The University of Chicago Law School Faculty Blog

Mail Fraud Sprawl

This is the third in a series of posts in which I use the George Ryan trial to illustrate the unfairness of federal mail fraud and RICO prosecutions.

American courts ordinarily exclude “other acts” evidence.  Although a defendant accused of purse-snatching may have been convicted a dozen times of purse-snatching, the jury will not learn of his prior convictions.  This “character” or “propensity” evidence will be excluded on the theory that jurors should not be tempted to convict the defendant just because he appears to be a sleazy guy.  They should focus only on the government’s accusation of a particular wrongful act at a particular time.  The trial of George Ryan and Larry Warner will depart from this vision of justice.  It will move toward the example set by Soviet trials for “hooliganism.”  Ryan and Warner may be tried, in effect, for the federal crime of wheeling and dealing while sleazy (and, in Warner’s case, while rich and, in Ryan’s, while political).

India: A Democracy’s Near Collapse into Religious Terror, Part II

India's story is of intrinsic interest and importance.  By following the story of Gujarat, Americans can begin to understand better than most currently do the political and religious dynamics of the world's most populous democracy, a nuclear power, and a nation that will play an increasingly large role on the world stage.  India is typically not well covered by the U. S. media or by education in U. S. schools and colleges.  Indian scholars who have written extremely well about their own situation, in books and articles and in a national press that is admirable for its quality and its openness, have little name-recognition in the U. S. and are rarely read. During the ascendancy of the Hindu right, when intelligent diplomatic pressure could have achieved change, U. S. foreign policy was largely indifferent to internal tensions in India, focusing only on the threat of nuclear conflict with Pakistan.   American ignorance of India's history and current situation was largely to blame for such omissions.   Americans typically follow events in the Middle East rather closely.  If one wants to know about Israeli-Palestinian relations, for example, ample material for such an understanding is readily available from daily newspapers, television, and the internet.  India is simply not as "present" to the American mind, because it is not as present in the American media.  Thus India's own struggle with religious extremism is little known, and the lessons it can teach us are little appreciated.

Another Way to Keep Up With Us

The good folks over at Juris Novus are now providing this blog's headlines. If you're looking for a good way to keep up with what's going on here and at other legal blogs at the same time, please visit them at http://juris.metanovus.com/.

The Death of Sadoun al-Janabi

Does the slaying of Sadoun al-Janabi, one of the defense lawyers in Saddam’s trial, show that the decision not to use an international tribunal was a mistake?  A New York Times article (available here) answers this question with a “yes” (albeit, in journalistic style, by implication):

The execution-style killing of a defense lawyer in the trial of Saddam Hussein and some top associates ... renewed doubts about whether it is possible to hold a fair trial in the midst of a war that has spurred a wave of revenge killings against people linked to Mr. Hussein....

Many Western legal experts and rights advocates have argued that Mr. Hussein should have been tried before an international court, or in an Iraqi court with a strong international dimension. But the Bush administration and its Iraqi political allies rejected that in favor of an Iraqi tribunal sitting in Baghdad, partly because an international court would not have the option of imposing the death penalty, which many Iraqis believe is the only fit punishment for Mr. Hussein.

The story implies that the assassination of the defense lawyer shows that only an international trial of Saddam Hussein could have been fair, and that the Bush administration was willing to do without fairness in order (“partly”) to ensure that the death penalty will be imposed.

The new corporate raiders?

For those hoping for a return of a vibrant market for corporate control (last seen in the 1980s) and the discipline it brings to corporate governance, hope may be on the way.  First, some background:

