The University of Chicago Law School Faculty Blog

Epstein on the GM and Chrysler Bankruptcies

Over at the website of The Freeman, published by the Foundation for Economic Education, Richard Epstein has published an article entitled "Political Bankruptcies: How Chrysler and GM Have Changed the Rules of the Game." Below is an excerpt:

The topic of corporate bankruptcy law scarcely titillates the imagination of ordinary citizens, even those with a deep interest in constitutional and public affairs. Harried people treat bankruptcy almost dismissively as a useful way of winding up firms that cannot keep their financial heads above water. In practice they sense rightly that the corporate bankruptcy system cleanses the economy of weak players by their liquidation, reorganization, or sale, hopefully to allow their assets to be released to more productive uses. Explaining how bankruptcy works isn’t a fit subject for polite company.

Those perceptions have changed now that the Chrysler and GM bankruptcies have set a new standard for the fast resolution of some complex if dubious transactions. So troublesome questions arise: Did these transactions comply with the rule of law? Were the property rights of the secured creditors fully protected in the expedited proceedings? Will the process bring confidence to the credit markets? No, no, and no again. Those three “nos” come as no surprise. The basic classical liberal position is right to insist that the government cannot sensibly occupy the roles of market participant and market regulator simultaneously. All else is detail.

You can read the rest of the article here.

Audio: Epstein on Bilski

Continuing with today's Epstein/Fed Soc theme, the Federalist Society has posted a recording of Prof. Epstein discussing Bilski v. Kappos. The SCOTUS heard oral argument in the case on November 9. According to the Fed Soc site,

The issue in this case is whether a "process" must be tied to a particular machine or apparatus or transform a particular article into a different state or thing in order to be eligible for patenting under 35 U.S.C. § 101.

You can download the podcast here.

Video: Richard Epstein on the Redistribution of Wealth

Over on the Federalist Society's YouTube Channel, they've posted an 11-part series entitled "Redistribution of Wealth," recorded at the 2009 National Lawyers Convention on Thursday, November 12, 2009. Our own Richard Epstein was one of the discussants.

Other participants included Steve Forbes, Chairman and CEO of Forbes Inc. and Editor of Forbes Magazine; Prof. Jed Rubenfeld of Yale Law School; Andrew L. Stern, President of the Service Employees International Union; and Judge J. Harvie Wilkinson III of the U.S. Court of Appeals for the Fourth Circuit as the moderator.

Video: Epstein Debates Judy Feder on Health Care

NYU has posted a video of a recent debate between Richard Epstein and Georgetown's Judy Feder about health care reform. You can watch the video here, and below is a sneak peek of Epstein's position, courtesy of the NYU website:

While agreeing with Feder that the system needed drastic fixes, Epstein differed stridently on what was required. Arguing that “cartel-like restrictions,” mandates, and subsidies in government programs like Medicare had caused healthcare’s woes, Epstein said that the current model of a system like Medicare was not tenable when extended to the broader population: “If all you’re going to try to do is to give everybody the same level of protection that you give to current Medicare recipients, you’ll not be able to finance it with any of the devices that she’s talking about.”

One of the primary problems, Epstein said, was that potential competitors to existing insurance firms lack free entry into local markets, resulting in insurance monopolies. He argued that Obama should pass legislation to correct a “deeply anticompetitive system,” but predicted that the administration would instead “buy off all the interest groups with corrupt bargains” and introduce taxation and cross-subsidy programs that “will bankrupt the nation.” The public health plan option, Epstein continued, would be run by a “bunch of blithering incompetents.... What you’re watching here is a grotesque concatenation of every bad left-wing liberal policy in the last 40 years, and the time has come to stop it.” Epstein prescribed instead a series of “mid-level rationalizations” involving medical malpractice and price restriction issues, as well as the application of contract law.

