April 9, 2011



Acharya, Viral v., Matthew Richardson, Stijn Van Nieuwerburgh, & Lawrence J. White, Guaranteed to Fail: Fannie Mae, Freddie Mac and the Debacle of Mortgage Finance (Princeton & Oxford: Princeton U. Press, 2011) ("In 1916 at the University of Frankfurt in Germany, scientists Martin Freund and Edmund Speyer developed the drug, oxycodone, as an alternative to heroin, which had been branded, marketed,, and sold from 1898 to 1910 by the drug company Bayer as a painkiller. As an opioid painkiller, the expectation was that oxycodone would be a prescription for severe pain, yet would have none of the severe consequences of heroin such as its long-lasting nature, its addictive impact on the brain, and its possible deadly effect if taken in excessive quantity." "In many ways, the development of oxycodone has been a resounding success. It is not only formulated as a single product but combined with numerous over-the-counter painkillers. The product include such familiar names as OxyContin, Percocet, Depalgos, and Percodan, among others. From approximately 11 tons of production in 1998, it grew sevenfold to 75 tons by 2007, approximately 80% of which services the U.S. market." "The problem is that, if oxycodone is not taken rarely and then carefully in moderation, it is highly addictive with almost 100% surety--more so than almost any narcotic, alcohol, or tobacco. With each prescription, the individual needs a little more next time for the same sense of satisfaction--so-called chasing the dragon--leading to a downward spiral. Going cold turkey does not work well as the side effects of withdrawal are severe. And, unfortunately, the United States as a whole has become addicted to painkillers. In the summer of 2010, the U.S. Department of Health and Human Services' Substance Abuse and Mental Health Services Administration reported that abuse of opiod painkillers like oxycodone had risen more than 400% over the past decade with no sign of abatement." "In a similar way, the United States is addicted to home ownership, and there is perhaps no better example than the tax credits provided by the U.S. government for home buying during the finical crisis. . . ." "The housing market felt much better. And while the government was patting itself on the back for easing the housing pain and stabilizing markets, the tax credits expired and, in July 2010, sales of new homes sank to the lowest point since the 1960s, when the government started keeping records. Now, again, there is discussion of what to do next." "Like addiction to painkillers, these remedies provide short-term 'benefits' against increasing costs in the long-term. Which solution lawmakers ultimately choose for the future of the GSEs [government-sponsored enterprises] depends intimately on how they answer the much deeper question of how much society should promote and subsidize hone ownership." Id. at 166-167. Interesting read, providing an interesting prescription for addressing the addiction.).

Baird, Douglas G., Robert H. Gertner, Randal C. Picker, Game Theory and the Law (Cambridge, Massachusetts, & London, England: Harvard U. Press, 1994) (This a primer to the application of game theory to legal problems. From the book jacket: "Organized around the major solution concepts of game theory, the book shows how such well known games as the prisoner's dilemma, the battle of the sexes, beer-quiche, and the Rubinstein bargaining game can illuminate many different kinds of legal problems. The organization of Game Theory and the Law serve to highlight the basic mechanisms at work and to lay out a natural progression in the sophistication of the game concepts and legal problems considered.").

Baker, Tom, & Sean J. Griffith, Ensuring Corporate Misconduct: How Liability Insurance Undermines Shareholder Litigation (Chicago & London: U. of Chicago Press, 2011) ("Shareholder litigation forms an important part of the structure of law and regulation affecting American business. Because public regulators cannot oversee every company at every moment and cannot anticipate or even respond to every report of a potential wrong, a variety of remedies are left in the hands of shareholders themselves. Shareholders who have suffered at the hands of a corporation in which they have invested can sue--either as a class or on behalf of the company itself--to right these wrongs. They thus assume, with their counsel, the role of 'private attorneys general,' with strong personal incentives to detect and prosecute corporate wrongdoing. The lawsuits they bring fill an important gap in the regulatory framework affecting American business." "Shareholder litigation exerts its regulatory effect through the mechanism of deterrence. That is, prospective wrongdoers realize, through the threat of litigation, that they will be made to account for whatever harms they cause and, thus internalizing the cost of their conduct, forswear bad acts. The basic mechanism of deterrence explains much civil litigation. Corporate officers and directors, understanding that they maybe held liable to their investors for the harms they cause, refrain from engaging in conduct that will harm investors and induce them to sue. In this way, shareholders litigation regulates corporate conduct." "The problem with this story in the corporate context is that officers and directors are typically covered under a form a insurance, known as "Directors' and Officers' Liability Insurance' or 'D & O insurance,' that insulates them from personal liability in the event of shareholder litigation. D & O insurance also protects the corporation itself from liabilities it may have in connection with shareholder litigation. This insurance disrupts the deterrence mechanism by transferring the obligations of the prospective bad actor (the officer, director, or the corporation itself) to a third-party payer (the insurer). An actor that is no longer forced to internalize the costs of its actions is no longer deterred from engaging in harmful conduct--managers who are no longer personally at risk for investor losses are less likely to take care in avoiding them, and corporations that are no longer at risk of shareholder litigation are less likely to monitor the conduct of their managers--and the regulatory effect of shareholder litigation is diminished, distorted, or destroyed." Id. at 1-2. This is an interesting read. Though I think the authors may underestimate the significance of potential loss of reputation as a deterrence. Also, for those seriously interested in corporate law, I would strongly suggest taking a stab at reading as sizable chuck of the works cited in the "References," at 267-275.).

