Notes

The federal tax code contains a number of provisions that reduce taxes on personal and business investment income. Many of these provisions fall into two categories: yield exemption provisions, which reduce taxes on investment returns, and tax deferral provisions, which reduce taxes on investment principal. While these two families of tax provisions are sometimes said to be equivalent, there are important differences between them. This Note focuses on one under-appreciated difference between yield exemption and tax deferral: the amount of risk to which the federal government is exposed. Under a tax deferral approach, the federal government’s expected revenue is higher but more uncertain, as revenue collections depend on the performance of taxpayers’ investments. This Note argues that policies that raise revenue by exposing the federal government to greater risk could be more efficient than other avenues of raising federal revenue. The federal government is able to take on market risk at a relatively low social cost, because of its high liquidity and ability to diversify risk across generations. While there are many possible ways for the government to raise revenue by taking on more risk, this Note argues that the tax code is a promising vehicle for doing so. All in all, this analysis adds a reason why tax deferral provisions are preferable to yield exemption provisions.

Modern capitalist theory has been the engine of Western innovation and prosperity for centuries. However, the persistence of the free market and corporate form in the United States has come at a high cost. Industrialization powered by fossil fuels has permanently degraded and destabilized the Earth’s climate, wealth continues to concentrate among a handful of individuals, and increasing nativist and anti-immigrant sentiments threaten our institutions. This has led scholars to draw parallels between the current day and the Gilded Age, a period of massive wealth inequality during which the negative externalities of unfettered capitalism became particularly clear. This Note is situated in the rapidly expanding literature about environmental social governance (ESG) and stakeholderism, looking to past instances of corporate reform as well as the present realities of the modern-day corporation to argue that private ordering is an ineffective and improper means of addressing negative externalities of capitalism. It identifies moments of proto-stakeholderism during three periods: the Gilded Age, Progressive Era, and stock market crash of 1929, highlighting the cyclicality of addressing stakeholder concerns throughout history. It critiques two major avenues through which corporations might consider stakeholders—private ordering or government action—and argues that private ordering’s legal limits and legitimacy problems are inescapable when considering transformational ESG reform.

Education in the United States is still segregated. But opponents of affirmative action now argue that affirmative action policies—which they maintain were never constitutional to begin with—are no longer needed to serve the goals of our education system. Yet while these policies in the education context continue to face challenges and public scrutiny, affirmative action policies in another area of law have consistently been upheld as constitutional. States, localities, and the federal government run robust minority- and women-owned business enterprise (M/WBE) programs, which set goals for minority- and women-owned business participation in government contracts. These programs are consistently upheld under Supreme Court doctrine in that area. This Note offers a reason for M/WBE success and a path forward for education: By taking the Court at its word and leveraging language about what “not to do,” advocates can design permissible programs to increase diversity.

Part I explores affirmative action in public contracting. Affirmative action policies have been actualized in government contracting through the use of disparity studies. These studies look at the disparity between available minority contractors and available work, using the blueprint laid out by Justice O’Connor in City of Richmond v. J.A. Croson Co., to set goals for minority participation in public contracting. Next, Part I reviews New York City’s and New York State’s M/WBE programs in-depth: their design, challenges to the programs, and their constitutional justification. Part II discusses how affirmative action in education differs from government contracting, and then looks to New York and Louisville school districts for examples of how advocates have started to navigate the Court’s language of what is impermissible to create plans that diversify permissibly. Part III explores the lessons for advocates seeking to achieve more diversity and better outcomes for minority communities. By focusing on what the Court wants in its opinions overturning advocates’ first tries at solving a problem, there is hope for more diversity using just the tools in the Court’s limited toolbox.

Though indigency is not a suspect class, the Supreme Court has repeatedly applied heightened scrutiny to laws that deprive low-income people of certain rights they can’t afford. It has done this through a makeshift doctrine that combines the principles of Equal Protection and Due Process. But the absence of a generalizable rule behind what this Note refers to as “wealth-based equal process” leaves the Court’s few constitutional protections for low-income people vulnerable to erosion by conservative Justices. This threat looms especially large as recent litigation draws on that doctrine to challenge the unfair treatment of indigent people in the criminal justice system. This Note attempts to shore up wealth-based equal process doctrine by proposing a general principle: Courts must apply heightened scrutiny when the government, by putting a price on a fundamental right that only the government can fulfill, entirely deprives an indigent person of that right. The Note then applies this principle to cash bail, revealing that the pretrial detention of indigent defend- ants lies at the heart of this doctrine and requires heightened scrutiny.

In Seila Law LLC v. Consumer Financial Protection Bureau, the Supreme Court split 5–4 on appointing party lines in striking down for-cause removal protections for the Bureau’s single Director as violating the constitutional separation of powers. Chief Justice Roberts’s majority opinion expounded a novel principle: Significant executive power may not be concentrated in any single individual in the executive branch unless that individual is removable at-will by the President. This Note argues that the majority’s usage of structure and history to constitutionalize this principle was deeply flawed. It is unconstrained by any particular interpretive commitments. Further, it is internally inconsistent, logically flawed, historically opportunistic, and unsupported by a pragmatic consideration of the issue. And the Court’s subsequent decision, Collins v. Yellen—extending Seila Law to invalidate removal protection for the Director of the Federal Housing Finance Agency—has only exacerbated Seila Law’s flaws. I conclude with reflection on agency independence post-Seila Law and a call for pragmatic deference to the political branches.

