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Anticipatory Remedies for Takings

INTRODUCTION Litigating takings claims under the U.S. Constitution involves pitfalls not encountered in ordinary constitutional litigation. With respect to takings claims against the federal government, just compensation can ordinarily be awarded only by the Court of Federal Claims (CFC), an court located in Washington, D.C. (1) The CFC, however, has no authority to grant equitable or declaratory relief. (2) Consequently, claimants who wish to advance claims enforced by injunctions or declaratory judgments (for example, that the government action was arbitrary and capricious) must seek relief in an Article III court. This means claimants must often split their claims between two courts, giving rise to tricky questions of timing and preclusion. If they file in the wrong court, or get the sequencing wrong, consideration of the takings claim may be foreclosed. (3) Congress could clean up the mess by rewriting the relevant jurisdictional statutes, but has failed to act. (4) With respect to federal takings claims against state and local governments, the Supreme Court has held that such claims must be initially presented to state courts before they can be heard in federal court. (5) Any legal and factual issues that are resolved by the state courts, however, cannot be relitigated in a subsequent challenge in federal court. (6) Since federal and state takings clauses are generally interpreted the same way, this gives rise to what has been aptly called a trap. (7) Although federal constitutional claims ordinarily can be tried in federal court under 42 U.S.C. [section] 1983, (8) takings claims, because they must be initially presented to state courts, are generally barred from being considered by any federal court other than the U.S. Supreme Court on certiorari from the final state court decision, which is rarely granted. This Essay argues that these pitfalls of litigating federal takings claims rest, in significant part, on an erroneous understanding about the scope of federal judicial authority under the Takings Clause. Starting from the premises that the Constitution does not prohibit takings but only requires that they be compensated, (9) and that compensation can be awarded only in a court in which the government has waived its sovereign immunity, (10) the Supreme Court has concluded--sometimes--that federal courts of general jurisdiction have no authority to consider takings claims as long as an action for compensation is available elsewhere. On other occasions however--and usually without acknowledging the inconsistency--the Court has reviewed takings claims without requiring that they first be submitted to the court having authority to award just compensation. The latter line of authority, although poorly theorized by the Court, is the correct one. There is no rule of law that prevents federal courts of general jurisdiction from adjudicating claims that arise under the Takings Clause --as long as they confine themselves to the question whether there has been a taking that entitles the owner to compensation. Given sovereign immunity, however, any actual award of compensation against the federal government or one of the states (as opposed to a local government) must be made by a court having jurisdiction to render such a judgment. The vehicle for allowing federal courts to consider takings claims, even if they have no authority to award just compensation, is what I call an anticipatory remedy. (11) The primary type of remedy I have in mind is a declaratory judgment, authorized by the Declaratory Judgment Act of 1934. (12) In appropriate circumstances, federal courts of general jurisdiction should be able to entertain claims that a federal or state government unit is proposing to engage in action that would constitute a taking, and if so, to issue a declaration that compensation would be required if the government persists. Anticipatory remedies could also take other forms besides declaratory judgments. …

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Corporate Political Speech: Who Decides?

I. INTRODUCTION The Supreme Court spoke clearly this Term on the issue of cor-porate political speech, concluding in Citizens United v. FEC (1) that the First Amendment protects corporations' freedom to spend corporate funds on indirect support of political candidates. (2) Constitutional law scholars will long debate the wisdom of that holding, as do the authors of the two other Comments in this issue. (3) In contrast, this Comment accepts as given that corporations may not be limited from spending money on politics should they decide to speak. We focus instead on an important question left unanswered by Citizens United: who should have the power to decide whether a corporation will engage in political speech? Under existing law, a corporation's decision to engage in political speech is governed by the same rules as ordinary business decisions, which give directors and executives virtually plenary authority. In this Comment, we argue that such rules are inappropriate for corporate political speech decisions. Instead, lawmakers should develop special rules to govern who may make political speech decisions on behalf of corporations. We analyze the types of rules that lawmakers should consider. We also offer a set of proposals, and policymaking consider-ations, for designing such rules. In Part II, we consider existing corporate law rules governing the political speech decision. As long as corporations are permitted to engage in political speech, we show, decisional rules governing whether and how they decide to do so are inevitable. Under existing corporate law rules, corporate political speech decisions are subject to the same rules as ordinary business decisions. Accordingly, corporate political speech decisions do not require shareholder input, a role for independent directors, or disclosure--the safeguards that corporate law rules establish for special corporate decisions. We explain that the interests of directors and executives with respect to political speech decisions may diverge from those of shareholders, (4) that the financial implications of these decisions are hardly trivial, and that the costs of the divergence of interests may be exacerbated by the special expressive significance that these decisions carry for shareholders. We conclude that political speech decisions are substantially different from, and should not be subject to the same rules as, ordinary business decisions. In Part III, we assess lawmakers' choices with respect to rules that would align corporate political speech decisions with shareholder interests. In particular, we suggest that lawmakers consider adopting rules that (i) provide shareholders with a role in determining the amount and targets of corporate political spending; (ii) require that independent directors oversee corporate political speech decisions; (iii) allow shareholders to opt out of--that is, either tighten or relax--each of these first two rules; and (iv) mandate detailed and robust disclosure to shareholders of the amounts and beneficiaries of a corporation's political spending, whether made directly by the company or indirectly through intermediaries. We explain how such rules would benefit shareholders. We also explain why the proposed rules are best viewed not as limitations on corporations' speech rights but rather as a method of determining whether the corporation actually wishes to engage in political speech. Thus, these rules protect, rather than abridge, corporations' First Amendment interests. Part IV discusses an additional objective that decisional rules concerning corporations' political speech may seek to serve: the protection of minority shareholders from forced association with political speech supported by a majority of shareholders. We discuss the economic and First Amendment interests of minority shareholders that lawmakers may seek to protect. Although we conclude that requiring unanimous shareholder approval for corporate political speech would likely be neither desirable nor permissible, we argue that decisional rules addressing political spending opposed by a sufficiently large minority of shareholders should be viewed as constitutionally permissible, and we discuss how lawmakers could best design such rules. …

