Human Rights Litigation against Multinational Companies in Germany

Miriam Saag-Maaβ‎ reviews the potential for human rights and environmental cases against multinationals in Germany. Outlining the rules on jurisdiction as per EU and national law. The chapter discusses the application of the Rome II Regulation to choice of law and the potential relevance of overriding mandatory provisions of German law and the possibility of claims for impairment or interference with property including the injunctive relief to prevent flooding caused by greenhouse emissions in Lliaya v. RWE. It also outlines the elements for liability for corporate human rights abuse under section 823(I) BGB and for the omission to comply with safety duties, in particular the potential for claims against a parent or buying company for breach of a safety duty by subsidiaries and suppliers. It considers key issues arising in Jabbir v. KiK, including the application of the Pakistani law and outlines key barriers to justice relating to discovery, collective actions, recovery of legal costs and funding.

Regulating smart contracts: An efficient integration approach

A smart contract is a digital protocol (software code) that enables automated monitoring and executing contract’s provisions without the need for intermediaries. Blockchain technology allows implementing smart contracts through a distributed ledger, but has no reliable way of enforcing legal rules. For example, in networks such as Bitcoin, it is possible to engage in illegal activities such as money laundering and dealing in weapons. In addition, it is impossible to enforce and audit legal costs such as taxes and duties. This research has devised a plan that allows official institutions to enforce the rules and audits efficiently during automatic execution process of smart contracts. This article discusses five important challenges in applying legal rules to Blockchain: the accreditation to the contracting parties’ and the goods’ nature, collecting legal costs, enforcing territorial laws and auditing. We present “Hyper Smart Contract”, a method for regulating Blockchain-based smart contracts and assess the limitations of the current generation of smart contracts on Ethereum to ensure a proper implementation of this plan. The performance of proposed method evaluated on a motivation application.

Turning a threat into an opportunity: British American Tobacco’s weakening of the Protocol to Eliminate Illicit Trade in Tobacco Products

BackgroundPrevious research has outlined transnational tobacco company (TTC) efforts to undermine implementation of the Protocol to Eliminate Illicit Trade in Tobacco Products (Protocol) and evidence of ongoing TTC complicity in the illicit tobacco trade (ITT). However, the industry’s views on the Protocol and role in its development are not well understood.MethodsSystematic searching and analysis of leaked documents—approximately 15 000 from British American Tobacco (BAT) and 35 from Philip Morris International, triangulated via searches of online resources and interviews with five stakeholders across academia, international organisations, governments, civil society and the private sector.FindingsEvidence indicates that after privately viewing the Protocol as a significant threat (2003), BAT worked to influence its content, while publicly signalling support for it (2007–2012), and was largely satisfied with the final text. BAT successfully pushed for a non-prescriptive text which enabled further country-level TTC influence during the Protocol’s implementation phase. The final text also reflected other BAT policy preferences, including preventing outright bans on duty-free sales and intermingling, and making it difficult to sanction and hold tobacco companies accountable for ongoing involvement in the ITT. TTC representatives were present during early Protocol negotiations, despite rules against this, and BAT obtained draft texts before they were public and paid at least one delegate to support its position.ConclusionsBAT’s primary interest in shaping the Protocol was to minimise its financial and legal costs for BAT while maximising potential costs to small competitors. These findings raise concern about the Protocol’s ability to control the ITT, particularly given TTCs’ intention to influence ongoing national implementation. An effective Protocol is vital to controlling both the ITT and ongoing tobacco industry involvement in it and, in turn, governments’ ability to increase tobacco taxes and thereby save lives.

Legal Expertise and the Role of Litigation Risk in Firms' Conservatism Choices

Firms face a greater risk of lawsuits for overstated rather than understated earnings or net assets, suggesting conservatism can reduce firms' expected legal costs. Because managers with legal expertise are more likely than other managers to recognize the legal benefits of conservatism, this study examines whether legal expertise among members of senior management promotes greater conservatism. Consistent with this prediction, we find that firms with a general counsel (GC) in senior management (our proxy for legal expertise) report more conservatively. We also find that GC firms recalibrate their conservatism levels in response to changes in the legal environment-their conservatism choices are more responsive to litigation against peer firms and to two judicial rulings that affected the litigation risk for firms located in the Ninth Circuit. Overall, our findings suggest that populating senior management with legal experts affects the extent to which a firm's level of conservatism incorporates legal risks.

4. The Nature, Extent, and Recovery of Legal Costs

This chapter focuses on the control and recovery of costs. Topics covered include the discretionary nature of costs awards, the general principle that the loser pays, how the court controls costs incurred, the basis upon which costs orders are made. In addition, the aspects of a legal representative’s work that are recoverable and how they are formulated, as well as the different types of costs order, are explained. The chapter also considers and helps to identify the changes or amendments that may be implemented in the future regarding the amount and recovery of costs in civil litigation.

46. Costs

This chapter focuses on legal costs. It discusses the two main principles for deciding which party should pay the costs of an application or of the whole proceedings; the rule that costs follow the event; range of possible costs orders; interim costs orders; indemnity principle; basis of quantification; proportionality; summary and detailed assessments; fast track fixed costs; fixed and scale costs; costs and track allocation; publicly funded litigants; pro bono costs orders; costs against non-parties; and wasted costs orders.

