2010 News Index
Professor Amy Deen Westbrook's article, "Sunlight on Iran: How Reductive Standards of Materiality Excuse Incomplete Disclosure Under the Securities Laws," has been published at 7 Hastings Business Law Journal 13 (2011). Federal securities law in the United States protects investors by requiring companies to disclose information that is "material," information that would be significant to a reasonable person making an investment decision. In recent years, the Securities and Exchange Commission has interpreted that standard in a reductive manner, enabling companies to limit disclosure to information that is currently, financially significant. But what about things that investors care about that do not currently have a reliably quantifiable impact on the company's bottom line? What about management integrity? What about a company's climate change impact? Most importantly for the purposes of this article, what about a company's business operations in Iran? "Sunlight on Iran" examines the doctrine of materiality as it has informed disclosure of several issues, and as it is currently being used by reporting companies to avoid disclosure of activities in Iran. The reductive standard relies on notions of informational efficiency implausible after the financial crisis, undercuts crucial U.S. foreign policy, and fails to protect investors. Professor Westbrook argues that the SEC should use a broader understanding of materiality: the statute allows this, the legislative history encourages it, the Supreme Court has clarified it, and the SEC has traditionally employed a broad standard. (Posted December 22, 2010)
Kursten Phelps has been selected to receive the Raymond Spring Award for 2010. The award is given annually to the Washburn Law Clinic intern who has demonstrated the highest commitment to providing legal services to clients in need. Kursten will receive the award at the Kansas Association for Justice annual conference in Kansas City on Friday, December 3, 2010. See the full story. (Posted December 2, 2010)
Professor Ali Khan's article "The Quran and the Constitution," has been published at 85 Tulane Law Review 161 (2010). The Quran and the Constitution are mutually supportive supreme texts; one does not negate the other. Numerous forms of government, cultural traditions, and economic systems are compatible with both supreme texts. Muslim nations are free to promulgate specific constitutions that reflect their social, political, and economic preferences rooted in history and culture. The specific constitution must reflect the conscience of the nation, for constitutions that fail to do so are vulnerable to amendment, even revolutionary replacement. Because the human condition is constantly evolving, the Quran, though a permanent divine text immune to alteration or amendment, is amenable to the evolutionary calls of believers. Each generation of Muslims is free to understand the Quran for meeting its needs. Interpreters as believers, however, summon the luminosity of faith while analyzing the Word of God and refrain from deforming the meaning of the divine text. They should not project personal agendas into the meaning of the Quran as do some interpreters of the Constitution. (Posted November 17, 2010).
Professor Tonya Kowalski's article "Toward a Pedagogy for Teaching Legal Writing in Law School Clinics," has been published at 17 Clinical Law Review 285 (2010). One of the major legal skills students use in almost every law school clinic is advanced legal writing. Clinicians spend many hours every week triaging student writing and coaching their students to produce practice-worthy documents. Yet advanced legal writing is not routinely addressed in clinic seminars and there is no clear methodology for teaching advanced legal writing through clinical supervision. This article is among the first to propose a comprehensive pedagogy for teaching and supervising legal writing in clinic. Moreover, clinicians commonly experience the frustration that students seem to come to the clinic deficient in many legal writing skills. Professor Kowalski identifies one of the causes as the "transfer of learning" phenomenon, in which the mind does not recognize applications for previous learning in new situations due to the change in context. One major premise of this transfer theory is that students need to be taught how to connect their clinical legal writing experiences to their previous legal writing instruction. Accordingly, this article is also the first not only to introduce "transfer-friendly" teaching methods in the proposed pedagogy, but is also the first to detail a comprehensive, step-by-step model for collaboration between the clinic and legal writing programs. By discussing and practicing the methods described here, clinical programs can craft approaches that work for the unique needs of their clinics, students, and individual teaching philosophies, resulting in an educational experience that leaves students better-prepared for clinical and professional law practice. (Posted November 16, 2010).
