2017 Wolfgang Friedmann Memorial Award Keynote Address


It’s really nice to be here. I’m so filled with enthusiasm that the students have energy and enthusiasm and interest in these subjects. It’s so great. You just feel it palpably. We’re at the center of something here—the center of the law school, the center of the New York legal community, the center of New York City, the center of the world—you’re at the center of something. It’s very nice to be here and receiving this reward is a great honor. Wolfgang Friedmann was a great, great scholar. And I like that word transnational. See, writing this book, I had a problem. I could say “international law,” but that immediately calls to mind a box called “international law.” It’s not quite that. “Transnational” gets closer to the idea because it’s more inclusive. . . .

Toward a Unified Theory of Materiality in Securities Law

By: ,

Regulatory efforts in the United States and European Union have recently refocused on materiality, an essential but elusive securities law concept. The renewed focus is due in part to increasing globalization of capital markets, data, and information channels that has highlighted inconsistencies in theory and application. In the United States, the Supreme Court has loosely defined materiality through a line of cases beginning with TSC Industries v. Northway and Basic, Inc. v. Levinson, whose reasonable investor rubric is frequently disregarded by lower courts, prosecutors, and the Securities and Exchange Commission. Meanwhile, in the E.U., courts have only lightly addressed materiality. Scholars in law and behavioral economics have criticized the TSC-Basic rubric for its ambiguity, unpredictability, and disconnection from market psychology. Recognizing these criticisms, this Article conducts an international comparative investigation of materiality in the legislation, regulation, and case law of the United States and European Union, revealing a shared, probabilistic Bayesian infrastructure. The Article then proposes a flexible Bayesian framework that harmonizes the substantive evaluation of materiality under existing U.S. and E.U. law. Finally, it models application of the framework using Bayesian network analysis in the context of a hypothetical stock transaction. Download [650.04...

Cleaning Up After Chevron: A Proposed Cross-border Pipeline for the Transfer Pricing of Intra-group Debt Transactions


The use of cross-border intra-group debt transactions to facilitate corporate tax planning faces heightened scrutiny by taxing authorities in light of the G20/Organization for Economic Cooperation and Development’s Base Erosion and Profit Shifting Project. This Note examines risks presented by the puzzling legal regime applicable to the transfer pricing of intra- group loans, using the recent Australian Chevron case as an illustrative vehicle, and proposes a solution through the Internal Revenue Service’s (“IRS”) Advance Pricing and Mutual Agreement (“APMA”) Program. The APMA Program facilitates the negotiation of binding contracts through which a taxpayer and at least one taxing authority delineate sanctioned transfer pricing methodologies applicable to specified transactions over a fixed term that generally spans at least five prospective years. IRS data suggests that taxpayers have not commonly leveraged the APMA Program to price intra-group loans, presumably owing in part to the bespoke nature of loans, the time and cost required to strike a deal with taxing authorities, and the difficulty of predicting financing needs years in advance. Nevertheless, this Note argues that the APMA Program is fundamentally a process that allows parties to agree on pricing methodologies—not standalone prices. Therefore, this Note suggests that certain multinational enterprises with high-volume or high-risk internal financing arrangements could benefit from locking in the underlying methodologies used to price their intra-group loans, thereby limiting the risks demonstrated by Chevron and the fluctuating regulatory environment. This Note also explores the possibility of establishing “mandatory” participation in the APMA Program where a taxpayer has already demonstrated a lack of compliance with arm’s length debt pricing. Download [365.60...