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Intimate Discrimination: The State's Role in the Accidents of Sex and Love

TABLE OF CONTENTS INTRODUCTION 1309 I. THREE NORMS INSCRIBED IN LAW AND CULTURE 1314 A. Law's Express Role 1314 B. Homogamy: Race 1317 C. Desexualization: Disability 1324 D. Heterogamy: Sex 1329 E. Intimate Norms Beyond the Intimate Sphere 1333 II. ON INDIVIDUAL DIFFERENTIATION 1338 A. The Individual Lover's Discourse 1338 B. Abandoning the Individual Bad Actor 1354 C. Functionalism As an Individual Ethical Inquiry 1355 III. ON STRUCTURAL DISCRIMINATION 1363 A. The State's Role: Of Accidents and Calculations 1364 B. Why Intimate Discrimination Matters 1371 IV. THE ROLES THE STATE SHOULD PLAY 1376 A. What Not To Do: Preliminary Ideas, Mostly Ill-Advised 1379 B. Toolkit: A Range of Plausible Structural Interventions 1382 C. Sex: Lifting Explicit Restrictions and Eliminating Penalties 1384 D. Disability: Removing Barriers to Entry and Encouraging Intimacy 1386 E. Race: Unburdening Existing Relationships 1392 CONCLUSION 1396 INTRODUCTION There is a separation, as it were, between the bedroom and the boardroom. You don't want the government or its laws meddling in your private life, what you do behind closed doors is your own personal matter, etc. But, of course, this does not mean that there isn't a relationship between whom I desire and whom I hire, or between whom I want my children to desire and whom I hire. --David Mura (1) The problem of combating discrimination faces a difficult juncture. Law has largely shifted from permitting or requiring discrimination (think segregated schools) to prohibiting discrimination (think employment discrimination law). At the same time, law has pushed discrimination underground. Most institutional decisionmakers--public and private--no longer say overtly discriminatory things. Discrimination is therefore harder to find and to regulate, because it has become less acceptable, legally and socially, to speak its language. Yet some groups in our society, such as people of color and disabled people, are still subject to systematic disadvantage. As many scholars have noted, this combination presents a difficult challenge for law and policies that address discrimination. This challenge requires us to look into less obvious domains to understand the phenomenon of discrimination and to evaluate the proper role of the state in its elimination. One such domain is the intimate. Because we do not police the intimate domain for discrimination, people are more explicit here about the distinctions they draw along lines of race, disability, and sex. By looking at our attitudes toward race, disability, and sex in the intimate realm, we can therefore learn about the condition and contours of our attitudes toward these categories more generally. Intimate discrimination also has practical significance. As David Mura elegantly portrays in the epigraph, to speak of intimacy and discrimination together is to join two spheres that we tend to, and like to, consider distinct. Yet the intimate realm is central to our lives; families and other close relationships structure our communities and our selves. Intimacy is considered by many to be a valuable social good, so exclusion from intimacy has welfare consequences. Moreover, intimate affiliations and norms in turn affect our interactions in other domains, such as employment, as Mura suggests. …

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Vote Fraud in the Eye of the Beholder: The Role of Public Opinion in the Challenge to Voter Identification Requirements

