Not Mitt Romney. He got it in 2008. 

It's Jimmer! See Times & Seasons. 

Last week T&S cited to a court case, Kiewit Power Constructors Co. v. NLRB, 10th Cir., pg. 10 (Aug. 3, 2011), in which DC Circuit judge Tom Griffith -- who also is an adjunct professor at BYU -- quotes a news story "describing college basketball phenom Jimmer Fredette as 'destroy[ing]' an opponent with his combination of longrange proficiency and acrobatic drives." This is the only case currently in the Westlaw "allcases" database referring to Fredette. It's only a matter of time, I suspect, before other cases get jimmered.

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We'd like to start by thanking Erik for inviting us to provide some posts to Conglomerate over the next two weeks, and the rest of the Conglomerate contributors for having us.  A bit about each of us before we begin with the substantive posts:

Kathleen Engel is the Associate Dean for Intellectual Life and Professor of Law at Suffolk Law School.  Together with Pat McCoy, Kathleen wrote The Subprime Virus: Reckless Credit, Regulatory Failure and Next Steps (Oxford Universty Press, 2011).  Kathleen is a national authority on mortgage finance and regulation, subprime and predatory lending, and housing discrimination.  She has presented her work around the world and advised federal and state agencies on various matters related to the financing of loans, including serving for three years on the Consumer Advisory Council of the Federal Reserve Board.

Tom Fitzpatrick is an economist by title (but mostly a lawyer by training) in the Community Development Department of the Federal Reserve Bank of Cleveland.  The views and opinions he expresses in his posts are his own,and not necessarily those of the Federal Reserve Bank of Cleveland, the Federal Reserve Board, or other Banks in the Federal Reserve System.  The majority of his research focuses on urban housing (particularly on weak markets, foreclosure, REO, and urban blight) and housing finance.  He also researchers resolution of large, complex financial firms, consumer bankruptcy, and public pension law.  To see Tom's publications just click on his name.

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In 2010 I blogged about David Kirkpatrick's business history, The Facebook Effect. Earlier this week, the California Legislative Analyst's Office invoked Kirkpatrick's title to speculate about tax revenues from a Facebook IPO. From the Overview of the Governor's Budget:

The Facebook Effect. Facebook Inc., a privately held company headquartered in Palo Alto, may proceed with an initial public offering (IPO) of its stock in 2012. Facebook reportedly is considering issuing $10 billion of stock in an IPO that would value the company at over $100 billion. Other companies also are considering IPOs in the coming years. 

In the coming months, the state’s revenue forecasts will need to be adjusted somewhat to account for the possibility of hundreds of millions of dollars of additional revenues related to the Facebook IPO. These revenues could affect the budgetary outlook beginning in 2012-13. We caution that it will be impossible to forecast IPO-related state revenues with any precision, and it is likely that little information about the state revenue gain from the Facebook IPO will be available before investors file tax returns in April 2013. (Even then, due to the confidentiality of individual taxpayer information, we are unlikely to know precisely how much state revenues increased due to Facebook’s IPO.) 

In considering the size of the Facebook IPO effect in the coming months, revenue forecasters will have a difficult task. Our office’s income models are based on historical trends and, therefore, already assume that some level of IPO activity occurs for California companies each year. Moreover, in our recent forecasts, our office has deliberately built in “extra” capital gains (above those generated by our model) in 2010, 2011, and 2012 to try to account for a variety of factors, including the surprisingly strong PIT receipts in some recent months. Finally, Facebook-related capital gains likely will prove to be a relatively small percentage of California’s overall capital gains in 2012. If the stock market as a whole has an unusually strong or weak year, that fact could change forecasted capital gains up or down by much more than the positive Facebook effect.

In case you missed it, the projected size of the IPO is $10 billion, and the expected valuation of Facebook $100 billion! For a sense of perspective, Google sold $1.67 billion in its IPO in 2004, giving Google a valuation of more than $23 billion.