The Russian Constitutional Court versus the European Court of Human Rights: How the Strasbourg Court Should Respond to Russia’s Refusal to Execute ECtHR Judgments


The European Court of Human Rights (ECtHR) and the Council of Europe face significant enforcement problems regarding Russia. These problems stem from Russia’s resistance towards implementing EC- tHR judgments. This resistance was formalized by a 2015 Russian law which granted the Russian Constitutional Court the power to review international human rights rulings to decide if they violate the Russian Constitution and are therefore “non-executable.” In April 2016, the Russian Constitutional Court used this power to refuse to implement the ECtHR judgment against Russia in the case of Anchugov and Gladkov v. Russia. This 2015 law and the Russian Constitutional Court’s subsequent ruling represents a significant development in how Russia views international law. Moreover, Russia’s actions pose a major problem for the legitimacy and future of the ECtHR. This Note examines the Russian Constitution’s treatment of international law and the broader context of Russian legal compliance with ECtHR judgments. By examining these relationships, this note seeks to determine the significance of Russia’s recent decisions and guide the Council of Europe and the ECtHR’s response go- ing forward. This note finds that, while Russian non- compliance with the ECtHR is not new, Russia’s re- cent actions against ECtHR judgments nevertheless pose a threat to the European Convention on HumanRights (ECHR) system. Therefore, the Council of Eu- rope and the ECtHR should assert the supremacy of the ECHR over Russian domestic law utilizing every mechanism within the current Council of Europe and ECHR framework. However, in doing so, this Note recommends that the Council of Europe and the EC- tHR acknowledge Russia’s position and, when possible, avoid further contradiction between ECtHR judgments...

Could a Code of Conduct Work? The Prospects of the French Proposal Limiting the Veto on the United Nations Security Council


During the opening session of the Sixty-Eighth United Nations General Assembly in 2013, President François Hollande of France proposed that the permanent members of the Security Council should agree to “renounce their veto powers” in situations of mass atrocities. Two years later, President Hollande went one step further and officially committed France to this voluntary “code of conduct.” Proposals to reform the Security Council veto have existed ever since the United Nations began in 1945, but could this code of conduct work? And, if so, how? This paper assesses the “French Proposal” and its prospects for success. It does so by examining the legal framework surrounding the veto power and why previous attempts to reform the veto have failed. It then considers how the French Proposal might be different, highlighting more recent changes that have occurred in the wider political context. Finally, the paper considers how the proposal might work in practice and, more importantly, which aspects need to be further defined. Download [171.53...

The Banking-Sovereign Nexus: Law, Economics & Policy


This Article examines a previously overlooked policy interdependence between the International Monetary Fund (“IMF”) and the Basel Committee on Banking Supervision (“Basel Committee”), which results from economic dynamics associated with the “banking- sovereign nexus.” The main finding of this Article is that interventions by the IMF and the Basel Committee function as regulatory complements by subtly reinforcing one another through a number of channels. In order to leverage that complementarity, the Article presents the following two-part policy proposal. First, that the Basel Committee enhance the stringency of its capital requirements with an increase in the risk-weights that are assigned to sovereign bonds that banks hold as assets. Second, that the IMF revise its lending criteria to allow countries that have effectively implemented the stricter version of the Basel Rules to prequalify for access to its credit facilities.

Access to Trade Secret Environmental Information: Are TRIPS and TRIPS-Plus Obligations a Hidden Landmine?


Freedom of Information laws (“FOI laws”) are fundamental to enabling access to environmental information. This Article argues that the specificity and strength of trade secret protections in TRIPS (article 39) and TRIPS-Plus regional and bilateral free trade agreements (“FTAs”) are hidden landmines that may unravel current access-to- information regimes (e.g. FOI laws). The aim of this Article is to delineate the nature and scope of the limits that TRIPS and TRIPS-Plus regimes place on domestic access-to-environmental-information regimes for information submitted to governments.

Rights-Protection Lawyers in China: A Behavioral and Rational Choice Analysis of Lawyers in an Authoritarian State


In the summer of 2015, the Chinese Communist Party (“CCP”) detained over 200 rights-protection lawyers, a human rights violation that many observers viewed as a retreat from prior commitments to the development of the rule of law. This Note uses two theoretical frameworks—rational choice theory and behavioral law & economics—in an attempt to explain why the CCP, an authoritarian regime, would allow this movement to develop in the first instance and why, after more than a decade, the CCP reversed course.