By William C. Hubbard
The Thomas E. Fairchild Lecture at the University of Wisconsin Law School – April 7, 2016
William C. Hubbard, a partner with Nelson Mullins Riley & Scarborough LLP in Columbia, South Carolina, was president of the American Bar Association in 2014–2015.
By Kobi Kastiel & Yaron Nili
Kobi Kastiel – Research Director, The Project on Controlling Shareholders, Harvard Law School Program on Corporate Governance
Yaron Nili – Assistant Professor of Law, University of Wisconsin Law School
Boards of public corporations in the United States are becoming increasingly independent due to an effort to ensure that shareholders’ interests in the company are protected. Yet, little attention has been given to the way that board members obtain and digest the information necessary for their independent decision-making. In this Article, we highlight how “independent” boards remain extremely dependent on management for the information they need to accomplish their role—what we classify as the “informational capture” of the board. We further describe how activist hedge funds identified this capture and are using what is commonly termed as “super directors” to mitigate it. Contrary to many who cast the rise of activist super directors in a negative light, we assert that super directors are not a new phenomenon, that they are not limited to activist nominees, and that they perform an important role in mitigating the board’s informational capture. We further show that this positive role carries several important doctrinal implications for the way Delaware law treats these nominees. However, while activist super directors serve an important role in mitigating this capture, they are far from a perfect solution. Therefore, we propose a more systematic approach to mitigating the board’s capture. Specifically, we call for the creation of a “Board Suite”—a dedicated office within the board that would be in charge of independent data collection and dissemination, therefore minimizing the dependence of the board on management for its information.
By Naomi Schoenbaum
Associate Professor of Law, George Washington University Law School
Antidiscrimination law faces a fundamental design question: the choice between symmetry and asymmetry. A symmetrical law prohibits discrimination on the basis of a trait for a universal class of persons, and for both “sides” of the trait. An asymmetrical law prohibits discrimination on the basis of one “side” of the trait, and for a limited class of persons. Current law is inconsistent in its design. For example, employment discrimination law prohibits race discrimination symmetrically (everyone is protected, and on the basis of any race), but prohibits disability discrimination asymmetrically (only the disabled are protected, and only on the basis of disability). This critical design choice has received scant attention outside of the affirmative action context, leaving this key inconsistency in current law unexplained, and the implications unexplored.
Relying on employment discrimination law and the traits of race, sex, disability, and age as core examples, this Article provides the first systematic study of this design choice. It makes the case for symmetry on three grounds: purpose, practice, and politics. As for the purpose of antidiscrimination law, this Article reaches the counterintuitive conclusion that a symmetrical design that protects everyone is effective not only at reducing classifications on the basis of protected traits, but also at improving the labor market circumstances of subordinated groups. When it comes to practice, a symmetrical law avoids challenges arising from protected-class determinations that limit plaintiffs’ ability to pursue their claims. Finally, symmetrical antidiscrimination laws are more likely to produce positive policy feedback, generating greater support for these laws. After discussing how to optimize symmetry, this Article explores further applications, including additional traits—such as appearance and sexual orientation—and additional areas of law—such as housing, education, and constitutional law.
By Kathryn E. Fifield
J.D. Candidate, University of Wisconsin Law School, 2017
It is axiomatic that the Fourth Amendment to the United States Constitution protects Americans from unwarranted police intrusions in their homes. Areas immediately surrounding the home which are so “intimately tied” to the home’s activities similarly protect Americans against warrantless search and arrest, or so says the doctrine of curtilage. However, courts have typically not extended curtilage protection to common areas, such as hallways, garages, or storage spaces within multi-unit structures, while they have recognized curtilage protection of similarly proximate spaces surrounding single-family homes. These courts rely almost entirely on an individual resident’s inability to totally exclude others—landlords, repairmen, fellow tenants, or their guests—from these areas to conclude that these spaces cannot constitute curtilage or that expectations of privacy within these spaces are not objectively reasonable. The Wisconsin Supreme Court decided as such in State v. Dumstrey. Courts’ reluctance to recognize curtilage protection in multi-unit dwellings creates a gap in privacy protection, particularly with respect to low-income urban residents, that belies deeply rooted privacy, property, and security interests. This Note argues that courts should utilize the licensing approach articulated in Florida v. Jardines to diminish the importance of the right to exclude, and that the Wisconsin Supreme Court should have taken this approach in Dumstrey.
TIF-for-Tax: Upholding TIF’s Original Purpose and Maximizing Its Use as a Catalyst for Community Economic Development
By Bryon Eagon
J.D. Candidate, University of Wisconsin Law School, 2017; M.A., Relay Graduate School of Education, 2013; B.A., University of Wisconsin–Madison, 2010
With shrinking state aid and growing needs, local governments are constantly searching for ways to increase their tax revenue. One significant policy in the toolbox of local governments in Wisconsin is Tax Increment Financing (TIF). Through TIF, municipalities aim to grow future revenues by attracting private investments in new real estate development. TIF was originally intended to assist communities in addressing urban blight, yet legislative enactments over the past few decades have significantly broadened TIF to make eligible projects that are not in metropolitan or blighted areas, thereby diluting TIF’s intended purpose.
Past calls for reforming TIF have suggested only small modifications, often advocating for expanding TIF’s applicability and use in an even greater number of development projects. However, legislators should instead support comprehensive reforms to this place-based investment instrument that improve clarity and predictability, increase measured objectiveness, and adjust spending restrictions in order to better utilize TIF as a catalyst for equitable Community Economic Development (CED). Through analyzing historic and contemporary uses and misuses of TIF in Wisconsin, as well as its risks and rewards, this Comment proposes specific reforms to realign TIF laws with its original purpose of addressing urban blight and better utilize the tool to attract and finance economic, community, and equitable development.