Perhaps God himself put it best when he said, “[n]aked a man comes from his mother’s womb, and

as he comes, so he departs.” While many have tried to take earthly possessions with them, often in unusual ways, the fact is that one’s property is generally left to living friends or relatives. For the very wealthy, this process may be more complicated in 2010 than in past years. Congress’s next move in the estate tax arena is clouded with uncertainty, and that has left wealthy families with large estates in a state of confusion. In the wake of the massive healthcare overhaul, Congress has now set its eyes on addressing the estate tax system. The Economic Growth and Tax Relief Reconciliation Act of 2001 (“EGTRRA”) phased out the estate tax over ten years and ended with a complete repeal of the tax in 2010. While Republicans had hoped to make the repeal permanent, the current Democratic Congress has affirmed its temporary status.

Congress has yet to officially address the estate tax lapse with new legislation. As such, estate taxes will not be imposed this year, making 2010 the cheapest year to die in recent American history. According to some estate and financial planners, however, it is also the most confusing year to die. Sarah Spear, director of policy and public affairs at the Association for Advanced Life Underwriting, has stated that the need to finance the implementation of new healthcare provisions makes the estate tax mess even messier. Estate planners expected a change in the law before the 2010 repeal, and Congress’s inaction came as a surprise to most. Legislators are now scrambling to clean up the mess created by the 2010 repeal and have discussed a variety of solutions to the problems it created. One of these possible solutions is a retroactive application of 2009 rates.

A Brief History of Estate Taxes

Americans have always known that nothing’s certain but death and taxes, but how did that come to be? Governments have imposed estate taxes on citizens as early as 700 B.C. Historians estimate that three thousand years ago, there may have been a 10 percent tax on property transfers at death in Egypt. Augustus Caesar imposed a tax on any transfers made to anyone except close relatives. In the United States, estate taxes began with the Stamp Act of 1797. Although the Act was repealed in 1802, the federal government continued to use estate taxes as a means of generating revenue during national emergencies.  This was especially true during times of war, when extra financing was needed. In December 1906, President Theodore Roosevelt, concerned about the growing concentration of wealth and power in the United States, urged Congress to pass a federal estate tax that would “put a constantly increasing burden on the inheritance of those swollen fortunes, which it is certainly of no benefit to this country to perpetuate.”

Ten years later, Congress changed its pattern of sporadic and temporary estate taxation by introducing a permanent federal estate tax and a personal income tax as part of the Revenue Act of 1916. During the late 1960s and early 1970s, legislators were set on closing loopholes in the Tax Code and passed the Tax Reform Act of 1976, leaving us with the current estate tax system.

The Current Taxonomy:  Estate Taxes in the Twenty-First Century

Under § 2001 of the 2009 Internal Revenue Code (“IRC”), a tax is imposed on the transfer of the estate of any deceased person (decedent) who is a citizen or resident of the United States. The amount of tax is determined in accordance with rate tables provided by the Tax Code.  In 2009, the highest tax rate was forty-five percent for estates of $3.5 million and higher. Although there is no estate tax rate for 2010, it is set to go back to the initial EGTRRA rate of a fifty-five percent maximum for estates over $1 million in 2011.

In addition to the estate tax lapse, a carryover basis has been introduced for 2010. Under the IRC, basis is defined as the cost of the property. The previous estate tax system used a decedent’s date of death value in determining basis. This resulted in a large break for beneficiaries inheriting property that had increased in value since the decedent purchased it. Essentially, beneficiaries were not taxed on the appreciation the decent enjoyed while the decedent owned the property—which can be a huge windfall for beneficiaries.

For 2010, however, people who escaped estate tax liability may end up paying taxes on a higher amount of capital gain than they would have in 2009. For example, assume your grandfather purchased a house in 1950 for $10,000 and died in 2010 when it was worth $100,000. If he left that house to you, and you sold it for $110,000, under the old system your gain on that sale would have been only the $10,000 you made above the $100,000 it was worth at the time of his death. You would then pay capital gains tax on the $10,000 you made above the value of the house at his death. However, using the new carryover basis rule under the same facts, the IRS would say that you had a gain of $100,000 because the house was originally worth $10,000 and you sold it for $110,000. This means that you would end up paying capital gains tax on $100,000 this year, rather than on $10,000. As you can see, the new carryover basis rule results in a substantial change in one’s tax liability.

Now that Congress has turned to addressing the estate tax system, some experts speculate that legislators may decide to give taxpayers the option of paying either an estate tax or capital gains tax. House Committee on Ways and Means Chair Sander Levin has stated that the House prefers to keep the estate tax at 2009 levels and make those levels retroactive to January 1, 2010. While some in the Senate are against retroactively reinstating the estate tax, Representative Levin said that he is willing to negotiate a compromise that allows taxpayers to pay lower capital gains tax rates in exchange for a retroactive tax. Legal scholars, however, disagree as to whether Congress should be allowed to retroactively apply the tax.

A Taxing Problem

Under Article I, Section 9 of the United States Constitution, ex post facto laws are expressly prohibited. Ex post facto laws are essentially laws that are applied retroactively. However, a large body of federal case law provides that retroactive tax laws are not ex post facto, and are thus constitutional. In a landmark decision, the U.S. Supreme Court in U.S. v. Carlton unanimously upheld as constitutional a change in the Internal Revenue Code that was applied retroactively. The Court held that the Due Process Clause was not violated because the law had a legitimate purpose—to address a mistake in the Tax Code. Because Congress made the Code amendments promptly after discovering the loophole, the Court rejected detrimental reliance arguments. This means the taxpayer argued that it was unfair to apply the law retroactively because the taxpayer relied on the old law to its detriment. Additionally, the Court stated in dicta that passing limited retroactive revenue statutes is a “customary congressional practice,” and that these statutes are typically “confined to short and limited periods required by the practicalities of producing national legislation.”

It is likely that a legislative fix applying 2009 estate tax rates retroactively would be considered an attempt to address a mistake in the Tax Code. However, whether this action would be considered prompt and timely is unclear. The Tax Code amendment in Carlton was introduced approximately one year after the government discovered the loophole. On the other hand, although retroactive estate tax application would be addressing the estate tax repeal within a year of its lapse, Congress was fully aware of the lapse well before it took place, making detrimental reliance arguments by taxpayers a little more persuasive.

The State of the Estate Tax

Taxing the transfer of wealth from one generation to the next has been a common government practice in the United States since the early twentieth century. The estate tax generates billions of dollars in revenue annually, even though less than 2 percent of estates actually pay an estate tax. The fact that this is an extremely valuable source of government funds suggests that Congress will address this issue sooner rather than later, and retroactive application of 2009 rates appears to be a frontrunner among possible legislative fixes.

Congressional inaction and rumors of possible legislation have left both wealthy taxpayers and the estate planning community waiting in anticipation. Estate tax consultants who are accustomed to seeing clients every few years are now being advised to maintain regular contact with clients because of this “fluid situation.” However, with the future of the estate tax in limbo, attorneys are as confused as clients and will likely respond to most client questions with one answer: “God only knows.”

Researched by:  Moorisha Bey-Taylor

Edited by:  Matthew Schroettnig

Managing Editor:  Kirk Strohman

“A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear arms, shall not be infringed.” – Second Amendment, U.S. Constitution

There are few issues in America today as polarizing as firearms, and our rights to them as citizens. The reason behind this never-ending debate is the enshrined, eternal, and tragically over-punctuated Second Amendment of the Constitution. Many have tried to glean the Founders’ intent behind their brilliant words, but often fail to so much as explain their exhaustive use of commas. A current U.S. Supreme Court case is about to reignite those fires and give you something to discuss the next time you are in an awkward conversation about gun rights with someone at the water cooler.

Last week, the Supreme Court heard oral arguments for McDonald v. Chicago. In McDonald,  Otis McDonald is challenging the city’s sweeping ban on handguns – widely considered the strictest in the nation. Chicago currently prohibits handgun registrations, which creates a de facto handgun ban, as residents cannot legally own unregistered weapons. McDonald is the sister case to D.C. v. Heller (more on this below) and is drawing considerable interest from both sides of the political spectrum. The furor is such that spectators and protesters from all over the country descended on the courthouse and camped outside the building the day before oral arguments began.

A Sawed-Off History of Gun Laws

The 1934 National Firearms Act subjected the weapons trade to federal taxation and registration requirements. The practical effect of this post-Prohibition statute was to bring the firearms trade under federal regulation. Later, the 1968 Gun Control Act prohibited unlicensed interstate weapon transfers and created a list of individuals restricted from gun ownership, such as felons, minors, and known drug addicts. In 1986, the Firearms Owner Protection Act banned ownership of machine guns made after 1986 and provided safe passage for persons carrying guns across state lines for personal use.

Additional laws enacted in the mid-1990’s required federal background checks for gun purchases and banned all assault weapons until 2004 when the ban expired. As broad as these regulations may seem, they did not address the specific issue of individual rights regarding firearm ownership. As previously noted, “in the absence of legislation arises litigation.” Simply put, when lawmakers don’t act to answer a question, people sue each other. Fast-forward to 2007, when the gun control debate left the legislative halls and entered the courtroom to determine whether it is truly an individual right to own a handgun.

Déjà Vu for the Supreme Court

D.C. v. Heller is the 2007 U.S. Supreme Court decision that struck down a sweeping ban on handguns in Washington D.C. The gun ban was the strictest in the nation, prohibiting residents from owning or keeping handguns in their homes. In limiting absolute handgun prohibitions, a 5-4 majority held that the Second Amendment guarantees an individual the right to bear arms.

It is worth noting that Heller was a very limited holding. First, the disputed handgun law was in the nation’s capital, a federal enclave, so Heller does not apply to state laws such as the one at issue in McDonald. Since there are 50 states, the McDonald decision could have significant implications involving individual rights against other state actions. Furthermore, the Court in Heller explicitly stated that its holding was not intended to bring down any “longstanding prohibitions” (i.e. – the existing gun control statutes), ensuring that firearms were still subject to regulation by the political process.

