US Federal Law Research Articles

Animal research: a moral science

Historically, the scientific community—at least in the USA—did not perceive the use of animals in research as an ethical issue. Anyone who raised questions about the way animals were kept and treated during experiments ran the risk of being stigmatized as an anti‐vivisectionist; a misanthrope preferring animals to people; or an ingrate who did not value the contributions of biomedical science to human health and well‐being. I received a full barrage of such charges when I drafted and promoted what eventually became two US federal laws to protect laboratory animals: the 1985 Health Research Extension Act and an ‘Animal Welfare’ amendment to the 1985 Food Security Act. Indeed, a reviewer of my book Animal Rights and Human Morality (Rollin, 1981)—in which I argue for elevating the moral status of animals and codifying that status into law for laboratory animals—wrote that I “exonerate the Nazis” by comparing the killing of animals for science with the Holocaust, and that the book gives “a false cloak of morality” to attacks on research laboratories (Visscher, 1982). To be fair, anti‐vivisectionists were not much more sophisticated at the time—conceptually or morally. The day after I received the published review, abolitionists criticized the book, castigating me for accepting the reality of science, and scolding me for proposing regulations that would result in short‐term improvements for animals, thereby retarding the complete abolition of animal research. My own experience of being vilified as ‘anti‐science’ by the scientific community has been reflected in societal debates on animal research. Although abolitionists argue that using animals in biomedical research produces no benefits for humans, the scientific community has adopted an equally extreme position. The Foundation for Biomedical Research—a non‐profit organization in Washington, DC, USA—produced a film in 1984 entitled Will I Be All Right, Doctor? . The query in the …

Of Birds, Rats and Mice: the Protection of Laboratory Animals in US Federal Law

Deborah Paulus-Jagric, Reference Librarian at N.Y.U. Law School Library, uses a case study to illustrate the workings of the US administration and gives us an insight into how to conduct legislative history research in the US. The footnotes contain much extremely useful bibliographic information.

Riparian monitoring using 2-cm GSD aerial photography

Riparian monitoring is a key aspect of sustainable resource management and is mandated by US federal law for federal land management agencies. However, it is an endeavor hampered by rising manpower costs and time-consuming travel and methods. These limitations tend to reduce sampling intensity per reach of stream and limit monitoring to the larger waterways of management units—limitations that reduce the accuracy of inferences derived from resulting data with consequential reductions in the effectiveness of landscape-level resource management. We tested the utility of low-altitude, high-resolution, intermittent aerial digital imagery for relatively inexpensive, high-intensity sampling in a watershed inhabited by the Lahonton Cutthroat trout, a species listed as threatened under provisions of the US Endangered Species Act. Measurements gleaned from the aerial imagery included late-summer open water width, number and location of late-summer dry channels, widths of riparian areas and willow coverage. All measurements were georeferenced to allow spatial data display. Riparian proper functioning condition (PFC) was assessed from the imagery by a USDI, Bureau of Land Management team. These assessments were compared to similar on-the-ground assessments made during the preceding year. PFC assessments from aerial photography were made using an average 4 staff hours per stream compared to an estimated 36 staff hours per stream for ground PFC assessments. The two assessment methods yielded roughly comparable results. We conclude that riparian-condition assessments from 2-cm GSD digital aerial imagery allowed increased sample intensity (and thus increased inference accuracy) and that it did so in our study at a cost less than half that of conventional ground-based methods. We recommend the acquisition and analysis of 2-cm GSD digital aerial imagery be further trialed for its utility and cost efficiency in ecological monitoring of riparian systems.

