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Abstract:
Martha Stewart is the subject of a civil enforcement action alleging violations of U.S. securities laws and regulations governing insider trading. The facts, as we now know them, suggest that the considerable governmental resources spent in pursuit of Martha Stewart (which are out of proportion to the apparent financial magnitude of any illegal trading activity) result from an express decision to single her out for potential criminal prosecution or civil enforcement based on some personal characteristic or characteristics. After describing the basic structure of insider trading regulation in the United States, this paper identifies potential structural sources of selective enforcement in the regulation of insider trading and isolates certain easily recognizable bases for enforcement bias in the application of that regulation, using the Martha Stewart insider trading investigation as an example. Ultimately, the paper recommends more rigorous investigation into possible sources of selectivity and bias in insider trading enforcement and offers preliminary suggestions for ways in which the identified potential for bias may be obviated or overcome, consistent with the current federal regulatory and political environment.

Insider Trading, Equal Justice, Enforcement Discretion

Abstract:
This article collects and interprets social science research on sex and trust and uses this work to shed new light on the emerging case for gender diversity on corporate boards. Specifically, the article describes social science research findings indicating (1) that men and women trust and are trustworthy on different bases and (2) that there is a bias against women in chief executive officer (and potentially other corporate leadership) positions. Based on this research, the nature of corporate management and control, and current legal scholarship on corporate governance, the article asserts that gender diversity on corporate boards may be desirable but difficult to attain. Ultimately, the article calls for more targeted research on the links among sex, trusting behavior, trustworthiness, and corporate board membership and also recommends that boards of directors pursue gender diversification in filling vacancies and new board slots as a means of diversifying trust in the corporation.

trust, trustworthiness, sex, gender, board, directors, independence, diversity, bias, corporate governance

Abstract:
This essay collects and interprets social science research on sex and trust and uses this work to shed new light on the emerging case for gender diversity on corporate boards. Specifically, the essay describes research findings that indicate (1) that men and women trust and are trustworthy on different bases and (2) that there is a bias against women in corporate leadership positions. Based on this research and current legal scholarship on corporate governance, the essay asserts that gender diversity on corporate boards may be desirable but difficult to attain. The essay also calls for more targeted research on the links among sex, trusting behavior, trustworthiness, and corporate board membership.

sex, gender, trust, corporate governance, director, board

Abstract:
If compliance with, or the efficacy of, Sarbanes-Oxley and other corporate governance initiatives requires that executives (or other firm leaders) be good ethical role models, then it is important to ask whether Sarbanes-Oxley - or any other attribute of existing corporate governance regulation - in fact promotes or permits the production or preservation of ethical role models in the executive ranks of public companies. An absence of support for ethical role models in public companies may signal the failure of broad-based federal corporate governance initiatives like Sarbanes-Oxley.

This Article assumes that ethical roles models may be important to the maintenance of good corporate governance (in general) and the success of Sarbanes-Oxley as a corporate governance initiative (in specific). With that in mind, the Article preliminarily analyzes, using legal and social sciences literature, whether Sarbanes-Oxley may encourage or discourage the existence of ethical role models in the corporation.

Sarbanes-Oxley, corporate governance, role model, ethics, corporate culture

Abstract:
This essay originally was presented orally at the University of Cincinnati College of Law's Sixteenth Annual Corporate Law Symposium. The essay describes corporate agency and agency-related relationships as implicated in the "Enron affair" and explores ways in which the Sarbanes-Oxley Act of 2002 fails or attempts to address the alleged malfunctions in these relationships. The essay concludes that the reforms enacted in Sarbanes-Oxley provide little assistance in resolving agency and agency-related problems associated with Enron's public misstatements and omissions. Ultimately, the essay exhorts scholars and practicing lawyers to work together to resolve these problems through (among other things) additional research into cognitive and behavioral science and direct client assistance both in the decision making process and in the search for and selection of corporate directors and officers.