The Foreign Intelligence Surveillance Act (FISA) authorizes the Federal Bureau of Investigation (FBI) to subject Americans to uniquely invasive electronic monitoring, so long as the Foreign Intelligence Surveillance Court (FISC) approves the surveillance application. But in 2020, the government announced that two of the FISA applications it submitted to surveil a former 2016 Trump campaign aide were based on false statements and omissions—revealing systemic deficiencies in the accuracy of FISA applications, which has long relied on the integrity of FBI and Justice Department procedures alone. In the ordinary criminal context, defendants would have the ability to challenge the truth of the application predicating their Fourth Amendment search under Franks v. Delaware, but when defendants are prosecuted with evidence derived from FISA-authorized surveillance, courts have uniformly interpreted the statute to abrogate defendants’ rights to a Franks hearing. This Note argues that courts should use the procedures authorized by the Classified Information Procedures Act (CIPA) to facilitate Franks hearings for these defendants in order to reveal the incidence of falsely premised FISA surveillance. While Franks hearings in this context would be unlikely to vindicate the individual interests of FISA-surveilled defendants, they would offer a systemic deterrent effect, alerting the FISC to flawed applications and providing the Court an opportunity to discipline the FBI agents responsible.

In recent years, there has been significant public debate concerning policing in the United States. Current events and recurring instances of police brutality have drawn attention to police misconduct and reinvigorated calls for systemic reforms to policing and police discipline. While there is a growing consensus in the United States among citizens, politicians, and even officers, that policing—and, in particular, police discipline procedure—requires reform, there is far less agreement as to what changes are necessary and feasible. In the U.S. military context, Congress enacted the Uniform Code of Military Justice (UCMJ), which created a separate military law system that imposes punishment for various administrative and criminal offenses. Some police reform advocates have proposed enacting a UCMJ equivalent—a Uniform Code of Police Justice (UCPJ)—for the nation’s police forces. This Note argues in favor of adopting a UCPJ and proposes a recommended Code structure, while acknowledging that a UCPJ would not be a cure-all for our nation’s policing troubles; further systemic reforms would still be required.

In its 2014 decision in Lexmark International, Inc. v. Static Control Components, Inc., the Supreme Court began the process of “bringing discipline” to the various elements of prudential standing and suggested that the doctrine as a whole is inconsistent with the Court’s place in the federal separation of powers. Last year, the litany of opinions delivered by a divided Court in June Medical Services L.L.C. v. Russo manifested ongoing confusion about the fate of prohibitions on third-party standing and generalized grievances—two of the traditional prongs of prudential standing. This Note documents the heterogeneous approaches to prudential standing taken in the lower federal courts since Lexmark, and argues that this confusion is partly attributable to the Court’s misleading analysis of the role of judge-made gatekeeping doctrines in our federal system. Judge-made gatekeeping rules are ubiquitous in the federal judiciary, and courts have adopted a wide-range of approaches in the wake of Lexmark’s failure to identify a principle that could cabin its disfavor to only prudential standing rules. This Note argues that courts should instead acknowledge that judge-made gatekeeping rules like prudential standing’s third-party standing rule do a better job than alternatives in upholding the separation of powers values that are at the heart of the Supreme Court’s jurisdictional jurisprudence.

Federal trademark registration helps protect the hundreds of billions of dollars of brand value that trademarks can represent. Recently, interest in the failure-to-function doctrine, which prevents registration of proposed trademarks that consumers do not perceive as marks, has surged at the appellate body of the United States Patent and Trademark Office (USPTO), the Trademark Trial and Appeal Board (TTAB). This Note is the first in-depth, focused critique of the TTAB’s recent failure-to-function jurisprudence. It argues that, as the TTAB currently uses it, the failure-to-function doctrine is incoherent and lacks clarity. On a more granular level, the doctrine rests on inconsistent multifactor tests whose factors the TTAB adds, subtracts, modifies, reconceptualizes, and weighs differently across cases, giving the USPTO little meaningful criteria by which to decide what marks merit registration. This inconsistency risks increasing costs for the USPTO, brands, and consumers by creating uncertainty as to what proposed trademarks the USPTO will approve. In response, this Note proposes combining failure to function with a different trademark doctrine: the doctrine of aesthetic functionality. Replacing failure to function’s unwieldy multifactor inquiries with aesthetic functionality’s narrow focus on competition promises to increase clarity and, in so doing, mitigate or avoid costs to the USPTO, brands, and consumers.

Over one third of all pending cases in the federal court system are part of a Multidistrict Litigation (MDL) proceeding. Previous and ongoing MDLs include claims stemming from the opioid epidemic, the Deepwater Horizon oil spill, the National Football League concussion cases, and a myriad of pharmaceutical and medical products liability suits. Both the percentage and sheer number of cases utilizing this form of aggregate litigation have dramatically increased in recent years. Bellwether trials, designed to test the facts and legal theories underpinning many of the consolidated cases, are a key feature of MDLs in facilitating resolution. This Note examines the role of MDL bellwether trials and the potential impact of proposed reforms. Part I surveys the functions of bellwether trials as well as current judicial limitations imposed on the practice. Part II examines proposals that would further restrict the use of MDL bellwether trials: first, a bill from the 115th Congress and second, proposed amendments to the Federal Rules of Civil Procedure. These proposals would require the consent of all parties for an MDL bellwether to ensue. Finally, Part III explores the potential effects of these proposed reforms as well as the discrepancies between their purported aims and the likely impact of their enactment. These proposals would exacerbate the MDL “black hole,” result in less informed settlements, and create more opacity in the MDL process. Principally, they are an attempt to wrest power over procedure to cement defendants’ structural advantage over the MDL.