Since the question of Heller’s applicability to state laws remains unanswered, Otis McDonald promptly sued the city of Chicago to clear things up. It is widely believed that the same five Justices in the Heller majority will also rule against Chicago’s handgun ban. Although the Heller ruling only invalidated a federal handgun ban, it still likely created a damning precedent for Chicago’s ban. Don’t start celebrating or denouncing just yet, however, since true victory lies within how the majority formulates its holding.

The Supreme Court: Handguns or No Handguns?

The Bill of Rights, including the Second Amendment, was initially intended to provide state and individual protections from federal government actions. Today, most of the Bill of Rights protections have been “incorporated” via Supreme Court rulings, and so apply to state actions as well. A right is “incorporated” when the Court decides that it is a “fundamental” right: one that is deeply rooted and implied within our nation’s concept of liberty. The Second Amendment has yet to be incorporated, and so its provisions do not bind the states. Thus, the real issue in McDonald – whether the Second Amendment should be incorporated and apply to state actions.

Assuming the Chicago gun law is overturned, the McDonald plaintiffs argue that the Court should incorporate the Second Amendment to apply to state actions. To achieve this, Mr. McDonald cites both the Privileges and Immunities Clause and the Due Process Clause, found in the Fourteenth Amendment. The Privileges and Immunities argument faces longstanding and unfavorable, albeit contentious, precedent in the Slaughterhouse Cases. Slaughterhouse held that the Privileges and Immunities Clause does not apply to state actions, so the Court would have to overturn a 137 year-old case if it adopts McDonald’s first argument. This result would be somewhat monumental.

There is, however, a fear among some gun rights supporters that overturning Slaughterhouse would also open the door for guaranteeing other less-liked issues as individual rights, such as gay marriage and abortion. This has some gun supporters divided as to whether winning this case is worth the potential costs. Conversely, the Due Process Clause holds more favorable precedent because it is the vehicle most often used to incorporate the Bill of Rights over state actions.

Leave the Gun, Take the Regulation

Regarding the Due Process argument, lawyers for the city argue against incorporating the Second Amendment by citing three valid, though somewhat outdated, cases dictating that the Second Amendment applies only to the federal government. Chicago’s lawyers then took a firmer stance against McDonald’s Privileges and Immunities argument. Their reasoning is that any absolute liberty interest regarding firearms that may be protected is already protected, since the city ban only forbids handguns but allows other weapons in homes, such as shotguns.

Should the Chicago ban fall, gun control advocates still hope the Court will be explicit with what it initially implied in Heller: that a pro-gun rights decision should not be construed to say that courts must heavily scrutinize all gun regulations that pass through the legislative system. The policy effect here would be to force judicial recognition of the unique risks associated with guns, as compared to the other rights provided by the Constitution. This would likely result in increased judicial deference towards legislation when examining state and local gun regulations

The McDonald decision is not expected until June, but some cities are already taking steps to circumvent the anticipated overruling of the gun ban, such as regulations on ammunition. So whether you love guns, loathe them, or just like to argue with people, it will be in your best interest to stay tuned and see how this case unfolds.

Written by: Stephen Robbins
Researched by:  Amanda Husted
Edited by: Daniel Kwak
Managing Editor: Jennifer Hill

This is Part I of a two-part focus on Haiti.  In Part I, Stephen Robbins discusses issues from the state of affairs in Haiti before the earthquake on January 12, 2010, to  international and domestic reform, to U.S. – Haiti relations, and finishes by discussing the foundation that needs to be laid for a “fresh start” to be realized.  Part II will be posted on theLegality.com next week.

http://www.flickr.com/photos/unitednationsdevelopmentprogramme/ / CC BY 2.0

Following the earthquake in Haiti, Speaker of the House Nancy Pelosi and various members of the media labeled the natural disaster an opportunity for a “fresh start.” The idea that the earthquake has brought anything but tragedy would be lost, of course, on your average Haitian. The quagmire of corruption and human rights violations that plagued Haiti were not somehow swept away in a baptism by earthquake on January 12th. Indeed, such problems continue to exist, only with a thick and new layer of destructive complexity piled on top.

This is not the first time that Haiti has momentarily captured the attention of the international community and elicited promises of a “fresh start.” As rebuilding efforts continue, how can we be sure that there will be anything fresh about our approach? Tents will be delivered, shelter constructed, and millions of dollars donated, but what will be done to address the issues that made Haiti a daily haven for tragedy, even before the earthquake? As President Roosevelt once stated, there is nothing mysterious about the foundations of a healthy and strong democracy. These foundations are equality, social and economic opportunity, and human rights. If the long-term situation in Haiti is to ever improve, the protection of human rights must serve as the foundation and constant measuring stick for every rebuilding effort, every dollar spent, and every decision made. While there are laws in place that purport to offer such protection, they often lack the kind of enforcement necessary to effect serious change.

Before the Quake

The problems Haiti faced before the earthquake are overwhelming and include the presence of violent gangs, a corrupt National Police force that participated in kidnappings and murder, grossly inadequate prisons, a broken judicial system, child trafficking, a total lack of worker’s rights, and widespread political corruption, to name a few. Immediately following the earthquake there were questions amid the chaos as to the whereabouts of the Haitian government, a question that may have well been asked days, even years earlier.

The Need for Governmental Reform

Despite the government’s complete ineptitude, Secretary of State Hillary Clinton rushed to Haiti to assure the victims, and the rest of the world, that the Haitian government was in charge. The Haitian government must become an aggressive advocate and protector of the rights of its people. Haitian law provides for many human rights protections, protections that have been ignored for years in Haiti. The Haitian Constitution incorporates by reference the Universal Declaration of Human Rights, which provides protections against things like arbitrary arrests and incompetent tribunals. The Declaration also assures just and favorable working conditions, social and economic rights, and even the right to a standard of living adequate for the health and well-being of each worker and of his family, including food, clothing, housing, and medical care to name a few. However, not even the most basic of these guarantees have been effectively protected in Haiti.

The first line of defense must come from the Haitian government. It is not enough to point to unenforced laws. For example, the government itself admitted in 2008 that forty percent of children never attended school, and of those that do, only fifteen percent would graduate from a secondary school, despite constitutional guarantees of free and compulsory education. Many children are forced to work at an early age.  Child trafficking and indentured servitude are rampant, and the Haitian government lacks the capacity, the resources, and the will to adequately protect or even advocate on behalf of their own people.

In 2009 the Haitian legislature voted to increase the minimum wage to about $4.90 USD a day. While this amount may seem meager, it represents a substantial pay increase for the average Haitian, millions of whom live on less than $2 dollars a day. Unfortunately, Haitian President Rene Preval was quick to bend under pressure from the private sector, and refused to sign the measure into law. Peaceful student demonstrators who protested this lack of presidential courage in the streets of Port-au-Prince were greeted with aggressive repression not only from Haitian Police, but from UN forces.

International Law Reform

A global disregard for international human rights law also played a vital role in developing Haiti’s precarious pre-earthquake condition. Rather than supporting a wage increase for Haitian factory workers, former President Bill Clinton and representatives from the UN have spent the last several years using the cheap Haitian labor as a recruiting tool to bring even more factories to the island nation. In an October conference Clinton was quoted as saying, “The rich will get richer, but there will be a much, much bigger middle class, with poor people pouring into it at a rapid rate.”

Unfortunately this model depends on a “middle class” that earns barely $3 dollars a day, while simultaneously increasing the concentration of wealth and power in the upper class. This model, which has already been tested and failed, does not present a long-term solution in Haiti.  Instead, it reveals an integral part of the problem. An economy that compromises the legally protected rights of the masses in order to serve the interests of a privileged elite is well poised to perpetuate the kinds of crime and poverty that plagued Haiti before the earthquake.

Much like Haitian law, there are international laws that provide for all the necessary human rights protections needed in Haiti, but these laws are not yet accompanied by any serious enforcement mechanism. The UN International Covenant on Economic Social and Cultural Rights (ICESCR), for example, requires party states to take steps to improve, in part, labor conditions and job creation. The obligations include providing “technical and vocational guidance and training” and the development of policies and techniques to achieve steady economic, social and cultural development. The United States has signed, but not ratified the ICESCR, while Haiti has yet to sign the Covenant.

While the ICESCR may not be binding on either the United States or Haiti, other international law does call for the protection of certain human rights. The Charter of the United Nations declares that the mission of the UN is in part to protect human rights, and equality of “nations large and small.”

In addition the UN Convention on the Rights of the Child is another tool that, if properly enforced, could help promote progress and development in Haiti. The convention provides in part that detention or imprisonment of a child will be used only as a last resort, and only for the shortest appropriate time. These and other guarantees go virtually unrecognized in Haiti where, at the end of 2008, nearly 88 percent of their 316 incarcerated minors were in prolonged detention. Many were detained without charges and without representation. Educational rights and guarantees provided in the Convention on the Rights of the Child will also be vital to the development in Haiti, where a high rate of illiteracy and unskilled laborers have gone hand in hand for years.

The development and protection of rights generally come in two phases. First comes the formal recognition of a right, followed in most cases by some kind of affirmative action to enforce that right. The desegregation of schools in the United States, for example, started with Brown v. Board of Education, where the Supreme Court formally recognized the harmful effects of segregation and the right to equal education. Later came a series of court decisions and affirmative action programs to ensure that the right to equal education was enforced.

The UN has taken the first step by recognizing the existence of certain human rights, but have yet to find an effective way to affirmatively enforce these rights. As the law currently stands, it is unclear that the recognition of these rights actually imposes any kind of obligation on party nations or the UN to help in the protection of human rights. Even if such an obligation was found, it seems that the UN lacks the capacity, like the Haitian government, to enforce the very laws they seek to uphold.