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The Canadian Supreme Court just held that creating a single Canadian securities law would be unconstitutional.  Unconstitutional!  Those guys haven't mastered the American Court's approach to legal legitmacy, which I interpret to be "tough in symbolic cases, deferential in substantive ones."  Under the Court's rule, Canada will never be able to federalize its securities law, unless, that is, the court can be overruled under the constitutional scheme, or the constitution is amendable.  Check out this language, summarized by Kevin LaCroix:

The “field of activity” that the Act “would sweep into the federal sphere simply cannot be described as a matter that is truly national in importance.” The basic nature of securities regulation “remains primarily focused on local concerns of protecting investors and ensuring fairness of the markets through regulation of the participants.”  

Sounds both incorrect and an unwise substantive judgment about the securities industry to me.  But it suggests that they take their federalism extremely seriously up there in Canada.  HT: CorpCounsel.

Meanwhile American trade lawyers are worried that the proposed combination of USTR and Commerce will not work well.  I would suggest that they needn't spend a lot of time thinking about it.  Combining agencies means dispossessing a congressional sub/committee of oversight responsibilities, and it isn't as if it can never happen - we have a Department of Homeland Security, after all - but it makes such consolidations much more difficult than mere logic would suggest.  USTR and Commerce do not generate a ton campaign contributions from regulated industry, but they aren't politically meaningless, either.

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At the Glom, we haven't hid our fascination with the Battle Hymn of the Tiger Mother, and we have even held a discussion among other law prof supermoms on the book.  One of my disappointments with the book was that Prof. Chua didn't discuss her dreams, aspirations, successes and failures in her on career path.  Today, I saw this interview with Chua that talks a little bit about her dissatisfaction with law school and practicing law.

Law school tore down my confidence. I hated being called on. It's not a discipline that comes naturally to me. I did not click with law. I'm the hardest worker, but I could not retain the information

Chua then explains that her hard work led her to a clerkship, which she did not enjoy, and a career at Cravath, which she also didn't enjoy, though she worked extremely hard at both.  After a 14-year odyssey to break into tenure-track teaching, she found a niche for herself in law and ethnicity in developing countries, a few leaps away from traditional law classes and law practice.  One can jump to the conclusion that she might have been happier in a different graduate program in that field without the wandering in the wilderness.

As a professor, this makes me wonder how many really smart folks stumble into law school and just don't enjoy it because they would "click" with a different discipline.  As a law professor, we have the amazing flexibility of dabbling in other disciplines, but most folks in law school are destined for the less flexible world of practicing law.  I know that I have seen my share of students who are used to succeeding in school by working very, very hard and are flummoxed by the first year of law school.  Some double down and work even harder, like Chua, but others sort of stall.  (Of course, this is one reason why there are a growing number of people arguing to make it cheaper for law students to leave after one year:  Me, Ian Ayres & Ahkil Amar, and Ari Kaplan.

Of course the tabloid-y bit of information in the interview was that Chua and her older daughter, Sophia, were asked to be on The Amazing Race, though they declined.  From reading her book, I think Chua and younger daughter, Lola, would make a more ratings-ready pairing!

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If you read or heard my memorial to my colleague and friend Larry Ribstein, then you already know that I saw Sherlock Holmes 2 over the break.  I actually saw it twice, once with my oldest child and the second with my middle child.  I enjoyed it the second time as much as the first, and (if you've seen it, you'll understand) was glad for the opportunity to watch the ending again. 

If you are not only a reader of the Glom but also have an amazing memory, you'll remember that I enjoyed the first movie, though was a little peeved with the deductive reasoning exploits that no audience member could have possibly followed.  (E.g., Holmes sees two dots of ink behind Mary's ear and instantly knows that she is a governess and her student threw ink at her that she didn't wash off completely and that's why she has on such a fancy necklace, which the student's mother loaned her as consideration for her trouble.)  I don't think that Guy Ritchie or the screenwriter is a reader of this blog, but I do think that those deductions from left field are minimized in the second movie.  The machinations of Holmes' mind are much more visible, with his logic spelled out (usually through the mouth of Watson) so that the audience feels more a part of the mystery solving.