Washburn Law alumna Nancy Moritz Caplinger, '85, Topeka, was appointed by Kansas Governor Mark Parkinson as a justice on the Kansas Supreme Court. "I am humbled and honored to receive this appointment from Governor Parkinson and join the six other distinguished justices on the Kansas Supreme Court," said Caplinger. With Caplinger's selection, Washburn Law graduates comprise five of the seven Kansas Supreme Court justice appointments. See the full story. (Posted November 2, 2010)
Professor Mary Ramirez's article "Prioritizing Justice: Combating Corporate Crime from Task Force to Top Priority," has been published at 93 Marquette Law Review 971 (2010). Inadequate law enforcement against corporate criminals appears to have created perverse incentives leading to an economic crisis – this time in the context of the subprime mortgage crisis. "Prioritizing Justice" proposes institutional reform at the Department of Justice (DOJ) in pursuing corporate crime. Presently, corporate crime is pursued nationally primarily through the DOJ Financial Fraud Enforcement Task Force and other task forces, the DOJ Criminal Division Fraud Section, and the individual U.S. Attorneys' Offices. Rather than a collection of ad hoc task forces that seek to coordinate policy among a vast array of offices and agencies, a Corporate Crimes Division should be created as a permanent base in the DOJ to combat the relentless waves of corporate criminality. The Corporate Crimes Division would more efficiently investigate and prosecute crimes of national and multinational corporations spanning multiple districts, and pursue a coordinated national policy that affirms the commitment of the DOJ to fight large-scale corporate crime which costs taxpayers billions of dollars, frustrates financial markets, increases the cost of capital to honest businesses, and undermines citizens' confidence in the rule of law. Given the cost of corporate crime, creating the division would promote superior institutional design that should yield substantial benefit. (Posted November 1, 2010).
Washburn University School of Law alumnus Lynn R. Johnson was honored as the Washburn University Alumni Fellow from the law school on October 22, 2010. Sponsored by the Washburn University deans and the Alumni Association, the Alumni Fellows program recognizes alumni who have distinguished themselves in their career fields. The Alumni Fellows program brings successful alumni to campus to meet with students, faculty, and other alumni and share their expertise formally and informally in the classroom and other campus settings. See the full story. (Posted October 26, 2010)
Washburn University School of Law is pleased to host University of the West Indies (UWI) Faculty of Law Dean Velma Newton, October 18-20, 2010, as a visiting scholar. She is the ninth dean to assume leadership of the UWI Faculty of Law which started in 1970. The Cave Hill Campus of the University of the West Indies on Barbados is the host site for the Washburn Law Summer Study Abroad Program. See the full story. (Posted October 15, 2010)
On Friday, October 8, 2010, the Washburn Law Democrats will host Kansas Attorney General Steve Six. He is in Washington, D.C. for the United States Supreme Court hearing of the Snyder v. Phelps case. On Friday, Six will talk to law students about this important case, his experiences as Attorney General, and his re-election campaign. His presentation will be held at noon in Room 102. Lunch will be provided to students who RSVP to casey.yingling@washburn.edu by October 7 at 5:00 p.m.
Professor David Pierce's article "Minimizing the Environmental Impact of Oil and Gas Development by Maximizing Production Conservation," has been published at 85 North Dakota Law Review 759 (2009). One oil and gas well results in less environmental impact and surface disruption than two wells. The number of wells required to efficiently develop an oil and gas reservoir can be significantly reduced, while increasing the ultimate recovery of the oil and gas resource, if the reservoir can be developed without regard for the rule of capture. Current oil and gas "conservation" regulation is built around the rule of capture, which creates the legal necessity to be associated with an oil and gas well in order to secure rights in the oil and gas. Professor Pierce recommends that by shifting the focus of rights in oil and gas reservoirs away from capture rights and toward correlative rights, state oil and gas conservation commissions can better manage development of the oil and gas resource, allowing all interested parties to maximize recovery of their oil and gas resources while minimizing the impact on surface and other natural resources. (Posted September 22, 2010).
Professor Tonya Kowalski's article "True North: Navigating for the Transfer of Learning in Legal Education," has been published at 34 Seattle University Law Review 51 (2010). As lifelong learners, we all know the feelings of discomfort and bewilderment that can come from being asked to apply existing skills in a completely new situation. As legal educators, we have also experienced the frustration that comes from watching our students struggle to identify and transfer skills from one learning environment to another. For example, a first-semester law student who learns to analogize case law to a fact pattern in a legal writing problem typically will not see the deeper applications for those skills in a law school essay exam several weeks later. Similarly, when law students learn how an equitable doctrine like unclean hands applies to a particular torts problem in one class, only the smallest percentage will then see the potential application for the doctrine in a contracts course with another professor. Fortunately, research in "transfer of learning" offers the legal academy tools to help students encode knowledge – whether doctrine or skills – in such a way that they know better when and how to retrieve it for later use. Professor Kowalski's article is the first to offer legal educators a comprehensive approach to the transfer of learning across the entire curriculum. It is also the first to propose that law schools should employ maps based on schema theory to help students encode knowledge for future transfer, as well as to conceptually integrate their courses. This approach uses meta-schema based on core lawyering skills – in both their abstract and applied forms – in order to help students attain a basic sense of orientation and to know how particular skills will manifest, depending on the contexts in which they are used. This "Core Skills Approach" then goes beyond the use of maps to encourage students to use maneuvers, including a wide array of transfer strategies, to cue previous knowledge across the conceptual bridges that span the distance between school and practice. (Posted September 21, 2010).