US-Haitian Relations

The United States Congress passed the HOPE II Act in May of 2008, which extends favorable trade benefits to Haiti in order to encourage foreign investment in the textile industry. The creation of cheap labor jobs has been touted by many as the key to Haiti’s poverty exodus, despite the fact that this model was followed in the 1970’s and 80’s with no real long-term benefits to Haiti or its people. This is yet another example of stale ideas being promoted as part of a fresh start.

While the Act may be designed to promote foreign investment in Haiti, it also contains several human rights provisions, namely that the benefits will not be available unless Haiti is “making continual progress toward establishing” systems to fight corruption and protect worker’s rights, including a prohibition of child labor, promotion of acceptable working conditions, and minimum wages. These provisions give the President considerable power to lean on the Haitian government to protect human rights, although such power is unlikely to be exercised. Much like the ICESCR, the Hope Act is sufficiently vague as to not require any real action by the Haitian or United States government. Rather than guaranteeing the right to collective bargaining, for example, the HOPE Act merely suggests that the Haitian government make progress towards protecting worker’s rights.

What Will Be Their Foundation?

There are always those who look to profit in the wake of a disaster, and many look to take advantage of the chaos and desperation. Private entities and foreign investors are often able to curtail human rights obligations either because of lack of enforcement, or weak statutory language that imposes no real duty in the first place. As reconstruction begins and Haiti is divvied up among foreign investors and private contractors, who will be there to make sure it is not done at the expense of the Haitian people? Who will make sure that Haitian workers are paid their legally guaranteed fair wages , or that the Haitians will be doing the work at all? These are the questions that must constantly be monitored throughout the rebuilding process, because if Haiti is not rebuilt upon a foundation of human rights, we risk rebuilding the Haiti of January 12th, 2010.

If the best things in life are free, then it’s probably unfortunate that we often take for granted what is freely given. Since the advent of free radio broadcasting, radio stations have enjoyed a unique role in American culture–they tell us what to listen to. Radio promotes the artists whom we grow to love as music listeners. They even tell us who to love.

In the early twentieth century, artists, managers, and recording studios began to recognize value in songs’ copyrights. They formed collectives to catalogue, copyright, and collect royalty fees. Under the current agreement structure, the broadcasters (radio stations) that use the music pay fees to these copyright collectives, or “performance rights organizations.”

Years of litigation and publicity battles resulted in an agreement whereby radio stations paid royalties to a song’s composer, but had a “free pass” when it came to paying the performing artists. The artists were “compensated” with the benefits of good airtime. This free pass, however, faces a stiff challenge in new federal legislation: the Performance Rights Act. At first glance, this seems like a fair deal–pay the composer and the performer. But is “fairness” really the driving force behind this new bill?

A  B R I E F  H I S T O R Y  O F  M US I C  L I C E N S I N G

In 1914, the American Society of Composers, Authors and Publishers (“ASCAP”) was formed, with membership consisting of famed composers and songwriters of the day. Organizations like ASCAP act as intermediaries between copyright holders and those who used the copyrighted material publicly. ASCAP’s practical task was to monitor the airwaves for copyrighted songs and charge broadcasters fees for airing the song.

Initially, radio stations primarily broadcasted live performances and paid artists for each show. Over time, however, performers demanded higher wages, citing the broad reach of their performances. Eventually, broadcasters resorted to playing recorded performances instead of live ones. Together, the stations and ASCAP developed a royalty-collecting technique known as blanket licensing, whereby the stations paid flat royalty fees to play the music over a specified period of time.

From 1931-1939, ASCAP raised royalty fees for its copyright owners by 448%. In response, broadcasters created their own collective, known as Broadcast Music Incorporated (“BMI”). BMI housed copyrights for new, previously unrecorded genres of music such as folk, jazz, and later, rock and roll. BMI’s operation differed from ASCAP most significantly in that it took public domain songs, non-copyrighted material that is open for public use without charge, and broadcasted them for free. When ASCAP threatened to double rates again in 1940, the majority of broadcasters jumped to BMI. ASCAP assumed that the mob would soon return because they had the popular music. They were sorely mistaken. Even with “second tier” music playing, the competition was enough to break ASCAP’s stranglehold [at 7:00] on licensing fees, resulting in lowered royalty fees to compete with BMI.

As mentioned above, broadcasters have historically enjoyed a free pass with regard to paying performers, through their record labels. Currently, radio stations can play songs and must only send royalties to copyright collectives like BMI or ASCAP. The general assumption is that the artist benefits from increased sales and exposure arising from the playtime. If the songs become popular, a broadcaster can attract more sponsors, whereas the artists get their benefits from more exposure, an indirect monetary gain at best. But now, the artists are fighting back.

S O,  W H A T ‘ S  T H E  P E R F O R M A N C E  R I G H T S  A C T ?

Decades after ASCAP lost their monopoly of music rights, the Recording Industry Association of America (“RIAA”) is using new legislation to seize control. The RIAA is a conglomerate that represents recording labels and their contracted artists, collecting royalties for performances on their behalf. Prior agreements held that the exposure an artist and record label received from radio airtime was very beneficial to the label/artist, so stations did not compensate performers. In 2009, however, the RIAA successfully lobbied Congress to push a bill that requires broadcasters to pay the record companies a fair royalty fee in addition to the existing copyright collective royalties.

The Performance Rights Act is now up for vote in both houses of Congress. If passed, the law will require radio broadcasters to pay royalty fees to the RIAA based on the station’s revenue. Proponents of the bill are pushing a fairness rationale. The RIAA even used several moderately popular recording artists such as Sheryl Crow and will.i.am to testify before Congress. This fairness appeal hits home for the average consumer and legislator alike, most of whom do not understand how the industry functions. After all, it seems only fair that the performer be compensated for his work, right?

Most radio stations and many scholars agree that performers should be compensated fairly, but say ‘no’ to the bill because they claim that the record labels will truly enjoy the revenues from the proposed license fee increase, not the artists. Society is now a bit wiser to the reality that few artists enjoy large revenue from album sales. The contracts that bind artists to record labels typically provide very small percentages of profit to the performer. Performers make most of their money doing tours and through sponsorship deals. Record labels have not enjoyed as high of profits from CD sales, since illegally downloading free music on the Internet became popular.

Critics of the bill say it is a last resort ploy from a “dying industry” to gain some revenue back from radio stations. The fees that would be imposed may be manageable for large radio stations, even if the result is budget cuts and more commercials. The bill, however, will likely hurt small radio stations, which would be forced to upgrade their technology to track and document the performer of every song they play in order to compensate accordingly in compliance with the proposed bill. These additional costs would be especially difficult for college radio stations and minority-owned stations, which tend to have fewer financial resources.

Other critics suggest the proposed bill will destroy diversity on the airwaves. Because stations’ primary means of income is advertising, the biggest advertisers tend to buy slots where the more popular music is played. The bill seems to encourage stations to play only the most popular music, in order to gather sufficient advertising revenue. Consequently, the bill also hurts independent artists, whom radio stations would now be reluctant to play due to their lower advertising potential.

An example of the backlash against the proposed bill occurred in Texas, where a station refused to play songs from any artist associated with the RIAA. The CBS-owned station representative said the bill is an example of how the recording industry is reacting to its own “hemorrhaging business model by taxing radio stations under the banner of ‘artist rights.’” (Referring to the financial difficulties the recording industry has faced because of the “free” digital music on the Internet).

Additionally, since stations choose who they play, they also decide in part who is popular. Therefore, they affect music label revenues (and any artists fortunate enough to own their record labels). If the record labels truly want to decide whom “legally” gets promoted more, what better way to control revenues than to implement better pricing mechanisms to influence what artists a station plays?

A N  U N C E R T A I N  F U T U R E  F O R  R A D I O

Once thought to be one of the few industries with real resistance to economic downturns, radio’s future now seems uncertain. Stations may now suffer in the same struggles as internet, satellite, and cable radio, which all saw a similar “performer royalty fee” imposed on them in the last decade, and do not enjoy the attention and advertising support that broadcast radio does.

Consciously or not, society is shifting toward a rationalization of obtaining music for free. This crusade is led by the youth of our nation. Stanford Law professor Lawrence Lessig, an expert in copyright law, claims that a youth’s ability to remix and adopt music in his or her own way is the instrumental way of self-expression [at 12:35]. He argues that the record companies and ASCAP are attempting to stifle the creativity of a generation by implementing strict and unrealistic royalty laws. In 1996, for example, ASCAP threatened to file suit against the Girl Scouts of America for using a song at a camp without paying a royalty, because the group used the song in a “public” fashion by playing it for 214 young girls. ASCAP also threatened to hike royalty fees for ring tones, claiming that whenever they are played in public from an incoming call, they violate copyright laws. Luckily, the NY district court didn’t buy it.

Society is in a strange middle ground [at 18:12]. We want to respect the creative works that our artists create and compensate fairly. Conversely, many people no longer wish to pay for music, leaving a large portion of society literally shifted into lawlessness. But, if an enormous segment of society is living “against the law,” isn’t it time to consider changing that law? Only time will tell. So turn on your radio and stay tuned in to the debate. It won’t cost you anything . . . for now.

Chances are, you are one of the 100+ million people who watched Super Bowl XLIV on Sunday. To say it was big is an understatement – it was a day of record breaking. Along with being the most-watched television program since the series finale of M.A.S.H, it was the first appearance (and first Super Bowl win) for the Saints in the battle for the Lombardi Trophy. Sunday’s victory for the New Orleans Saints, and the subsequent strains of “Who Dat!” heard throughout New Orleans also echo a recent controversy over the Saints’ battle cry – and who, if anyone, can copyright or claim trademark on such a saying. Originating in minstrel shows and other decidedly un-PC uses, “Who Dat’s” modern associations with football are contested. Some claim it arose from Patterson High School, some 60 miles south of New Orleans, following a star football player, Dalton Hilliard, to LSU and later to the Saints in the 80s. Others say it came from a cheer used at Southern University and New Orleans’ St. Augustine High school. No matter the origin, though, “Who Dat” is now a beloved and unmistakable rally cry – it’s even been memorialized in song. Members of the Who Dat Nation say that the Saints fans own the slogan, but the NFL begs to differ.

