The Faculty Lounge

Raped (7500 times)

In March, outreach workers in Port au Prince documented 230 incidents of rape in 15 displacement camps.   There are more than 500 camps in and around PAP.  That's over 7500 rapes. 

And it's a month later. 

A spike in sexual violence always follows a natural disaster: New Orleans.  Sri Lanka.  Port au Prince.   Always.  And yet, time and again, reconstruction officials wantonly overlook ways to guard against it.  Take the layout of settlement camps, for example.  In PAP they're densely packed, and so dark at night you can hardly see your hand in front of you.  The women we talked to said they wanted flashlights and lanterns to carry to the toilet at night, but they weren't being distributed with their weekly rations of cooking oil and beans.  They had nowhere to get them on their own, and even if they did, there's no money.

There's more space outside of PAP, in places like Pettionville, and a bit more room to breathe in the camps.  But the toilets and medical tents (which, btw, we didn't see in any of the PAP camps we visited) are a ways up hill and some distance from the tarps where people sleep at night.  In refugee camps in Sudan and the Congo, camp organizers dramatically reduced incidents of sexual assault when they moved the water source and latrines to the center of the settlement so that women didn't have to walk long distances at night to access the facilities.  

It's not rocket science, and in the short term, plans to lay new settlements in anticipation of Haiti's rainy season should take these considerations into account.  For the long run, though, women must be empowered to stand on their own (think literacy, job training, and econommic opportunities specifically targeted towards women) since social and economic independence, to some degree at least, reduces the risk of sexual assault and exploitation.

For more check out the video below, and add your name to those demanding that international authorities follow through with promises to make the settlements safe for women.  
 

Haitian Women Testify from Adam Stofsky on Vimeo.

-Kathleen Bergin

SEC v. GS: Fraud? Maybe, But What’s The Point?

 Well, risky as it is to attempt to wrap up an assessment of the Goldman case while news is constantly streaming in, I’m going to give it a shot, if only because I said I would.  Of course, we may learn yet more information this week during the upcoming Senate subcommittee hearings.

When the SEC first filed, my initial reaction upon reading the complaint, and before Goldman had come out with fists swinging, was that it was a hard case – neither the SEC’s case nor Goldman’s defense of it were slam dunks.  Although I still largely believe that to be the case, at least some of the news that has come out in the intervening week hurts the SEC. 

For example, Goldman’s contention that ACA was actually aware of Paulson’s short interest from the beginning, if true, to my mind is highly damaging, and I’ve been puzzled by some of the commentary that seems to consider this information relevant only to the question of fraud vis-à-vis ACA.  If ACA was aware of Paulson’s adverse position all along, then the contention that Paulson exercised any meaningful influence over portfolio selection, and thus performance, is substantially diminished.  This should affect the materiality inquiry for the entire case and I, suspect, the causation inquiry as well.

But leaving legal technicalities aside for a moment, the broader question arises of what purpose this case serves.  The SEC, as we’re constantly reminded when criticisms of their various failures emerge, has limited time, resources, and personnel.  Unquestionably, this is the type of case, and the type of defendant, that will consume resources.  And it increasingly seems to me that those resources would have been better spent elsewhere.

Of course, the SEC shouldn’t shy away from a case simply because it’s difficult, and there may be times when regulators feel they have to push the contours of existing law in the name of meaningful investor protection.  But I’m becoming progressively less convinced that this case has meaningful implications for investor protection.

 And in the end, I’m left wondering: is this the best the SEC could get out of the crisis? Presumably, the SEC, which as I understand it, combed through hundreds, if not thousands of deals, picked this case on purpose. And this is the best they could do?  

I’m somewhat reminded of the Martha Stewart insider trading case, in which large resources were consumed to go after a big fish in a case that would otherwise be small fry, were the defendant not widely disliked.  Moreover, the condemned conduct in both cases is assumed to be widespread.  Thus, the government’s action is defended against critics as a means to prove a point.  The problem, though, is that it’s often unclear what that point really is, beyond sticking it to an unpopular defendant and the opportunity for high-profile agency action.

