Author : Larry E. Ribstein
Publisher :
ISBN 13 :
Total Pages : 25 pages
Book Rating : 4.:/5 (129 download)
Book Synopsis Dabit, Preemption and Choice of Law by : Larry E. Ribstein
Download or read book Dabit, Preemption and Choice of Law written by Larry E. Ribstein and published by . This book was released on 2006 with total page 25 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Supreme Court's decision in Merrill Lynch, Pierce, Fenner amp; Smith, Inc. v. Dabit, involves the reconciliation of three significant policy goals - controlling abusive litigation, deterring securities fraud, and preserving our federal system by limiting the federal government's power. These goals seem to conflict in that controlling litigation involves expanding federal power, thereby foreclosing potential state approaches to controlling fraud. In Dabit, the Court opted to broadly interpret the federal government's preemption of state securities remedies, thereby giving momentum to the federalization of corporate law. This article shows that forcing Congress to attend more closely to the role of state law might have encouraged a better reconciliation of the three policy goals. Specifically, Congress can control abusive litigation without sacrificing the states' role in remedying fraud by preserving fraud remedies imposed under state corporation laws. Letting firms choose the applicable state law would motivate states to develop reasonable remedies rather than to invite abusive litigation. A viable state fraud remedy would, in turn, free Congress and the courts to examine the appropriate extent of federal fraud remedies.