will be subject to a fine or suspension and force users to "click" to acknowledge they have read the warning.  I suspect that many who tweet impulsively later regret it so a warning at point of posting/sending might make some think twice. 

I realize that hiring people to evaluate each reported post might take time so that the best solution would be software that flags certain posts and sends a warning to the user to reconsider the post.  It could also contain a reminder that the user will be liable for damages if the tweet is defamatory.  All this scary stuff is in the contract - but because it is contained behind a hyperlink, few users will actually read it.  An email delivered to the users, reminding them of their contractual obligations and the scary things (public condemnation, suspension or expulsion from the site, liability for lawsuits, maybe even criminal prosecution if the tweet is threatening enough) that might happen to them if they violate these obligations, might be more effective.  Some users may voluntarily take down the post in response to the automated email which may cut down on the number of tweets subject to human review. 

Of course, contracts can only do so much, but they might help.

 

March 6, 2015 in Commentary | Permalink | Comments (2) | TrackBack (0)

Thursday, March 5, 2015

Artistic license

Artistic License

The official portrait of former President Bill Clinton has been completed.  See it here.   It was painted in the “conservative realistic style” … maybe a little too realistic and not sufficiently conservative?

According to the artist, Nelson Shanks, the bluish shadow of a person that you see on the mantelpiece next to Clinton is that of Monica Lewinski in her infamous blue dress.  You got that right: the artist himself has admitted that he purposefully scarred the picture just as the Lewinsky scandal scarred Clinton’s second term.  The artist has apparently caught quite some flak for having done this.  Regardless of artistic freedom and setting aside all thoughts about the scandal per se, what is, after all, at issue here is a contract for artwork depicting a former President of the United States of America.  A bit more respect may have been in order.  This was not any regular client having a portrait done; it’s in effect the entire nation that commissioned this work.  Perhaps a subjective satisfaction clause would have been in order here.  Even if it had been any “regular” client, deliberately depicting one’s paying client in a highly controversial light seems to me to be in questionable taste. 

On the other hand, the argument has been made that if the artist had been held to certain contractual stipulations, the portrait of the 42nd President would have been “stiff and untrue.”  

That’s not the case?  Take a look and judge for yourself.  While much has been made of Clinton holding an actual, gash, newspaper – so retro – the strange positioning of his fingers on his hip looks more bizarre to me.  An indication of his alleged two-sided look at what constituted “the truth” in certain contexts?  To me, it looks more like the V sign for, perhaps, Clinton’s ultimate victory over at least some of the political and other challenges he faced.  

 

 

 

March 5, 2015 in Commentary, Government Contracting, In the News, True Contracts | Permalink | Comments (0) | TrackBack (0)

Tuesday, March 3, 2015

Want a Class with that Barrista Job?

Last year, Starbucks announced a new corporate-supported educational program that one year later is still viable: Starbucks will reimburse its full-time workers for taking online classes with Arizona State University.  Partial tuition (58%) will be offered to freshmen and sophomores and full tuition for juniors and seniors as long as credits are earned within the past 18 months so as to keep students on track.  

As you may have noticed if you are a Starbucks customer, very many of its employees appear to be college-aged.  In fact, 70% of Starbucks’ workforce are either in school already or have had to drop out because of various personal difficulties.  

This program seems to be a benefit to employees who cannot afford to go to school full time (or even part time), but who desire and education.  What is remarkable is also how few “strings” are attached to the program.  For example, the employees do not even have to stay with Starbucks after the completion of their degree.  Said CEO Howard Schultz (still the CEO): "We want to attract and retain great people. We want to provide [our employees] with new tools and new resources to have advancements in the company.” 

What is in it for ASU?  This has been said to be a coup for the university, which already has one of the nation’s largest and most highly regarded online programs.   Of course, Starbucks has a large amount of employees with, presumably, many coming and going, so ASU now has access to a large database of potential students, something many universities – private and public - are craving in these competitive times.

For the students and the university, rates may be discounted.  This is normal in this type of situation.   What would truly make a difference would be if the rates could become so reduced for students that they would, in effect, have no out-of-pocket costs altogether. 