If that’s the case, then what explains the market’s sustained negative reaction to news of the suit?  It’s certainly not the likely damages and penalties associated with the case itself.  It could be that GS is suffering a reputational cost because clients will no longer trust them; though, based on the facts as alleged so far, I have my doubts about that.   It could also be the case that the market fears this is the tip of the iceberg – as the SEC and Congress start digging, they’ll find more damning facts.  This seems more likely.  But, perhaps the best explanation is that the SEC’s suit, and the way in which it was brought (with no or minimal attempt at advance settlement), signals a sea change in government attitudes toward perceived Wall Street excess, currently exemplified by Goldman Sachs. And that could be very bad for business.

Related Posts:


The Abacus Offering Circular
The Goldman Earnings Call, Part 2 (It’s Not Our Fault Other People Are Stupid, And By The Way, We Lost A Bunch of Money Too)

The Goldman Earnings Call, Part 1: ACA Chose and It Doesn’t Matter Anyway


The Goldman Complaint

 

Hubble Telescope - 20th Anniversary

Today is the 20th anniversary of the launch of the Hubble telescope and the telescope's latest image has just been released:

For an archive of images and full story, see here.

Baseball Trivia

On this date (and for the first time) in baseball history, a batter hit a home run off of a pitcher who had already won over three hundred games and repeated the feat the very next inning off of a different pitcher who also had already won over three hundred games. 

Name the three players involved, all living Hall of Famers.

For Your Amusement and Entertainment

Baseball fans who enjoy working crossword puzzles may enjoy the challenge found here.

The Abacus Offering Circular

 . . . all 196 pages of it, is here, via Felix Salmon.

Yes, I know, I know that I promised a wrap-up post, but real life intervened – the volcano flight ban lifted, the significant other finally made it home, and (remarkably) didn’t consider watching me blog about GS to be a nice welcome home.  

But I shall return, with a wrap-up.  Really.  Now back to writing my final exam.

Related Posts:

The Goldman Earnings Call, Part 2 (It’s Not Our Fault Other People Are Stupid, And By The Way, We Lost A Bunch of Money Too)
The Goldman Earnings Call, Part 1: ACA Chose and It Doesn’t Matter Anyway

The Goldman Complaint

A Reading Suggestion For New Law Profs

This week I read Strategies and Techniques of Law School Teaching:  A Primer for New (and Not So New) Professors, co-authored by Howard Katz and Kevin O'Neill and published by Aspen Publishers in 2009.  Here's a description from the publisher's website:

Strategies and Techniques of Law School Teaching is intended to help you, as a new law teacher, prepare for your first semesters in the classroom.  It begins at the preliminary stages of planning a new course and takes you all the way to writing and grading your final exam.  Authors Katz and O'Neill offer experience and insight to the tasks of coming up with teaching objectives, choosing your book, crafting your syllabus, and creating a classroom atmosphere that is conducive to learning.  The day-to-day teaching techniques in this primer for new (and not so new) professors will prepare you to successfully field students' questions, teach legal analysis to first-year students, and make the most of today's pedagogy and technology to support your teaching.

There's something in this book for everyone, regardless of experience.  But I highly recommend it to anyone who will soon be starting (or just started) a law school teaching career.  Contact the publisher, or ask your academic dean to send you a copy.  I'm glad I read the book.  You'll enjoy it, too!

Maybe Law Schools Should Hold A Draft

The NFL draft began last night, and continues through today and tomorrow.  The draft is designed to create as much balance in the league as possible. Accordingly, the team with the worst record from the previous season has the opportunity to pick the best player available in the draft.

Maybe law school rankings, which are otherwise generally worthless, should be used to establish a system of faculty hiring.  The school ranked lowest by US News would be entitled to draft the best prospect from the AALS Faculty Recruitment Conference.  Top rated schools would have to wait until the end to make their choices.  Of course, it would never work because some schools would cheat on their numbers to achieve a lower ranking.

This is a Rather Pedestrian Post

From Philadelphia comes news of a new literary magazine that's about to launch, called ... The Pedestrian.  I love their logo -- reminds me of Emerson's eyeball ... except this time, the disembodied body part is the leg.  (Or more properly the legs.)