Does litigation change managers’ beliefs about the value of voluntarily disclosing bad news?

Research suggests that earnings-disclosure-related litigation causes managers to reduce subsequent disclosure, perhaps stemming from a belief that even their good faith disclosures will cause them trouble. This paper considers unexplored dimensions of disclosure and alternative channels of disclosure to provide additional evidence that speaks to how litigation shapes managers’ disclosure strategies. Consistent with Skinner (1994)’s classic legal liability hypothesis, we find that, while managers reduce and delay forecasts of positive earnings news following litigation, they increase the frequency and timeliness of their bad news forecasts. Moreover, many managers who were nonguiders prior to facing legal scrutiny begin guiding following litigation. Managers also maintain (if not increase) the information they provide via press releases and during conference calls following litigation. Supporting the notion that managers use disclosure to walk down expectations, additional analyses document an increase in the likelihood that lawsuit firms report earnings that beat consensus forecasts in the post-lawsuit period. Collectively, our evidence suggests that following litigation managers continue to view disclosure as a valuable tool that shapes their firms’ information environments and reduces expected legal costs. In so doing, it supports an important alternative viewpoint of how firms respond to litigation as well as the effectiveness of litigation as a disciplining mechanism.

Supply Chains and Antitrust Governance

Antitrust regulations are meant to promote fair competition in the market, but balancing administrative and legal costs with enforcement can be difficult when multilayered supply chains are involved. The canonical example of this challenge is the landmark Illinois Brick ruling, which limits antitrust damages to only the direct purchasers of a product; for instance, consumers can file antitrust claims against colluding retailers but not against colluding manufacturers—only retailers can file claims against manufacturers. This controversial ruling was meant to reduce legal costs, but it can clearly lead to missed enforcement opportunities. In this paper, we demonstrate how the Illinois Brick ruling interacts with contracts adopted in the supply chain, and we show that otherwise equivalent supply chain arrangements can have markedly different effects. In particular, we find that wholesale price, minimum order quantity, revenue sharing, and quantity discount contracts lead retailers to take legal action against manufacturers in the event of collusive behavior. However, the wholesale price plus fixed fee contract structure (also known as a two-part tariff or slotting fee contract) facilitates collusion among the manufacturers with retailers compensated by the fixed fee and not filing the antitrust litigation. We further demonstrate that collusion is more likely under high demand uncertainty and high competition at the retail level but is less likely under high competition at the manufacturer level. Our paper helps public enforcers identify market conditions conducive to antitrust violations. This paper was accepted by Vishal Gaur, operations management.

CIVIL-LAW SET-OFF AND SET-OFF MADE WHEN THE COURT SATISFIES COUNTERCLAIMS AND INITIAL CLAIMS: THEORETICAL REFLECTIONS ON THE SIMILARITIES AND DIFFERENCES OF LEGAL INSTITUTIONS

In this article, the author highlights the main scenarios on the basis of which the coexistence of two seemingly similar legal institutions could be built – a civil set-off and a set-off made when the court satisfies counterclaims and initial claims (a scenario based on the displacement of one institution by another; a scenario based on the permissibility of parallel implementation of each of the institutions; a scenario based on a mixed model of implementation of each of the institutions). To identify the scenario that best meets the needs of the turnover and the goals of effective judicial protection, the differences between these legal institutions are analyzed (the distinction is made according to specific criteria that either manifest themselves differently, or are present in one structure, but are absent in another). At the same time, the analyzed legal institutions (civil offset and offset produced by the satisfaction of the court counter and initial claims) are distinguished from similar legal phenomena – automatic setoff, offset by the will of a third person, eventual set-off, objections on the surrender made by the defendant during the trial and addressed the court, and the offset produced by the court in the absence of will of the disputing parties in the resolution of the question of legal costs and making a decision about a bilateral restitution.

ON THE UNDERSTANDING OF THE INSTITUTION OF LEGAL COSTS AND ITS RELATIONSHIP WITH LOSSES IN THE ASPECT OF MODERN LEGAL POLICY

The article is devoted to the legal nature of legal costs in the context of domestic legal policy. The relevance of this study is evidenced by the lack of proper coverage and a more or less consistent understanding of this problem in legal science, which is inevitably extrapolated to the legislation and applied components of domestic legal life. In order to form a comprehensive idea of the institution of legal expenses, general scientific (logical (induction, deduction, analysis and synthesis), systemic and functional) and private law (historical-legal, formal-legal, comparative-legal) methods are used. It is argued that any presence of a right or its absence, violation or non-violation of it is established only through a formal jurisdictional process, as a result of which a person has expenses and the right to compensation in case of a positive outcome. It is stated that a legitimate fact for the submission of claims for the recovery of legal costs is not jus or some traditional conditions of civil circulation, but judicium and its legal force. It is noted that there is no direct causal connection between jus and the procedural institute of judicial expenses, but there is between satisfaction of actio and subsequent award of such expenses. It is concluded that legal costs do not correlate with the discovery of contractual or non-contractual obligations, as well as the need for compensation for harm to a person who suffered from a guilty act. Being an institute of civil procedural law, court costs are not recoverable not because of the indicated, but because of the administration of justice in a civil or administrative case and are directly dependent on its final outcome.