Illinois Business Law Journal

Creating Stability in the Airline Industry through Merger

I. Introduction

In the mid-1980s the airline industry experienced merger mania. Delta bought up Western. [1] Pan Am merged with National [2]. Texas International and New York Air merged with Continental and People Express. [3] Now this trend has reemerged through the possible merger of Delta, the third-largest U.S. airline in terms of passenger traffic, with Northwest, the fifth-largest carrier, to create the largest passenger airline in the world. [4] Executives of both airlines have agreed on most of the basics of a merger, but talks have stalled over the issue of integrating workers. [5] As talks have stalled, the questions remains whether Delta and Northwest should merge. This article will discuss the implications of the Delta-Northwest merger. First, it will discuss the antitrust considerations. Second, it will examine the likely impact of the merger on employers, shareholders, and customers. Finally, this article will conclude on whether or not the Delta-Northwest merger will be beneficial for the two companies and the airline industry.

The Young and the Restless: the Inevitable Trend of New Graduates towards Solo Practice

I.    Introduction

The word is out--as of 2007, big law firms have boosted their starting salaries to as high as $160,000. [1]  Moreover, NALP has released its employment statistics for the Class of 2006, boasting a 90% employment rate for new graduates. [2]  If these statistics sound too good to be true, it's because they are.  The much publicized "BigLaw" salary only accounts for 14% of new-graduate salaries. [3]  In fact, 42% of new graduates last year received less than $55,000. [4]  What does this mean?  It means that graduates, who don't attend top-tier law schools and don't score at the top of their class, are struggling to find jobs that will cover both living expenses and law-school debts; which can exceed well over $100,000.  With job prospects looking grim, many recent graduates are turning to solo practice, hoping to create the dream career and salary that nearly dissolved when reality first set in.

Privacy Implications of Radio Frequency Identification Technology

   Before Mrs. Jones leaves work on a typical Tuesday, she goes to a familiar Web site where she can view the items left in her refrigerator to determine if she needs to stop by the grocery store.  She is completely out of milk and some other items, so she plans a trip to the store.  Double-checking to make sure her children arrived safely at home, she sees on the Web site that they both got off the bus on time and are in the living room, probably watching television instead of doing their homework.
    As she walks toward her car on the way home, a billboard greets her, “Good evening, Mrs. Jones!” and displays a pair of jeans she might be interested in – the same brand of jeans she bought a couple of months ago.  In her car, she drives through the parking garage exit without handing anyone money - the arm automatically lets her out.  At the store, she is greeted again with her name and the shopping cart she grabs tells her what she bought last time and what aisle each item is in.  Upon arriving home, her doors unlock automatically so she do not have to dig out her keys while she carries the grocery bags. 
    This scenario is made possible through radio frequency identification (RFID).  It may seem incredibly futuristic, but the truth is that the technology is closer than one would think.  RFID technology offers incredible possibilities for efficiency and convenience for both businesses and consumers, but also raises important privacy concerns.

When In Doubt, Seek a Buyout: Indiana's Solution to the Kelvin Sampson Dilemma

I.    INTRODUCTION

Parting ways with a college coach accused of violating National Collegiate Athletic Association (NCAA) rules has become a delicate process.  On February 8th, the NCAA notified Indiana University that its men's basketball coach, Kelvin Sampson, had allegedly committed five "major" NCAA rule violations.[1]  After more than a week of speculation surrounding Sampson's future at Indiana, the school negotiated a settlement to terminate its relationship with the second-year coach.[2]  In exchange for a $750,000 buyout, Sampson resigned and agreed not to purse any legal action against the university.[3]

On its face, the buyout seems generous for a coach who conceivably could have been fired outright for cause.  Sampson, who was already under NCAA sanction for prior infractions, had a clause in his contract that allowed Indiana to terminate him "for significant or repetitive violations."[4]  Nevertheless, Indiana was in a difficult position.  Firing Sampson prior to NCAA hearings on the alleged violations would have likely spurred a wrongful termination suit in which Sampson could potentially recover the remaining $2.5 million on his contract.[5]  Allowing the embattled coach to remain a Hoosier until the NCAA's final determination in July would prolong the program's instability as the NCAA tournament and recruiting season approach.[6]  Faced with this dilemma, Indiana decided it was well worth the buyout to get Sampson out the door immediately.

Limited Liability: Is Stoneridge a Threat to U.S. Markets?