On Wednesday, September 15, 2010, Phi Alpha Delta (PAD) sponsored "War Stories," a panel discussion where professors and attorneys shared stories about their jobs and the cases they have had. The panel was held at noon in Room 114. Panelists included Jay Hall, '07; Ron Pope, '84; and Professor Jeffrey Jackson, '92.
On Monday, September 13, 2010, the Washburn Federalist Society hosted a debate on "Betting the Earth: Free Market Environmentalism v. Heavier Government Control." The debate was held at noon in Room 102. Charlotte Law Professor John C. Kunich presented his argument for rational analysis of the uncertainty surrounding global climate change in a debate with Topeka attorney and environmental law authority Robert V. Eye, '80.
On Monday, September 13, 2010, Ed Collazo, '97, spoke to students at noon in Room 114. He shared his experiences starting his own law practice in Topeka, specializing in criminal and immigration law. Collazo's presentation was sponsored by the Hispanic American Law Students Association (HALSA).
Professor Janet Jackson's article "What is Property? Property is Theft: The Lack of Social Justice in U.S. Eminent Domain Law," has been published at 84 St. John's Law Review 63 (2010). Must the government fulfill a social justice obligation when it takes property and, if so, from where does that obligation arise? Social justice has largely been absent in eminent domain law, particularly in the context of blight removal and economic development condemnations. Government takings too often result in an undue burden on poor people and communities of color in a way that resembles Discovery-era takings of land from American Indians. In the periods of colonization and western expansion of the United States as well as in recent takings, the lack of social justice has had a profound effect: the disproportionate burden and exploitation of people who have the fewest resources -- legally, politically, or economically -- with which to resist the intrusion of eminent domain. Rooted in an historical framework of social justice, Professor Jackson examines the pervasive injustice in the realm of eminent domain. Specifically, she explores the theory of social justice through four lenses: religion, philosophy, mythology, and the law, all of which share the common theme of a social or institutional responsibility and speak to the challenge of eminent domain abuse. She then critiques competing social justice theories that appear to represent present-day rationales for both sides of the eminent domain debate and asserts that social justice requires justice as fairness. Thus, it requires an end to using “blight” and economic development as a pretext to exploit the poor and people of color. It also means implementing policies to restore communities in a way that would allow low-income residents to stay and enjoy the benefits of such improvements. In American society, two distinct paths have emerged in achieving social justice: social movements and legal reform. Professor Jackson looks at some examples of how social and legal reform movements have transformed the legal and political climate and led to greater social justice. She contends that, even in the midst of post-Kelo social movements and legal reform, many poor communities continue their struggle to exist. Legal reform has, in large part, failed to address the injustice of carte blanche blight condemnations or to significantly limit unjust economic development condemnations. Furthermore, reform efforts have essentially ignored the plight of displaced low-income residents who are left without affordable housing in a neighborhood of their choosing. "Justice, if we only knew what it was" queried Socrates. As it turns out, in the case of eminent domain law, we know what justice should be: the equal ability of citizens, regardless of race, income or any other distinction, to protect their home and community from unwarranted condemnation. (Posted August 30, 2010).
Professor Ali Khan's article "Protection of Languages and Self-Expressions Under Islamic Law," has been published at 19 Journal of Transnational Law & Policy 61 (2009). The Islamic law of speech diversity recognizes two distinct divine rights, one applying to speech communities and the other to individuals. The divine right to language allows each speech community to preserve and celebrate its native language free of coercion and disrespect from other speech communities. Native languages are the assets of speech communities. The Islamic law prohibits coercive degradation of native languages but at the same time it interposes no barriers in learning other languages. Closely related to the right to language is the divine right to individual self-expression or self-determination. Each human being is unique because God, the Master-Artist, shapes each human being with special attention. Social, economic, and legal barriers that refuse to recognize special talents or refuse to accommodate disabilities are incompatible with the divine plan. When individuals are given the maximum liberty allowed under Islam to pursue sciences, arts, knowledge, sports, and spirituality, Muslim communities will prosper. Professor Khan recommends that Muslim states recognize linguistic diversity and the right to personal self-determination in their positive law, including national constitutions. (Posted August 30, 2010).