What, to me, is interesting about this situation is that a public university has found out workable model for online classes and cooperation with a private business venture when many private universities have not. 

The somewhat strange catch here is that ASU cannot enter into any other arrangement with a for-profit business for four years, but that Starbucks is free to advertise its partnerships with a few other schools.

See the contract at issue here.

See Starbucks’ description of the program here.

March 3, 2015 in Commentary, Current Affairs, E-commerce, Food and Drink, Labor Contracts, Teaching, True Contracts | Permalink | Comments (0) | TrackBack (0)

Tuesday, February 17, 2015

Submitting a Law Review Article about Wrap Contracts through a Wrap Contract

I've been away from the submission process for a few years.  In the meantime, Scholastica has entered the picture, which from an author's view is simply an expensive headache, and more journals are encouraging authors to submit directly through either e-mail or their own online submissions process. 

Having been a historian before becoming a law professor, I am still grateful for the advantages of student-edited law journals and authors' ability to submit to scores of journals simultaneously.  I still believe that this process is better for authors and not significantly less arbitrary that double-blind peer review.  Lots of scholarship gets published that does not end up getting used or cited under both systems, but the peer review process banishes lots of possibly meritorious scholarship to the dung-heap of history based on the opinions of two people whose reasoning might be insufficient to justify such a heavy penalty.

That said, I do find a new feature of online submission processes disquieting.  At least one journal that encourages authors to submit through their online submission form features a Submission Agreement that includes a link to a separate page containing the journal's "attribution and usage policies."  The latter are incorporated by reference, and thus one must agree to them in advance before submitting the article.  There is nothing particularly onerous in the Submission Agreement or the usage policies, but the problem is that authors submit to dozens or scores of journals.  The journals cannot really expect authors (or their administrative assistants who submit on their behalves) to read through boilerplate terms.  So there we have it -- forms that purport to bind law professors to terms to which they have not meaningfully consented.  This is especially ironic if, like me, you have been writing about the dangers of form contracts and the degraded version of "consent" in this context. 

The practice is especially irksome as the submission process does not otherwise involve a contract.  When I submit my article to multiple journals for publication, I am submitting an invitation for offers.  I have no obligation to the journals, and they have no obligation to me.  They don't even have to read my piece before rejecting it, nor do they have to respond in any way to me.  And if they do offer to accept my piece (which, note, is typically described as an "offer to publish" not as an "acceptance"), I can reject that offer and go merrily on my way.  

The introduction of form contracts at the submission state --  a point at which the parties have no legal relationship -- is simply unnecessary.

February 17, 2015 in Commentary, True Contracts | Permalink | Comments (0) | TrackBack (0)

Monday, February 16, 2015

Your Smart TV May Be Engaged in Intelligence Work

Back in 2013, we mused about the seeming disconnect between public outrage at NSA data mining and the lack of comparable outrage with respect to private data mining.  Nancy Kim and I have been writing in this area, and a recent report in the ABA Journal provides additional fodder for our scholarship.  

One of the things that makes television's "smart" these days is that they have the ability to respond to voice commands.  If you have this feature on, the television transmits your information to a third party, according to Samsung.  If you turn the voice recognition feature off, your television still gathers the data but it does not transmit it.  

Smart_TV
Photo by LG

Over at Salon, Michael Price gives us reasons why we should be afraid of our smart tvs.  Having reviewed his television's 46-page privacy policy, Price concludes that it has the capability to collect a staggering amount of data.  One could turn off the television's "smart" features, but that can affect your television's ability to do some of the things you bought it for.  Just as we cannot choose which channels the cable providers send us, we can only choose from packages, we apparently cannot choose to have a television with some "smart" features unless we are willing to invite Big Brother into our living rooms.

February 16, 2015 in About this Blog, Commentary, Television, Web/Tech | Permalink | Comments (1) | TrackBack (0)

Thursday, February 12, 2015

Bar Prep Teaching

This year, I am teaching a bar preparation course on contracts, which is being offered for the first time at my Law School.  This is a lot of fun for me -- I like teaching contracts both semesters because it keeps my mind more focused on the subject.  It's also fun to teach the material in a different way -- no cases, as some familiarity with the case law is assumed at this point, so I just give mini refresher lectures and then move on to the homework assignment.

