Author: Dave Hoffman

10

Trump’s Net Worth

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This article press release details Donald Trump’s new defamation suit against New York Times reporter Timothy L. O’Brien and Warner Books, Inc., for, saying that Trump was not a billionaire in the book The Art of Being the Donald:

The lawsuit alleges that in publishing these false statements, O’Brien and Warner deliberately chose to ignore, among other things, voluminous and comprehensive financial information that Trump made available to them prior to the publication of the book, which confirmed conclusively that Trump’s net worth is in the billions of dollars. Indeed, Forbes Magazine rigorously analyzed the very same books and records and other financial data that O’Brien and Warner chose to ignore, and concluded that Trump’s net worth conservatively is at least $2.7 billion.

What I know about the topic of Trump’s net worth comes largely from O’Brien’s NYT articles on the topic, which (not incidentally) were quite skeptical of Forbes’ approach to valuation. I also am surprised that Trump would be interested in exposing his books to public scrunity, which (presumably) O’Brien and Warner could insist on as a part of their defense. Shucks, as a plaintiff, Trump might not even be able to obtain a protective order in N.J. State Court. [Being unfamiliar with local practice, this is just a guess, but Trump’s privacy claim is weaker than it would be if he had been forced to court as a defendant.]

Nevertheless, you’ve got to give Trump style points for being willing to double-down his bets:

The lawsuit, which was filed in state court in Camden, New Jersey, seeks $2.5 billion in compensatory damages and $2.5 billion in punitive damages….

4

Criminal Prosecution for Scientific Fraud

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I spoke to a reporter at the end of last week about the criminal prosecution of scientific fraud. I’m not sure how coherent my end of the conversation was at the time, but I thought the topic was interesting enough to return to it briefly here.

Let’s put aside potential investigations and prosecutions by the federal Office of Research Integrity (part of DHHS). Granted, the ORI has claimed an extraordinarily broad mandate (funded and unfunded applications!), which might be worth returning to one day. But on the whole, such cases seem to me to be a fairly mundane application of the general contract fraud principles.

Instead, I’ll concentrate on a free-floating action in fraud against a scientific investigator for having misled potential patients. Thus, consider the scenario of a doctor faking an experiment to show that Drug X prevents heart attacks and has no side effects, when, in fact, it has no preventative powers, and it causes immediate hair loss. Is that doctor criminally liable? Civilly?

I’d guess that to the extent that general fraud often requires an intent-to-induce element, most scientists would be able to successfully assert that they did not intend for patients to rely on their work. In the civil context, I also assume that a consumer’s action would fail on the “justifiable reliance” end. If this weren’t true, I imagine that most scientific papers would end with a disclaimer that they are not intended to be relied upon, and that patients ought to consult their physicians (etc.)

But let’s put aside the doctrine for a moment and consider the policy arguments for attacking scientific fraud with prosecution. There are at least two reasons to think this is a bad idea (again, apart from the government-contract fraud case).

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1

Drug Package Insert Regulations

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The Times this morning offers this revealing story about the FDA’s new drug package insert regulations.

There is lots here for the legal blawgosphere to chew on. Administrative law profs will be interested in claims about the pre-emptive effect of the regulation’s preamble. Behavioral researchers will like the discussion of information overload. And, needless to say, food law folks will wonder if they are next.

But I’m interested in a detour around halfway through the story, where the author notes (and I’m going to take his word for it) that:

But the rule does not address the information sheets routinely provided to patients by pharmacists. These sheets are lightly regulated and often fail to include important drug warnings.

Here’s my (perhaps silly) question. What economic explanation is there for the “fail[ure] to include important drug warnings”? Even if consumers don’t want this information,* why don’t drug companies want to marginally reduce their liability costs? Perhaps they are more interested in making “extra” profits on off-label use (which could be deterred by pharmacy information sheets) than they are concerned about reducing accident costs (which might be relatively fixed). But perhaps I haven’t thought about this hard enough. Does anyone else have an idea?

* I’m skeptical, that that is a topic for another post.

1

Truth on the Market: Why Build When You Can Buy?

As Dan noted, today a new blog, Truth on the Market, went online. As I expected when I first welcomed this possible development, it seems likely that TOTM will be a regular stop in my daily internet rounds.

Keith Sharfman’s new post is worth further comment:

A blog’s market share is largely search-driven rather than reputation-based. And for search-generated hits, blog entries compete with each other on a level playing field. A blogger’s reputation cannot in itself trigger search hits in the absence of search-relevant content. This makes me confident that there’s still plenty of room for Truth on the Market in business law blogging, notwithstanding the large number of high quality business law blogs that already exist.

This is interesting. I think Keith is saying that off-line reputation doesn’t transfer easily to online blogs, and, therefore the barriers to entry for a new blog’s success are quite low. I agree (look at this blog’s success over the last three months). But I do think that it is easy to overstate this point, because to some degree search traffic is “distorted” by prior reputation through google pagerank. Around 20% of our daily traffic currently is driven here by google (and other search engines). I suspect we’d get significantly more hits if our page rank value (currently 3) were higher; we expect that if we continue to do a good job over time, we’ll build a virtuous cycle with google and obtain some type of early mover advantage with traffic. But still, as Randy Barnett said at the AALS blogging session, it is far from too late to start a new blog.