Well known as a zealous and sometimes overprotective guardian of its intellectual property, the NFL began to target sellers of unofficial Saints merchandise using the slogan, claiming exclusive rights over the phrase based on a 1988 trademark. The NFL asserted that any use of the phrase, the Saints’ black and gold colors, or roman numerals infringed on their trademark. Another wrinkle in this issue? A lapsed copyright to the phrase belonging to two Louisiana brothers. This did not deter the NFL, however. Cease and desist letters – the ominous reveille of an impending IP suit – began to appear in late January. But Saints fans did not go quietly into the night. Their  protests over the NFL’s claims raises the question of what exactly can be trademarked, and what kind of protections arise from them.

Trademarks and Fair Use

Trademark Law’s modern iteration comes by way of the Lanham Act of 1946 – 15 U.S.C. §§ 1051-1127. A trademark, like a copyright, is created when the work it marks is created, but a trademark exists to identify the source of products and services (as opposed to works of literature or art, like copyrights). Trademarks are meant to be a unique identifier of certain brands to consumers – a distinguishing mark to assure quality and prevent fraud or misrepresentation. Trademarks must be distinct and specific. Merely descriptive or generic trademarks are often not registered by the US Patent and Trademark Office. Trademarks do not need to be registered, but registered trademarks (identified by the ® symbol) are more likely to be protected and upheld in court. Registered marks, if used uncontested for five years, become “incontestable,” which means that a mark may not be contested on the basis of being “descriptive,” (even if it is). Infringements on unregistered trademarks (identified by the ™ symbol) are not explicitly conferred any protection under federal law.

Trademark claimants, in order to bring a successful claim, must prove that they were the first party to use the mark in trade, and that the public associates it with their business. One powerful defense trademark defendants have is the doctrine of fair use. With trademarks, fair use is seen as a tool of the First Amendment – protecting the defendant’s right to use the mark to describe a product (not identify it) or to refer to the mark owner.

So Who Owns “Who Dat?”

Several parties have laid claim to the mark of “Who Dat” – including two trademarks by the New Orleans Saints Louisiana Partnership in 1988 (one for “Who Dat,” and one for the phrase in conjunction with the team’s Fleur de Lis logo). However, Steve Monistere, a local musician, registered the trademark five years earlier, in 1983, as part of his original version of the chant “Who Dat.” Monistere registered the trademark for the sale of records, cassette tapes, bumper stickers, t-shirts and other merchandise, claiming exclusive rights to the phrase, and was one of the first to call foul when the NFL went on the offensive.

The real ownership of the trademark is murky – if the phrase can even be trademarked. The immediate association with “Who Dat” is with the football franchise, not Mr. Monistere. Nevertheless, “Mr. Monistere claims he first sold shirts bearing the now infamous slogan in April 1983 – more than five years before the Saints claimed trademark on the phrase. He even filed a suit against Tees Unlimited in 1983 for copyright infringement: Tees Unlimited printed shirts saying “Who dat say dey gonna beat dem Saints.” The court held that neither side had exclusive rights to the phrase. There still remains questions over whether the phrase can be trademarked it all – it originates far before the 1980s, and its initial association with Louisiana football is not even clear. Even Saints coach Sean Payton asserts that “I don’t think anyone can own Who Dat personally.”

Settling the Score

Even after all the confusion regarding the true ownership of the phrase – and whether it is something that can be trademarked – the NFL registered a trademark for “Who Dat” in Florida, the location of Super Bowl XLIV. Their claims in Louisiana have been met with criticism and protest – even from Louisiana Junior Senator David Vitter. The NFL returned with an uncharacteristic almost-apology, saying that it would “narrowly focus” its enforcement attempts to uses of the phrase associated with other identifiers of the Saints.

This uncharacteristic backing off of the NFL is almost as unexpected as the Saints’ underdog win on Sunday. Still, the question remains: just who, if anyone, can trademark a slogan? The NFL may have backed off while the Saints came marching in (sorry), but the battle over “Who Dat” will have to wait until next season.

Despite the amount of behind-the-back trash-talking and whispered secrets passed along in e-mails between friends, we feel at ease because our electronic correspondence is secure, right? While most take solace in the fact that their e-mail accounts can only be accessed with a password, websites like Activehacker.net and Hackmail.net provide hacking services for anyone who wishes to view another person’s e-mail account. E-mail is now the primary means of communication among individuals, organizations, businesses and governments – and it is vulnerable. As the rate of innovation in computer technology increases, the advancement of hackers’ abilities treks closely behind. The Federal Bureau of Investigation estimates that online banking attacks, primarily through the use of Trojan Horses and phishing scams, has resulted in attempted losses of $100 million as of October 2009. Additionally, the recent surge of new viruses making their way through the Internet, causing substantial disruption and financial damage, shows that computer hacking and online fraud are constant threats.

“Hacking,” defined as “the illegal entry into a computer system through unauthorized means . . . via a direct or indirect approach[,]” has been taking place since the 1980s. While financial gain is the most commonly cited motive for computer hacking, other reasons include desire for entertainment, furthering political agendas, and revenge. Hackers can commit several different types of technology-based crimes, and each crime presents novel and challenging enforcement issues. Deterring and prosecuting e-mail hackers, however, is particularly difficult because paying customers can access targeted e-mail accounts undetected.

Cyber Crime Laws

In the United States, the main law governing cyber crime comes from the Computer Fraud and Abuse Act (CFAA), codified in 18 U.S.C. § 1030. The CFAA, however, is primarily aimed at protecting government computer systems. More specifically, section 1030(a)(1)-(7) prohibits anyone from knowingly accessing a computer without authorization to (1) obtain national security data, (2) obtain financial institution information, (3) obtain information from any U.S. agency or department, (4) obtain financial gain by fraud, (5) cause damage to a “protected computer,” (6) knowingly use password information to defraud, and (7) obtain information for extortion purposes. Some critics argue that this law is poorly written because it allows one to access a non-government computer without authorization, so long as he or she does so without intent to defraud – no help to the private web e-mail user.

Federal laws on e-mail hacking are set forth in 18 U.S.C. § 2701. Section 2701(a) punishes anyone who “intentionally accesses without authorization a facility through which an electronic communication service is provided[,] or intentionally exceeds an authorization to access that facility[,] and thereby obtains, alters, or prevents authorized access to a wire or electronic communication while it is in electronic storage in such system . . . .” If an offense was committed for commercial gain, the punishment enforced under this statute is a fine or imprisonment up to five years for first-time offenders, and up to ten years for repeat offenders. All other offenses may be punishable by a fine and imprisonment up to a year for first-time offenders, and up to five years for repeat offenders.

Prosecution Problems

All Internet users and services are vulnerable to hacker attacks. Even major e-mail players like Google and Microsoft are not beyond the reach of online fraud. Due to the increased and widespread use of the Internet, seasoned hackers can obtain confidential information on almost anyone. For example, shortly after John McCain named Alaska Governor Sarah Palin as his running mate in 2008, a group of hackers made headlines by hacking into her email account and posting what they found on Wikileaks.org, a website that provides an online forum for leaked documents. The high-profile nature of the case led to law enforcement action. Alleged hacker David Kernell, a twenty-year-old college student, was charged with violating federal e-mail hacking laws, fraud, unlawful electronic transmission of material across state lines, and an attempt to conceal records to impede an FBI investigation. His trial is set to begin in April of 2010.

In addition to federal legislation, states have tried to pick up the slack, also passing hacking and unauthorized access laws. However, these measures have proven to be ineffective. John Thompson, CEO of computer security powerhouse Symantec, stated in a speech that “[i]t is impractical to have 40 different states, each with its own laws; we need a federal law with very high standards today.” Regardless, federal and state laws do not appear to deter e-mail hackers from continuing operations. In a recent Washington Post article, George Washington University law professor Orin Kerr concedes that federal law clearly prohibits hacking into e-mail accounts and services, but the offense only constitutes a misdemeanor, unless further illegal activity stems from the hacking. Furthermore, Professor Kerr acknowledged that “[t]he feds usually don’t have the resources to investigate and prosecute misdemeanors . . . [a]nd part of the reason is that normally it’s hard to know when an account has been compromised, because e-mail snooping doesn’t leave a trace.” Because the services provided by e-mail hacking experts are merely misdemeanors, typically not investigated by the FBI, and difficult to track, hacking service providers can continue operations with little fear of being caught.

Adding to the difficulties in enforcement, many hackers providing services to the United States have sprung up overseas. Alissa Cooper of the Center for Democracy and Technology said that “[t]his kind of thing has been on the radar of law enforcement already . . . [but] in practice it takes a lot of resources and time to build up relationships with [law enforcement] in other countries.” Because hackers have many tricks and techniques at their disposal to avoid capture, including the creation of fake trails concealing their location, the fact that hackers are now located throughout the world solidifies the presumption that enforcement is impractical. James Lewis, director of the Technology and Public Policy Program at the Center for Strategic and International Studies, adds that “[i]t’s very difficult to track hacker attacks, and even if you can track it, you don’t always know with 100 percent certainty if you’re right . . . .” Even when hackers are caught, some escape harsh punishment through plea bargains in exchange for information about other notorious hackers. After all, sophisticated hackers are better equipped than federal authorities to break through other hackers’ defense mechanisms.

It seems reasonable that the FBI would rather devote its resources to the next big drug bust or tracking a serial killer, rather than attempting to take down hacking service providers owned and operated by college students and part-time Internet bandits. While hacking into e-mail accounts of high-profile politicians and well-known public figures is more likely to result in federal investigations and prosecutions, enforcement of anti-hacking laws where the target is one of over hundreds of millions in the general public seems unlikely.