Professor Amy Westbrook's article "What's in Your Portfolio: U.S. Investors Are Unknowingly Financing State Sponsors of Terrorism," has been published at 59 Depaul Law Review 1151 (2010). U.S. investors are unknowingly investing in companies that do business in and with state sponsors of terrorism. The United States has extensive economic sanctions in place to prevent U.S. companies from doing business in such nations, but sanctions often do not prevent foreign companies, or even foreign subsidiaries of U.S. companies, from doing business in sanctioned countries. U.S. securities law, given its emphasis on providing information to investors, should require companies to disclose any such operations if they sell securities to U.S. investors. Securities laws include a variety of disclosure regulations, generally subject to a broad materiality standard, to guide reporting companies in making disclosure. Activities in state sponsors of terrorism satisfy the materiality standard and should be disclosed. Professor Westbrook presents the results of substantial original empirical research that shows that companies are not disclosing their operations in sanctioned state sponsors of terrorism. As a result, the SEC needs to clarify the application of the disclosure regulations and the materiality standard in the case of corporate activity in state sponsors of terrorism. (Posted July 6, 2010).
Professor William Merkel's article "Heller as Hubris, and How McDonald v. City of Chicago May Well Change the Constitutional World As We Know It," has been published at 50 Santa Clara Law Review 1221 (2010). This article critiques the jurisprudential philosophy underlying Justice Scalia's opinion in District of Columbia v. Heller, in which the Supreme Court for the first time enforced a private right to weapons possession under the Second Amendment. The article anticipates the likely incorporation of that newly minted right against the states in McDonald v. City of Chicago, a case heard by the Supreme Court in the spring of 2010, and argues that the original understanding of the Second and Fourteenth Amendments cannot easily be reconciled with a judicially enforceable right to weapons possession unrelated to service in the lawfully established militia. In the process, Professor Merkel calls into question glib popular and judicial assumptions believed to legitimize judicial review, and suggests that judicial veto of legislatively determined policy choices requires a far more cogent theoretical foundation than that provided by Justice Scalia's fetishistic and idolatrous adherence to caricatured visions of an "original public meaning" that allegedly held sway when constitutional text was proposed and ratified. (Posted May 13, 2010).
The 12th annual John F. Kuether Memorial Golf Tournament, sponsored by the Washburn Student Bar Association, was held Saturday, April 10, 2010 at the Lake Shawnee Golf Course in Topeka, Kansas. See the full story and photos. (Posted April 26, 2010)
Washburn University held its annual Employee Recognition Ceremony Tuesday, April 6, 2010. A number of Washburn Law staff and faculty were recognized for their years of service: Sandy Knipp (Admissions Office, 5 years); Donna McMurry (Dean's Office, 5 years); Cindy Moyer (Professional Development Office, 5 years); Dee Barker (Library, 10 years); Donna Vilander, (Continuing Legal Education, 15 years); Kerri Pelton (Clinic, 25 years); John Bostwick (Library, 30 years). Being awarded Eminentes Universitatis status were Elizabeth Fischer and Carol Rhodes. Professors Carl Monk, Gregory Pease, and Sheila Reynolds were awarded Emeritus status. Betty Fisher and Donna Haverkamp were nominees in the administrative category for the Outstanding Service Award. Shirley Jacobson, Sandy Knipp, and Donna Vilander were nominees in the secretarial/clerical category for the Outstanding Service Award. Sonny Luarks was nominated for the Outstanding Service Award in the service/maintenance category. (Posted April 7, 2010)
Professor Jeffrey Jackson's article "Blackstone's Ninth Amendment: A Historical Common Law Baseline for the Interpretation of Unenumerated Rights," has been published at 62 Oklahoma Law Review 167 (2010). The Ninth Amendment clearly indicates that there are fundamental constitutional rights other than those in text of the Constitution and the Bill of Rights. The United States Supreme Court has recognized a number of these rights in its jurisprudence. However, the Court's decisions have lacked a consistent historical baseline for rights, and as a result, the Court's use of history has tended to devolve into cherry-picking from a variety of historical sources without regard to how much they would have influenced the Framing generation. Legal scholars have also posited several theories regarding a baseline for rights. Some of the more popular theories focus on a baseline taken from natural law, either derived from the writings of specific natural law theorists such as John Locke, from a combination of different natural law theorists, or from some shared natural law idea of individual freedom. However, these theories generally overstate the influence of natural law theorists on the Framing generation's concepts of rights, and understate the influence of English constitutionalism and common law. Although the Framing generation often spoke of rights in natural law terms, the rights they identified and talked about were all English rights. Professor Jackson examines the common understanding of rights at the time of the Framing of the Constitution and the Bill of Rights, and argues that the common understanding of rights at the time were not grounded in the high-minded abstractions of the natural law theorists, but rather derived from the rights the Framing generation assumed to be inherited from the English constitutional and common law, tempered by experience as American colonists. Further, for most Americans by the time of the Framing, their conception of these rights was formed by the readily accessible summary of the common law provided by Sir William Blackstone. Professor Jackson goes on to posit a theory for unenumerated rights based on custom and practice, using Blackstone's Commentaries as a common law baseline from which to start, and then relying on the common law concepts of custom and practice to update rights from the "common law rights of Englishmen" to the "rights of Americans." (Posted April 5, 2010).