Incidentally, I wonder what explanation we could come up with for the TOTM folks’ unwillingness to simply buy an existing blog? (Like the market for virtual swordmasters, but more professionally useful!) Starting a blog takes time, and an existing blog’s traffic, google score, blogrolls, etc., surely have some value. If folks are looking for a platform, why build your own? A related question: why have so few bloggers followed in the Conglomerate’s footsteps and merged with another blog to grow an audience? (Maybe Ribstein’s HSR concerns chilled activity?) Such mergers would seem to be a dominant solution to some of the time and traffic worries that plague most bloggers. Group blogging also may help to ameliorate the political concerns with blogging recently in the news. (Note: if this blog is too [_____], blame Solove! I’m kidding. Blame Wenger.)

5

The Future of Law Libraries

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Via Brian Leiter, I read this post on a controversy at Tulane’s Law Library. The Law Librarian Blog, after detailing recent staff and policy shifts, wonders whether the University administration is using Katrina as an excuse to do away with an independent academic law library:

So my question is do the actions at Tulane reasonably represent a sub rasa determination by relevant powers to subsume the law library into the operations of the University library, demoting it from an independent entity and transforming it into a subordinated department? The recent spate of firings looks to be designed to preshape the structure of the law library for insertion into the main library’s organization.

If this is true, I wonder whether Tulane would defend itself by arguing that in light of recent developments, there is less of a need for an independent law library than there used to be. Or, more provocatively, “Law Libraries. Huh. What are they good for?”

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2

The Market Tells Us What To Think About Alito’s Hearings

Reading conflicting accounts of the Senate’s hearings on Judge Alito, I thought it might make sense to turn to the InTrade electronic futures market. This graph of the predicted likelihood of Alito’s confirmation is somewhat illuminating:

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The trading history indicates a small run before the hearings began, but once the questioning started, Alito made a dramatic comeback. The last price I saw quoted was 97 (i.e., the traders think he has a 97% likelihood to be confirmed).

But that isn’t particularly surprising. I data mined dug a bit deeper and found two other interesting results.

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1

A “Stealth Rottweiler”

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Following up on a story the blawgosphere chewed on a few weeks back, Peter Lattman of the WSJ blog posts on the latest Martin Singer cease-and-desist letter controversy.

Singer’s letters usually claim that they are copyrighted and may not be published further. (The particular letter on Lattman’s radar has an interesting commentary on its recepient’s likely response. But you are going to have to go through the WSJ’s blog to find it.)

As I know almost nothing about copyright law and libel, I can’t comment on the merits of the dispute. However, I can say that Lattman has unearthed a great quote from Singer client Priscilla Presley, who apparently once said “Marty Singer is a very nice man who loves his family. But if he thinks someone has done me harm, he is a stealth rottweiler.”

A stealth rottweiler? Isn’t the whole point of rottweilers that you know they are coming?

2

Zywicki Compares Kennedy to McCarthy?

I may be misreading this post, but I think that Todd Zywicki is saying that Senator Kennedy is playing Eugene Joe McCarthy to Judge Alito’s Joseph Welch Fred Fisher when discussing the CAP issue. This seems to me a strained analogy, as the commentators to Zywicki’s post are currently thrashing out.

[UPDATE: Two really silly errors in the above post, noted by our commentators, have been corrected.]

7

Judge Alito and the Rule of Law

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I was wrong.

In this post, I predicted that because of a footnote in a 1985 strategy memo, Judge Alito would be unlikely to find much rhetorical purchase by making “paeans to the rule of law” in his confirmation hearing. Indeed, given the Judge’s evident disdain for rule of law and precedent-based defenses of Roe, I thought that the footnote might force Judge Alito to “actually say that he believes Roe should be reversed.”

Today’s headline from the Times:

“Alito Tells Senators That ‘Rule of Law’ Is Paramount”.

That will teach me to try to read tea leaves. It also suggests the tremendous rhetorical flexibility of the concept of the “rule of law.” Now, Nate has already once taken Kaimi and I to task for our co-authored paper that had suggested the “rule of law” is almost entirely a contentless political slogan. Nevertheless, it it still evident to me that appeals to the “rule of law” in the context of public debate are almost always a form of constitutional puffery. Which probably helps to explain why Judge Alito’s “Footnote 10” problem isn’t much of one after all.

0

AALS Contracts Session

As ContractsProf Blog spotlighted here, today was the Contracts Section meeting at the AALS Conference. The theme was empirical studies in contract law. Section Chair David Snyder moderated a discussion of papers by: Mitu Gulati (presenting on disclosure and sovereign debt contracts); George Geis (presenting on the optimal specificity of default rules); Debora Threedy (presenting on “legal archaeology”, i.e., qualitative research on leading cases); and Stewart Macaulay.

Macaulay in particular provided a good perspective on the field, based on his long experience as one of the founders of the law and society movement. He noted the increasing prevalence of private dispute resolution for contractual disputes, and evidence (some presented today) of contracts’ lawyers lack of interest in the existence of, or changes in, governing default rules. The message of his talk – somewhat implicit – was that there would be surprisingly few economic consequences were contract law to pick itself up and disappear off of the face of the earth. That is, the hierarchical model of American legal education, which posits that judges (and professors?) generate law, lawyers interpret it, and clients follow it, bears little to no relationship to observed experience. Obviously, Macaulay said it better than I could, and certainly this isn’t a novel idea (he’s said it before, in many places and in many forms) but it was a good thing to be reminded of as I begin to get ready to teach the second semester of my contracts course.