The Future of Cyber Crime and E-mail Hacking

The government’s concern over cyber security will continue to grow, so long as technological innovations take place and scammers who thrive on beating the system keep perpetrating frauds. Currently, citizens who knowingly open paper mail addressed to other people without authorization are guilty of a federal felony under 18 U.S.C. § 1702. Those who knowingly open e-mail addressed to other people without authorization, on the other hand, are guilty of a misdemeanor, presumably because sending e-mails is like sending a post-card through the postal service—and one does not send confidential information on a post card. When it comes to hacking into e-mail accounts, however, the question we must ask is whether e-mail hackers should be punished as felony offenders. Depending on the nature of the harm effected, some might feel uneasy about sending dorm-room chop shoppers to serve five-year prison terms. Others, however, are in favor of stricter laws.

Congress has responded to widespread cyber crime with increased prison sentences for computer hackers targeting government computers. U.S. Senators John Rockefeller (D-WVA) and Olympia Snowe (R-ME) further advocated for a new “cyber security czar” to serve as the government’s top cyber security official, with the goal of creating an integrated and creative cyber security system, and in 2009, President Obama announced the creation of the “cyber czar” position. These developments demonstrate the administration’s commitment to protecting critical national security computer networks, but they do not address concerns over the growing number of hacking service providers. It appears that e-mail privacy for the general public will not become a major governmental concern anytime soon; as such, those who are looking to transmit confidential information would be better off sending self-destructing disks via snail mail in the vein of Mission Impossible rather than conveying messages through e-mail.

Written By:  Casey E.R. Sanders
Researched By:  Moorisha Bey-Taylor
Edited By:  Stephen Robbins
Managing Editor:  Mary Anne Nash

Every week, Animal Planet airs the reality television series “Whale Wars.” The show chronicles the

missions of the radical environmental group Sea Shepherd as they attempt to disrupt the Japanese whaling fleet from the hunting of minke and fin whales. The television show has become a cult hit and cultural phenomenon, raising both praise and ire from the general public. The Sea Shepherds brave the fierce storms and freezing waters of the Southern Ocean to prevent what they claim is de facto commercial whaling by the Japanese under the guise of scientific research. The Japanese in turn have accused the Sea Shepherd activists of piracy, and even in the United States critics have accused the group of radical eco-terrorism. Sea Shepherd’s leader Paul Watson is no stranger to controversy and seems to revel in the rebellious nature of his group’s mission.

Whale Wars has brought issues of commercial whaling and alleged piracy into our homes as riveting television. But what legal regimes have created this flurry of controversy? Both Sea Shepherd and the Japanese claim to be on the right side of the law and accuse the other side of flagrantly violating it. What fuels the so-called Whale Wars is a fascinating mix of international law, or lack thereof, conservation efforts, scientific research, cultural values, and continued legal controversy that seems unlikely to fade away in the near future. So which side has the sharper legal harpoons?

A Whale Of A Tale

Whaling has been part of the cultural traditions of most oceangoing peoples since ancient times. Many of these cultures engaged in sustainable near shore whaling which ensured the continual survival of whale species. That changed however in the 17^th century with the advent of large scale European whaling expeditions which could last for many months and yield large profits for investors. These expeditions devastated previously sustainable populations of whales and resulted in a dramatic decline in certain populations of whales. Large-scale whaling seemingly knew no bounds as the whalers exhausted populations in the Atlantic and began to devastate whales in the Pacific. As industrialization of whaling continued, methods became more and more effective at catching and killing whales.

Recognizing that whale populations were declining dramatically as well as the potential tragedy of the commons problem whale stocks presented, in 1946 the major European and American whaling countries reached an agreement known as the International Convention for the Regulation of  Whaling. The convention established the International Whaling Commission (IWC) to supervise whaling and ensure the continued survival of whale stocks. The powers given the IWC include the ability to set quotas on a species by species basis, dictate open and closed seasons for whaling, and establish whale sanctuaries in which no whales can be hunted. Since the founding of the IWC many more countries have joined, with Japan entering in 1951.

Things changed dramatically in the 1970’s and 80’s with increased scientific research on whales. Suddenly whales were no longer simply seen as the sea monsters of old, they had dense social structures and performed complex whale songs. Ever increasingly cetaceans were viewed in more and more human terms and organizations such as Greenpeace began advocating for an outright abolition of whaling. In particular the United States became an increasingly vocal advocate for greater restrictions on whaling. Finally in 1982, the IWC member states voted 25-7 to support a moratorium on commercial whaling beginning in 1986. Japan was among the seven countries that voted against banning commercial whaling.

Japanese View on Whaling

Since the beginning of the ban on commercial whaling, Japan has been arguably the most vocal critic of the moratorium and its consequences. The Japanese claim whaling as an important part of their cultural heritage and are extremely resentful of “Western insensitivity” toward their whaling heritage. Japan has repeatedly attempted to lobby other countries to support an overturning of the moratorium, but has failed to rally countries to their cause. In addition to the IWC, Japan faces difficulties in any potential resumption of commercial whaling operations from the United States which has legislation on the books that would severely limit Japanese fishing in American waters if Japan ever violates the rulings of IWC. It is the threat of sanctions in the international community especially from the United States that seem to check Japanese whaling ambitions more than anything else.

Almost immediately after the commercial moratorium on whaling was issued, Japan protested the IWC’s scientific basis for applying the moratorium. Article VIII of the 1946 convention allows for any member of the IWC to issue special permits to allow for the killing of whales in the interests of scientific research and for the government of that country to mandate what is done with the whale after the killing. Japan thus far is the only member state of IWC to issue these scientific research permits.

In 1988, the Japanese began a program known as JAPRA to scientifically study minke whales in around Antarctica.  The goals of JAPRA were the scientific study of minke whales for the estimation of minke whale stock numbers (specifically for better management of stock numbers), the role of whales in the Antarctic ecosystem, and the effects of environmental changes on the whales. In order to “properly” conduct the research, the Japanese proposed the killing of a limited number of whales and after the research was conducted, processing the whale meat and giving it up for commercial sale. Japan has also initiated a small program closer to home in the North Pacific.

Initially JAPRA did not seem to raise much controversy within the IWC. The Japanese government went so far as to praise the researchers efforts saying “that JARPA has already made major contributions to the understanding of certain biological parameters” of whale populations in a 2002 research plan. However when the Japanese attempted to expand the scientific research with a new program, JAPRA II, the IWC sprung into action and condemned the “lethal aspects” of the research in a 2007 resolution. Nevertheless Japan has continued to exercise its Article VIII rights and maintained the research harvest in the Southern Ocean.

A Shepherd Protecting Their Flocks

The continued Japanese whale hunting in the name of scientific research has not escaped environmental organizations. Greenpeace has been particularly critical, accusing the Japanese of outright commercial whaling under the guise of scientific research and pointing out that the research done by the Japanese is only useful for the resumption of commercial whaling, something Greenpeace is firmly opposed to.

But no group has been more critical and openly hostile to the Japanese whaling fleet than Sea Shepherd. Since its founding, Sea Shepherd and the group’s leader Paul Watson have orchestrated a truly global campaign against whaling operations. Sea Shepherd proudly lists multiple successes in the destruction of multiple whaling vessels on its website and the Institution for Cetacean Research maintains a similar list of “alleged terrorist activities.”

Sea Shepherd is committed to vigilante tactics in openly disrupting the Japanese whaling fleet, yet still recognizes the need to find a basis in law for their actions. Paul Watson claims the authority to do this comes from the United Nations World Charter for Nature. Specifically Sea Shepherd claims that Section 21 allows “states and, to the extent they are able, other public authorities, international organizations, individuals, groups and corporations,” to implement the applicable international legal provisions for the conservation of nature and the protection of the environment.” The Japanese fleet takes whales in a designated whale sanctuary, and Sea Shepherd has declared this action to be illegal and has taken enforcement into its own hands.

The Murky Nature of International Waters

The great drama of Whale Wars is created by the nature of international law. There is no police force on the high seas and both the Japanese, by hunting in an IWC designated whale sanctuary, and Sea Shepherd, in engaging in destruction of property and other tactics, operate free of any interference by other ships. This has essentially created a zone of vigilantism in the Southern Ocean where both the whalers and the anti-whalers must fend for themselves.

While Sea Shepherd’s tactics, such as putting crew members onboard a Japanese vessel and claiming they were illegally “detained” have raised the specter of piracy charges, it seems unlikely that any charges could hold up. Piracy as defined by the United Nations consists of any “illegal acts of violence or detention, or any act of depredation, committed for private ends by the crew or the passengers of a private ship or a private aircraft” and Sea Shepherd does not meet those criteria. In practice Sea Shepherd seems to be committed to skirting, but not crossing, the standard of “violent acts.” Watson himself claims that “Our record speaks for itself. In 30 years of operations the Sea Shepherd Conservation Society has never caused a death or a single injury.” Sea Shepherd also exploits the lack of jurisdiction: most countries are reluctant to allow charges against Sea Shepherd to proceed, and Sea Shepherd does not operate in Japan.

Hunting the White Whale

Both the Japanese and Sea Shepherd remain stubbornly committed to fighting for their beliefs on the high seas of the Southern Ocean. This will probably lead to a continuing cold war between the whalers and whale activists with compromise unlikely in the near future. Given the reluctance of the IWC or the international community to denounce the actions of either side in any meaningful way, the Whale Wars, and the compelling television they produce, will continue unabated.

Written by:  Eric Blaine
Researched by:  Amanda Husted
Edited by:  Adam Gottlieb
Managing Editor:  Jennifer Hill

Cue Soundtrack!