Enron, Agency, Sarbanes-Oxley

Abstract:
This brief article focuses attention on the ineffectual nature of prosecutions of corporations and their insiders - generally, officers and directors - for securities fraud under Rule 10b-5. Specifically, the article begins by briefly summarizing the nature of enforcement actions and related penalties under Rule 10b-5. Next, the article argues that, as currently conceived and executed, criminal enforcement actions under Rule 10b-5 are ineffective as a means of achieving retribution, as deterrents of undesirable behavior, and as enforcement vehicles that vindicate the policies underlying Rule 10b-5. As a means of addressing these criticisms, the article suggests possible enhancements to Rule 10b-5 prosecutions, including more victim involvement in the proceedings. These enhancements, rooted in victims' rights initiatives and restorative justice principles, may better serve societal and regulatory aims.

securities fraud, Rule 10b-5, theories of punishment, retribution, deterrence, restorative justice, victims' rights, allocution

Abstract:
This is an edited, annotated transcript of a conference panel discussion on feminism, sex, and gender in law, legal education, and legal scholarship. The transcript reflects widely divergent views of the place of feminism, sex, and gender in the law and legal scholarship. Moreover, the panelists differ as to the role feminism has played in the lives of women as law students and practicing attorneys. In the latter part of the transcript, the panelists' remarks focus in on hotly debated issues surrounding possible gender (or sex) and racial bias in LSAT testing and the innate abilities of women and men as they relate to learning and practicing law. This portion of the piece is exceptionally timely, following on the controversial January 14, 2005 remarks by Harvard University President Lawrence H. Summers relating to inherent differences between men and women in career choice and success.

feminism, sex, gender, law school, law, legal scholarship

Abstract:
This article analyses the criminal securities fraud charges brought against Martha Stewart. Stewart was acquitted of these charges by a federal district court judge in February 2004. Specifically, the article initially focuses on whether the securities fraud charges brought against Stewart were valid as a matter of prosecutorial discretion and substantive law and whether the court was correct in granting Stewart's motion for acquittal before handing the rest of her case to the jury for deliberation. The article then offers substantive and procedural observations about Rule 10b-5 cases like the one brought against Stewart.

Martha Stewart, Section 10(b), Rule 10b-5, securities fraud, Rule 29, prosecutorial discretion

Abstract:
This paper extends existing scholarship that questions the existing materiality standard used under Rule 10b-5 (and elsewhere in U.S. securities regulation) and its touchstone notion of the reasonable investor. Specifically, the paper asks and answers a seemingly straightforward, yet provocative, question: Is the reasonable investor a woman? The paper then preliminarily explores the potential significance of its key findings - that women and men exhibit different investment behaviors and achieve different investment outcomes, and that the resulting female investor profile is closer to existing conceptions of the reasonable investor than the resulting male investor profile.

As women become larger players in the securities markets, it may be comforting to know that they are relatively well protected by existing conceptions of the reasonable investor. However, the knowledge that women are not completely protected by these existing conceptions and that men are less well protected than women under the current reasonable investor paradigm gives us pause and forces us to reconsider inaction. To that end, this paper continues an ongoing academic and practical conversation about when changes in investor protection should be undertaken and how those changes can best be made if they are to be undertaken - not just for the benefit of women or men, but for the benefit of all underprotected investors.

materiality, reasonable investor, female investor, male investor, sex, gender, 10b-5, securities, fraud

Abstract:
Required disclosures under U.S. securities laws, whether mandated by line-item disclosure rules, gap-filling regulations, or antifraud provisions, tend to focus principally, although not exclusively, on corporate facts - information about an issuer of securities or a transaction involving an issuer of securities. Although there are line-item disclosure rules that require the public revelation of personal facts about executive officers (both by the issuer and by the executive himself or herself), these rules are limited in scope.

However, public disclosure of executives' personal facts not covered by these line-item rules still may be required under applicable gap-filling regulations or antifraud provisions. The analysis of whether and, if so, when to disclose personal facts about an executive officer under these regulations and provisions may be difficult. The lynchpin in that analysis is a decision as to whether the personal facts are material under applicable formulations of the judge-made materiality standard. These materiality determinations may be complex and emotionally laden.