Banner, Stuart, American Property: A History of How, Why, and What We Own (Cambridge, Massachusetts, & London, England: Harvard U. Press, 2011) ("The basic message of the book is that our ideas about property have always been contested and have always been in flux. Property is a human institution that exists to serve a broad set of purposes. These purposes have changed over time, and as they have, so too has the conventional wisdom about what property is really like. As new coalitions have formed around particular goals, they have pushed conventional understandings of property in one direction or another." Id. at 3. "Philosophers and law professors sometimes try to discern property's 'true' nature, but the stories this book has told suggest that property is not something that has a true nature. . . . Is it a thing or a bundle of rights? Is it a relationship between people and things or a relationship between people and other people? Is it something we find in nature or something we create through law? What one thinks property is depends on what one wants property to do--that is, what goals one is trying to advance by thinking of property in a particular way. . . . Property is not an end in itself but rather a means to many other ends. Because we have never had unanimity on how to prioritize those other ends, we have never had unanimity on an understanding of property. Our conceptions of property have always been molded to serve our own particular purposes." Id. at 289-290. This is an excellent read!).

Black, Duncan, The Theory of Committees and Elections; and Duncan, Black, & R. A. Newing, Committee Decisions With Complementary Valuation Rev’d 2d edited by Iain McLean, Alistari McMillan, & Burt L. Monroe (Boston: Kluwer Academic Publishers, 1998).

Baskin, Jonathan Barron, & Paul J. Miranti, A History of Corporate Finance (Cambridge, England: Cambridge U. Press, 1997).

Brand-Ballard,Jeffrey, Limits of Legality: The Ethics of Lawless Judging (New York & Oxford: Oxford U. Press, 2010) ("The rhetoric of lawyers is legalistic, too. An essential part of a litigator's job is to persuade the judge that the law at least permits a ruling in favor of her client. Even when a litigator presents arguments from justice or policy, she presents them as arguments about what the law says or should say. She encourages the judge to understand existing law in a certain way or to develop the law in a certain direction. She knows that judges sometimes deviate and she will encourage deviation if the law disfavors her client, but she will do so by persuading the judge to believe, or at least to assert, that the law permits what it actually forbids. Urging a judge to deviate in so many words is a rare act of desperation. If judges actually have an all-things-considered moral obligation to obey restrictive rule, then encouraging them--whether explicitly or implicitly--to deviate is probably unethical, too, even in suboptimal-result cases. By contrast, if selective optimization is permissible, then encouraging judges to deviate in suboptimal-result cases is not unethical." Id. at 312. "From the book jacket: "Judges sometimes hear cases in which the law, as they honestly understand it, requires results that they consider morally objectionable. Most people assume that, nevertheless, judges have an ethical obligation to apply the law correctly, at least in reasonably just legal systems. This is the view of most lawyers, legal scholars, and private citizens, but the arguments for it have received surprisingly little attention from philosophers." "Combining ethical theory with discussions of case law, Jeffrey Brand-Ballard challenges arguments for the traditional view, including arguments from the fact that judges swear oaths to uphold the law and arguments from our duty to obey the law, among others. He then develops an alternative argument based on ways in w"neutral framework rather than the agent-relative framework favored by many moral philosophers. Defying the conventional wisdom, [he] argues that judges are not always obligated to apply the law correctly. Although they have an obligation not to participate in patterns of excessive judicial lawlessness, an individual departure from the law so as to avoid an unjust result is rarely a moral mistake if the rule of law is otherwise healthy." I am completely unconvinced!).