American motion picture studios have a bipolar reputation. There is the glamorized but satisfying notion of Hollywood as being a delightfully messy mixture of high-powered fast-talkers, gonzo auteurs who will do anything for their art, sleazy agents, stylish stars, and the distinct possibility to dreams may very well come true. However, there is also the doleful realization that movie studios are almost all merely one branch of multinational corporations, those unappealing guys who combine all the worst qualities of bureaucracy, economics, and salesmanship. Movie studios are big businesses, and while making movies often involves art, entertainment, and attractive distillations of cool, they also have to keep an eye on profit margins and bottom lines.

So when one reads that 20th Century Fox, Universal, and Warner Bros. (owned by News Corporation, NBC, and Time Warner respectively) refused to deal with rising DVD retailer Redbox because, frankly, they didn’t think they were making enough money, it’s pretty hard to imagine these three studios as being anything but tedious bean-counters just looking to squeeze some more cash out of whatever source they can find. It strikes many as unseemly, but it’s not the gloriously despicable evil that Hollywood villains could cook up.

The fact that Redbox is suing them both under antitrust law, however, highlights one of the most litigated aspects of anti-competition statutes: the idea that a contract, combination, or conspiracy that restrains trade is something that invariably harms consumers like you and me, and is not tolerated, even in a free market economy.  Conspiracies and restraints sound like something more common in the glamorized version of Hollywood, though in truth, they are very common, very mundane, and represent very large amounts of cash.

Establishing Shot!

The lead-up to this lawsuit is straightforward.  Redbox’s business model is to place its automated kiosks in locations with a lot of foot traffic, like grocery stores and malls. The kiosks function essentially as DVD vending machines – customers are able to select from hundreds of new and older DVDs and pay $1.00 per night to rent them (or pay $25.00 if they lose the movie). Because the vending machines require virtually no overhead, Redbox is able to stay profitable despite charging only 20% of what brick-and-mortar stores like Blockbuster will charge for the same movie. The combination of low price and convenience has helped Redbox expand from twelve machines in 2004 to thousands in a little over five years.

There is a lot about Redbox’s operations that movie studios just don’t like. For one, studios make vast amounts of money selling new DVDs, and are concerned that having such a low-price alternative will only drive down the demand for new DVDs. Also, after renting a DVD a certain number of times, Redbox sells it, either directly to consumers or to used DVD distributors. Because the quality of used DVDs is virtually the same as for new versions, this further dilutes the market for DVD purchases.

Late this year, Warner Bros., Universal, and Fox had enough. They prohibited their distributors from selling DVDs to Redbox until at least thirty days have passed since the date the movies initially hit the shelves. This means that Blockbuster, Target, and Walmart will have a month to rent and sell a movie before Redbox can even start stocking its machines with it. This directive followed lengthy negotiations in which the studios tried to get Redbox to agree to raise its one-dollar-a-night price, with Redbox steadfastly refusing.

Redbox thereafter filed an antitrust suit, alleging an illegal restraint of trade.

Cut to Flashback!

“Antitrust” is a term given to a broad range of laws meant to prevent business entities participating in certain activities that prevent competition in the free market. The term antitrust arose from the peculiar history of business governance in America’s late 19th century. During that time, one corporation was barred by law from owning the stock of another corporation. The captains of industry (or robber barons, depending on who you asked) didn’t much like this rule, and an elegant solution was devised: shareholders of a corporation could transfer their stock to a trust, and have the trustees operate the corporation or purchase stock in another corporation. The same ends were met, and the law barring corporate ownership of another company’s stock was thoroughly circumvented. The awesome social power that these trusts enjoyed alarmed reformers of the day, who saw rampant harm to consumer choice and the competition of free markets in the actions of entities like the Sugar Trust and Standard Oil.

In 1890, the outcry was great enough for Congress to pass the Sherman Antitrust Act, a law that grants the Federal government authority to break up trusts and other combinations that impermissibly restrained trade and, thereby, harmed the economic welfare of consumers. Moreover, it grants to private actors the right to sue for damages if they are harmed by the illegal antitrust activities of others. Though the days in which corporations cannot own stock in other corporations is long past, the operative language of a “contract, combination, or conspiracy in restraint of trade” is still a fertile ground for both governmental and private litigation.

Such private antitrust suits are common, and potentially lucrative if they prevail. In the recent past, the National Football League has been sued by manufacturers of athletic clothing, alleging that the NFL’s business model drives out small and medium-sized companies and drives up prices for NFL apparel. Similarly, class actions have been filed against telecommunication companies for allegedly agreeing not to branch out into new technologies – technologies, it is said, that would help drive prices down.

Perhaps most on point for Redbox, the United States Supreme Court has held that manufacturers that impose minimal retail prices on their products sold by third parties are not in per se violation of the Sherman Act. In Leegin Creative Leather Products Inc v PSKS Inc., the Court held that a company must demonstrate that its minimal price restriction conforms to the demand that the restriction be commercially reasonable not only for itself, but for all aspects of the economy including consumers. This is a major change from previous precedent, which held that minimal price requirements are as a matter of law violations of antitrust law.

Big Finish!

A contract, combination, or conspiracy to restrain trade is precisely what Redbox is alleging against Universal, Fox, and Warner Bros. By directing their distributors not to sell Redbox some of its products until Redbox competitors have had the products for a month, Redbox alleges, these studios are depriving Redbox’s customers of the choice to view a Universal, Fox or Warner Bros. movie, with the naked justification that Redbox is simply not charging people enough money.

It will come as no surprise that Universal, Fox, and Warner Bros. dispute Redbox’s allegation. Fox notes that the economic crisis has harmed its bottom line recently, and that its actions are not only in its own best interest, but in the best interests of consumers. Others wryly speculate that Fox’s economic woes stem more from poor business judgment leading to a string of flops, particularly in its feature film division.  Universal’s outlook is similarly bleak. Yet Warner Bros.’ movie studio has been more commercially successful of late, buoyed with a number of successful franchise tent-poles.

Meanwhile, other movie studios are watching closely, especially in light of the recent ruling in Leegin Creative. An executive with Paramount Pictures praised the litigation (without actually backing one side or the other), saying it “gives us access to information that will allow us to make an informed decision about Redbox’s impact on our home entertainment business.”

Even in these lawsuits, the two versions of Hollywood can be seen competing with each other. Lawyers for each party casts itself in the mold of a perfectly innocent, utterly reasonable party just trying to make it through its day the best it can, while being beset by the greedy, arrogant bullying of low down tough guys with lots of money. Meanwhile, the parties’ legal briefs hinge on dusty old precedent and abstract legal arguments, about as far away from the glamour and excitement of movie sets. Time will tell not only which party prevails in these suits, but which aspect of Hollywood controlled the outcome.

Written by:  Adam Gottlieb
Researched by:  Daniel Kwak
Edited by:  Eric Blaine
Managing Editor:  Mary Anne Nash

America is losing the war on drugs.  Over the past 40 years, the United States Government

has spent more than $2.5 trillion dollars fighting the “war on drugs” yet the number of drug users in the United States has risen to a record 19.9 million Americans.  Meanwhile, each year Mexican drug cartels make billions from drug trafficking and there has been a steady increase in violence directly attributable to drug cartels, which style themselves after small paramilitary forces. Since 2006, more than 12,000 people have died in Mexico due to drug related violence, including more than 5,000 in 2009 alone.  The numbers of dollars spent and lives lost in this war are staggering, yet a disconnect persists between efforts of the U.S. government to curb drug use and the statistics of drug usage.

Many states are taking matters into their own hands and responding to what their citizens have said at the ballot box:  Some drugs are simply not worth fighting over. In some cases, such as with marijuana, many citizens believe that there are legitimate medicinal purposes for some drugs that have been outlawed. However, the United States has a rich history of legislation criminalizing drugs. This history begs the question:  Can the war on drugs be waged at the ballot box?

Puff Puff Passed Laws:  A History of Drug Regulation in the United States

There has long been tension between the Federal Government and the States regarding the right of the individual states to police themselves.  Under the Tenth Amendment, any powers not delegated to the federal government by the Constitution and not explicitly prohibited to the states are reserved to the States and the people. The federal government found a workaround by passing tax acts as an extension of their power to lay and collect taxes.  These acts taxed, and thus regulated, drugs, giving the federal government some authority over an area the courts traditionally considered within the state’s police powers.

Individual states took measures to regulate marijuana in the early 1900’s in response to the Mexican Revolution, the violence of which was spilling over the border into Texas and creating an influx of Mexican immigrants.  By 1921, Wyoming, Texas, Iowa, Nevada, Oregon, Washington, Arkansas, Nebraska and Utah had all outlawed marijuana largely as a reactionary response to the arrival of these new Mexican immigrants.  A chief difference between the new immigrants and the predominantly white populations in these states was that some of the new immigrants smoked marijuana recreationally.  This led to a push by mainly white State residents to outlaw the drug.  This was also part of a wider social movement against recreational intoxicants, as the United States passed the Eighteenth Amendment banning alcohol around the same time.

On a federal level, the government took incremental steps to police drugs. First, the Pure Food and Drug Act in 1906 created the Food and Drug Administration (FDA), which stated that certain drugs could only be sold by prescription, and required that labels for drugs that may be habit forming clearly state so. Next, in 1914, the Harrison Act criminalized non-medical use of drugs.  Using taxes on narcotics, the Harrison Act brought doctors under the regulations included in the act while effectively creating a criminal prohibition against recreational drug use.  Finally, in 1937 Congress passed the Marihuana Tax Act, effectively outlawing all marijuana use and, incidentally, the cultivation of hemp.  After the passage of this act, there was a sharp increase in the number of prosecutions for violating the act, as well as a corresponding increase in public awareness of drugs in general.

In 1969 Congress passed the Dangerous Substances Act which analyzes all drugs for two criteria:  First, whether the drug has a medicinal purpose, and second, the potential for and severity of the drug’s abuse.  Thus, Congress created what is commonly known as “scheduled” drugs, listing out five different Schedules.  To complement these schedules, penalties associated with each level correspond in severity, with the harshest penalties tied to Schedule I drugs , including LSD, marijuana, hash, heroine, cocaine, and other “hard drugs.”

