"I realise that some of my criticisms may be mistaken; but to refuse to criticize judgements for fear of being mistaken is to abandon criticism altogether... If any of my criticisms are found to be correct, the cause is served; and if any are found to be incorrect the very process of finding out my mistakes must lead to the discovery of the right reasons, or better reasons than I have been able to give, and the cause is served just as well."

-Mr. HM Seervai, Preface to the 1st ed., Constitutional Law of India.

Tuesday, March 16, 2010

SSRN Articles

This article explores the benefits and drawbacks of using model examples of good legal writing in the first-year writing curriculum and proposes a practical, hands-on approach to effectively integrating model examples into the curriculum to meet students’ high demand for them. 

The literature addressing the meaning of a commitment made by holders of patents ‘essential’ to a standard to licence such patents on ‘fair, reasonable, and nondiscriminatory’ (FRAND) terms and conditions is now substantial. While reaching quite different conclusions, a number of authors have addressed this as a question of economic theory: what limitations (if any) on the freedom of the parties negotiating a licence to essential patents will best ensure efficient outcomes?

On the basis of such analyses, authors have variously argued that, in order to satisfy a ‘fair and reasonable’ commitment, a patent holder:
• Must charge no more than the incremental value of his invention over the next best technical alternative;
• Must not negotiate for a royalty-free cross-licence as part of the consideration for a licence;
• Must set his royalty rate based on a mathematical proportion of all patents essential to the practice of a standard;
• Must set his royalty rate in such a way as to prevent cumulative royalties on the standardised product from exceeding a low percentage of the total sale price of that product;
• Must not raise requested royalty rates after the standard has been adopted, or after the relevant market has grown to maturity;
• Is not entitled to seek injunctive relief against a standard implementer should they fail to agree on licence terms.

The types of economic arguments relied on by these authors to justify these restrictive regimes may well be useful in debating public policy and the proper application of national competition law – although one of the present authors and others have elsewhere critiqued the merits of many of these calls for what is essentially government intervention in the private licencing process. But in this paper we step back to ask a different question: What do these arguments and proposed regimes have to do with the contract which is the source of the FRAND obligation? 

For years, legal theory scholars have been obsessed with two dominant normative accounts: law and economics and individual rights. Recently, however, an old normative theory has resurfaced. Virtue theory, grounded in Aristotelian practical philosophy, has begun to receive attention from both historians and legal philosophers. In the past year, a small group of theorists has made a dramatic move: they have attempted to apply virtue theory to problems in contemporary law, in the form of a new “virtue jurisprudence.” Thus far, virtue jurisprudence scholars have limited their work to public law subjects. This article makes a substantial new contribution by extending virtue jurisprudence to a central area of private law: contracts.

Why contract law? This article contends that several difficult challenges in contract jurisprudence remain unresolved because neither law and economics nor rights theorists have been successful in accounting for the actual desires of contracting parties. For example, current theoretical frameworks fail to fully explain contract’s duality as both an economic and social institution. They fail to account for parties’ interest in both wealth maximization and justice. Virtue jurisprudence accounts for these critical dualities better than either law and economics or individual rights. Accordingly, this article suggests that virtue jurisprudence may reframe how both theorists and courts think about “the parties’ intent,” which is a foundational concept in any contract case.

This article takes on several tasks. It explains virtue theory in ways that show its relevance to contract law. It lays out a historical case for the importance of virtue theory to political liberalism and free markets. It explores several sites where current theoretical approaches do not fully capture contracting parties’ intent. Finally, it shows how virtue jurisprudence may offer a superior descriptive, and normative, account of intent-based doctrines in contract law. 

Abstract:      European law gives consumers the right to withdraw from a range of contracts for goods and services; American law, with narrow exceptions, does not. Yet merchants in the United States frequently provide by contract that consumers have the right to return goods. We analyze the right to withdraw in a model that incorporates a tradeoff between allowing consumers to learn about goods that they purchase and protecting sellers from the depreciation of those goods. The right to withdraw - at least, as a default rule - has a plausible economic basis. We identify a nascent version of it in the well-known, controversial case of ProCD v. Zeidenberg.

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