I. THE FAMILIAR PLACE OF PERCEPTIONS IN THE DEBATE OVER ELECTION FRAUD 1740 II. SURVEY METHODOLOGY 1742 III. BELIEFS IN THE FREQUENCY OF VOTER FRAUD, VOTER IMPERSONATION, AND VOTE THEFT 1744 IV. PERCEPTIONS OF FRAUD AND THE LIKELIHOOD OF VOTING 1750 V. VOTER IDENTIFICATION AND FEARS OF FRAUD 1754 VI. CONCLUSIONS 1758 APPENDICES 1761 APPENDIX A 1761 APPENDIX B 1765 APPENDIX C 1768 APPENDIX D 1770 APPENDIX E 1772 APPENDIX F 1773 The current debate over the constitutionality of laws mandating photo identification for voters presents a series of largely unanswered, and in some respects, unanswerable, empirical questions. For the most part, the parties to the litigation culminating in the case currently before the Supreme Court, Crawford v. Marion County Elections Board, (2) have speculated about the number of illegal votes cast and the number of legal voters who would be prevented from voting were voting conditioned on the production of a driver's license or some other form of state-issued voter identification. When critics of voter ID requirements point to the lack of prosecutions or reported incidences of voter impersonation fraud, defenders of such laws reply, in part, that successful fraud goes undetected. When defenders of voter ID argue that such laws lead to very few people being turned away from the polls or having their votes go uncounted, critics respond that even a violation of the voting rights of a few is constitutionally impermissible, and that precious little data exist to assess the impact of such laws on the currently voting population or the deterrent effect it might have on future voters. With the scarcity of empirical findings to settle some of the factual issues central to this debate, (3) there is great risk that the Court will resign itself--as it hinted it might in Purcell v. Gonzalez, (4) quo-ted above--to its intuition that of election fraud drives honest citizens out of the democratic process. This intuition, however, presents a testable empirical proposition, which this Essay attempts to evaluate based on new survey data that assess the popular perception of election fraud and the likelihood that such beliefs lead to voter disengagement. We begin this Essay in Part I by situating the argument about fears of fraud within the debate over voter identification requirements and election law more generally. The argument follows a path familiar to campaign finance law, in which the Court elided difficult questions about the empirics of campaign contributions and corruption by relying on the prevention of the appearance of corruption as a state interest sufficient to justify restrictions on campaign contributions and expenditures. (5) Part II describes the unique national survey we conducted to assess how widespread popular fear of two different types of election fraud is, and the relationship between such fear and the likelihood of people turning out to vote. Part III discusses our findings about the prevalence of perceptions of vote fraud and how those perceptions vary among political, racial, and other demographic subgroups. In Part IV, we present findings suggesting that such fears of fraud, while held by a sizable share of the population, do not have any relationship to a respondent's likelihood of intending to vote or turning out to vote. …

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In Memoriam : Clark Byse

Clark Byse was a member of that great generation of scholars that created administrative law. He worked with Walter Gellhorn, Louis Jaffe, Kenneth Culp Davis, Nat Nathanson, and a handful of others. They began with a few traditional common law rules, a new federal statute, a group of New Deal agencies, and a growing number of judicial decisions. They formed these materials into more coherent legal principles, approaches, and systems of interpretation. They helped to define the proper relationship between citizen and government in a world that must rely upon administrative expertise to translate the electorate’s desires into effective policy and action. In a word, Clark and those few others were the intellectual architects of the modern democratic administrative state. Clark Byse as scholar participated fully in that great enterprise. His casebook with Walter Gellhorn, now in its tenth edition, is a legal classic.1 He did not limit his writing to administrative law, however, for he also wrote much of value about, for example, contracts, civil procedure, and academic freedom. Clark Byse as teacher taught administrative law and contract law to generations of law students. His object was to transmit what we call “legal thinking” — the disciplined, critical, purpose-oriented approach that underlies American law. Indeed, Clark made a point of telling his students, “[N]ever forget that the emphasis in this class is on what and how you think, not on what some judge or treatise writer or

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Precontractual liability and preliminary agreements