Is Marijuana Medicine and Can States Legalize It?

As of this article there are currently thirteen states that have passed legislation to legalize the use of marijuana for medical purposes with four states utilizing licensed “dispensaries” where users could obtain the drug with a valid prescription. The federal stance on this issue is that marijuana is an illegal and dangerous narcotic that has no accepted medical purpose. The FDA argues that states who have made marijuana available for use upon a doctor’s recommendation are inconsistent with FDA efforts to ensure medications undergo rigorous scientific scrutiny under an FDA approval process and are proven safe and effective for it’s intended purpose. Currently the federal government, through the Department of Health and Human Services, owns the patent for all medicinal uses of marijuana. The FDA has concluded that marijuana has been correctly placed under Schedule I of the Controlled Substances Act as it meets the criteria for the schedule.

In the 2005 case of Gonzales v. Raich, the US Supreme Court ruled that the Commerce Clause allowed the government to ban the use of marijuana for any purpose, including medicinal use. Justice John Paul Stevens wrote for the majority which held, “Congress’ power to regulate purely activities that are part of an economic ‘class of activities’ that have a substantial effect on interstate commerce is firmly established,” regardless of the legality of that commerce.  This decision allows for federal prosecution of both medicinal users and producers of marijuana earmarked for medicinal use.  This case was a major victory for the Bush administration, which had been involved in federal raids of medicinal marijuana dispensaries in California and other states.

Shortly after his election President Obama appointed Attorney General Eric H. Holder Jr., who stated the Justice Department’s new enforcement policy would be restricted to drug traffickers who masqueraded as medical dispensaries and who use State medical marijuana laws to shield themselves from criminal prosecution.  This statement has been widely interpreted to be a tacit acknowledgement that States may regulate medicinal marijuana without excessive federal involvement.

Legalize It – Don’t Criticize It?

It’s no secret the economy has been bad recently and many states are having budgetary problems.  One state looking at an unorthodox method of raising revenue is California.  There are two proposals that may be be included on the November 2, 2010 ballot that could dramatically reform the state’s marijuana regulation.  The first is the Legalize, Regulate and Tax Marijuana Initiative and the second is the Regulate, Tax and Control Cannabis Act of 2010.  Govenor Arnold Schwarzenegger has publicly stated, “Well, I think it’s not time for (legalization), but I think it’s time for a debate.”

The reasons for the open debate are projections that legalization and taxation of marijuana could bring an estimated $1.4 billion dollars in revenue into the cash strapped state, which is still fighting a $26.3 billion dollar budget deficit.  Furthermore, the Legalize, Regulate and Tax Marijuana initiative includes a provision to retroactively expunge any conviction for marijuana related charges and provide convicts a “clean slate,” including releasing those in prison convicted of marijuana charges.  This in turn could free up some much-needed money from the $9.7 billion dollars allotted per year for the California prison system.

Several other states have attempted to decriminalize or legalize marijuana in recent years. In Alaska it is legal to possess up to 4 ounces of marijuana in a private home under the Alaska Supreme Court case of Ravin v. State. In that case the Court found that under the State constitution the citizens have a right to privacy within their own home that extends to possession and use of the drug.  This case is still good law in Alaska even though there have been several attempts to re-criminalize the drug in recent years.

In Colorado, the city of Denver voted to essentially legalize possession of marijuana in amounts less than 1 ounce by setting the fine at $1.  However, a 2006 ballot initiative to legalize marijuana on a statewide basis was definitively defeated.  The effect of this is that state law enforcement officials may still prosecute marijuana offenders to the fullest extent of the law. These test cases for the legalization of marijuana are still rife with constitutional implications, and the debate on how to balance state rights against federal powers is far from over.

Where Are the Laws Headed Now?

While the debate about legalizing marijuana for medicinal use or recreational use has become a hot topic in the United States, Mexico has been facing a severe crisis due to the violent drug cartels that smuggle drugs into the United States.  Violence along the border of Mexico and the United States has been extreme, with casualties and kidnappings of both Mexican and American citizens.  The problem has become so severe that Attorney General Eric Holder has stated that Mexican drug cartels pose a national security threat to America and threaten to destabilize the Mexican government.  Mexico has gone so far as to mobilize more than 36,000 troops to combat the cartels, which have no problem funding their business and paramilitary enterprises.  In one of its most recent reports, the U.S. Department of Justice disclosed that an estimated $17.2 billion dollars was funneled into Mexico in the past two years as a result of money laundering operations.

Beyond activating troops and looking to the United States for more help, Mexico has recently taken a drastic step in their battle on drugs. They legalized them. As of the end of August anybody caught with “personal usage amounts” of marijuana, cocaine, heroin, ecstasy, or crystal meth will not be subject to any criminal penalties. The socially conservative President Felipe Calderon argued that the Mexican government needs to refocus its efforts on combating the sources of drugs and violence, rather than the users. This sweeping change will have an impact in Mexico and could have one here in the United States. Drug reform groups have celebrated these laws as an example the United States should follow if they prove effective across the border.  Whatever your position is, with California’s ballot initiatives gaining momentum, this debate looks to be far from over.

The Legality is on the long road back from Summer break.  Please look for a new article by the end of September.  Until then we have posted a new Word of the Week, so check it out and browse the rest of the site.

Thanks for stopping by,

the Legality Staff

The threat of piracy has been around as long as ships have been carrying goods across water. Recent events on the high seas show that the days of dramatic attacks and heroic rescues live on today, sans eye-patches and wooden legs. Earlier this month, Somali pirates attacked an American cargo ship and took Captain Richard Phillips hostage. After failed negotiations and repeated requests from the Defense Department to use force, President Obama authorized Naval snipers to shoot and kill the pirates if the captain’s life was in “imminent danger.” The Navy Seals, upon hearing gunshots from the pirates’ vessel, took aim and fired.

This incident is one of many that has caused anxiety in the international community. Policymakers and citizens alike want to know: what causes pirate activity and how do we catch them? Even if pirates are caught and detained, however, procedural and substantive legal questions continue to arise. Pirates’ trademark use of force and intimidation has sparked a debate over whether pirates should be treated as terrorists. While occurrences of piracy and terrorism on the high seas have both swelled in the past few years, the increasing rate of seaborne piracy has eclipsed that of terrorism. According to a study conducted by the Rand Corporation, the number of piracy incidents has far outpaced terrorist attacks and plots between 2000 and 2006. Not surprisingly, these grim statistics have shifted the attention of policymakers back to the pre-Internet days of old-school piracy law. Should seaborne pirates be prosecuted as pirates or as terrorists, and why does it matter from a legal standpoint what we call them?

The Piracy Problem

A growing number of shipping companies do not report incidents of piracy in order to avoid the risk of higher insurance premiums and costly investigations; consequently, actual statistics of piracy are unknown. The International Maritime Bureau (IMB), however, estimates that pirates have successfully hijacked 61 boats since beginning of 2008, with 19 coming just in the first few months of this year.

Several high-profile piracy incidents in the open sea off the Horn of Africa over the last decade have caused some experts to point to lawlessness in Somalia as the root of the piracy problem. In a country where half the population is in need of food aid, the potential reward and relatively high probability of success generally outweigh any fears of capture for most Somali pirates who long for a taste of the high life. Additionally, patrolling the commonly pirated area off the coasts of Kenya and Somalia (an area of over a million square miles) has proven to be a difficult task.

So, Should Pirates be Treated as Terrorists?

The debate over whether pirates should be prosecuted under anti-terrorism laws is ongoing. Many experts liken piracy to terrorism–especially after incidents like the one seen earlier this month. Douglas R. Burgess Jr., author of The Pirates’ Pact: The Secret Alliances Between History’s Most Notorious Buccaneers and Colonial America, draws a parallel between piracy and terrorism: “both crimes involve bands of brigands that divorce themselves from their nation-states and from extraterritorial enclaves; both aim at civilians; both involve acts of homicide and destruction . . . ‘for private ends.’” Further, international laws treat the two criminal offenders similarly as “enemies of the human race.”

Others argue that piracy and terrorism are different because the former commits crime for personal financial gain while the latter commits crime for political reasons. Democratic Senator Russ Feingold (Wisconsin) acknowledges they are different, but argues that they share the same roots. Clearly, the question of whether crimes committed for political reasons should be punished more severely than those committed for financial gain is still an unresolved policy issue. Either way, enforcement requires actual legal authority. Although pirates and terrorists may share commonalities, they are in fact prosecuted differently in the United States. Determining whether an enemy combatant is a pirate or a terrorist, therefore, is an important issue that affects the treatment of detainees.

What Arrrr the Applicable Laws?

In the United States, Article 1, Section 8 of the Constitution gives Congress the authority “[t]o define and punish Piracies and Felonies committed on the high Seas, and Offenses against the Law of Nations.” Congress’ first anti-piracy law (passed in 1790) banned murder and robbery at sea. Both were punishable by death. The U.S. Supreme Court in 1818, however, ruled in United States v. Palmer that the law did not cover foreign pirates targeting foreign citizens. Congress responded the following year with a law that extended U.S. jurisdiction over all pirates—American and foreign.

The principal source of anti-piracy law in the United States today is embodied in 18 U.S.C. Chapter 81. Section 1651 states: “[w]hoever, on the high seas, commits the crime of piracy as defined by the law of nations, and is afterwards brought into or found in the United States, shall be imprisoned for life.” Section 1652 invokes the same penalty for U.S. citizens who engage in piracy, and Section 1653 does the same for pirates who are citizens of other countries. Authorization to prosecute pirates of any nation comes from universal jurisdiction, an age-old international law principle that “allows any nation to try certain offenders who have committed international crimes, even if the crime, the defendant and the victims have no nexus with the state carrying out the prosecution.”