Professor Rory Bahadur's article "Electronic Discovery, Informational Privacy, Facebook and Utopian Civil Justice" has been published at 79 Mississippi Law Journal 317 (2009). Electronically stored information ("ESI") has had a massive impact on our society. In civil litigation the discovery process remains fundamental. The discovery process traditionally represents equilibrium between adversarial justice's incorporation of two competing principles: the search for the truth and recognition certain information is private and therefore unavailable, even if dispositive, for consideration in resolving the dispute. The contours of this private information are defined by the attorney client privilege, the work product doctrine and ethical confidentiality rules. Electronically stored information and the new paradigm of electronic discovery shift this equilibrium heavily in favor of the truth. Electronic discovery effectively obliterates the privacy traditionally protected in adversarial justice. This obliteration of privacy in discovery is a reflection of ESI's reduction of informational privacy on a broader societal scale. For example ESI has broadened the concept of newsworthiness such that the tort of public disclosure of private fact no longer exists and online social networking, possible only because of ESI, is an unprecedented, voluntary relinquishment of informational privacy. Professor Bahadur mentions that the decline in privacy is directly attributable to the space less nature of ESI and an ESI fueled shift in social morality. This shift in privacy facilitates implementing a justice system combining the best of both the European inquisitorial system and America's adversarial system. The hybrid system ensures the continental search for material truth is not subjugated by the recognition of privacy as in the adversarial model but retains the laudable, libertarian, societal safeguards of the adversarial system. This justice model decreases litigation costs, improves public perception of the civil justice system, and increases the relevance and applicability of ethical rules. (Posted March 30, 2010).
Professor Ali Khan's article "Faith-Based Torture," has been published at 12:1-2 Global Dialogue (Winter/Spring 2010). Professor Khan focuses on faith-based torture against Muslim detainees, torture that was crudely designed, only minimally seeking security-sensitive information. He asserts that anti-Islamic torture has profoundly offended Muslim communities throughout the world and reaffirms the U.S. government policies that periodically single out populations, domestic and foreign, and subject them to cruelty. Other example populations include the degradation of Native Americans, enslavement of Western Africans, internment of Japanese-Americans, and slaughtering of the Vietnamese. More specifically, anti-Islamic torture has undermined what were sincere and substantial efforts of many American institutions to promote religious freedom at home and abroad. Today, indignant American citizens and organizations are seeking to prosecute lawyers and politicians who designed and endorsed torture, partly because torture policies have soiled the honor of the U.S. as a beacon of liberty. (Posted March 24, 2010).
Professor Aïda Alaka's article "The Grammar Wars Come to Law School," has been published at 59 Journal of Legal Education 343 (2010). Professor Alaka's overview of pedagogical shifts in language arts education over the last twenty-plus years, as well as empirical studies of high school and college reading and writing skills, provides insight into why basic skill errors surface in the writing of law students today. With legal education reform under consideration nationally, and with several important studies published regarding the importance of skills training in law schools, this article helps focus development of best practices in legal education. (Posted February 19, 2010).