For decades, there has been substantial uncertainty regarding when the law will impose precontractual liability. The confusion is partly due to scholars' failure to recover the law in action governing precontractual liability issues. In this Article, Professors Schwartz and Scott show first that no liability attaches for representations made during negotiations. Courts have divided, however, over the question of liability when parties make reliance investments following a preliminary A number of modern courts impose a duty to bargain in good faith on the party wishing to exit such an agreement. Substantial uncertainty remains, however, regarding when this duty attaches and what the duty entails. Professors Schwartz and Scott develop a model showing that parties create agreements rather than complete contracts when their project can take a number of forms and the parties are unsure which form will maximize profits. A allocates investment tasks between the parties, specifies investment timing, and commits the parties only to pursue a profitable project. Parties sink costs in the project because investment accelerates the realization of returns and illuminates whether any of the possible project types would be profitable to pursue. A party to a breaches when it delays its investment beyond the time the specifies. Delay will save costs for this party if no project turns out to be profitable and will improve this party's bargaining power in any negotiation to a complete contract. Delay often disadvantages the promisee, and when parties anticipate such strategic behavior, they are less likely to make agreements. This disincentive is unfortunate because a often is a necessary condition to the realization of a socially efficient opportunity. Thus, contract law should encourage relation-specific investments in agreements by awarding the promisee his verifiable reliance if the promisor has strategically delayed investment. Professors Schwartz and Scott study a large sample of appellate cases showing that: (1) parties appear to make the agreements described in the model and breach for the reasons the model identifies, and (2) courts sometimes protect the promisee's reliance interest when they should, but the courts' imperfect understanding of the parties' behavior sometimes leads them to err. I. INTRODUCTION For at least fifty years, a particular pattern of commercial behavior has engendered considerable litigation and substantial scholarly commentary. Two commercial parties agree to attempt a transaction and agree also on the nature of their respective contributions, but neither the transaction nor what the parties are to do is precisely described, and neither may be written down. The parties do not agree and, indeed, may never have attempted to agree on important terms such as the price. After the parties agree upon what they can, and before uncertainty is resolved, one or both of them make a sunk-cost investment. (1) This pattern of commercial behavior suggests that the parties have made a preliminary agreement that will have one of two legally significant outcomes: If the transaction turns out to be profitable after uncertainty is resolved, the parties will make their more concrete and then conduct the transaction. But if the transaction turns out to be unprofitable, the parties will abandon the project. Disputes sometimes arise under these agreements after one or both of the parties have invested. One party may then abandon the project even though the other party protests the first party's exit. In particular, the disappointed party believes that he is entitled to compensation either for his expectation or for his investment cost while the other party believes that she is entitled to exit without liability. A court must then decide whether to protect the promisee's (2) expectation interest, or to protect his reliance interest by reimbursing his sunk cost, or to award him nothing. …

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Controlling Shareholders and Corporate Governance: Complicating the Comparative Taxonomy

Corporate governance scholarship has shifted focus in recent years from hostile takeovers, which occur primarily in the held systems of the United States and the United Kingdom, to the comparative merits of the shareholder systems that are the norm most everywhere else in the world. In this emerging debate, the simple dichotomy between controlling systems and held systems that has largely dominated the discourse is too coarse to allow a deeper understanding of the diversity of ownership structures in different national capital markets and their policy implications. In this Article, Professor Ronald Gilson seeks to complicate the prevailing analysis of controlling shareholders and corporate governance by developing a more nuanced taxonomy of controlling structures and examining the implications of this view on our understanding of held and controlling systems. Development of a new taxonomy begins with recognition of the controlling tradeoff: focused monitoring in return for some private benefits of control and at a cost in speed of adaptation. Building from this tradeoff, this Article looks closely at two central features of a more complex taxonomy: the concepts of controlling shareholders and of private benefits of control. In particular, the framework highlights the value of distinguishing between efficient and inefficient controlling systems, and between pecuniary and nonpecuniary private benefits of control. Together, the two distinctions reframe the taxonomy of distribution to distinguish between regimes that support companies with a diversity of distributions and regimes that support only companies with a controlling shareholder. This Article concludes by examining potential macroeconomic effects and policy implications and calling for research under this new framework to further the debate on controlling systems. I. INTRODUCTION The big issue in corporate governance scholarship is changing. Over the last fifteen years, the academic and policy debate has focused on hostile takeovers. The terms and tenor of the debate in the United States are by now numbingly familiar. The same pattern is now observable in Europe, (1) where the tone of the debate, if not necessarily its politics, seems to have moderated a great deal. (2) As the issues surrounding hostile takeovers have clarified, attention has begun to shift from debating a phenomenon--observed largely in the United States and the United Kingdom, because only in those two jurisdictions is control of most public companies in the public float--to understanding the kind of control structure that dominates public corporations everywhere other than the United States and the United Kingdom. Put simply, public companies in the rest of the world typically have a single or group of shareholders with effective voting control, often but not invariably without corresponding equity holdings. Debate is now turning to the merits of these shareholder systems, both on their own terms and in comparison to the widely held shareholder systems of the United States and the United Kingdom. In this Article, I venture some early thoughts concerning how this inquiry might usefully be framed. The simple dichotomy between controlling systems and held systems that has largely dominated academic debate thus far seems to me much too coarse to allow a deeper understanding of the diversity of ownership structures in different national capital markets and of the policy implications of those structures. My goal here is to complicate the prevailing analysis of controlling shareholders and corporate governance by developing a more nuanced taxonomy of controlling structures, and then by examining the implications of this view on our understanding of held and controlling systems. …

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