ContractsProf Blog

Contracts and Commercial Law Visitors 2007-08 (Updated)

A number of contracts and commercial law professors (including yours truly) will be venturing forth from their nests this coming academic year.  Here's an alphabetical sampling:

Carl Bjerre (Oregon) will be visiting Brooklyn for the 2007-08 academic year.

Scott Burnham (Montana) will be visiting UNLV for the 2007-08 academic year.

Andrea Coles-Bjerre (Oregon) will be visiting Brooklyn for the 2007-08 academic year.

Dan Crane (Cardozo) will be visiting NYU for the 2007-08 academic year.

George Geis (Alabama) will be visiting the University of Virginia for the 2007-08 academic year.

Lee A. Harris (Memphis) will be visiting George Washington University for the 2007-08 academic year.

Max Huffman (Cincinnati) will be visiting the University of West Virginia for the 2007-08 academic year.

Edward (Ted) Janger (Brooklyn) will be visiting Harvard for the Spring 2008 semester.

Howard Katz (Charlotte) will be visiting Capital University for the 2007-08 academic year.

Hila Keren (Hebrew University of Jerusalem) will be visiting the University of California at Berkeley (Boalt Hall) for the 2007-08 academic year.

Anne Lawton (Roger Williams) will be visiting Michigan State University-DCL for the Fall 2007 semester.

Wayne Lewis (DePaul) will be visiting Suffolk University for the Spring 2008 semester.

Jennifer Martin (Western New England) will be visiting the University of Pittsburgh for the 2007-08 academic year.

Marcy Peek (Whittier) will be visiting Seattle University for the 2007-08 academic year.

Chris Peterson (Florida) will be visiting the University of Utah for the 2007-08 academic year.

Caprice Roberts (West Virginia) will be visiting Washington & Lee for the Fall 2007 semester.

Keith Rowley (UNLV) will be visiting the University of Alabama for the 2007-08 academic year as the Charles E. Tweedy, Jr. Visiting Chairholder in Law.

Brian Slocum (Florida Coastal) will be visiting the University of Memphis for the 2007-08 academic year.

Daniel Sokol (Wisconsin - William H. Hastie Fellow) will be visiting the University of Missouri-Columbia for the 2007-08 academic year.

I know there are more, but I won't list anyone who does not report their own plans.  Hopefully, this post will prompt others to reply to [email protected] or via comment to this post.  I will update the list again as more information comes in.

[Keith A. Rowley]

Limerick of the Week

In rejecting Mama Rizzo, Inc.'s arguments in Brookside Farms v. Mama Rizzo, Inc., Judge Kent wrote as follows:

"For the Court to allow Defendant to invoke the no-oral-modification clause after MRI itself induced and participated in the extended course of action it now complains of would be to convert the sale of basil leaves into a 'basil sale carcinoma' that would devour all reasonable commercial standards of behavior between merchants" (emphasis added).

Now I have my own standards for reasonable behavior, and I just didn't find the case Limerick-worthy.  But some of my students felt the phrase "basil sale carcinoma" needed to be memorialized in verse.  Facing an inevitable student rebellion, I composed the following in self-defense:

Brookside Farms v. Mama Rizzo's, Inc.

Addressing the judge as "Coxcomb-a,"
Mama Rizzo flew back to Roma.
In rejecting her Answer,
This judge has cured cancer,
The dread basil sale carcinoma.

[Jeremy Telman]

Warning: Do Not Try This At Home

The WSJ has an interesting story today (subscription required) about the use of contracts (though, perhaps, only metaphorically) in the home. Turns out, contracting is not the most effective device to ensure that the chores get done. The article begins:

Elizabeth Gray wasn't getting anywhere with her husband on a particular parenting issue. Always admiring parents who have the kind of control she's accustomed to having at the office, she finally turned to the kind of tactic that comes in handy at work: a contract.

"I'm a project manager," she says, "so I managed it like a project."