This paper argues for an enhancement of federal disclosure rules as they relate to personal facts about executive officers of public companies. The paper first summarizes significant existing requirements for disclosure about executive officers. Then, the paper argues that the existing federal securities law regime applicable to public company executive disclosures of personal facts is deficient in three respects. Specifically, existing disclosure requirements place too much discretion in the hands of executives, cause pressure on important individual rights, and tend to cause investors and markets to overreact. As a response, the paper proposes limited federal securities rule changes designed to more effectively and efficiently manage the public release of personal facts about public company executives.

disclosure, officer, executive, personal facts, securities regulation

Abstract:
The coauthors have constructed a model asset purchase agreement, annotated with footnotes on substantive law and legal drafting issues. This model is intended to be used as a research piece, teaching tool, and practitioner resource. This agreement is part of a series of acquisition agreements and related ancillary contracts and instruments published by Transactions: Tennessee Journal of Business Law beginning in 2003.

asset purchase, acquisition, disposition, contract drafting, Tennessee

Abstract:
This article acknowledges the trend toward federalizing aspects of corporate governance (as evidenced by, among other things, the Sarbanes-Oxley Act of 2002) and offers a model for institutional choice in federal corporate governance rulemaking. Specifically, the article suggests a way to determine whether the components of a specific substantive rule of corporate governance should be legislated by Congress, regulated by the Securities and Exchange Commission, or established by the federal courts. Both the thesis of the article and the specific analytical framework it promotes are foundational in corporate governance scholarship and draw from previous research and scholarship in law (including constitutional law, administrative law, corporate law, and securities law), political science, and economics.

Sarbanes-Oxley, corporate governance, federalism, institutional choice

Abstract:
This article acknowledges the trend toward federalizing aspects of corporate governance (as evidenced by, among other things, the Sarbanes-Oxley Act of 2002) and offers a model for institutional choice in federal corporate governance rulemaking. Specifically, the article suggests a way to determine whether the components of a specific substantive rule of corporate governance should be legislated by Congress, regulated by the Securities and Exchange Commission, or established by the federal courts. Both the thesis of the article and the specific analytical framework it promotes are foundational in corporate governance scholarship and draw from previous research and scholarship in law (including constitutional law, administrative law, corporate law, and securities law), political science, and economics.

Sarbanes-Oxley, corporate governance, federalism, institutional choice

Abstract:
Like other teaching innovations, course management software has been somewhat slow to take hold in legal education. Yet, as law teachers, we cannot deny that our current students are children of a technological age that centers on electronic communication. Although there is a lack of empirical evidence strongly supporting the pedagogic case for the use of technology in law teaching, some of us in the law academy have ventured forth with the use of teaching technologies on the theory that the current demographics of the law student population demand our interaction with students on this basis.

Course management systems are an easy way to bridge the technological gap between law teachers and law students without forcing law teachers to irrevocably alter the material they teach and the way in which they teach it. In that spirit, this article describes the way in which I have implemented Web-based course management in my law school course offerings and sets forth my perspectives on that experience. The article adds to existing literature by offering primary experiential observations that should be useful to others in law teaching - especially those who may not be familiar with course management systems.

legal education, teaching, technology, course management system

Abstract:
This short paper begins to explore whether a corporate officer’s duty of good faith extends to public disclosures of personal facts. Specifically, the paper preliminarily attacks the following question: in the post Stone v. Ritter, post-Gantler v. Stephens era in which we now live, is the absence or inadequacy of an executive officer’s disclosure of personal facts a breach of the duty of good faith and, as a result, the fiduciary duty of loyalty under Delaware law? The answer to this question is tied up in recent jurisprudence of the Delaware Supreme Court at the intersection of the duty of good faith, the duty of disclosure (or candor), and the applicability of fiduciary duties to corporate officers. Accordingly, in a preliminary analysis, this paper first describes that jurisprudence and then applies it to executive disclosures of personal facts. The paper closes with a brief conclusion that includes a cautionary note about the use of its findings in a litigation setting.

officer, executive, good faith, candor, disclosure, loyalty, fiduciary duty, personal facts, privacy

Abstract:
The coauthors have constructed a model stock purchase agreement, annotated with footnotes on substantive law and legal drafting issues. This model is intended to be used as a research piece, teaching tool, and practitioner resource. This agreement is part of a series of acquisition agreements and related ancillary contracts and instruments published by 'Transactions: Tennessee Journal of Business Law' beginning in 2003.

stock purchase, acquisition, disposition, contract drafting, Tennessee

Abstract:
The coauthors have constructed a model bank merger agreement, annotated with footnotes on substantive law and legal drafting issues. This model is intended to be used as a research piece, teaching tool, and practitioner resource. This agreement is part of a series of acquisition agreements and related ancillary contracts and instruments published by Transactions: Tennessee Journal of Business Law beginning in 2003.