Audio: Richard Epstein on Patent Rights in the Supreme Court

Continuing our recent (unintentional) theme of patent law and the Supreme Court, we'd like to draw your attention to a recent Federalist Society podcast that featured our own Richard Epstein, along with Scott Kieff (George Washington University Law School), Mark Lemley (Stanford University Law School), Fred von Lohmann (Electronic Frontier Foundation), and Adam Mossoff (UChicago Law '01 and now prof at George Mason University School of Law), discussing the Quanta case. Listen to the podcast and get some more background on the case here.

Audio: Epstein and Lessig on Campaign Finance Reform

Richard Epstein recently faced off with former Chicago prof Lawrence Lessig on campaign finance reform on the WRFU program The Logic Consortium. Professors Epstein and Lessig agreed heartily on the goals, somewhat less so on the means. You can listen to the program here.

Audio: Richard Epstein on Locke v. Karass

Yesterday, the Federalist Society posted a brief recording of Richard Epstein discussing Locke v. Karass. In this case, the Court considered whether union requirements that dictate that nonmembers pay a service fee for litigation that does not directly benefit the local union (i.e. “national litigation”) violate the First Amendment. You can listen to the recording here.

Epstein Debates the Employee Free Choice Act

Over at the Federalist Society website, Richard Epstein today participated in a discussion with Thomas Kochan (MIT), Eugene Scalia (Gibson, Dunn & Crutcher LLP), and Patrick Szymanski (Change to Win) to debate the policy and constitutionality of the EFCA. See the complete discussion here.

Student Blogger - A Second Look at the Third Party Doctrine

Professor Richard Epstein on the 4th Amendment Third Party Doctrine

Criminals who can't keep secrets have short careers. A big reason for this is the “third-party doctrine” which, as most readers of this blog are probably aware, holds that information shared with others is not generally protected by 4^th Amendment restrictions on search and seizure. Put differently, the law does not recognize any reasonable expectation of privacy in information shared with others. This doctrine has been widely criticized and, most recently and notably in an article by 4^th Amendment scholar Orin Kerr, defended (The Case for the Third-Party Doctrine, 109 Mich. L. Rev. 561, 563 (2009)). Chicago's own Richard Epstein has recently taken interest in this debate, and presented his preliminary thoughts at this week's Works in Progress (WiP) talk. Essentially, Prof. Epstein thinks current constitutional doctrine is generally correct on this point. He agrees with Prof. Kerr and other defenders of the third-party doctrine that it is worth keeping, though his defense is on somewhat different grounds than those of Prof. Kerr. Since Prof. Epstein comes to this issue as an outsider, he also returns to first principles in his work and asks whether we are analyzing these cases consistently and coherently. His conclusion is to suggest a general method for considering 4^th Amendment issues that optimizes the public benefits and private costs of permitting government action in various classes of cases.

Video: Crisis and the Law with Richard Epstein

Over the past week, the National Review Online has been posting portions of a video interview with Richard Epstein as part of "Uncommon Knowledge with Peter Robinson," produced by the Hoover Institution. Links to the week's episodes are below. Update: The Hoover Institution has the full video, along with a transcript.

• MONDAY, MARCH 30, 2009 Crisis & the Law with Richard Epstein: Chapter 1 of 5 - Richard Epstein considers the soundness of contracts and the constitutionality of taxing bonuses at a rate of 90 percent. 
• TUESDAY, MARCH 31, 2009 Crisis & the Law with Richard Epstein: Chapter 2 of 5 - Richard Epstein discusses the financial crisis, determining that “government incentives were perverse, so the actions of the private parties were perverse.”
• WEDNESDAY, APRIL 01, 2009 Crisis & the Law with Richard Epstein: Chapter 3 of 5 - Richard Epstein rates the separate responses of the Bush and Obama administrations to the financial crisis.
• THURSDAY, APRIL 02, 2009 Crisis & the Law with Richard Epstein: Chapter 4 of 5 - Richard Epstein, who has dealt professionally with Barack Obama in the past, describes the talents and shortcomings of the 44th president.
• FRIDAY, APRIL 03, 2009 Crisis & the Law with Richard Epstein: Chapter 5 of 5 - Richard Epstein discusses the constitutionality of several hot items on the congressional agenda, including card check.