Bossaerts, Peter & Bernt Arne Odegaard, Lectures on Corporate Finance, Second Edition (Singapore: World Scientific, 2006).

Committee on Negotiated Acquisitions, The M&A Process: A Practical Guide for the Business Lawyer (Chicago: American Bar Association, 2005).

Dickie, Robert B., Financial Statement Analysis and Business Valuation for the Practical Lawyer, Second Edition (Chicago: American Bar Association, 2006).

Diffie, Whitfield, & Susan Landau, Privacy on the Line: The Politics of Wiretapping and Encryption: Updated and Expanded Edition (Cambridge, Massachusetts, & London, England, 2007) ("Invasions of privacy have occurred despite legal provisions to the contrary. The debate about cryptography is a debate over the right of the people to protect themselves against government surveillance. But privacy intrusions are difficult to uncover. Many are suspected but few are proven. Those that are discovered are frequently exposed only as a result of years of litigation or though a major investigation like the Church Committee hearings of the 1970s. . . . " Id. at 156. "What type of society does the United States seek to be? The incarceration of Japanese-Americans during World War II began with an invasion of privacy and ended in the tyrannical disruption of many individual lives. Could the roundup of Japanese-Americans have occurred so easily if the Census Bureau's illegal cooperation had not made the process so efficient? The purpose of the Bill of Rights is to protect the rights of the people against the power of the government. In an era when technology makes the government ever more efficient, protection of these rights becomes ever more important." Id. at 170. "The right to be let alone is not realistic in modern society. But in a world that daily intrudes upon our personal space, privacy and confidentiality in discourse remain important to the human psyche. Thoughts and values still develop in the age-old traditions of talk, reflection, and argument, and trust and privacy are essential. Our conversations may be with people who are at a distance, and electronic media may transmit discussion that once might have occurred over a kitchen table or on a walk to work. But confidentiality-and the perception of confidentiality--are as necessary for the soul of mankind as bread is for the body." Id. at 11. "Anonymity and identity are among the many threads in human culture that have existed in uneasy harmony for millennia. The revolutionary changes of the 1990s--globalization, mobility, greater availability of information--brought many of these threads into open conflict, and a new balance among them has yet to be found." "At a moment in human history, however, when reflection and tolerance might have served us best, the events pushed everyone in a direction that, by maximizing security, minimized privacy and individual liberty." Id. at 275. "The task is simple to explain but far harder to achieve. If we do not incorporate adequate security measures in our computer and communications infrastructure, we risk being overwhelmed by external enemies. If we put an externally focused view of security ahead of all other concerns, we risk being overwhelmed by their misuse. We must find a set of rules and a mechanism for overseeing those rules that allows society to defend itself from its genuine enemies while keeping communication surveillance from stifling dissent, enforcing morality, and invading privacy. If we do not, the right to use privacy-enhancing technology that was won in the 1990s will be lost again." Id at 334-335.).

Jackson, Howell E., Louis Kaplow, Steven M. Shavell, W. ip Viscusi, & David Cope Analytical Methods for Lawyers (New York: Foundation Press, 2003) ("This text was created to accompany a course . . . at Harvard Law School. The course and the text grew out of [the authors'] joint realization that the traditional law school curriculum, with its focus on the development of analogical reasoning skills and legal writing and research, left many law students inadequately prepared for upper-level law courses and, more importantly, for legal practice in the modern world. Lawyers, whether corporate counsel or public interest advocates, must work in settings where effective argumentation and the giving of sound legal advice often depend on mastery of language and techniques derived from disciplines such as economics, accounting, finance, and statistics, stapes of the modern business schools curriculum, but notably absent, in introductory form, from law school classrooms. . . . " "It has been our experience that the students who lack background in these critical areas are themselves acutely aware of their deficiency (or are made aware of it when they encounter their first law and economics discussion in torts and contracts) . . . ." Id. at v. Topic covered: decision analysis, games and information, contracting,accounting, finance, microeconomics, economic analysis of law, fundamental of statistical analysis and multivariate statistics.).

Jackson, Matthew O., Social and Economic Networks (Princeton & Oxford: Princeton U. Press, 2008) ("Social networks permeate our social and economic lives. They play a central role in the transmission of information about job opportunities and are critical to the trade of many goods and services. They are the basis for the provision of mutual insurance in developing countries. Social networks are also important in determining how diseases spread, which products we buy, which languages we speak, how we vote, as well as whether we become criminals,how much education we obtain, and our likelihood of succeeding professionally. The countless ways in which network structures affect our well-being make it critical to understand (1) how social network structures affect behavior and (2) which network structures are likely to emerge in a society. The purpose of this monograph is to provide a framework for an analysis of social networks with an eye on these two question." Id. at 3.).