Like the first movie, however, this installment is great fun.  Watson's fiancee, Mary, gets a much bigger part in this one, and Moriarty is an on-screen character.  Rachel McAdams' character, Irene, does not get much screen time, however.  Holmes' brother, Mycroft, appears and very nearly steals the show.  But he does not because the real stars are Robert Downey Jr. and Jude Law, who make the so-called "bromances" of modern film just seem silly.  They are great together and the rest of the plot, etc. seems secondary.

I found this plot a little less convoluted than the first movie's plot, but according to those in my party who have read the original books, it is a mash-up of several famous Holmes' stories.  This plot involves Moriarty's scheme to acquire interests in businesses that produce the tools of war and then push Europe into a multi-country clash.  As a business law professor, what I loved, loved about the movie was that Moriarty acquires an interest in a German munitions factory owned and ran by (wait for it, wait for it) MEINHARD!  Yes, the evil Moriarty is partners with Mr. Meinhard!  And if we thought that Mr. Salmon was horrible to our NY Mr. Meinhard, then you should see what Moriarty does to the German Mr. Meinhard.  After assasinating him, Moriarty takes control of the munitions factory (not sure why German law would bring about such a result -- possibly a buy-sell agreement or a buyout under the UPA, but these are details).  Scholars point to Germany to show how more enlightened corporate governance is there, but this movie shows the rougher side!

My only disappointment was with the character of a Gypsy woman named Simza, played by Noomi Rapace, who potrayed Lisbeth Salander in the Swedish version of the Girl With the Dragon Tattoo.  Rapace goes from playing one of the more interesting and challenging female characters of our time to playing basically "the girl."  She has very few lines, but is on-camera a lot, usually drinking or eating.  She has no interesting scenes and her character basically just tags along with Holmes and Watson to find her brother, who is mixed up in Moriarty's evil plan.  Kind of a waste, but it doesn't take away from the movie.

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Res ipsa loquitur ...

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Fran Tarkington, prompted by Tim Tebow, asks that question in a WSJ editorial.

I can answer definitively: No. And I know this because of Fran Tarkington.

When I was young, I was a passionate Minnesota Vikings fan in the heart of Packer Country. (Even though I don't follow the NFL anymore, I still hate the Packers. Blech!)

Fran was our quarterback, and, after Alan Page, was my favorite player on the team. Fran led the Vikings to three Super Bowls during my formative years. Each time I prayed fervently that the Vikings would win, and each time my request was denied.

Not surprisingly, Fran had the same experience with prayer and those Super Bowls:

I prayed fervently before each of the three Super Bowls we Minnesota Vikings played in. We played against the Dolphins, the Steelers and the Raiders. I don't know about the first two games, but I was sure God would be on our side for the game against the Raiders! After all, they were the villains of the league, and it was hard to believe they had more Christians on their team than on our saintly Vikings. We lost. 

If you need further proof that God doesn't care about the outcome of football games, just look at the result of last year's Super Bowl.

QED

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WaPo is remembering the crash of Air Florida Flight 90, which happened 30 years ago today. Seventy-five people died in the crash, which I remembered last week while riding to Reagan National after the AALS annual meeting. One reason that crash is so memorable to me is "The Man in the Water," Roger Rosenblatt's famous essay:

The person most responsible for the emotional impact of the disaster is the one known at first simply as “the man in the water.” (Balding, probably in his 50s, an extravagant moustache.) He was seen clinging with five other survivors to the tail section of the airplane. This man was described by [Donald Usher and Eugene Windsor, a park-police helicopter team,] as appearing alert and in control. Every time they lowered a lifeline and flotation ring to him, he passed it on to another of the passengers. “In a mass casualty, you’ll find people like him,” said Windsor. “But I’ve never seen one with that commitment.” When the helicopter came back for him, the man had gone under. His selflessness was one reason the story held national attention; his anonymity another. The fact that he went unidentified invested him with a universal character. For a while he was Everyman, and thus proof (as if one needed it) that no man is ordinary.

