Forthcoming Issue: Volume 82, Issue 2: Spring 2007

ARTICLES

Thomas W. Joo: Legislation and Legitimation: Congress and Insider Trading in the 1980s

An alternative explanation for the insider trading legislation of the 1980s is that Congress sought political legitimacy: not "investor confidence" in the markets, but "voter confidence" in the political-economic system. Our government has a symbiotic relationship with a capitalist system under which the power of business and finance sometimes rivals that of the state. This arrangement is acceptable to most voters during prosperous times, but can undermine the legitimacy of the political-economic system in times of perceived economic crisis. Government crafts its responses to such crises to protect its legitimacy. The process of self-legitimation does not consist merely of responding to exogenous preferences of constituents. It also includes attempts to mold constituents' preferences to be more consistent with the self-interest and problem-solving abilities of Congress.

Daniel R. Cahoy: Medical Product Information Incentives and the Transparency Paradox

The article is about medical product safety and focuses on the economics of information production by pharmaceutical companies and companies that manufacture medical products. It finds that increased disclosure measures may backfire by enhancing significant tort-based disincentives to produce the information in the first place. That is, requiring private firms to disclose more information will result in their producing less information in the first place, causing the so-called "transparency paradox." The article argues for the adoption of a specific tort liability limitation that will encourage cost-internalizing companies to increase information production and help unravel the paradox.

Robert H. Heidt: When Plaintiffs are Premium Planners for their Injuries: A Fresh Look at the Firemans Rule

As courts continue to increase tort liability by expanding and purifying the negligence concept, another common law limit on liability being swept away is the fireman's rule. This rule bars firemen, policemen, ambulance drivers, emergency medical technicians and other professional rescuers from maintaining a tort suit against the private party, typically a crime victim or an occupant of a home or business, whose negligence triggered the peril in response to which the professional rescuer was injured. In the modern era courts or legislatures in at least eight jurisdictions have rejected the fireman's rule. Hence, once the professional rescuer in these jurisdictions shows that the defendant crime victim or home or business owner was negligent in triggering the peril and that the rescuer's injuries came from responding to the peril, the professional rescuer will establish a prima facie case to recover for his injuries from the defendant. At that point the defendant crime victim or home or business owner must resort to his only substantive defense, the rescuer's contributory negligence, which, this Article argues, the defendant will face severe practical difficulties in establishing. The current law raises serious doubt about whether those who have provided the professional rescuer first party benefits to compensate him for his injuries--such as the rescuer's accident, life and health insurers, the administrators of his disability pension plan or those paying for specially created death benefits--are subrogated to the rescuer's tort recovery from the defendant. Abolishing the fireman's rule, therefore, may allow the professional rescuer to recover all his tort damages from the defendant crime victim or homeowner on top of all of the first-party benefits he has also received. After explaining the fireman's rule in Part II, this Article discusses in Part III most of the arguments for and against abolishing the rule. The Article demonstrates several problems with the arguments against the fireman's rule and concludes by expressing novel arguments in favor of retaining the rule. layers.

L. Camille Hebert: Why Don't "Reasonable Women" Complain About Sexual Harassment?

In response to the rise of cases claiming sexual harassment by superiors has also come a rise in victim-blaming--instances in which the concerns of harassed women are minimized as being not objectively hostile or offensive enough. Yet this is not the only way in which victim-blaming can arise. Courts use a "reasonable person" standard to judge a victim's response to harassment or a harassing individual, and one aspect of what a "reasonable person" does is file a complaint or somehow actively resist and respond to the situation. Women, afraid of retribution and socially trained to seek solutions in quieter and more passive ways, rarely do this; hence, courts have found many women's reactions to sexual harassment "unreasonable." An honest use of the "reasonable woman" standard, examining the motives and actions of real women in harassing situations, could help courts to overcome the victim-blaming that so often plagues the law in this area.

Brian Galle: A Republic of the Mind

Under Section 164 of the Internal Revenue Code, taxpayers are allowed to itemize and deduct the cost of their state and local taxes--income, property, and sales taxes. The accepted theory of this deduction is to effect a shift in federalism--giving more power to the states to regulate and tax. In the article, the author argues that this deduction actually can serve an opposite purpose; rather than shifting regulation and power to the states and promoting federalism, it can actually undermine state governments. The author argues in this article that the deduction plays a large role in the way that state and local governments are structured. The author does not advocate the abolishment of Section 164, but rather a more complete understanding of how it actually functions and changes politics at the state and local levels.

NOTES

Laura Koenig: Lies, Damned Lies, and Statistics? Structured Settlements, Factoring, and the Federal Government

In 1983, Congress revised the tax code to subsidize tortious defendants who offered claimants settlements via structured payments. Fearing that victims were carelessly dissipating lump sum awards, Congress justified its actions with anecdotal stories of victims on public assistance and a rather untenable statistic declaring that ninety percent of tort victims squandered their lump sums within five years. The resulting $6 billion structured settlement industry spawned a zealous factoring market, anxious to give claimants drastically reduced lump sums in exchange for all future structured payments. In 2001, Congress attempted to restrain the factoring industry via another round of tax revisions. This Note argues that Congress's latest efforts, rather than protect victims, effectively secure the factoring industry's livelihood; that both tax structures unfairly restrict claimants' contractual freedoms; and that Congress must honestly evaluate its expressed devotion to tort victims in light of this critique.