The Pedestrian's website explains that it "seeks to explore the ordinary."  They continue:

It is easy to find coverage of big events, big ideas and bigger-than-life people. But as for life’s unassuming features, as for our less theoretical, more practical thoughts, and as for the people we daily interact with, they fail to inspire a comparable degree of sustained reflection. For this reason The Pedestrian was founded, so that the people and things that are familiar – or have become too familiar – might be allowed to enchant.

The issues are centered around themes.  The first one is empathy -- such a wonderful nineteenth century topic.  I'll looking forward to the first issue.  The next issues are tools, play, and quiet.  

YouTube Pulls Hitler Parodies, Sort Of

In 2004, a film named Downfall was released.  I don't know what was in the whole movie, but it featured a scene designed to be a realistic account of Hitler confronting his likely fall.  He sat in his office, faced his underlings, and screamed at them.  But about a year ago, something odd happened to this scene: it was captured on a YouTube clip and parodied with subtitles on utterly unrelated topics.  Parodies surfaced on a number of topics, including - most saliently to law school associate deans - a depiction of Hitler as a law school prof demanding to teach after only after 11 and never on Fridays.

Critics of the film argued that it over-humanized Hitler; the parodies seemed to undermine that effort.  On the other hand, some folks felt that the whole project trivialized Hiter.  A pretty nice account of the social phenomenon is here.

Now, however, YouTube - a division of Google Inc - has begun to pull the parody clips.  The owner of the film's copyright is sick and tired of having its IP hijacked.  (Query whether the clips are fair use...)  And, naturally, parodies of that very act of removal have now surfaced on YouTube here. 

Welcome to the Blogosphere, The Literary Table

I've just learned that one Warren Emerson (a pseudonym, I'm led to believe) has begun blogging at theliterarytable.com.  One of the things I'm going to do is to try to figure out Mr. Emerson's identity.  I've got a few guesses already; we'll see just how far off base I am.  Given that I had no idea that Jonathan Adler was Juan Non-Volokh, my track record isn't good for these sorts of things....

But the idea behind theliterarytable.com is an intriguing one: selections of poetry and prose from important literary figures, as well as commentary on their writings and on the writings of leading academics.  The first post lists a few people in particular: "Robert Penn Warren, Herman Melville, Fydor Doystoyvesky, Edgar Allen Poe, Ralph Waldo Emerson, F. Scott Fitzgerald."  Pretty interesting list -- no Dickinson, Stowe, or Thoreau.  But perhaps this'll be like the faculty lounge and people will come and go.  Here's one conversation I'd love to hear: Melville commenting on the similarity between Billy Budd and Stowe's Dred: A Tale of the Great Dismal Swamp.

The image is Osias  Beert the Elder's Dishes with Oysters, Fruit, and Wine in the collection of the National Gallery of Art.

Want Less Police Violence? Hire Better Educated Cops.

Here's an abstract from a new study by Jason Rydberg and William Terrill in the Police Quarterly:

In the past, police scholars have examined the impact of higher education on different measures of officer behavior, most notably arrest and the use of force. Much of this prior work has suffered from poor methodologies, such as inadequate samples and the inability to control for theoretically relevant variables. In addition, previous inquires have focused on but one single behavior per study. In an attempt to overcome some of these limitations, we examine the effect of officer education on three key decisionmaking points (i.e., arrest, search, and use of force) by relying on observational data from two medium-sized cities.The results of the analysis indicate that higher education carries no influence over the probability of an arrest or search occurring in a police— suspect encounter. College education does, however, significantly reduce the likelihood of force occurring. Results may be due to the amount of discretion officer’s exercise in pursuing these behaviors. Recommendations for future inquiries revolving around theory development and the incorporation of research from the field of education are presented, as well as varying policy implications.

Christopher Uggen plots the results and offers his own commentary here.

Dust Up Over Externship Credit Expansion At Georgetown

Georgetown University law students and faculty are discussing whether to expand the credit value of the school's externship program.  Georgetown offers a maximum of 2 credits for externships and students are pushing for a 50% increase.  The student proposal is here.  According to the Georgetown SBA, Stanford allows 12 credits, Berkeley 10, and GW 8.  There seems to be some trepidation among Georgetown faculty, at least according to this report.