Counterfeit Drugs and States’ Efforts to Combat the Problem

State boards of pharmacy strive to reshape state regulation of wholesale distributors to maintain the security and integrity of the US medication distribution system. Despite being faced with a complicated situation of illegal importation of drugs, erosion of state and national borders, and a complete disregard for US federal and state laws by entities engaged in the production and distribution of counterfeit drugs, the National Association of State Boards of Pharmacy (NABP) and state boards of pharmacy are working to develop and implement more stringent laws and regulations for the licensure and regulation of wholesale distributors. In citing incidences of counterfeit drugs from a global perspective and efforts that NABP has taken to implement the Prescription Drug Marketing Act of 1988, this discussion will highlight NABP’s recent efforts to monitor counterfeit and adulterated drugs entering the US drug distribution system, recommendations emanating from NABP’s Task Force on Counterfeit Drugs and Pedigree Requirements, and its Verified-Accredited Wholesale Distributors program.

Hedge fund marketing overview

PurposeTo provide a brief overview of US securities laws that apply to the marketing of hedge funds.Design/methodology/approachSummarizes US securities offering rules, including Regulation S and Regulation D at the federal level, state securities laws, antifraud standards, and broker‐dealer regulation.FindingsAll securities offered and sold in the USA must be registered with the SEC unless an exemption is available under the Securities Act. Offerings offshore under Regulation S and private placements in the USA under Regulation D offer two such exemptions. Most states have private placement exemptions similar to Regulation D. While certain state‐level regulation over the registration of securities has been preempted by federal law, a level of state regulation continues to exist. All US offers and sales of securities are subject to general antifraud standards under both US federal and state laws. Funds and their employees, investment managers and their employees, and any placement agents may not contact any US investor in the USA or any non‐US investor from the USA without registering as broker‐dealers.Originality/valueProvides a concise overview of laws and regulations that apply to the marketing of hedge funds.

The Efficacy of Choice Threats within School Accountability Systems: Results from Legislatively Induced Experiments

Targeted stigma and school voucher threats under a revised 2002 Florida accountability law have positive impacts on school performance as measured by the test score gains of their students. In contrast, stigma and public school choice threats under the US federal accountability law, No Child Left Behind, do not have similar effects in Florida. Estimation relies upon individual‐level data and is based upon regression analyses that exploit discontinuities within the accountability regimes. Choice threats embedded within accountability regimes can moderate educational inequalities by boosting achievement at the lowest‐performing schools, but policy design is crucial.

From the Fiduciary Theory to Information Abuse: The Changing Fabric of Insider Trading Law in the U.K., Australia and Singapore

The fiduciary theory animates to a considerable degree the US federal securities law against insider trading; in contrast, the theoretical basis of insider trading law in the United Kingdom, Australia and Singapore has historically been less clearly articulated. While the earlier legislative enactments against insider trading in these three jurisdictions reveal traces of the fiduciary theory, the law in these countries has been significantly refashioned. They have all quite clearly moved away from fiduciary notions. This article looks at how the contours of insider trading liability evolved in the U.K., Australia and Singapore and the ramifications of these changing contours for insiders, investors, market professionals and associated persons. The author argues that the contours of insider trading liability have come to be shaped by two opposing notions: the parity of information norm and the economic efficiency norm. In their sophistication, these insider trading regimes easily match the US federal securities law on insider trading; from a comparative perspective, therefore, they offer attractive alternatives to the US model. A broad proscription inspired by the parity of information norm augurs well for the small investor. Yet, the carve-outs found in these regimes also demonstrate the need to permit economically desirable activities—and importantly, to guard against the chilling effect on economic efficiency from an over-enthusiastic pursuit of the parity norm. The author analyses how these jurisdictions have attempted to resolve the resultant tension; this is instructive first, for the policy choices made and second, for the techniques by which the legal draftsmen gave effect to the policy choices. The information parity—economic efficiency tension also poses challenges for judicial interpretation. Insofar as there is legislative ambiguity regarding activities that are arguably desirable, the judiciary is potentially called upon to resolve this tension.