bank, merger, acquisition, disposition, contract drafting, Tennessee

Abstract:
The coauthors have constructed a model escrow agreement for use in acquisitions, annotated with footnotes on substantive law and legal drafting issues. This model is intended to be used as a research piece, teaching tool, and practitioner resource. This agreement is part of a series of acquisition agreements and related ancillary contracts and instruments published by Transactions: Tennessee Journal of Business Law beginning in 2003.

escrow, asset purchase, acquisition, disposition, contract drafting, Tennessee

Abstract:
The coauthors have constructed a model bill of sale for use in connection with acquisitions, annotated with footnotes on substantive law and legal drafting issues. This model is intended to serve as a research piece, teaching tool, and practitioner resource. This instrument is part of a series of acquisition agreements and related ancillary contracts and instruments published by Transactions: Tennessee Journal of Business Law beginning in 2003.

bill of sale, asset purchase, acquisition, disposition, contract drafting, Tennessee

Abstract:
The coauthors have constructed an annotated model executive employment agreement for use in connection with mergers and acquisitions, annotated with footnotes on substantive law and legal drafting issues. They intend that this model agreement serve as a research piece, teaching tool, and practitioner resource. This annotated model agreement is the most recent in a series of coauthored merger and acquisition agreements and ancillary agreements and instruments published by Transactions: The Tennessee Journal of Business Law beginning in 2003.

employment agreement, employment contract, employment law, executive, officer, merger, acquisition

Abstract:
In his 2007 book No Seat at the Table, Professor Douglas Branson aptly describes how patterns of male dominance inherent in the legal structures of corporate governance reproduce themselves again and again to keep women out of executive suites and boardrooms, and then he offers a practical way to break this cycle of dominance-through paradigm shifting. A central value of Professor Branson's book derives from this thesis, as well as his use of nontraditional empirical data and interdisciplinary literature (in addition to more traditional decisional law and legal scholarship) to support the positions he takes. Moreover, No Seat at the Table is an invaluable resource because it collects in one volume varied research materials and related information at the intersection of women and corporate boards and because it offers further support for diversification of boards of directors as part of the overall effort to strengthen corporate governance practices and promote more productive, efficient, and trustworthy corporations.

This review is designed to explore these strengths - and a few related weaknesses - in Professor Branson's approach. Specifically, the review highlights three key strengths of Professor Branson's work: his thorough and useful report of 2001 and 2005 proxy data from public company filings with the U.S. Securities and Exchange Commission, his account of the effects of tokenism in the boardroom, and his analysis of the obstacles women face in climbing the rungs to the top of the corporate ladder. The review then evaluates the strengths and weaknesses of his proposed paradigm shifting as an effective way to procure female advancement to executive ranks and board positions. Finally, the review examines the potential shortcomings of Professor Branson's observation and suggestion that the differences between men and women are inconsequential and should be minimized and, further, how these statements (when taken out of context) conflict with his efforts to keep women in the pipeline toward upper management.

corporation, corporate governance, management, manager, board, director, executive, CEO, women, female, paradigm

Abstract:
The coauthors have constructed a model license agreement for use in connection with acquisitions, annotated with footnotes on substantive law and legal drafting issues. This model is intended to serve as a research piece, teaching tool, and practitioner resource. This agreement is part of a series of acquisition agreements and related ancillary contracts and instruments published by Transactions: Tennessee Journal of Business Law beginning in 2003.

license, intellectual property, asset purchase, acquisition, disposition, contract drafting, Tennessee

Abstract:
This article reflects upon certain negative effects associated with the ambiguity of the current legal standard for materiality in the insider trading context and suggests and demonstrates an approach to mitigating these negative effects. Specifically, after describing and illustrating the concept of materiality and its application in the insider trading context, this article identifies and assesses applicable regulatory policies, showing that these policies do not dictate an imprecise definition of materiality. Next, the article explains certain negative impacts on stockholder value emanating from the lack of predictability and certainty in interpreting and applying the existing materiality standard, including negative impacts created by continued speculative and abusive class action litigation. The article then suggests and illustrates an approach for fashioning materiality guidance, consistent with applicable policy and existing regulatory principles. The suggested approach is designed to enhance predictability and certainty in interpreting and applying the concept of materiality in insider trading regulation.

Materiality, Insider Trading