Since start-up, I've watched the development of our Co-op program - a super-intensive externship.  My conclusion thus far is that externships can deliver a great experience...but they require schools to invest a fair amount of money, planning, and human resources. It's not enough, for example, to design an excellent classroom component.  You also must build and maintain close relationships with the sponsoring organizations and their staff.  Externships don't work unless supervisors actively engage in one-on-one teaching - which often turns out to be a bigger hassle for these employees than having no extern at all. For that reason, a law school needs identify, train, and engage the people who will have day-to-day student contact.  If you've got 60 students placed at 60 different sites each term, and an array of 150 externship sites rotating in and out of service, that's a ton of labor.

The growth of externships is good news.  The challenge for a school which markets itself as having top-flight experiential education (like Georgetown) is to insure that the externships are as good as the in-house clinics.  They're easy to do cheaply; they're difficult to do well.  And of course, they have to be crafted to conform with Department of Labor regulations!

(Cross-posted atLeiter Law School Reports)

Duke’s Schroeder confirmed as head of Office of Legal Policy

 Christopher Schroeder, Charles S. Murphy Professor of Law and Professor of Public Policy at Duke, has been confirmed by the United States Senate to the post of assistant attorney general for the Office of Legal Policy in the Department of Justice. The President nominated Schroeder on June 4, 2009.

Schroeder’s new duties will include assisting the president and attorney general in the selection and confirmation of federal judges.

Duke press release here.

BLT story here.

Pedigree Diversity On The Supreme Court

University of Texas law prof Daniel Rodriguez shares his thoughts on the topic in this editorial.

Richard Graving: 1929-2010

Richard Graving, my friend and colleague, died earlier this week at the age of 81.  Dick, who joined the South Texas faculty in 1983, taught conflicts, international human rights, international civil litigation, and other courses in which he could use his talents as an attorney who had practiced law on four continents.  He and I also shared a common interest in "old movies," often stopping each other in the hall and commenting on a film that we had recently viewed and asking questions about an actor or actress that would send us to imdb.com for a definitive resolution.

Houston Chronicle columnist Mary Flood has a nice article on the life of my friend and colleague here.

The Goldman Earnings Call, Part 2 (It’s Not Our Fault Other People Are Stupid, And By The Way, We Lost A Bunch of Money Too)

 In my last two posts, I went through the SEC’s complaint against Goldman Sachs and assessed the strength of the allegations, and began an analysis of the information shared by Goldman Sachs yesterday in its first quarter 2010 earnings call.  (Reminder: you can access the full transcript here).

I believe that four major points emerge from that call.  I discussed the first two in my post earlier this morning: (1) ACA Chose and Had Every Reason To Choose Well and (2) Who Chose – And Even The Contents – Are Not Material.  In this post, I’ll discuss the second two points.

1.       3.  We Did Not Mislead ACA

The SEC complaint alleges that Goldman led ACA to believe that Paulson would be buying an equity position, as opposed to taking a short position.  According to the SEC, if ACA had been aware of Paulson’s true position, it would not have allowed him to take such an active role in selecting the reference portfolio.  In his prepared statement, however, Palm insists that the evidence cited by the SEC does not establish that “ACA was misled into believing Paulson was going to be buying an equity position and the term sheets and offering circular did not reflect an equity trench.” 

Now, this apparently missing equity tranche has been much-discussed, because (as I’ll come back to in a minute) it appears that Goldman did not hold the equity tranche either.  The flipbook does reference a “first loss” tranche. Says Felix Salmon on this point:

Goldman said that they did not hold on to the equity tranche of the deal, which raises the obvious question: who owned ABACUS 2007-AC1, and whatever happened to the famous 0-9% equity tranche? If the bonds in the deal had all performed perfectly, where would the excess profits have gone?

Also recall this portion of the SEC complaint:

47. On January 10, 2007, Tourre emailed ACA a “Transaction Summary” that included a description of Paulson as the “Transaction Sponsor” and referenced a “Contemplated Capital Structure” with a “[0]% - [9]%: pre-committed first loss” as part of the Paulson deal structure. The description of this [0]% - [9]% tranche at the bottom of the capital structure was consistent with the description of an equity tranche and ACA reasonably believed it to be a reference to the equity tranche.  In fact, GS&Co never intended to market to anyone a “[0]% - [9]%” first loss equity tranche in this transaction.   