So it's fun, but it's also a lot of work.  I give my students four multiple choice questions each day, and they have to turn in their answers -- explaining why the right answer is wrong and the wrong answers are wrong.  The idea is to both solidify their understanding of the doctrine and alert them to the strategy behind bar exam "distractors" -- that is, wrong answers that are trying to trick students into mistaking them for correct answers.  Most days, they also have to write a short essay, designed to be akin to MEE questions.  

Because I am teaching such a course myself, I read with some interest David Frakt's recent post on The Faculty Lounge on the value of in-house bar prep courses.  But I was taken aback by the comments.  The anonymous or pseudonymous commentators asked the following rhetorical questions:

  • Does bar prep make students better lawyers?
  • What good is passing the bar when there are no jobs for lawyers anyway?
  • Don't law schools have an obligation to refrain from flooding the market with unemployable lawyers?

I think this is a case of massive anger that is massively misdirected.  Students are in law school.  They want to stay in law school and they want to become lawyers.  I have met with many students facing dismissal from my Law School for poor academic performance.  The ones I have spoken to all are willing to do whatever it takes to stay in, and they are furious with us when we dismiss them.  So we put the time and the energy into bar prep courses because it is what our students need.  Some of them need it because they won't do the work without the additional kick in the pants.  Others need it because they have many natural gifts that will make them great lawyers, but excelling at standardized tests is not one of them.  We are trying to get them over that hurdle so that they can have the careers for which they are otherwise qualified.

I certainly understand the anger of the unemployed law students.  I was an unemployed Ph.D. before I went to law school.  I know what professional devastation feels like.  It seems like the "Law School Scam" crowd thinks the solution is to just shut law schools like the one I teach at.  But how would throwing me, my colleagues, and our support staff out of work improve the situation?  It certainly would not improve things for the students we serve, most of whom pass the bar, find work, and do better than they would have done without their degrees.  Law school opened for me a range of career options that would have been completely unthinkable without my J.D.  Why should that opportunity be denied to the current generation of potential law students?

February 12, 2015 in Commentary, Teaching, Weblogs | Permalink | Comments (0) | TrackBack (0)

Wednesday, February 11, 2015

Construction Contracts that Kill

Property development is often considered a way for local communities to earn more taxes and evolve with times in general.  But when construction and other development is approved in geologically risk areas such as flood zones and things go awfully wrong, is this a mere property and contracts issue, or may criminal liability lie?

In France, the answer is the latter.  The former mayor of the small French seaside town La Faute-sur-Mer  was just sentenced to jail for four years for deliberately hiding flood risks so that he and the town could benefit from the “cash cow” of property development, a French court has held.  His deputy mayor received a two-year sentence in the same plot.

In 2010, the cyclone Xynthia hit western Europe and knocked down seawalls in the French town, leading to severe floods and 29 deaths. 

Wait… a cyclone in France?  Yes.  Climate change is real and it’s here.  Unless we do something about it (which apparently we don’t), things will only get worse.  As on-the-ground steps that could prevent extreme results such as the above are often simply ignored or postponed while more and more research is done and money saved at various government scales, lawsuits will necessarily follow.  The legal disciplines, including contracts law, will have to conform to the new realities of a rapidly changing climate.  For starters, we need to seriously question the wisdom and continued desirability of constructing more and more homes in coastal and other flood prone areas.  Ignoring known risks is, well, criminal.

February 11, 2015 in Commentary, Current Affairs, Government Contracting, Labor Contracts, Science | Permalink | Comments (0) | TrackBack (0)

Monday, February 2, 2015

Ride Sharing Services: It Just Keeps Getting Better!

NYC_Taxi_in_motion
Photo by The Wordsmith


We have had quite a few posts about Uber, Lyft and other ride-sharing services, but they just keep popping up in the news, and the wrinkles are always unexpected and fascinating.  Saturday's New York Times reported that the companies allow drivers to rate their passengers.  If you get a bad rating, you'd better hail a cab or [shudder] take public transportation.  It's not such a strange thing to be rated by a service-provider you pay, the Times point out.  After all, students pay tuition to attend law school, and yet we grade them.  But of course, students know that going in.  Probably most passengers don't expect to be rated.  What a wonderful century we inhabit -- so many opportunities to pass judgment on perfect strangers!  