The document was intended to lay out a compromise over the couple's one source of friction. She valued her boys doing chores while her stay-at-home husband was more permissive. So, the document attempted to close the gap, including "Whereas" resolutions stating that consistency is important in parenting and that the boys would get the same answer from both of them, she recalls. She would have quoted the two-and-a-half page contract verbatim but, after they negotiated it last July, she ripped it up in a fit of frustration when she felt her husband breached the agreement by December.

"It was an abject failure," she says.

The moral: just because you are the boss at work doesn't mean you'll be the boss at home. (Also: what were the remedies for breach?) One CEO told the WSJ:

"The whole economic system shifts, from capitalism at work to communism at home." If metrics existed for the family as they do for business, "you're measuring gross family happiness and yours doesn't count more than anyone else's -- and probably less," he says

[Meredith R. Miller]

Big-Boy Letters

Behold the power of the contract!  Indeed, even federal securities laws genuflect before what Debevoise and Plimpton calls "the product of arms-length negotiations between sophisticated, well-represented parties" (see page 5 of the link, "Do Big-Boy Letters Really Work?").  And what is the product of this negotiation?  In a big-boy letter, a purchaser of securities in a private transaction promises not to sue the seller who may well be in possession of inside information not disclosed to the buyer. 

Well, okay, I can understand why a party that waives its right to sue should not be permitted to sue, but why would a sophisticated institutional investor be so eager to buy something that the insider is eager to dump?  As today's New York Times reports, the buyer may want to flip the securities to a third party, without disclosing the existence of the big-boy letter to that third party.  I'm no securities law expert, but I can't see how this use of big-boy letters is distinguishable from insider trading through a broker.

One case involving big-boy letters is now working its way through the courts, as the New York Times reports.  The R2 hedge fund is suing the Jeffries Group over $20 million worth of bonds that plummeted 30% in value two days after R2 bought them from Jeffries.  Jeffries got the bonds from Smith Barney, which protected itself with a big-boy letter.  The SEC is also reportedly investigating Barclays in connection with its use of big-boy letters. 

[Jeremy Telman]

Limerick of the Week

As I said before, my casebook does not include the classic coronation cases, arising out of the postponed coronation King Edward VII, pictured at left.  I therefore expect my students to learn the history of the frustration of purpose doctrine solely by studying Limericks.  It's a very rigorous curriculum, and I still get complaints that some contracts doctrine is easily reduced to Haiku.

Krell v. Henry

Was Henry's whole purpose frustrated
When the King burst appendix dictated
That the crown must delay
It's coronation day?
Yes! So contract doctrine's updated.

[Jeremy Telman]

Books Now Never Go Out of Print

This is news to me, but apparently, before there was the internet, people got information from things called books.  I gather they are like those other outmoded, non-interactive technologies, television and radio, only more boring.

Except, of course, for Stephen Colbert's Alpha Squad 7: Lady Nocturne, A Tek Jansen Adventure.  At left you can see one of many proposed covers for this epic, which for some reason has yet to find its publisher.  Buck up, Stephen, James Joyce had a hard time too! 

Anyhew, according to the New York Times, book contracts used to have a standard term that provided protection to authors should the book go out-of-print.  Under the old standard-form contract, when a book went out-of-print, the author had the right to request a return of rights in the book so that the author could try to interest a different publisher in a new edition.  A book was deemed out-of-print if either: it was no longer available in either hardback or paperback, or if annual sales fell below a certain threshold.

That is no longer the case.  Print-on-demand technology means that books now never go out of print and at least some publishers are therefore less willing to relinquish rights than they used to be.

[Jeremy Telman]

Meanwhile, on the UNCITRAL Front

The former Yugoslav Republic of Macedonia succeeded to the U.N. Convention on Contracts for the International Sale of Goods (CISG) last November, effective retroactively to November 17, 1991, bringing the number of Contracting States to 70.