48. On January 12, 2007, Tourre spoke by telephone with ACA about the proposed transaction. Following that conversation, on January 14, 2007, ACA sent an email to the GS&Co sales representative raising questions about the proposed transaction and referring to Paulson’s equity interest. The email, which had the subject line “Call with Fabrice [Tourre] on Friday,” read in pertinent part:

“I certainly hope I didn’t come across too antagonistic on the call with Fabrice [Tourre] last week but the structure looks difficult from a debt investor perspective. I can understand Paulson’s equity perspective but for us to put our name on something, we have to be sure it enhances our reputation.”

Goldman was pressed on this point in the Q&A.  For example, David Trone, of Macquarie Securities said:

It strikes me that if there is a synthetic and if ACA was as experienced as you say they must have known there was a short so it comes to the question of when Paulson was making recommendations did they; A. Solely think they were long. B. Did they think they were the short side of the trade? C. Did they think they were going to be the short and maybe hedge it with the equity trench? I guess that is really the crux of the matter.

Palm responded that he had no idea what ACA might or might not have thought or why, but that Goldman did not mislead them. UBS’s Glenn Schorr asked similar questions, with largely similar results:

If there was no misrepresentation about Paulson being a long, how were they introduced into the process? In other words they were obviously making suggestions into what securities ACA should include but under what capacity were they introduced if it wasn’t a long or a short? What were they doing?

Now, at this point, Palm seems to me to dance around the idea that ACA did know Paulson was a short, but without really saying so, noting that “in this market there has to be a long and a short,” and that the reference portfolio has to be acceptable to both sides.  Consistent with that, both the WSJ and CNBC are reporting that Paolo Pellegrini, a former top Paulson executive, told ACA that Paulson intended to short the Abacus portfolio (HT: WSJ Law Blog).

2.        4.. We Lost Money, Stupid!

Lastly, Goldman emphasizes that it lost money – nearly $100 million – on the deal, meaning that it was exposed to portfolio losses as well and had no reason to structure a deal designed to lose money.  Says Palm:

Finally, a significant point missing from the SEC’s complaint was the fact that Goldman Sachs retained a significant residual long position in the transaction. Our overall losses in connection with the transaction exceeded $100 million including $83 million with respect to the retained long position. We certainly had no incentive to structure a transaction that was designed to lose money. 

That claim was called into question by the New York Times today, which reports that Goldman desperately tried to off-load its Abacus investment, but found no takers.  The article also reports that several Goldman employees claim the firm bought insurance against losses in the Abacus portfolio, and thus did not suffer net losses. 

This latter claim seems contrary to Goldman’s statements on the conference call, though I suppose the definition of "net" in this context is open to some interpretation. In response to a question from David Trone of Macquarie Securities, Palm says that the reported loss is net loss, rather than gross.  Palm also clarifies that Goldman’s equity position was the super senior tranche, rather than the equity tranche, but does not respond to questions from Trone about why the firm held it, saying instead that the reasons are irrelevant – “we had skin in the game.” 

In my next post, I plan to end with a wrap up of what we know about the Abacus deal, would still like to know, and what it all means for the strength of the SEC’s complaint. 

Related Posts:
The Goldman Earnings Call, Part 1: ACA Chose and It Doesn’t Matter Anyway
The Goldman Complaint

The Battle of San Jacinto

On this day in history -- 1836 -- Sam Houston led his Texan revolutionaries to a resounding victory over Mexico's General Santa Anna in the Battle of San Jacinto (not too far from downtown Houston).  Santa Anna's army outnumbered Houston's forces, 1200 to 900.  But in less time than last night's episode of Glee (I'll assume we have some Gleeks in the house!), the Texans had control of the opposing camps.  Santa Anna lost more than 600 men, Sam Houston less than a dozen.

And what did this battle mean for Mexico and the United States?

