Band 23, Heft 1

Delaware’s famous corporate law and its highly respected specialized Court of Chancery attract entrepreneurs from all over the world, who choose the small state as their locus of incorporation and litigation forum, and global investors who choose Delaware law as the law governing their corporate investments and mergers and acquisitions (M&A). Other jurisdictions vie with Delaware in regard to these choices. This interjurisdictional competition makes Delaware a significant global norm exporter in the field of corporate law because jurisdictions emulate some of its corporate law. Israel leads the global pack. For two decades, it has been approximating its corporate law to Delaware’s and emulating its principal institutions, including by establishing a specialized Chancery-like court whose judges seek guidance in Delaware’s case law in deciding open corporate law questions. This Article employs qualitative methods—interviews with M&A practitioners from the United States, the United Kingdom, and Israel. We use the interviews to assess whether the project of approximating Delaware corporate law has succeeded in shifting incorporation decision preferences away from Delaware to Israel and watering down the natural reluctance of global investors to accepting an unfamiliar corporate law when engaging in cross-border corporate M&A transactions involving an Israeli party. Our findings indicate that the approximation project has countervailing effects, opinions about its success being polarized and nuanced; that approximation increases the familiarity of domestic practitioners with the foreign law being emulated, making the emulated law easier to implement; and that approximation creates more room for other aspects of interjurisdictional competition to influence private choices.

This Article studies the Israeli courts’ approach to choice of law in securities class actions against dual-listed companies, and its unexpected adverse effects on Israeli shareholders. Israeli courts apply American law to dual-listed companies, as an inducement for companies to list their shares for trade on the Tel Aviv stock exchange. However, one of the outcomes of this choice was to enable American attorneys to include Israeli-traded shares in American securities class actions. The Article claims that this outcome might undermine Israeli shareholders’ rights and reduce their expected compensation.

This Article analyzes the interaction between the burden of proof and evidentiary discovery rules. Both sets of rules can affect incentives for prospective injurers to invest in evidence technology (i.e., ex ante investments that increase the quantity and quality of evidence in case an accident occurs). This interaction becomes acutely important in the private international law setting, where jurisdictions are split on the question whether the burden of proof should be treated as a substantive or procedural matter. When a tort occurs in Europe, but the case is litigated in American courts, treating the burden of proof as a procedural matter preserves the complementarity of incentives created by the burden of proof and evidentiary rules. Conversely, treating the burden of proof as a substantive matter creates a mismatch in incentives created by the burden of proof and evidentiary rules.

The law market model posits that the most appropriate resolution of choice-of-law disputes in private international law is to permit individuals to choose ex ante the law that applies to them. This is contrasted to the public law model where courts choose law based on the perceived interests of, or the parties’ connections with, the states or nations involved. The law market model envisions that consumer choice will lead to optimal competition among jurisdictions to supply the most efficient law. This model has influenced the rise of party autonomy, most notably in the widespread enforcement of many contractual choice-of-law and forum-selection clauses. One area that the model has had little influence on is the enforcement of foreign judgments. In the United States, judgments from other countries face higher hurdles in obtaining recognition and enforcement, as compared to judgments issued by courts of sister states. There has been little discussion in the law market literature of the possibility of ex ante contractually waiving these hurdles, or of choosing the law of states that make it easier to enforce foreign judgments. This reticence appears to be based in part on the assumption that state law on such recognition is mandatory and non-waivable, and that such law reflects the sovereign interests of states. Revisiting this regime through the lens of the law market model suggests that courts and public policymakers should permit parties, within broad limits, to contractually waive or select the law on judgment recognition, as they are permitted to do with other areas of law.