And what sort of behavior will get you a bad rating?  It may be simple things like asking the driver to turn the heat/air conditioning/radio up or down.  One rider expressed her angst about being thought insensitive or lacking in interpersonal skills if she took a call or did work while riding.  Even Uber's CEO, one of the few riders with access to his own rating, was downgraded from five stars as a passenger to four.  He attributes the lackluster reviews to work stress.  He blames himself.  "I was not as courteous as I should have been.”  He should watch out.  You can be banned from Uber, which siad in a blog post that it only wants to serve "the most respectful riders."

The article suggests that two-way review systems are inevitable, even though they may be inaccurate.  A comparison of a site that allowed two-way reviews with one that allowed only one-way review found that the two-way system leads to far more positive reviews.  

What goes around comes around.  I would not put it past these companies to monitor their drivers' ratings of passengers.  The company may find its own ways to retaliate against drivers who complain about passengers who do nothing more offensive than behaving like busy people who are getting a ride from a stranger as part of a commercial transaction.

February 2, 2015 in Commentary, In the News, Travel | Permalink | Comments (0) | TrackBack (0)

Sunday, January 25, 2015

Weekly News Roundup

BasketballAn Ohio appellate court upheld a $1.2 million breach of contract judgment against Kent State's men's basketball coach, Geno Ford.  The judgment enforced a liquidated damages clause entitling Kent State to damages equal to Ford's annual salary ($300,000) multipled by the number of years remaining on his contract at the point of breach.  In Kent State University v. Ford, Coach Ford tried to characterize the liquidated damages clause as a penalty.  The court applied Ohio law to determine whether at the time the contract was entered into: 1) damages were uncertain; 2) the damages provided for in the contract were not unconscionable; and 3) the parties intended for damages to follow a breach.  The court upheld the trial court's determination that the standard was satisfied in this case. Coach Ford can take consolation in the fact that his salary is short of Jim Harbaugh's by an order of magnitude.

PetaPixel.com reports on a wedding photographer who, after charging a couple $6000 to shoot a wedding album, sought an additional $150 for the album cover.  The couple balked, so the photographer is refusing to hand over the photographs and is threatening to charge them an additional $250 "archive fee" if they do not pay up in a month.  PetaPixel draws the following lesson from the story: 

This all goes to show that as a photographer, you should never rely on verbal agreements when it comes to conditions and charges. Always get everything in writing.

Maybe.  The photographer herself has an extremely lengthy blog post about the entire affair in which she claims that everything should have been clear from the written contract.  PetaPixel's story makes it seem like an additional charge was added after the contract had been entered into, and if that's the case, the couple might well have balked whether or not the new terms were in writing.

Contracts Prof/Con Law Prof Randy Barnett, writing at the Volokh Conspiracy picked up by the Washington Postmuses interestingly on the applicability of the contractual duty of good faith to the President's duty to faithfully execute the laws in the Constitution's Take Care clause.  This helps Barnett reconcile his empathy for the President's refusal to enforce federal drug laws in the face of permissive state laws permitting use of marijuana with his opposition to the President's new initiative on immigration.  I've never been persuaded that the contractual analogy is particularly useful in Constitutional interpretation.  Suggesting that the contracts doctrine of "good faith" provides a useful gloss on the Take Care clause strikes me as a stretch, but Professor Barnett is always stimulating.

January 25, 2015 in Commentary, Contract Profs, In the News, Recent Cases, Sports | Permalink | Comments (0) | TrackBack (0)

Friday, January 23, 2015

Merchantability Applied to Legal Scholarship

Katowice Fair Building Collapse graphic

 

We know that merchantability means passing without objection in the trade. If law review articles were goods, what would that trade be? For law professors, it  seems like it is second and third year law students.  At some level it would also reviewers of works when a professor is considered for promotion. Recently, though, a colleague of mine and I did a bit of research and began to wonder if acceptable in the trade -- as defined by law students and law professors --  is a meaningful strandard within the trade of academia.