Financial viability of reforesting reclaimed surface mined lands, the burden of site conversion costs, and carbon payments as reforestation incentives

US Federal law mandates that mined land be returned by mine operators to a condition capable of supporting its pre-mining use or a higher use. Previously forested lands have commonly been reclaimed to hayland/pasture or wildlife habitat, and most of these lands have been abandoned from management and rendered non-productive. This situation has left landowners in the position of converting these reclaimed mined lands to forests at a later date, if they choose to make them economically productive. Such land-use conversion, however, comes with a substantial up-front cost to the landowner, which makes the financial viability of such a conversion questionable. We examine the financial viability of reforestation of these previously reclaimed mine lands by calculating land expectation value (LEV) under a range of conditions that include forest type, site quality, and reforestation intensity. We find that conversion to white pine is viable on higher quality sites under low to moderate interest rates with low or high timber prices, but conversion to mixed hardwoods is only profitable under the high price scenario with low interest rates, and only on higher quality sites. We also consider the implications of a shift in reforestation burden from the landowner to the mine operator, and results suggest that including costs of reforestation as part of the mining operation creates a financially viable forest enterprise for landowners under all scenarios for both white pine and mixed hardwoods. Two forms of carbon payments that could encourage reforestation of previously reclaimed mined lands also are examined: an annual payment based upon the total accumulated carbon found on-site in a given year, and an annual payment based on only the increment of carbon storage each year. Our carbon payment results indicate that annual values of up to $5.17 per ton of carbon stored in hardwoods and $9.39 per ton of carbon stored in pines would be required to make reforestation profitable under the poorest conditions (high interest rates, low prices, and poor quality site) when the payment is based on accumulated on-site carbon, although lower values are required under more favorable scenarios. Payments that are based upon the annual increment of carbon must fall in the range of $8.66–$71.88 per ton of carbon stored in hardwoods and $0–$83.29 per ton of carbon stored in pines to make reforestation financially viable.

How the capital market laws affect the development of venture capital industry

Given that the stock market is essential for the venture capitalists to exit through an initial public offering (IPO), this study explores how the laws and regulations governing the capital markets affect the venture capital industry. The paper discusses the impact of US federal state laws and Securities and Exchange Commission (SEC) regulations to the venture capital markets, arguing if the rules and regulatories are burdensome to entrepreneurs and new‐growth businesses. The impact of Sarbanes‐Oxley Act and the future Investment Act on venture capital funds and entrepreneurial companies going public are also discussed. The paper proposes the model of venture capital financing describing the process from fund raising to investment exits, the linkages of the venture capital market to the financial/capital markets and the related capital market laws. The policy implications on SEC regulations essential to the development of venture capital industry are suggested.

Composition of the audit committee: Ensuring members meet the new independence and financial literacy rules

Responding to the corporate scandals that have recently dominated the front pages of US newspapers, the Sarbanes–Oxley Act, the Securities and Exchange Commission (SEC) and the major US securities markets have imposed a number of sweeping corporate governance changes on public companies (including non-US public companies — so-called ‘foreign private issuers’) traded in the USA. Of special significance, the US federal securities laws and the major national securities markets now mandate that public companies possess audit committees composed of ‘independent’ members who meet exacting and specific criteria. Unfortunately, unlayering the various new and different corporate governance rules can be a complex and daunting task. In an effort to assist companies, including foreign private issuers, to understand and comply with these new rules — which are currently in effect for US companies and which will take effect no later than 31st July, 2005 for foreign private issuers — this paper provides a brief overview of key new requirements imposed by the Sarbanes–Oxley Act, and the SEC regulations promulgated thereunder, by the New York Stock Exchange (NYSE), and by the NASDAQ, including certain exceptions for foreign private issuers.

The rise and fall of Heilig–Meyers

This two-part instructional case examines an auditor’s reporting decision in a complex, actual situation and the auditor’s liability to shareholders under US federal securities laws. Part One of the case describes the history and operations of furniture retailer Heilig–Meyers. Students use information from Heilig–Meyers’ fiscal 2000 annual report to decide whether the auditors should have expressed substantial doubt about the company’s ability to continue as a going concern. Part Two describes a shareholder lawsuit accusing Heilig–Meyers’ auditors of violating Rule 10(b)(5) of the Securities Exchange Act of 1934. Students evaluate the plaintiffs’ charges and the defenses the auditors used to have most of the complaint dismissed.

