Volume 69, Fall 2016, Issue 1
Arthur B. Laby
On May 20, 2016, the Rutgers Center for Corporate Law and Governance hosted a conference at Rutgers Law School entitled, New Directions in Corporate Compliance. The conference provided a forum for academics, practitioners, and government officials, with different experiences and varying perspectives on compliance, to share information and ideas on promoting effective corporate compliance within organizations. The success of the 2016 conference prompted a second event on corporate compliance one year later, starting what has become an Annual Institute on Corporate Compliance at the Law School.
Joseph E. Murphy
This Article addresses one of the foremost, yet mostly unrecognized, barriers to the development of effective compliance and ethics programs in organizations: the existing legal system. While much has been made of government efforts to promote and recognize compliance and ethics programs, almost no attention has been given to an undercurrent in the legal system that has thwarted organizational self-policing and that threatens to undermine the policy basis for promoting effective compliance and ethics programs. This Article begins with a brief overview of the history of the field of compliance and ethics and the policy reasons for its development. It then reviews the policy conflicts between the existing legal system and the application of compliance and ethics. It surveys weaknesses in current approaches to implementing compliance and ethics programs that undercut the effectiveness of such programs. In the Conclusion, it discusses how to balance the conflicting policies, ending with proposed legislation to resolve the conflict.
Greg Urban
The culture concept has taken on an explanatory role in popular media accounts of corporate misconduct, from Enron in the early 2000s to the recent Volkswagen emissions-cheating scandal. However, the concept, from its origins in the Enlightenment philosophy of Immanuel Kant at the end of the eighteenth century through its transformations within the discipline of anthropology during the twentieth century, has continued to undergo refinement. This Article outlines recent developments in culture theory, focusing on one novel approach to culture as a form of motion. This approach views culture as propelled, retarded, and altered in its movement through the world by four classes of force: inertial, entropic, metacultural, and interest-based. I argue that the approach illuminates the problem of corporate compliance. True compliance occurs when the force of an explicitly formulated regulation—a metacultural force—is brought to bear on conduct. Much of what appears to be compliance in this true sense is actually habitual cultural practice, driven by inertia. An important source of metacultural force inside the corporation is the coherence of its regulations and internal motivations, that is, its ethos. Correspondingly, the sources of non-compliance include ethos incoherence. The Article concludes with two corporation-external sources of ethos incoherence—legal theories regarding corporations as existing exclusively for the benefit of shareholders, and economic theories emphasizing the self-regulatory character of markets and the quest for profit. Compliance, from this perspective, depends in part on the relationship between corporations and their external cultural environment.
John H. Walsh
Cultures of compliance have received considerable attention over the years from regulators, compliance professionals, and academics. Regulators have constantly advocated for the development of strong cultures of compliance within regulated firms. 1 For example, in his excellent and thought-provoking luncheon remarks at this symposium, Andrew (“Buddy”) Donohue, now a regulator, and formerly a compliance professional, described how he could become comfortable in a compliance role; the culture of the firm in which he functioned evidently played an important role. In addition, academics have studied organizational culture and its impact on compliance. 2 It is a pleasure to serve on a panel with two of the leading contributors to this growing body of work: Donald Langevoort of Georgetown University and Greg Urban of the University of Pennsylvania.
Jenny Brooke Condon
Equal protection doctrine addressed to immigrants’ rights is thoroughly exceptional. It is an amalgam of super-deference, suspect class treatment, and even intermediate scrutiny, depending upon whether immigrants are present in the United States lawfully or not, and whether a state or federal classification is at issue. No other area of equal protection law modulates equal protection scrutiny in this way, producing unparalleled complexity and tension within the doctrine—and ultimately undermining equality. It is time to rethink the doctrine.
Anthony C. Thompson
Prosecutorial misconduct has stubbornly remained a troubling feature of the American criminal justice system. Judges and scholars have bemoaned its persistence, and some have warned that it threatens to reach epidemic proportions. The problem is that the current approaches we deploy to surface, investigate, and stop such misconduct are inadequate to the task. Too often, the courts, scholars, and the public misread the scope of the problem. They want to treat responses to prosecutorial misconduct as a product of individual bad actors. These individual “bad apples” are viewed as outliers and disconnected from office leadership. But the misconduct is rarely just an individual failure and more often encompasses an array of key players throughout the prosecutor’s office. Prosecutorial misconduct flows from an environment that tolerates it, oversees it, and encourages it. So, rooting out the problem of misconduct necessarily involves more than weeding out a few bad individuals; it requires new ways of defining the conduct and coordination of the responses to capture the scope of this misconduct.
This Article explores the dimensions of prosecutorial misconduct and challenges the prevailing notion that misconduct is a singular act by a corrupt individual. It contends, instead, that the chronic increase in instances of prosecutorial misbehavior stems from our failure to understand the scope and frequency of misconduct coupled with our tendency to minimize or cover up the behavior of prosecutors. This article proposes treating misconduct as obstruction of justice as a preliminary step toward recognizing and signaling the gravity of the stakes involved. It then calls for better coordination, more thorough data-gathering, and more focused state and federal intervention to investigate and deter misconduct.
Gwendolyn M. Leachman
Legal and sociolegal scholars have argued that social movement litigation often generates social change indirectly by drawing publicity and public attention to movement issues. Yet some cases are more likely than others to receive coverage in the mainstream news media—particularly those cases involving conflict or controversy, which resonate with established definitions of “newsworthiness.” This Article empirically examines bias in the news media’s coverage of social movement litigation through a case study of the LGBT movement, which compares the content of the litigation dockets of three major LGBT civil rights organizations to the content of newspaper coverage of those organizations from 1996–2006.