Law professors who do research are generally spending the money of others. The actual buyers are, therefore, those who pay  for the scholarship. Let's add that they have no idea what the standard is but would uniformly agree that every article should make someone or something better off and should reflect high quality research. Students and reviewers should be regarded as agents for those paying the bills.

If that is the measure of merchantability (and why wouldn't it be) then editors and reviewers should apply that standard in their own decisions. Clearly they do not and left to their narrow and inappropriate standard for merchantability we have  massive amounts of scholarship that, let's face  it, is written to justify being granted tenure.  There is little verification that most, no matter how carefully done or clever, actually benefits anyone. Some of it -- a small percentage -- is cited but rarely for the substantive points made as opposed to piggy-backing on a fact asserted in the first work.  Morever the research is often sloppy.  Here is an example. I recently read an article that makes the claim that a certain area of law is now consistent with empirical studies. I looked at the cite and it was to another professor who had not actualy done any empirical work and did not quite say what was claimed. And the work cited by that professor was not on the point made in the first article. In fact the most frequent cite is  the hearsay cite in which the author makes a claim because someone else made the same claim.

I expect readers of this will disagree but shouldn't the test of merchatability mean making someone or something (even if a fish) better off and shouldn't documentation be careful and accurate? Don't misunderstand, much of scholarship meets these standards. But much of what currently passes in the trade without objection does not. 

January 23, 2015 in Commentary, Current Affairs, Law Schools, Miscellaneous, Recent Scholarship, Teaching | Permalink | Comments (0) | TrackBack (0)

Monday, January 19, 2015

What's So Great about Being the Master of the Offer?

I recently came across an article by Professor Sidney Kwestel that has many good and interesting things to say about the UCC's famous battle of the forms section, 2-207.  However, Professor Kwestel suggests the UCC § 2-207(2)'s "knock out rule" cannot be right because it violates "a basic contract concept--that the offeror is the master of the offer."  

Master Yoda
Now that's a real master

I've always understood the "rule" that the offeror is the master of the offer to mean only that: (1) the offeror is free to revoke the offer at any time before acceptance; and (2) under the common law, the offeror can treat any purported acceptance that is not a mirror image of the offer as a rejection of the offer and a counteroffer.  In my view, the notion is hardly a "basic concept."  It's more like a slogan.  You think you are the master of your offer.  Big deal.  I'll make you a counteroffer.  Then I'm the master.  Oooh la la.  

Professor Kwestel thinks it absurd that an expression of assent could operate as assent to some terms but not others.  However, the result is worse for the offeror under the common law.   Under the last shot rule, the counterofferor's terms do not just knock out the offeror's terms, they replace them.  Since the UCC's version of the battle of the forms eliminates both the mirror image rule and the last shot rule, it reduces the slogan to its first meaning -- it only permits revocation at any time before acceptance.  The result is much more even-handed as to whose terms govern, and I count that as a win.

Certainly there are problems about what to do with different terms under § 2-207, and Professor Kwestel's article is very good about illuminating the difficulty navigating between the text of the section and the reporter's comments.  While I can easily concede that it has its flaws, I think the problems with the knock-out rule are more textual than conceptual. 

January 19, 2015 in Commentary, Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Thursday, January 15, 2015

In Dog We Trust

Speaking of auctions (see Jeremy's blog below), how about a rug reading "In Dog We Trust" instead of the official motto of both the United States and Florida? 

A sheriff's office in Florida has removed a mat featuring the miswoven lettering.  There have reportedly been several offers to buy the misprinted rug after the error was discovered two months after having been placed at the entrance to the sheriff's office.

Spelling in this country is truly going to the dogs.