Klein, William A., John C. Coffee, Jr., & Frank Partnoy, Business Organization and Finacne: Legal And Economic Principles 11th ed. (Concepts and Insights Series) (New York: Foundation Press, 2010) ("The principle objective of this book is to explain, in simple terms but not simplistically, (a) the basic economic elements and legal principles, as well as the language, of business organization and finance; (b) the interrelationships between and among the economic elements and legal principles; and (c) the practical importance of a basic understanding of those elements, principles, and interrelationships... ." Id at iii.).

Landau, Susan, Surveillance or Security: The Risks Posed by New Wiretapping Technologies (Cambridge, Massachusetts, & London, England, 2010) ("Throughout this book, when I say the Internet, I mean the packet-moving layered architecture described in chapter 2. The Internet does not include the applications--the Googles, Facebooks, and so on--that lie above this architecture. Often the public conflates these two. I owe the observation about the confusion to Stefan Savage, who pointed out that engineers and the public have two differing definitions of the Internet. While there are security problems in both Internets, the ones that make securing the Internet extremely difficult are the ones inherent in the packet-moving architecture. This book focuses on these problems." Id. at ix. "In the decade since the attacks of September 11, in an attempt to keep the nation safe, the U.S. government has embarked on an unprecedented effort to build surveillance capabilities into communication infrastructure." "[T]he issue of who is defending what runs more deeply than the question of whether we are diverting funds from techniques that may provide better security. What are these communication surveillance systems? Who are the guards? Are they really protecting us? Or are they working for someone else? Could these surveillance capabilities be turned by trusted insiders for their own profit, or used by our enemies to access our secrets? The fundamental issue is whether, by housing wiretapping within communication infrastructure, we are creating serious security risks. Understanding whether building wiretapping into communication infrastructure keeps us safe requires that we understand the technology, economics, law, and policy issues of communication surveillance technologies. That is the point and purpose of this book." Id. at xii-xiii. "For a moment, suppose that we grant that under emergency circumstances, justice and domestic tranquility can take a second place to security. Under the U.S. constitutional system, such periods should be brief. The absence of liberties should be measured in days and weeks, not months and years. It should never be decades. That is where the problem of changing technological standards to accommodate wiretapping becomes very important. Even if we were to grant that liberty can briefly take a second place to security, changing technological standards to accommodate wiretapping fails the test, because it becomes a change of decades, a change that is far greater than is permissible under the Constitution. . . ." "In the case of large, complex infrastructure, standards last for decades (the PSTN must recognize the 1950s telephone that sits on my desk). We have seen many instances of security vulnerabilities in interception systems. The longevity of technology infrastructure increases the risk that the eavesdropping capabilities might be used against the United States, destroying those very 'blessings of liberty for our posterity'." Id. at 202. "What is the right approach in securing the nation's communications as we face the competing--and contradictory--demands of a mobile society, critical infrastructure that is increasingly reliant on an IP-based network, and a dangerous, nihilistic foe? How should we structure communications surveillance? Any resolution of these questions must adhere to the fundamental principles espoused in the U.S. Constitution, principles very similar to those espoused in the Universal Declaration of Human Rights and the European Convention on Human Rights. . . . Id. at 203. "The founders sought to build a government that would act carefully and deliberately. They wanted to insulate the system from the potential that short-term decisions made in the heat of an 'emergency' might limit freedom and justice, perhaps for the long term. The checks and balances built into the U.S. form of government usually work to delay hasty action. This is not to say that during previous times of stress, the government has not acted against the rights of the people; such actions have included the 1798 Alien and Sedition Acts, the suspension of habeas corpus during the Civil War, and the internment of Japanese-American citizens during World War II. The U.S. form of government was deliberately designed to slow such processes down; such a slowdown could cool the heat of the moment and sometimes prevent some of these actions from occurring." "It is easy to imagine that communications surveillance is imperative to the nation's security, but in fact, there is no right more important to democracy than the right of the public to communicate securely. Secure communication underlies freedom and that nation's and the people's security." Id. at 256. At times a technical-read, but not unduly so; and worth the effort. Food for thought. Food for concern.).