The fact pattern for my exam in Corporations last year was Oliver Stone’s fabulous movie “Wall Street.”  This isn’t as cute as it seems.  The movie, despite being sloppy with the law and largely mixing up the villains and the heroes, is a perfect snapshot of the market for corporate control that prevailed in the 1980s.  From 1982 until the collapse of the high-yield (“junk”) bond market in 1989, approximately 60% of large U.S. firms were either takeover targets or restructured on their own.  While all LBOs, MBOs, and corporate takeovers did not succeed, the threat of a hostile raider was so real and so scary for management, that it provided unprecedented discipline on managerial behavior.  Executives no longer sought to build empires, like the synergy-free conglomerates slapped together in the 1970s, and executive compensation, instead of being based on firm size, became linked to shareholder value through the use of options and other equity compensation.  A related outgrowth of this takeover activity was the creation of shareholder activist organizations and movements, such as Council of Institutional Investors and Institutional Shareholder Services.  Very often, the public motives of these “good guy” activist groups and the “bad guy” raiders were aligned.  Just take one example from the movie that mimics reality: Gordon Gekko’s speech to the board and management of Teldar Paper at its annual stockholders’ meeting.  Gekko—the supposed villain—rips the executives for wasting the shareholders’ money on country club memberships, hundreds of do-nothing vice presidents, excessive compensation, and “golden parachutes.”  One can imagine CII or ISS making these same arguments then and now.

A Third Cheer for Genetic Testing

The short post that I did on genetic testing earlier this week has provoked a further response from Daniel Solove (which can be found at http://www.concurringopinions.com/archives/2005/10/a_reply_to_rich_1.html) to my last posting. It further reveals the weakness of the case on behalf of any law that seeks to prohibit an employer from relying on genetic information.

Are Judges Political?

Are judges political? At least in some ways, this is an empirical question. Together with Tom Miles and a group of superb students, and as part of the Chicago Judges Project, I have been studying this question in an area where the answer might well be expected to be "no." But the answer turns out to be “yes” -– if a somewhat qualified one.

Book Review: The Search

Over the weekend, I read John Battelle’s new book, The Search: How Google and Its Rivals Rewrote the Rules of Business and Transformed Our Culture (Portfolio, 2005). Battelle was a cofounding editor of Wired magazine—culture, life and technology for the digerati—and founder of The Industry Standard, an Internet-focused magazine that rose and fell with the bubble. Battelle also blogs on search.

The Search details the rise of Google from Larry Page and Sergey Brin’s days as Stanford graduate students and their research on search algorithms to the start-up—yes, there was a garage—through the Google IPO (do look at Google’s unique S-1 if you haven’t). Google is sufficiently important that that story alone would make the book a worthwhile read, but Battelle does substantially more.

If plastics was the one word for Benjamin Braddock, then today’s word is clickstream.

Political Defenses Then and Now

October 19, 2005:

He was instructed by the judge to stand and identify himself for the purposes of the trial, but the grey-bearded figure, with his thick black hair combed stylishly to one side, was not having any of it.
He buttoned up his jacket and declared: "Those who fought in God's cause will be victorious... I am at the mercy of God, the most powerful."
"You are to give your full name to establish you identity to the court," the judge said.
"Who are you? What does this court want?" the defendant challenged.
"I don't answer this so-called court, with all due respect, and I reserve my constitutional right as the president of the country of Iraq.
"I don't acknowledge either the entity that authorises you, nor the aggression, because everything based on falsehood is falsehood," he said.

Sound familiar?

January 20, 1648:

The Charge being read the Lord President replied:

Lord President. Sir, you have now heard your Charge read, containing such matter as appears in it; you find, that in the close of it, it is prayed to the Court, in the behalf of the Commons of England, that you answer to your Charge. The Court expects your Answer.

The King. I would know by what power I am called hither. . . . by what Authority, I mean, lawful; there are many unlawful Authorities in the world, Thieves and Robbers by the highways: but I would know by what Authority I was brought from thence, and carried from place to place, (and I know not what), and when I know what lawful Authority, I shall answer: Remember, I am your King, your lawful King, and what sins you bring upon your heads, and the Judgment of God upon this Land, think well upon it, I say, think well upon it, before you go further from one sin to a greater; therefore let me know by what lawful Authority I am seated here, and I shall not be unwilling to answer, in the meantime I shall not betray my Trust....  Let me see a legal Authority warranted by the Word of God, the Scriptures, or warranted by the Constitutions of the Kingdom, and I will answer.

Hedge Funds

In today's NY Times, David Swensen worries about small investors' taste for hedge funds, and argues for restricting hedge funds to the most sophisticated investors.  So much so that he would regulate "funds of funds" (mutual funds that offer portfolios of hedge funds) out of existence.  Swensen is thoughtful, as usual, but I find it hard to agree with anything in the op-ed piece.