Still, he could never have imagined such a capacity in himself. Only minutes before his character was tested, he was sitting in the ordinary plane among the ordinary passengers, dutifully listening to the stewardess telling him to fasten his seat belt and saying something about the “No Smoking” sign. So our man relaxed with the others, some of whom would owe their lives to him. Perhaps he started to read, or to doze, or to regret some harsh remark made in the office that morning. Then suddenly he knew that the trip would not be ordinary. Like every other person on that flight, he was desperate to live, which makes his final act so stunning.

For at some moment in the water he must have realized that he would not live if he continued to hand over the rope and ring to others. He had to know it, no matter how gradual the effect of the cold. In his judgment he had no choice. When the helicopter took off with what was to be the last survivor, he watched everything in the world move away from him, and he deliberately let it happen.

Yet there was something else about our man that kept our thoughts on him, and which keeps our thoughts on him still. He was there, in the essential, classic circumstance. Man in nature. The man in the water. For its part, nature cared nothing about the five passengers. Our man, on the other hand, cared totally. So the timeless battle commenced in the Potomac. For as long as that man could last, they went at each other, nature and man; the one making no distinctions of good and evil, acting on no principles, offering no lifelines; the other acting wholly on distinctions, principles, and, one supposes, on faith.

Since it was he who lost the fight, we ought to come again to the conclusion that people are powerless in the world. In reality, we believe the reverse, and it takes the act of the man in the water to remind us of our true feelings in this matter. It is not to say that everyone would have acted as he did, or as Usher, Windsor, and [Lenny Skutnik, who jumped into the icy water to drag an injured woman to shore]. Yet whatever moved these men to challenge death on behalf of their fellows is not peculiar to them. Everyone feels the possibility in himself. That is the abiding wonder of the story. That is why we would not let go of it. If the man in the water gave a lifeline to the people gasping for survival, he was likewise giving a lifeline to those who observed him.

The odd thing is that we do not even really believe that the man in the water lost his fight. “Everything in Nature contains all the powers of Nature,” said Emerson. Exactly. So the man in the water had his own natural powers. He could not make ice storms, or freeze the water until it froze the blood. But he could hand life over to a stranger, and that is a power of nature too. The man in the water pitted himself against an implacable, impersonal enemy; he fought it with charity; and he held it to a standoff. He was the best we can do. 

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..and that's the problem Mitt Romney's got right now.  You can argue that it's hard to feel too sorry for private equity types: they certainly tend to live up to their name, keeping their name and doings out of the limelight (unless they're going public this year, and have to reveal that their top 3 execs made $402 million).  It's that privacy that's hurting Romney now.

The mystery of private equity is something I confront each spring as I being my Life Cycle of the Corporation course.  As the title suggests, it covers a corporation's life, from founding through venture financing, going public, and being public (and M&A and bankruptcy, time permitting).

Fully a third of the substantive classes focus on venture financing.  That because it takes a while for the students to grasp what venture capitalists do.  We watch a movie.  We discuss term sheets and Series A financing documents.  We have a negotiation exercise, pitting company counsel against investor counsel.  By the end of the unit, they really do get it.  But it takes three weeks.

Most of America hasn't done this.  So maybe when they hear, as the Journal reported yesterday, that of the 77 companies Bain invested in during its tenure, 22% filed for bankruptcy or stopped operations by year 8, or that "most of the 50-80% of annual gains" Bain produced came from "a relatively small number of deals, and some of these winning companies later ended up filing for bankruptcy protection", that sounds scandalous.  To me, it sounds like Bain hit it out of the park.  But I know the odds are against a successful exit, even for a venture-backed corporation.  I know it's normal for a few "home-runs" in a fund to make up for a lot of ho-hum investments and some real stinkers.  Most Americans don't know that.

Like Gordon, I think Perry's "vulture capitalist" label is unfair and misplaced.  But there aren't really any venture capitalist household names--Gordon Gekko is one popular image of private equity, and he plays a villain.  Steve Jobs may be an entrepreneur-hero, but the public doesn't lionize the VC funds that got Apple off the ground. 