Lawless, Robert M., Jennifer K. Robbennolt, & Thomas S. Ulen, Empirical Methods in Law (New York: Aspen Publishers/Wolters Kuwer Law & Business, 2010) ("Several years ago [the authors] began talking about the fact that empirical studies seemed to be coming a larger part of legal scholarship. While the empirical study of legal topics is not new, there was nowhere in the traditional law school curriculum where one could learn empirical techniques so as to be an intelligent consumer or a proficient creator of empirical work. . . " Id. at xix. "This book about empirical methods in legal research is, fittingly, an experiment. It is an experiment in communicating the technical details of empirical research in a relatively nontechnical manner while being mindful of the precautions and pitfalls of doing that research. It is also an experiment in being comprehensive about the many steps involved in understanding an empirical research project in law. . . . [W]e believe that this is one of the first attempts to provide a broad textual treatment of the subject--taking the reader through the entire process of posing an empirical question, deciding on the method or methods by which to pursue that research question, gathering and coding the data, analyzing the data, and then communicating one's results--with an emphasis on legal research." Id. at xxi.).

Malkiel, Burton G., A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing/Completely Revised and Updated (New York: Norton, 2003) ("Greed run amok has been an essential feature of every spectacular boom in history. In their frenzy for money, market participants throw over the firm foundations of value for the dubious but thrilling assumption that they too can make a killing by building castles in the air. Such thinking can, and has, enveloped entire nations." Id. at 34. Read this book not as an investor, but as a lawyer trying to keep your clients from, out of greed, doing something really and truly stupid.).

Seligman, Joel, The Transformation of Wall Street: A History of the Securities and Exchange Commission and Modern Corporate Finance, 3rd. ed. New York: Aspen Publishers, 2003) (In light of the nearly total meltdown of the American economy in 2008, even the most recent materials in this third edition of The Transformation of Wall Street, published not even a decade ago, seem like ancient history. However, though the particulars of the meltdown and the SEC's role in that meltdown might surprise Seligman, he would not be surprised by the fact that circumstances of the late 1990s were not necessarily a good basis for predicting what things would look like at the end of the fist decade of the twenty-first century. "History is also the study of the consequences of events. In the short term the enactment of the Sarbanes-Oxley Act in 2002 is one consequence of a period characterized by a serious deterioration in law compliance. Only decades from now will history fully be able to appraise the extent to which the new law and a significant increase in SEC budget and staff size restored the vitality of federal securities regulation." "What even this brief interval after the great bull markets of the 1990s, however, does illustrate is that the problems that led to the enactment o the SEC in the first place are perennial. Conflicts of interest, misleading disclosure, and outright fraud do not decline by fiat, but only when a vigilant SEC is on the job." "This history of the agency is a warts and all description of its first 67 years. It highlights above all else that the enactment o a law may matter little unless it is effectively enforced." Id. at xi-xii.).

Stearns, Maxwell L., & Todd J. Zywicki, Public Choice Concepts and Applications in Law (St. Paul. MN: American Casebook Series) (West/Thomson Reuters, 2009) ("Public choice theory has emerged an essential part of the modern legal scholarship landscape because it provides a means of closing the gap between the normative prescriptions associated with the traditional economic analysis of law, on the one hand, and the observed realities of legal practice and doctrine, which so often resist wide ranging calls for reform, on the other hand. Public choice is not merely an antidote, or complement, to the neoclassical law and economics scholarly tradition. Instead, public choice presents it own independent set of tools that provide the means for restoring a positive analysis of, and appreciation for, some of the most confounding features of law and public policy." Id. at vii. This is a very good introductory text.).

Tirole, Jean, The Theory of Corporate Finance (Princeton & Oxford: Princeton U. Press, 2006).

Von Neumann, John, & Oskar Morgenstern, The Theory of Games and Economic Behavior (Sixtieth-Anniversary Edition)(Princeton & Oxford: Princeton U. Press, 2004).

Worthington, Sarah, Propriety Interests in Commercial Transactions (Oxford & New York: Clarendon Press/Oxford U. Press, 1996) (This book may be of interest to American students of commercial law, especially those interested in security interests in personal property. This assume, of course, that the American students is curious as to how certain familiar types of commercial transactions are handled under English law. From the book jacket: "This book provides an analysis and overview of personal property in a commercial context. Two features of the analysis are significant. The first is the unavoidable integration of contract and property law. Although proprietary interests may be broadly classified as ownership or security interest, these are relative concepts which are frequently subject to impinging contractual arrangements. The second is the prevalence of equitable proprietary interests, This prevalence is directly related to the case with which equity is able to convert personal obligations into proprietary remedies. . . .").

Oops! I guess this list of suggested readings is not for the faint-hearted.