The international community, through the United Nations, developed thirteen international counter-terrorism instruments during the last fifty years to address growing concerns over terrorism. One of the most notable is the United Nations Convention on the Law of the Sea. Enacted in 1982, this Convention establishes guidelines for governments and businesses in their usage of marine resources. A year later, the U.N. General Assembly introduced the International Convention Against the Taking of Hostages. Article Three of the International Convention provides that “[t]he State Party in the territory of which the hostage is held by the offender shall take all measures it considers appropriate to ease the situation of the hostage, in particular, to secure his release and, after his release, to facilitate, when relevant, his departure.” The recently amended Convention for Suppression of Unlawful Acts Against Safety of Maritime Navigation is another U.N. instrument aimed at curbing piracy and terrorism. Enacted in 1988 and amended in 2005, this counter-terrorism measure forbids a person from unlawfully and intentionally seizing or exercising control over a ship by force, threat, or intimidation.

Currently, terrorists detained under the notorious Bush-era Authorization for Use of Military Force (AUMF) have little hope of being released, let alone tried. Before enactment of the U.N. instruments, pirates faced similar fates as “international criminals and enemy combatants.” Today, in accordance with the U.N. Convention on the Law of the Sea, pirates are afforded the luxury of being judicially punished while enjoying the protections and privileges of the Geneva Conventions. Even with these humanitarian protections, pirates often escape unscathed by claiming to be “simple fishermen.” Unfortunately, most pirates are in fact fishermen-by-day and pirates-by-night. Since universal jurisdiction only applies to pirates, these “simple fishermen” typically slide through the legal loopholes because it is not an international crime to have guns on a boat.

Who Will be the Hero?

Although international laws typically forbid governments from interfering with foreign vessels, universal jurisdiction gives the U.S. government and foreign governments the authority to apprehend pirates of any nation and punish them under their own laws. Unfortunately, these laws do not always produce the intended result. According to Burgess, “[t]he legal confusion extends to what happens once pirates have been caught. In theory, any nation can shoulder the burden of prosecution. In fact, few are eager to do so.” This is largely due to the fact that prosecuting and punishing pirates imposes a substantial financial burden that few governments are willing to bear.

The impracticability of policing every square mile of the open seas reinforces the unfortunate conclusion that “only a ship can guarantee its own security.” The U.S. Navy has made an effort to increase patrolling coverage and may attempt to get other countries on board. The bottom line, however, is clear: piracy will likely continue so long as the benefits of committing the crimes outweigh the risks of capture. Since most pirates are citizens of countries where starvation and poverty are commonplace, the international community must increase efforts in patrolling the high seas to outweigh the financial benefits to pirates. Until then, ship owners may want to consider making friends with sharpshooters in the U.S. military to deter pirate attacks and effectively protect their booty.

A batter digs into the soft brown dirt to face down a pitcher throwing a ball at nearly 100 miles per hour. A halfback takes a football and runs full-charge into players looking to hit him with the same physical force of a small car. A basketball player dives into a sea of elbows chasing a stray ball. Incidents like this happen every day across America. Sports have become so engrained in our culture that we often take the inevitable injuries as a given in these situations. Recently, however, lawsuits have come forward questioning whether such injuries are a given in all sports contexts and whether parties should be held liable due to sports injuries.

Generally, sports are held to be somewhat dangerous activities involving a certain assumption of risk: being hit by a fastball, a brutal tackle at midfield, an errant elbow in a basketball game are all simply part of the game. In order for athletes to assume the risks that come along with sports, the athlete must have knowledge of the risk, appreciation of the gravity of such a risk, and willingly put themselves in harm. As the old saying goes: no pain no gain.

Contact Hitter

Courts have made a distinction between the contact sports involving direct physical contact between participants and non-contact sports which involve minimal or no contact between participants. In Cohen v. Brown Universitythe court defined contact sports as including “boxing, wrestling, rugby, ice hockey, football, basketball and other sports the purpose or major activity of which involves bodily contact.” This is a rather contentious definition: the most hardened football fans would not consider baseball a contact sport; however Major League Baseball would disagree. States which do make the contact/non-contact distinction are faced with problems of this nature when injuries outside of the “traditional” sports come up on the docket. Further complicating matters is the potential for serious injury in “non-contact sports” such as tennis where balls are served at speeds as high as 128 MPH. While there is no direct physical contact between players, tennis balls can and do cause serious injuries. Not to mention a less well known game that is considered the world’s most dangerous: jai alai.

Why divide sports between contact and non-contact sports for liability purposes? Assumption of risk plays a heavy part in these considerations: a participant in a contact sport like rugby would expect (in fact take pride in) serious injuries whereas as league night at the bowling alley comes with a certain expectation of safety. If a bowling ball were to suddenly broadside a players head, or a player were to slip from an over-oiled floor, it would almost certainly be the result of negligence, recklessness, or an intentional act.

Appeal to the Cheerocracy

The divide between contact and non-contact sports came to a head in the case of Brittany Noffke, a varsity cheerleader at a Wisconsin high school. Brittany was part of a squad executing a difficult move when Kevin Bakke, the male cheerleader holding her on his shoulders, failed to catch Britney on her way down. Ms. Noffke plunged to the gym floor headfirst, sustaining serious head injuries. Noffke’s parents then proceeded to sue both the school district and Bakke. Noffke contended the coach was negligent for not having a second spotter or protective mats on the floor when the move was performed. In Bakke’s case, the Noffke family contended that his failure to catch Brittany was a reckless act.

The Wisconsin Supreme Court dismissed both arguments, finding that cheerleading does constitute a contact sport, and thus participants enter with an assumption of risk. The Court cited to the “spirit rules” of the National Federation of State High School Associations, which contained photographs of several formations involving close contact between participating cheerleaders. The coach and school district could not be held liable for the injuries because of the assumption of risk any contact sport has.

As for Bakke, he was found to have not recklessly performed his duties freeing him from any liability for the accident. The Court agreed with Bakke’s assertion that his failure to catch Brittany was “mere inadvertence, lack of skillfulness or failure to take precautions,” did not constitute reckless behavior. While essentially ending Noffke’s ability to recover damages, this ruling was actually hailed as protective of cheerleaders. Mistakes in even the most practiced and seasoned squad do happen, and Wisconsin freed them from liability for mistakes during a performance or routine. Coaches across the country praised the ruling, as they had worried a ruling the other way would have a chilling effect. Having given cheerleaders some leeway from liability for mistakes, squads can continue to “be aggressive-b-e aggressive” in their routines.

Another Ball in the Trees

Three time Master’s winner Jimmy DeMaret was once quoted saying that “Golf and sex are the only two things you don’t have to be good at to enjoy.” Because golf is a sport that appeals to both “fairway challenged” individuals as well as the more skilled ones, errant balls have become somewhat engrained in the sport. Even an experienced pro jock can have an occasional problem.

Golf is unquestionably not a contact sport, which raises the question of errant golf balls. When one strolls onto the golf course is there an assumption of risk that you might be hit by an errant ball? In the state of California the answer is “yes.” Despite golf being a decidedly non-contact sport, the courts of California have held in Shin v. Ahn “that the primary assumption of risk doctrine does apply to golf and that being struck by a carelessly hit ball is an inherent risk of the sport.” The opinion (which includes footnotes defining what “shanking” a golf ball is) was no doubt a favorite amongst the duffers of the world, the court stating that “Hitting a golf ball at a high rate of speed involves the very real possibility that the ball will take flight in an unintended direction.” Mulligan and shouts of fore now seem to have a somewhat legal dimension.

Advantages and Disadvantages of Liability Free Sports

Participants in sporting events will likely tell you that competition, as Yogi Berra once quipped, “is 90 percent mental, the other half is physical.” Allowing athletes to compete without worry that they’ll be held liable for the resulting injuries that may occur allows for aggression in sports: the same aggression that make competing so enjoyable to both participants and spectators alike. If athletes were held personally liable for the injuries they inflict during the course of play, professional sports in North America would suffer dramatically. The NFL and college football (not to mention high school football), arguably America’s most popular sport, would be virtually non-existent if players were held to be personally liable. If such leagues were able to survive, in the era of the super agent more aggressive players might negotiate “team liability” clauses forcing the team to take responsibility for the player’s actions.

Sports must adhere to a strict set of laws, rules, or guidelines in order to facilitate fair competition. However, every sport has its unwritten rules and sometimes these can clash with the intentions of the game.

Take baseball for example. Hall of Famer Don Drysdale once said that an intentional walk was “a waste of three pitches” and over his career, Drysdale earned a well deserved reputation as a “headhunter.” Brush back pitches and bean ball wars where pitchers will “protect” their hitters from the opposing pitchers by aiming at the head do occur from time to time. Such a pitch is not a sanctioned part of baseball, and pitches thrown at the head can be extremely dangerous. Holding pitchers liable for their intentionally thrown bean balls might discourage this dangerous practice. Things get a little murkier in sports like hockey where fighting is an accepted part of the culture.

Similar principles would apply in football. Defensive lineman might think twice before a late hit on a quarterback if they risked more than a 15 yard penalty and a fine from the NFL. Do players in these sports assume a risk that players would conduct themselves in a manner outside the rulebook? Arguably quarterbacks assume a certain risk of a late hit when they take the field: if such a hit were unanticipated then there would be no penalty for such behavior. Football does an exceptionally good job of addressing these potential problems as the occur, one only need to look at the leagues swift response to horse collar tackles.

“Look for Low and Away. But Watch Out for in Your Ear.”

Sports are as much an expression of the human desire to achieve newer and greater feats of physical performance as a competition between individuals. When an athlete steps onto the field of play they assume many risks: failing themselves, failing their teammates, failing their gifts. The risks weigh heavily on the mind of an athlete, as does the fear of injury. Ultimately athletes should feel free to compete and focus on the game at hand, rather than finding a good tort lawyer.

But when injuries do occur, it’s best to have a good sense of humor about these things. Or, as legendary college football coach Bear Bryant said “There’s no substitute for guts.”