Volume 2008, No. 5


Taxation Without Liquidation: Rethinking “Ability to Pay”

By Sergio Pareja

This Article proposes a novel way to tax wealth transfers. Specifically, it suggests that we divide all assets transferred by gift or bequest into two classes—illiquid assets and liquid assets. The recipient should include those assets in income but be allowed two options. With respect to illiquid assets, the recipient should be able to avoid immediate income inclusion if he takes the property with an income-tax basis of zero. With respect to liquid assets, the recipient should be allowed a full income tax deduction if he rolls the gift or bequest into a deductible IRA. The combination of these simple rules would be much more equitable than our current system, and it would prevent people from having to sell illiquid assets to pay taxes.

Soft Paternalism for Close Corporations: Helping Shareholders Help Themselves

By Judd F. Sneirson

This Article draws on the idea, recently popularized by Professors Richard Thaler and Cass Sunstein, that individuals are imperfect and can sometimes use a well-meaning “nudge” to help them reach decisions that are in their best interests. The Article applies these concepts to the persistent problem of minority-shareholder oppression in close corporations, and makes soft-paternalistic suggestions to encourage less sophisticated incorporators to protect themselves against squeeze and freeze outs. These include modest changes to states’ typically one-page incorporation forms, improvements to do-it-yourself incorporation resources, and additional offerings for online incorporation services. Once implemented, these recommendations will complement existing close-corporation law by helping shareholders help themselves guard against oppression, and thereby obviate the need to determine after the fact whether the parties bargained for such protections and whether the law affords such a remedy.


Deutschland Über Alles: Why German Regulations Need to Conquer the Divided U.S. Renewable-Energy Framework to Save Clean Tech (and the World)

By Brad A. Kopetsky

The current U.S. renewable-energy regulatory framework does not adequately incentivize the clean-technology development needed to address global energy concerns. The United States’ fragmented, state-by-state approach creates an unacceptable level of uncertainty for clean-tech investors and innovators. This uncertainty has stifled U.S. clean-tech capital formation, a useful barometer for overall innovation, relative to nations with more progressive frameworks. This Comment proposes a comprehensive overhaul of the U.S. renewable-energy framework that includes elements of the the highly successful German Renewable Energy Act, along with pieces of various state programs, in a unified, demand-pull approach. The proposed framework would encourage widespread adoption of clean tech in the United States, reduce investment risk to clean-tech investors, and foster the clean-tech innovation needed to address current and future energy concerns.

The Right to Make Informed Reproductive-Health-Care Decisions Regardless of Age: Maintaining the Focus on the “I” in “I Want to be One Less”

By Danielle M. Costello

In 2006, the FDA approved Gardasil, a vaccine for the human papillomavirus (HPV) known to cause cervical cancer and genital warts. Soon thereafter, state legislatures sought to make the vaccine mandatory for girls entering the sixth grade, sparking a national public debate. Despite valid concerns on each side, and in recognition of the potential protection that Gardasil offers young women against HPV, simply mandating the vaccine is not the answer. In mandating the vaccine but failing to mandate comprehensive sexual education, children are robbed of the knowledge necessary to protect them against all risks related to sexual activity.


Transactional Pleading: A Proportional Approach to Rule 8 in the Wake of Bell Atlantic Corp. v. Twombly

By Ryan Gist

Bell Atlantic Corp. v. Twombly may represent a judicial attempt to reconcile the many seemingly inapposite interpretations of Federal Rule of Civil Procedure Eight (“FRCP 8”) that have been perpetuated since its inception. If this is so, Justice David Souter and his divided court have failed. In the past, the courts have followed a rule-based approach to the pleadings, asserting that one rule applies to every pleading in every situation. The certainty touted by this rule-based pleading system is, at best, illusory. Certainty in outcome is unattainable, as multiple standards for judging the pleadings have always existed even if they are usually applied only in the shadows. However, each of these standards serve important functions within our legal system, and an approach is needed that explicitly permits these standards to exist in the same procedural universe.

This Note proposes an amendment to FRCP 8 that requires plaintiffs to plead varying degrees of factual particularity, proportional to the dangers of overrestriction and abuse in a given situation. A transparent pleading system that articulates when each standard is appropriate provides practitioners and courts with specific, quantifiable criteria to apply and argue. By providing transparency in reasoning, a transactional standard achieves the more attainable goal of ensuring certainty in process.