January 15, 2015 in Commentary, Current Affairs, In the News | Permalink | TrackBack (0)

Tuesday, January 13, 2015

Improving Financial Literacy

The effectiveness of disclosure is an ongoing discussion on this blog and not long ago we had an engaging online symposium on Omri Ben-Shahar and Carl Schneider's thought-provoking book, More Than You Wanted to Know:  The Failure of Mandated Disclosure.  Lauren Willis and Theresa Amato have written an op-ed in today's LA Times that gets to the heart of the failures of disclosures (and related informational problems) when it comes to consumer literacy - and they offer some solutions.  I particularly like their suggestion that banks demonstrate that consumers understand the financial products offered.  This shifts the burden of disclosure from the consumers to the banks.  You can read more here. 

January 13, 2015 in Commentary | Permalink | Comments (1) | TrackBack (0)

Thursday, January 8, 2015

A Bad Taste in One’s Mouth

On January 7th, a federal judge struck down a ban on foie gras that had been in effect since 2012.  The judge was of the opinion that the federal Poultry Products Inspection Act preempts the California ban.  This Act gives the U.S. Department of Agriculture the sole jurisdiction over the “ingredients requirements” of poultry products. 

The judge seems to have forgotten about the federal Animal Welfare Act’s requirements for the humane treatment of farm animals as well as states’ ability to ban the sale of the products of animal cruelty.  The California Attorney General’s office is reviewing the decision for a possible appeal of the law, which was upheld in previous litigation.

Foie gras is, without a doubt, cruel to animals.  To produce the alleged delicacy, geese and ducks are “force-fed a corn mash through a metal tube several times a day so that they gain weight and their livers become 10 times their natural size. Force-feeding sometime injures the esophagus of the bird, which may lead to death. Additionally, the fattened ducks and geese may have difficulty walking, vomit undigested food, and/or suffer in extreme confinement."  Do we as consumers still have a right to buy such a product even if it tastes very good?  No, according to at least California state law.

How anyone could make themselves eat this product is beyond my comprehension.  I confess that I am an animal lover and environmentalist.  I do personally believe in those core values.  However, I am quite far from an extremist and respect, to a very, very far extent, the opinions of the vast majority of other people.  Heck, I am not even a vegetarian (I try to at least buy free-range products).  But under notions of both positive law – state and/or federal – and natural law, this is where the buck must stop.  There must be limits to what we can do in the name of obtaining a gourmet experience, especially when it comes at such a high price of extreme suffering by our living, sentient creatures. And if consumers cannot draw such lines themselves, courts and legislatures must.  In the words of Mahatma Gandhi, “the greatness of a nation and its moral progress can be judged by the way its animals are treated.”  More than a dozen countries around the world have outlawed the production of foie gras.  In this respect, the United States is not great.  This case leaves a bad taste in my mouth and, I hope, in yours as well.

January 8, 2015 in Commentary, Current Affairs, Famous Cases, Food and Drink, In the News, Recent Cases | Permalink | Comments (1) | TrackBack (0)

Tuesday, January 6, 2015

Payback for Payday Lenders

The U.S. Office of the Comptroller of the Currency and Federal Deposit Insurance Corp. plans to create hurdles for lenders of payday and direct deposit advance loans.  Both types of loans are short-term loans intended to help consumers through a rough patch.  Payday loans are available at various storefront locations whereas direct deposit advance loans are for banks’ existing customers.

The problem with these types of loans is that they often trap people into cycles of mounting debt with annual interest rates of more than 500% and the need by some to take out an average of 10 loans a year amounting to a total of more than $3,000.

This is a crackdown on organizations that may be seen to pry on the already weak.  But is it also a setback for financially underprivileged consumers?  After all, if you need money now, you need money now.  I think the new proposed regulations are a step in the right direction as consumer protection, but at the same time, more is needed.  That “more” is a decent living wage so that so many people do not have to live not only paycheck to paycheck, but in fact pre-paycheck to pre-paycheck. 

In his 2015 State of the Union address, President Obama is expected to highlight the nation’s economic growth and falling unemployment rate.  However, as I have written here before, most people in the U.S. still do not see or feel the economic recovery.  Perception is reality.  Let’s hope that the economy soon improves so much that most people feel it.

Hat tip to Professor Miriam Cherry for alerting me to this story.

January 6, 2015 in Commentary, Current Affairs, Legislation | Permalink | Comments (3) | TrackBack (0)