Reform in a Cold Climate: Change in US Campaign Finance Law

AbstractThe Bipartisan Campaign Reform Act (BCRA) of 2002 was the first major change in US federal campaign finance law in a quarter of a century. Many attempts at reform had failed in that period. Few members of Congress were enthusiasts for reform, the two parties and two chambers had conflicting interests to protect, successive presidents did not promote the issue and public pressure for reform was weak. When reform was achieved in 2002, many of these formidable obstacles remained in place. This paper draws on the literature of public interest reform and policy innovation to attribute the change to a policy entrepreneur whose resources had undergone a sharp increase, the neutralization of opposition, the impact of an event (the bankruptcy of the Enron Corporation) and membership turnover in Congress. The substantial support for the bill in Congress from Democrats, the party with most to lose from reform, is attributed to the inescapability of past commitments.

Best interests of students left behind?

Analyzes the impact of recent policy developments in the USA associated with school accountability according to the best interests of the student. With the mandated implementation of the US federal law entitled the No Child Left Behind Act approaching, minimal attention has been afforded to the complex ethical dimensions associated with policies intended to improve the quality of education on a broad scale. When the meaning of “fairness” and “equity” are not negotiated in advance by groups either supporting or rejecting the need for federal intervention, doubts are raised about the fundamental purpose of the initiative. Argues that social conflict arises when the ideological framing of the purposes of the No Child Left Behind Act fails to incorporate the moral responsibility of policymaking and professional practice and attribute the purpose of reform as ensuring students’ best interests. Argues for a greater awareness of the tacit ethical assumptions politicians and policymakers embrace as policy is developed and implemented, and suggests strategies for identifying an ideological common ground.

Annoying, intrusive, … and constitutional: telemarketing and the national Do‐Not‐Call Registry

The recent adoption by the US Federal Trade Commission of the national Do‐Not‐Call Registry prohibiting most telemarketers from contacting individuals once their number is added to the listing is a threat to the US domestic telemarketing industry. Analysis of US federal law suggests that the national registry is likely an unconstitutional exercise of administrative power. To be legal, governmental prior restraints on commercial speech must pass the four‐part Central Hudson test adopted by the US Supreme Court. The Do‐Not‐Call Registry fails parts three and four of the test and probably part two as well. There is an insufficient fit between the stated governmental purpose of the regulation and its operation. Moreover, balancing the benefits from the registry against the harm it inflicts further militates against its constitutionality. International and public relations implications are explored and discussed.

The crash in competitive telephony

In the latter half of the past decade, the electronics business became a part of the telephone business. Quite unexpectedly, many parts of the electronics industry - particularly data switch makers - found their economic welfare tied to four decades of regulatory experimentation. In this experimentation, regulators wanted to develop competitors in various parts of the telephony industry. One catalyst for the change was the US Telecommunications Act of 1996 - the first major alteration to US federal communications law in more than 60 years. At the same time, the Internet exploded into commercial use, fueling the demand for bandwidth affiliated with data transmission. The general public does not widely understand these changes. This is understandable, because the events themselves were genuinely complicated. Nonetheless, if you have an eerie sense that these changes did not go well, you are right. Many of these new competitors have gone bankrupt. Some analysts now view US transmission capacity as needlessly overbuilt. Others view this crash as marking the beginning of the end to deregulation for local telephony. This situation will take some explaining.