I. Introduction

      The idea that by engaging in fraudulent behavior one incurs liability for the foreseeable harm caused by such behavior is a cornerstone of the law.  Therefore, it seems reasonable that by engaging in fraudulent transactions designed to manipulate financial statements and market valuations a company should expect to incur liability to investors relying on those statements and valuations.  In a 5-3 opinion (Justice Breyer recused himself) authored by Justice Kennedy,the Court, in Stoneridge Investment Partners, LLC v. Scientific-Atlanta, Inc., limited such liability in private actions based on SEC Rule 10b-5. [1] In doing so, the Court drastically restricted the types of private actions that are critical to investor confidence and market stability, and to thus to the success of U.S. securities markets.   

Zoning Regulations Need to Keep Pace

     Many Americans take the plunge and start a small business.  The predominant form of small business in the united States is home-based business. [1]  Nearly 8,500 new home-based ventures are started each day with one in ten U.S. households conducting some type of home-based business. [2]  Although many local zoning regimes started with the same intentions they have led to varying restrictions which may not appropriately balance the concerns of neighbors against the benefits and characteristics of all current home-business.

Payday Lenders: Luring the Elderly into the Debt Trap

I. Introduction

During the past few months, the credit crunch has spread to all areas of the credit market, including: commercial real estate mortgages, student loans, and even auction-rate securities that are considered as safe as cash.[1]  In attempt to prevent further loss, many lending industries have tightened lending standards to the extend that some consumers have found obtaining a loan or even a credit card more difficult.[2]  At a time where borrowing money has become harder, people with bad credit and low income are flocking to lenders that are willing to fill their wallets with no questions asked. The “payday” loan industry is growing rapidly and is known for its quick and easy lending.[3]  Although the quick and easy money may seem attractive, the outrageously high interest rates are leading payday loan users into an inescapable debt trap.[4] Aside from high interest rates, another critical problem surrounding the payday loan industry is its practice of targeting the elderly and other recipients of government benefits.[5]  The elderly falling victim to these predatory lenders has only grown over the years, and this exploitation calls the need for regulation and strict enforcement.

College Football Coaching Carousel

I. Introduction

Both the National Football League (“NFL”) and the National Collegiate Athletic Association (“NCAA”) have endured their fair share of high profile coaching defections either from one university to another, university to professional franchise, or professional franchise to university.[1] Among the high profile coaches who have abandoned their respective clubs under contract are Nick Saban, formerly of the Miami Dolphins and currently with the University of Alabama, Bobby Petrino, head football coach at Arkansas via the Atlanta Falcons, and Rich Rodriguez, the freshly minted coach at the University of Michigan.[2] The defections by Saban and Petrino received a fair amount of attention. However, the Rich Rodriguez situation may be enough to scare other high profile coaches from jumping ship too soon.

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Booster Shot or Bandage?

An analysis on the H.R. 5140 economic stimulus package

I. Introduction

According to a recent Associated Press-Ipos economic study, 61 percent of Americans believe the economy is in a recession. [1] Yet, some individuals are optimistic of the direction of the economy. In the Treasury Economic Update on February 1st, Assistant Secretary of the Treasury for Economic Policy, Phillip Swagel said “recent data indicate[s] that economic growth and the pace of job creation have slowed. At the same time, the unemployment rate remains low and core inflation is contained. We expect that the economy will continue to expand, even as the housing downturn and credit market strains remain a drag on growth.” [2]

Puff-Puff, You're Unemployable

I.  Introduction

An increasing number of employers are refusing to hire smokers in hopes of cutting health insurance costs and increasing productivity. [1] A number of large corporations, including Alaska Airlines, Union Pacific, and the World Health Organization, have instituted formal policies against hiring smokers. [2] This practice has surfaced in a variety of employment industries including health care, government services, education, transportation, lawn care maintenance, and retail services. [3] Though this practice appears to be gaining popularity, the more common method of cutting costs associated with smoker-employees is to provide cessation incentives within the workplace.[4]

Three initiatives that smokers have utilized to combat anti-smoker policies are: 1) assertions of a constitutional "right to smoke," 2) claiming violation of privacy rights by requiring an individual to disclose their smoking habits, and 3) attempts to have nicotine addiction classified as a disability under the Americans With Disabilities Act ("ADA"). [5] All three of these arguments and mechanisms have been largely unsuccessful. [6] This discrimination is perfectly legal so long as employers are not using an individual's smoking status as a pretext for discrimination prohibited by federal and state statutes.[7] Employers must also refrain from engaging in this practice in states with statutes explicitly prohibiting such discrimination. [8] However, it must be noted that the Supreme Court has said nothing as to the legality of this practice. [9] As such, employers engaging in this practice may want to develop secondary plans for cutting costs.