The time period examined in this study offers a unique opportunity to investigate bias in media coverage of movement litigation. This period marks the formative first decade after LGBT rights organizations began to take part in litigation for marriage equality, an issue which has since become an essential part of the LGBT movement’s public narrative. As movement litigators during these years tentatively asserted the right for same-sex couples to marry in a few select state courts, they were met with an intense conservative backlash targeting both same-sex marriage as a goal and the impact litigation strategies being used to achieve it. In examining LGBT movement litigation during this period of intense controversy around same-sex marriage, this Article illuminates the role of countermovements in shaping media constructions and broader popular interpretations of social movement litigation.
Findings from the study reveal that the news media reported more extensively on the LGBT movement’s marriage equality litigation than on any other issue. This coverage was drastically disproportionate to the small percentage of marriage equality cases on the LGBT legal organizations’ dockets during this time period. In addition, news articles on same-sex marriage litigation were significantly more likely than other articles to discuss anti-LGBT countermovement activity. These findings suggest that countermovement mobilization against same-sex marriage, dubbed a “culture war” in the media, may have created conflict that reporters found particularly newsworthy—leading the news media to focus attention on one of the LGBT movement’s most contentious litigation campaigns. I explore the implications of these findings in shaping the course of social movement mobilization, countermobilization, and the possibilities for social change.
James S. Arrabito
As the use of body-worn cameras by police and law enforcement agencies becomes more widespread in the United States, local and state governments are beginning to grapple with how to regulate their use. This regulation requires local and state governments to consider a number of factors, not the least of which are the privacy concerns involved in deciding when police ought to record civilian encounters. In 2014, the California legislature began to consider a bill that, among other things, attempted to address such privacy concerns by barring officers from recording while responding to medical emergencies in public. Though that bill ultimately died in committee, other states are beginning to think seriously about how best to regulate body-worn camera usage. This Note will explore the privacy concerns involved in recording medical emergencies in public and will argue against such a prohibition. Instead, this note will ultimately argue that body camera policies should be tailored to meet the concerns and exigencies of each locale, and that, therefore, state should not over-regulate body camera use. Moreover, this Note will argue that such prohibitions are wholly duplicative, as such privacy concerns, to the extent that they exist, are generally mitigated by state and federal sunshine law exceptions.
Yi An Pan
Corporate scandals and misconduct have persisted throughout twenty-first century America. Since 1999, the Department of Justice (“DOJ”) has attempted to provide federal prosecutors with guidance on how to prosecute corporations through the issuance of a series of memorandums. In September 2015, former Deputy Attorney General Sally Quillian Yates issued the latest memorandum aimed at targeting individuals involved in corporate crimes. This Note will discuss the Yates Memo and will argue that it serves at least two valuable functions, regardless of whether or not it simply solidifies existing policies. First, the revised requirement that cooperation credit is now “all or nothing” puts more pressure on companies to identify individual wrongdoers right from the outset of the investigation and reduces the opportunities for corporations to withhold crucial information needed by the DOJ. Second, the memo will hopefully serve as an incentive for individuals to abide by rules and regulations. Since corporations are obligated under the Yates Memo to disclose all relevant facts regarding individuals potentially involved in the misconduct in exchange for cooperation credit, it will perceivably be harder for employees to hide behind the corporation as a legal entity. This Note will also address the shortcomings of the Yates Memo, examining problems that are either presented or left unaddressed. Finally, this Note will explore the effects of the Yates Memo on recent cases like the Volkswagen scandal and its implications for success, in light of recent political developments.
Kimberly Saginario
Sunday: a day of importance for many different reasons. For some individuals, Sunday is a day of religious worship. For others, it represents “Sunday dinner” with family members. But for over 57.4 million individuals, Sunday signifies one thing: fantasy sports. While traditional, season-long fantasy sports have been popular for over two decades, many individuals have retired from the games because they do not have the time to commit themselves to an entire fantasy season. Cue daily fantasy sports—the increasingly appealing spin on traditional fantasy sports that only lasts twenty-four hours and offers instant gratification. Why wait months until the end of the season to find out if your fantasy team is victorious when you can claim your prize that same night? The daily fantasy sports industry is thriving and shows little sign of stopping. As the popularity of the daily fantasy sports industry continues to explode, however, so do the concerns about the legality of these games. Due to the short time frame, entry fees, astronomical cash prizes, and undeniable element of chance involved in daily fantasy sports, the line between daily fantasy sports and illegal gambling is blurred. As a result, several states have conducted investigations into the games and concluded that daily fantasy sports are indeed illegal gambling. This Note will examine the legal issues and hurdles that the daily fantasy sports industry has faced within the last year and will continue to face in the future. Part II provides a brief history of fantasy sports, while Part III discusses both traditional and daily fantasy sports and the differences between the two types of games. Part IV of this Note reviews the federal laws that affect fantasy sports. Part V examines the “skill vs. chance” argument that typically determines whether fantasy sports constitute illegal gambling within a state, as well as how certain states have recently reacted to daily fantasy sports. Finally, Part VI discusses specific bills that states have proposed to regulate daily fantasy sports, as well as recommendations for regulation in the future, followed by a brief conclusion in Part VII. Ultimately, this Note proposes that regulations similar to Illinois’ “Fantasy Contests Act” be adopted across the states because it protects consumers while allowing a rapidly growing industry to continue to flourish.
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