Paraguay and the Russian Federation signed on to the U.N. Convention on the Use of Electronic Communications in International Contracts in March and April 2007, respectively, becoming the 9th and 10th signatories.  However, because none of the signatories has yet ratified or acceded to this Convention, it is not yet in force anywhere.

[Keith A. Rowley]

... And Another Dean-Designate

With all due apologies for not mentioning it sooner (pesky exams), Robert Rasmussen (Vanderbilt) was named earlier this month as the new dean of the University of Southern California's Gould School of Law.  Here's a link to USC's announcement.

Congratulations, Bob!

[Keith A. Rowley]

A Dean-Designate Among Us

Congratulations to our colleague Blake Morant (Washington & Lee), who was named yesterday as the new dean of the Wake Forest University School of Law.  Here's a link to the Wake Forest press release.

Kudos, Blake.  Well deserved!

[Keith A. Rowley]

Limerick of the Week

This case may be so well known as to need no introduction, but if people are in the market for visual aids, at left are public domain images of the Surrey Music Hall and Gardens, the former of which was the music hall that burnt down in Taylor v. Caldwell.

Since neither this nor the coronation cases are included in the casebook that I use, and since I am usually way behind by the time I get to this subject matter, this is a portion of the course that I teach entirely through Limericks. 

Taylor v. Caldwell

• Taylor rented a hall like the Met's
  For the purpose of concerts and fetes
  When fire the hall downed,
  The court wisely found
  A way to excuse Taylor's debts.

[Jeremy Telman]

Iowa, Kansas, and (Almost) Florida ... Oh, My!

Iowa Governor Chet Culver signed SF 535 on April 4 and Kansas Governor Kathleen Sebelius signed SB 183 on April 9, bringing to 27 the number of states that have enacted Revised Article 1.  Additionally, both chambers of the Florida legislature have passed SB 252.  However, due to a flurry of end-of-session activity, SB 252 hasn't yet made it to Governor Charlie Crist's desk.

Iowa SF 535, Kansas SB 183, and Florida SB 252 each reject uniform R1-301 in favor of a choice-of-law provision that tracks pre-revised 1-105 and adopt uniform R1-201(b)(20)'s unitary good faith standard.

[Keith A. Rowley]

Limerick of the Week

I always have a hard time teaching Donahue v. FedEx, in which an employee-at-will is terminated after attempting to blow the whistle on his corrupt boss.  The court recognizes that there is a public-policy exception to the at-will doctrine but states that there is no public policy protecting whistle blowers.  There isn't?

Plaintiff, an employee at will,
Thought his boss had a hand in the till.
FedEx is correct;
"Bad faith" won't protect
Where policy contentions are nil.

I also have a problem because I can't get the last line of my Limerick to scan.

[Jeremy Telman]

Imus Might Sue CBS for Breach of Contract

As most readers presumably know, Don Imus was fired from CBS last month after he made "racially insensitive remarks" about the Rutgers women's basketbal team. Rumors are circulating that Imus might sue CBS for $40 million for breach of contract. Apparently Imus' argument is that the contract encouraged him to be "controversial" and "irreverant" and CBS promised him a warning before it could fire him.

Tonight, CNN's Anderson Cooper was boasting "exclusive access" to Imus' contract. CNN reports this excerpt from the contract:

"Company [CBS Radio] acknowledges its familiarity with the program Conducted by Artist [Imus] on the station [WFAN] prior to company's ownership thereof and it, and its familiarity with the reviews and comments, both favorable and unfavorable concerning Artist and his material by critics, reviewers and writers of the various media both in New York and nationally. Company acknowledges that Artist's services to be rendered hereunder are of a unique, extraordinary, irreverent, intellectual, topical, controversial and personal character and that programs of the same general type and nature containing these components are desired by Company and are consistent with Company rules and policies."

Interesting contract-related development. Certainly, copies of the entire contract should surface soon. Stay tuned.

[Meredith R. Miller]