International Business Travelers Beware

I.  Introduction

          Picture yourself in the shoes of Maria Udy, a marketing executive working for a travel management firm in Maryland. [1]  Udy, a British citizen traveling from Washington D.C. to London, was pulled aside by a federal agent because he had "a security concern" with her. [2]   She was presented with a frustrating choice:  hand over her laptop for the agent to search or miss her flight. [3]  In a similar incident a tech engineer, a U.S. citizen who chose to remain anonymous for fear of calling attention to himself, was pulled aside by a federal agent who demanded that he log into his computer so that the agent could search it. [4]  The engineer protested, as the computer belonged to his corporation, but he logged in and watched in dismay as the federal agent copied down each of the websites he had visited. [5] Sadly, these incidents are far from isolated. [6]

The Mail-Order Bride Phenomenon

IN A WORLD OF RISING GLOBALIZATION HOW DO THE LAW AND INDUSTRY GENERATE SAFE OPPORTUNITIES FOR PEOPLE TO MEET ONLINE IN DIFFERENT NATIONS?

Contrary to popular depiction in the media and amongst the populace of western countries, the idea of a ‘mail-order bride’ no longer exists in the classical sense; in the 18th and 19th Centuries, women such as the ‘casket girls’ of New Orleans were often ordered through catalogs or sent to colonies by their Governments to marry settlers and maintain the harmony and prosperity of the colony. [1] Nowadays, the term generally refers to women from developing countries that use introduction services such as Anastasia International ( HYPERLINK "http://anastasia-international.com" http://anastasia-international.com) to meet and possibly marry men in first world countries. [2] The common misconception, at least with regard to women in the Commonwealth of Independent States (the former Soviet Union), is that they are coming to this country to escape political or economic turmoil in their own. [3] The following article will dispel the myth of the ‘mail-order bride’ and explain the legal concerns regarding safety and security for both men and women looking to meet someone internationally.

Google Defends Its Trademark From Genericide

I.     Introduction.

Over the last decade, Google has quickly risen to dominate the internet search arena.  The company’s rapid ascension is marked by a corresponding rise in the value and recognition of the Google trademark.  In that time, Google has attached its name to an increasingly wide-range of products and services, such as Google News, Google Maps and Google Images.  On occasion, Google has also manipulated its trademark into easily recognizable derivatives, such as its web mail service Gmail.  Google also alters its primary trademark on major holidays, adding playful cartoon flourishes to its recognizable search page. 

Overtime Pay and White-Collar Exemptions: Seeking Clarification in Light of Recent Revisions

     I.     Introduction

The New York Times recently asked, "In today's perpetual workplace, where downtime has merged with work time, where you can carry your office in your pocket, where collars are no longer distinctly blue or white, how does one measure overtime?" [1] Such questions lead to others, concerning the purpose of overtime pay, the reasons for distinguishing between types of employees, and the role the federal government ought to play in resolving the growing inconsistencies and confusion of the complex structure of overtime law. This article examines recent changes to the overtime laws concerning exemption of white-collar workers and any effects, beneficial or burdensome, that they may have on individual workers and the economy as a whole.

SBA Proposes Limitations on Set-Asides to Women-Owned Small Businesses

On January 30th, 2008 women's groups rallied in protest at a hearing held by the U.S. Senate Committee on Small Business & Entrepreneurship, chaired by Sen. John Kerry (D-Mass), regarding the Small Business Administration's (SBA) recent proposal to limit set-asides to women-owned small businesses (WOSBs) in federal contracting. These set-asides would be limited to four out of some 140 possible sectors in which women were underrepresented, as indicated by a recent RAND Corporation study. [1] Among the groups involved were the U.S. Women's Chamber of Commerce and National Association of Women Business Owners. According to Margot Dorfman, executive director of the U.S. Women's Chamber of Commerce, the RAND data can also be read to show that 87% of industrial sectors are underrepresented by WOSBs. [2]

Chinese Commerical Arbitration – Alternative Approach for Resolving International Disputes

The New York Times characterizes China’s court system as a “Chinese legal netherworld.”[1] Many foreign business memoirs are packed with horror stories about corrupt judges and unenforceable court decisions.[2] For foreign investors, arbitration offers a way to bypass much of the corruption and local protectionism existing in court systems.[3] In 2005 China’s arbitration commissions handled more than 1,000 disputes involving foreign partners.[4] With some improvements, Chinese arbitration will be the first choice for resolving international business disputes in China. This article intends to address the history and structure of the arbitration system in China and how it has developed in recent years to meet the needs of constant economic development.