The Sarbanes‐Oxley Act of 2002 effects sweeping changes to the US federal securities laws

Signed into law by President Bush on July 30, 2002, the Sarbanes‐Oxley Act of 2002 (the Act) presents what may be among the most sweeping set of changes to U.S. federal securities laws since the New Deal. Designed to address widespread outrage and waning investor confidence resulting from a series of financial meltdowns, earnings restatements, and other corporate and accounting abuses, the Act is in many ways unprecedented. For example, in addition to regulating disclosure and securities trading, the traditional jurisdiction of U.S. federal securities laws, the Act also addresses matters of substantive corporate governance and executive fiduciary responsibility, such as loans to officers and directors, management oversight, director due diligence, and executive compensation, as well as professional responsibilities of external auditors and attorneys, areas traditionally left to the states and self regulatory organizations (SROs) such as the NYSE, AMEX, and NASDAQ. The Act is complex, with over 70 sections, and will present numerous challenges to corporate executives, financial officers, and professional service providers. What’s more, given the pace with which the Act was pushed through the conference committee process and adopted by Congress, various inconsistencies and ambiguities already have emerged and will continue to do so. The Act certainly will receive the prompt attention of the Securities and Exchange Commission (SEC) as it promulgates the many regulations required to implement the Act’s broad‐based mandate. This article presents a number of key aspects of the Act that we believe are of most immediate concern to corporate executives and directors of corporations and financial institutions.

The Sarbanes-Oxley Act of 2002 effects sweeping changes to the US federal securities laws

The Sarbanes-Oxley Act of 2002 effects sweeping changes to the US federal securities laws

Application of the precautionary approach in the national standard guidelines for conservation and management of fisheries in the United States

The passage of the Sustainable Fisheries Act (SFA) by the US Congress in 1996 fundamentally changed the approach to fisheries management in the United States. While an objective of the Magnuson–Stevens Fishery Conservation and Management Act (Magnuson–Stevens Act), the US Federal law controlling fisheries management in the Exclusive Economic Zone (EEZ), had always been to prevent overfishing, the attendant mechanisms for accomplishing the objective were not included in law. Some of the most significant amendments of the SFA were the addition of three new national standards, against which all proposed fishery conservation and management measures are measured, and the amendment of several other existing standards. Among the most important changes from the standpoint of conservation were changes that relate to national standard 1, regarding the prevention of overfishing and the rebuilding of overfished resources. Although the SFA did not use the term ‘‘precautionary approach’’ explicitly, the concept is implicitly expressed in several provisions of that Act. In developing the guidelines for implementation of the national standards, the National Marine Fisheries Service (NMFS) incorporated precautionary concepts to ensure that compliance with the SFA’s measures to prevent and end overfishing are satisfied. In addition, the NMFS developed further technical guidance to assist fishery scientists and managers in providing advice that appropriately considers risk, relative to the scientific information available, such that meaningful protection is afforded marine stocks and stock complexes. Such protection extends not only to consideration of stock recruitment, but also to maintenance of sustainable levels of stock biomass and biodiversity. 1999 International Council for the Exploration of the Sea

US CFTC ISSUES ADVISORY APPLICABLE TO CPOS OF OFFSHORE COMMODITY POOLS

This paper first generally describes the requirements under US federal law to register as a commodity pool operator (CPO), and the disclosure, reporting and record keeping obligations which normally apply to registered CPOs. It then discusses in detail two particular sources of relief from certain of these disclosure, reporting and record keeping obligations — an Advisory issued by the US Commodity Futures Trading Commission (CFTC) on 11th April, 1996, and CFTC Rule 4.7 — and compares the requirements to qualify for, and relief available under, the Advisory and CFTC Rule 4.7.

Telephone—cable cross-ownership: A study in policy alternatives

US federal law bans telephone/cable TV cross-ownership, but policy makers are not united as to the future of this law. One of the important technical trends which is prompting this reassessment is the advent of fibre-optic technology. The question now facing the telecommunications industry, regulators and consumers alike is whether the public interest is better served by allowing US telephone companies to enter video distribution through fibre-optic lines to the home. This article advances a set of recommendations intended to balance public interest objectives with the need to reconcile competitive requirements among the existing telephone, cable and broadcast communication players.