Professor Tonya Kowalski's article "The Forgotten Sovereigns," has been published at 36 Florida State University Law Review 765 (2009). Our federal system includes 562 federally-recognized American Indian nations, most of whom have their own sovereign lands, governments, and court systems, and who interact every day with the state and federal systems. Yet most legal thought overlooks our sovereign Native American nations and legal heritage. Although much of American law and policy intersects tribal jurisdictions, such issues generally appear in the law school curriculum only in specialized, upper-level courses. Professor Kowalski argues that the three-sovereign system should provide the fundamental framework for the United States legal system across the legal curriculum, and she provides several concrete examples for how to do so. She also argues that many law courses should touch upon how their disciplines impact tribal jurisdictions and their citizens. By changing our fundamental orientation toward the role of tribal sovereigns in the U.S. system, we will advance the academy’s goals of scholarship, teaching, and service. First, we will accurately represent the true structure and diversity of our tripartite federal system. Second, we can improve learning by using direct and comparative tribal perspectives for fundamental legal principles and methods. Third, we can further the social justice mission by raising awareness of tribal sovereignty among future advocates and lawmakers. (Posted February 19, 2010).
D. Duke Dupre will receive an honorary Doctor of Law during the Washburn University School of Law commencement exercises on Saturday, May 15, 2010. See the full story. (Posted January 29, 2010)
Professor Aida Alaka's article "The Phenomenology of Error in Legal Writing," has been published at 28 Quinnipiac Law Review 1 (2009). This article reports the reflections of ten students who participated in individual interviews after their first year of law school regarding "technical errors" in writing. Because legal writing instructors expend a great deal of effort commenting on student writing, Professor Alaka sought information regarding how students experienced and reacted to the critiques they received on writing assignments throughout their first year; that is, whether and how their instructors' comments actually guided the students' revision process. What the students revealed helps to illuminate why the phenomenon of error persists in legal writing and demonstrates that factors both outside of and within students' control underlie it. Professor Alaka suggests that many of the theories articulated in the literature on critiquing student papers may not always hold up in practice and may explain why some legal writing instructors perceive their comments to be ignored. (Posted January 19, 2010).
Professor Aliza G. Organick's article "Tribal Law and Best Practices in Legal Education: Creating a New Path for the Study of Tribal Law ," has been published at 19 The Kansas Journal of Law & Public Policy 63 (2009). Teaching culture in the law school classroom is enormously challenging. Teaching culture to law students in a clinical setting poses additional challenges in that we are not solely teaching the theoretical components of cultural competency, we are asking students to put them into practice. Law schools currently do not provide an effective framework for students to do this. By introducing tribal law into the curriculum, law schools begin the process of introducing students to the cultural component of legal theory and practice in culturally distinct communities. Law schools can begin this process by teaching the three-sovereign system endorsed by Justice O’Connor. In addition law schools should consider ways to provide a cross-cultural practice opportunity such as practice in tribal communities. Best practices provide a framework for developing an overall methodology for creating an institutional model that supports inclusion of this topic across the curriculum. In this article, Professor Organick explores the importance of introducing law students to tribal law and the culture of other local legal systems early and often, identifies key components of best practices that establish a framework for teaching culture in general and for teaching it alongside tribal law in particular and finally identifies a few teaching techniques that may be helpful to those interested in trying cultural education. (Posted January 15, 2009).
Professor Bradley Borden's article "Taxing Shared Economies of Scale," has been published at 61 Baylor Law Review 721 (2009). Economies of scale exist if long-run average costs decline as output rises. All else being equal, the decline in average costs should lead to greater profitability, making economies of scale attractive to businesses. Nobel laureate George Stigler recognized that economies of scale should help determine the optimum size of a firm. To obtain economies of scale and optimum firm size, parties may integrate resources or grant access to resources without integrating. Such arrangements create shared economies of scale. Tax law must consider the effects of shared economies of scale and address them. In particular, the varying degrees of scale-sharing raise tax classification issues. Traditional classification analyses focus on the legal definition of tax partnership, which requires a joint-profit motive. The IRS and courts have concluded that sharing economies of scale satisfies the joint-profit-motive test and that arrangements with a joint-profit motive are tax partnerships. Relying on technical analysis and economic theory, Professor Borden argues, however, that if parties integrate resources without integrating all relevant parts of the production process, they often should not come within the definition of tax partnership. By focusing upon shared economies of scale, the IRS and courts have created a slippery slope. Sharing economies of scale is common even in nonintegrated arrangements, which allow parties to benefit from each other’s specialized skills by granting access to resources. If tax law relies upon shared economies of scale to classify business arrangements, its classification system will include arrangements that are not suited for tax partnership classification. (Posted January 5, 2010)
Washburn University School of Law is sad to announce the passing of Professor James B. Wadley on January 1, 2010. See the full story. (Posted January 4, 2010)