There are important reasons for states to recognize and enforce the judgments of other states’ courts. There are also reasons that may militate against recognition or enforcement of certain foreign judgments, making it appropriate to calibrate or “fine tune” the presumption favoring recognition and enforcement so it is not applied too broadly. Most calibration principles, such as the principle that a judgment from a court lacking jurisdiction should not be recognized, are case-specific. However, one calibration principle that is, to our knowledge, unique to the law of the United States stands out: the principle of systemic calibration, according to which U.S. courts must not recognize or enforce foreign judgments “rendered under a system which does not provide impartial tribunals or procedures compatible with the requirements of due process of law.” In this Article, we aim to shed empirical light on how U.S.-style systemic calibration operates in practice. We find that state-of-origin indicator scores related to systemic adequacy are on average higher when U.S. courts recognize or enforce foreign judgments than when they refuse to do so. Moreover, the probability of recognition and enforcement increases as these indicator scores increase. However, in only six of the 587 opinions in our dataset did a court refuse recognition or enforcement based explicitly on the systemic inadequacy ground. Thus, while the level of systemic calibration in U.S. courts is high, it is mostly achieved implicitly. Finally, even judgments from states with low systemic adequacy scores are sometimes recognized or enforced by U.S. courts.

It is often argued that courts avoid foreign laws because they prefer local law. It would make sense if they did—after all, foreign law can be hard to understand and complicated to employ, and it is also . . . foreign. Aiming to investigate this assumption through a qualitative analysis of all available cases on one question and comparing the findings with the approach towards local matrimonial property cases in Israel, this Article finds something rather different. At least as regards Israeli judges discussing matrimonial property, it appears that sometimes judges do not prefer the lex fori but something else. The Article discusses one case that reveals what could be described as a judicial mutiny, where judges chose to apply neither foreign law nor local law per se. In the case of matrimonial property, a particular legal norm seems particularly close to the judges’ hearts. So much so that despite legislative intervention designed to change the judicially-shaped law, the courts continue to apply their own, judicially created law.

Elite U.S.-based global law firms (“Biglaw” firms) concentrate in the costliest districts of superstar cities, especially two neighborhoods in Manhattan. This pattern has persisted despite both the dispersal of Biglaw clients across less-dense, lower-cost U.S. geographies and the development of telework capacity. It suggests a puzzle: law is among the occupations most conducive to remote work, yet Biglaw prior to the coronavirus pandemic required in-person work in the priciest places—meaning it paid (and continues to pay) a premium on both of its biggest expenses, wages and real estate. How might this equilibrium be explained, and what might lead it to change? This Article contends that Biglaw clustering reflects a management preference for the exploitation of proven strategies over the exploration of novel and uncertain ones—but that the pandemic telework experience is eroding this dichotomy. This analysis has direct implications for private international law (“PIL”) practice, where large-scale transactions and disputes are handled by Biglaw firms and involve significant international travel. This Article contributes to a growing literature on telework’s impacts on cities, labor markets, and industries, and is the first to extend that focus to Biglaw and PIL. A post-pandemic Biglaw embrace of dispersal via telework would destabilize standard accounts of collaboration in agglomeration economies. While the Article expresses skepticism about that outcome, it identifies a mechanism by which it might plausibly come about. Crucially, this mechanism—the replacement of an exploit vs. explore choice with two different exploit options—posits as the key driver not technology but management learning and innovation that quickened during the pandemic.

Over the last three decades, the art market has undergone a remarkable transformation. Before the 1990s, artworks were sold with hardly any concern about whether they had been stolen or looted, whereas now any reputable gallery or auction house checks the “provenance” of any substantial work before sale. This transformation reflects interlocking changes in law, norms, and institutions. New York’s and more broadly the United States’ assertion of jurisdiction and application of U.S. substantive law has destabilized title to stolen and looted goods worldwide because American statutes of limitations generally provide weaker protection for those who possess stolen or looted goods even in good faith. Application of American law has had a profound effect, especially for the high end of the market, because European or Asian investors who purchase art outside of the U.S. may eventually want to sell or display their works in the U.S. Defective title under American law thus affects prices worldwide. The tightening and broader application of American law reflects both longstanding legal principles and changes in social norms towards the redress of historical wrongs, most notably prominent campaigns relating to art confiscated or sold under duress in Nazi Germany. New institutions, most importantly searchable databases recording stolen and looted art such as the Art Loss Register, are also changing perceptions about minimum standards for good faith purchase, which in turn affects both social norms and court cases. These new norms, induced by both legal changes and better information, have influenced the market even for less valuable art, for which sale or display in the U.S. is not a relevant consideration and for which the threat of costly legal action is not credible. The fact that social and institutionalized norms play an important role in protecting original owners is probably good, because norms and institutions can be effective even where law is not and often do so at lower cost.