For Mexico, the defeat was the beginning of a downhill martial and political spiral that would result into the loss of nearly a million square miles in territory.  For the Texans, their victory led to annexation into the United States and the United States' war with Mexico.  In the end, the United States would gain not only Texas but also New Mexico, Nevada, Arizona, California, Utah and parts of Oklahoma, Kansas, Colorado and Wyoming.

As a result of the Battle of San Jacinto, almost a third of what is now the United States of America changed ownership.

Read more here (which also is the source link for the quoted passage and other details above).

Pictured:  the San Jacinto Monument, constructed in the 1930s to commemorate the Battle (and standing taller than the Washington Monument).  Additional reading here.

A Plan for More Comprehensive Law School Graduate Employment Data

Kyle P. McEntee and Patrick J. Lynch of Vanderbilt Law School have a new paper up on ssrn, "A Way Forward: Improving Transparency in Employment Reporting at American Law Schools."  Their paper proposes  more comprehensive collection and reporting of data on law school graduates' employment than the aggregate data that's reported now.

Here is their abstract:

The decision to attend law school in the 21st century requires an increasingly significant financial investment, yet very little information about the value of a legal education is available for prospective law students. Prospectives use various tools provided by schools and third parties while seeking to make an informed decision about which law school to attend. This Article surveys the available information with respect to one important segment of the value analysis: post-graduation employment outcomes.

One of the most pressing issues with current access to information is the ability to hide outcomes in aggregate statistical forms. Just about every tool enables this behavior, which, while misleading, often complies with the current ABA and U.S. News reporting standards. In this Article, we propose a new standard for employment reporting grounded in compromise. Our hope is that this standard enables prospectives to take a detailed, holistic look at the diverse employment options from different law schools. In time, improved transparency at American law institutions can produce generations of lawyers who were better informed about the range of jobs obtainable with a law degree.

I suspect that it would be quite difficult to collect the level of data that they propose, but I certainly agree that if we could obtain such data that it would be of utility to prospective students, as well as US News.  

I recall filling out a detailed survey on employment and salary data as part of my final PhD paperwork -- and so my guess is that some schools already collect this sort of data for some of their graduates (maybe more so in arts and sciences than law).  Whether that data is released to anyone or is used more for internal study, I don't know.

As McEntree and Lynch's website, lawschooltransprancy.com, makes clear -- some schools already report some of this data in their alumni magazines (by listing who is employing graduates).

Too Early for a Summer Reading List?

In the hopes that it's not too early (or too optimistic of me) to start thinking about summer reading - for fun, not work - I'll make a few suggestions below that people may be interested in picking up on a beach somewhere.  I'd love to hear what books others would suggest for summer reading.

I've blogged previously about Supreme Courtship and The Immortal Life of Henrietta Lacks and would definitely recommend both of them.

I've also enjoyed discovering Carl Hiaasen - Nature Girl and Skinny Dip, amongst others.

Then, there's the "Girl with the Dragon Tattoo" series.  The first two books have been released in the U.S. and are great.  I'm still awaiting release of the third book and haven't yet seen the movie which is also meant to be pretty good.

For those who like Charlaine Harris' Sookie Stackhouse series (the genesis of HBO's True Blood TV series), there's apparently a new one of those coming out next month.  I've also started reading one of Harris' other series - the Harper Connelly mysteries.  Not as good as Sookie Stackhouse, but I've only read the first book so far so it may not be a fair comparison.  (And, speaking of vampires, I finally did see "Let the Right One In" which I enjoyed in its own low-key gruesome way.)

Also speaking of vampires, I was once a fan of Anne Rice, but really found her newest book, Angel Time, to be pretty tedious.

For the girls amongst us (stop reading here, guys), pretty much anything written by Sophie Kinsella is a good holiday read.  In a similar vein to the Bridget Jones books and very English.  Kinsella writes the "Confessions of a Shopaholic" series along with a bunch of other similar books.

Back to murder mysteries, a "not bad" debut novel by Georgina Donovan set in Hawaii is "Reads Like Murder - in Honolulu".

I guess my spring reading list comprised a lot of vampire books and murder mysteries - so perhaps people can suggest other directions in which I could develop my pop culture pursuits over the summer...