Gordon says this issue "should be a winner for Mitt, if he can make the connection to average voters."  The question for me, is whether  Romney is going to try to explain venture capital and private equity to the average American in soundbites.  My experience tells me that might be a tall order. 

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The "King of Bain" video by Invest in America is here. If you are inclined to embrace the Romney-as-Raider narrative that Newt Gingrich has been developing, you might find this film effective, but it's hard to imagine independent-minded voters being persuaded. 

One problem is that many of the claims and insinuations in the film are facially ridiculous. For example, the first case study of Romney's rapaciousness is about a company called UniMac. According to the film, this was the Bain formula: buy a great company, degrade the products, fire the employees, and sell the company at a huge profit to the Canadians. In that order.

The bigger problem is that the tone and rhetoric of the film are well-designed to affirm preexisting beliefs, but not likely to persuade those who are independent or inclined to favor Romney. Romney buys big houses, and he makes them bigger! He is rich, and he likes money! He says crazy stuff like, "everything corporations earn ultimately goes to people"! His own firm took "foreign seed money from Latin America"! And in case you missed the fact that Mitt isn't like you, look at a clip of him speaking French!

It's just over the top.

"More ruthless than Wall Street," Romney apparently coined the term "creative destruction." (Sorry, Mr. Schumpeter.) For Newt Gingrich, this film is just about destruction. Ultimately, I think it will be self-destruction. 

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If you are fascinated by words, you will enjoy Wordnik. Recently featured in the NYT, this site is fun and educational. Just try it. 

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Today in the Crocker Fellows class, we discussed the IMVU case study. IMVU claims to be the "world's largest 3D and dress-up community." 

No, thank you.

But I digress. The point of this post is not to direct you to IMVU, but to link to Stanford's Entrepreneurship Corner, an excellent resource for students of entrepreneurship. In fact, Eric Reis talks about his experiences building IMVU in several videos on ecorner.

Not as flashy as TED, but good stuff.

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Plagiarism is a hard word to spell, but that doesn't necessarily make it a disease or a medical condition.  However, one confessed plagiarist, Quentin Rowan, is comparing his habit of blatant copying to alcoholism and other addictions.  In light of the recent Rowan kerfuffle, in which he published a spy novel that lifted literally pages from famous spy novels, Salon has a debate concerning the definition of "plagiarism."

I was lured to read because I wanted to see what the experts thought the definition of plagiarism is.  Having had to witness too many students put through the wringer who claimed that no one ever told them what plagiarism was, I have to admit I think we are good at telling folks that plagiarism is wrong (or a violation of the honor code), but even better at assuming that everyone has already been told by someone else what plagiarism is.  I've also seen this with academics, too.  I've been told that in some areas of legal scholarship many articles contain almost stock explanations of traditional arguments, with the same cites in the same order.  I've been told by others that this is just wrong.  Most of the experts on Salon were also in the "everyone knows what plagiarism is" camp -- just repeating that it is the presentation of someone else's words or ideas without attribution.  The experts do agree that some plagiarism is unintentional and that one can misremember whether ideas were one's own or anothers.

But, the interesting event that spawned the debate answers some questions for me.  I have always wondered what could possibly be the mindset of someone who steals another's words and passes them off as her own, for a grade or for profit.  I've always thought that the plagiarist must rationalize this to themselves, possibly by assuming that everyone else does it or that this is just the way things are done.  Perhaps in a school setting, a student could convince herself that a teacher was so hard or so unfair that plagiarism was the only way to succeed under a rigged system.  Writing a novel, though, doesn't lend itself to those arguments.  Perhaps plagiarism is just another risky behavior that creates a sense of danger and excitement for the writer.  Hopefully, I'll never know firsthand.

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The CFTC, the most on track agency in Dodd Frank implementation, just issued its new segregation of customer accounts rule, or, as I like to call it, the MF Global Rule.  It just issued a Volcker Rule, too, but the MF Global rule was passed in the time between October 31, the firm's bankruptcy, and today, with breaks for Christmas, Thanksgiving, and assorted other federal holidays.  By American standards, that's really flying. 

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