Monthly Archives: November 2014

Fantasy Football: Better to Be Good Than Lucky

Author: Matt Huffman, Associate Member, University of Cincinnati Law Review

In 2014, nearly 37 million people will participate in a fantasy football league.[1] As the game’s popularity has grown, it has drawn unwanted attention from state officials questioning the legality of betting on fantasy football. While a small group of friends drafting fantasy football teams in a basement is unlikely to attract law enforcement scrutiny, fantasy football host sites[2] have become a billion dollar industry and are potentially subject to prosecution in states with strict gambling laws. Congress addressed fantasy football and determined that, under certain circumstances, betting on fantasy football is a legal activity.[3] However, some state gambling laws are stricter than federal law. Ohio law does not explicitly address the legality of fantasy football gambling, but based upon Ohio’s application of the “predominant factor test,” Ohio courts would likely determine that betting in fantasy football leagues, particularly those of shorter duration, would violate state gambling laws. Therefore, any host site (and its operators) accepting bids from Ohio or a state with similar gambling laws could be subject to criminal prosecution under state gambling laws.

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City of Indianapolis v. Annex Books: Has Renton’s “Reasonable Belief” Standard Become Unreasonable?

Author: Rebecca Dussich, Associate Member, University of Cincinnati Law Review

Among the petitions reviewed during the Supreme Court’s September conference was a request[1] to reverse a Seventh Circuit decision, City of Indianapolis v. Annex Books, in which the court invalidated an Indianapolis ordinance that restricted the permissible hours of operation for “adult entertainment businesses.”[2] The Supreme Court denied certiorari.[3] In that case, the Seventh Circuit held that the Indianapolis ordinance was unsupported by evidence of a justifiable government interest to restrict First Amendment rights. The Seventh Circuit’s decision employed a foundational standard of free speech jurisprudence originally set forth in Renton v. Playtime Theaters[4] and the denial of certiorari confirms the interpretation of this standard by lower courts. The Supreme Court was correct to allow the Seventh Circuit’s holding to stand. Had the Court granted certiorari and reversed the Seventh Circuit’s decision, this case would have signaled the first major shift in time, place, manner jurisprudence in almost three decades.

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Protecting Attorneys and Jeopardizing Creditors: In re Thelen LLP and Rejection of the “Unfinished Business Rule”

Author: A.J. Webb, Articles Editor, University of Cincinnati Law Review

In recent years, numerous multinational law firms have declared bankruptcy amidst dwindling demand for legal services. Generally, the bankruptcy of a law firm is similar to that of any other debtor: a trustee must carefully scrutinize the debtor’s assets, ensuring their availability for distribution to outstanding creditors. These assets are essential in repaying the partnership’s previous debts.

The New York Court of Appeals, however, holds a different view of how a bankrupt law firm should be treated, at least with respect to legal fees generated after the law firm declares bankruptcy. In a decision this past July, the Court of Appeals held that the “unfinished business” rule of partnership law, which provides that any “profits arising from work begun by former partners of dissolved law firms are a partnership asset that must be finished for the benefit of the dissolved partnership,” is inapplicable to pending hourly fee matters.[1] Fees generated after the declaration of bankruptcy concerning pending matters prior to the firm’s bankruptcy belong to the attorney, not the bankruptcy estate.[2] This single decision by the Court of Appeals will have major ramifications in bankruptcy law. While rejecting the unfinished business rule increases attorney and client independence, it seriously harms a creditor’s chance of recovery from the firm in bankruptcy.

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A Tail Is Not a Leg: Statutory Interpretation Games at the Ohio Supreme Court

Author: Colin P. Pool*

It is often said that Abraham Lincoln, “faced with some thorny issue that could be settled by a twist of language,” would ask his questioner how many legs a dog would have if you called its tail a leg. “Five,” the questioner responds. “No,” Lincoln answers. “Calling a dog’s tail a leg doesn’t make it a leg.”[1] In a recent decision, Hauser v. Dayton Police Department,[2] the Ohio Supreme Court effectively “called a tail a leg,” and held that an employment discrimination statute that imposes liability on “any person acting directly or indirectly in the interest of an employer” did not, in fact, impose individual liability against public-sector supervisors. In doing so, the Court arbitrarily limited the tort remedies available to public-sector employment discrimination plaintiffs, and showed its willingness to engage in intellectual dishonesty to reach these results.

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Secure Currency or Security? The SEC and Bitcoin Regulation

Author: Dan Stroh, Associate Member, University of Cincinnati Law Review

The Securities and Exchange Commission (SEC) took a bold step in the regulation of virtual currencies on July 23, 2013, when it charged Trendon Shavers and his company, Bitcoin Savings and Trust (BTCST), with defrauding customers in a Ponzi scheme.[1] The defense offered by Shavers in the motions leading up to the judgment was that bitcoin[2] is not a real currency or money recognized by the U.S. government.[3] Because securities fraud law requires an “investment of money”[4] to form an investment contract, Shavers argued that because the SEC could not show this investment, the statutes did not apply to Bitcoin and the SEC’s prosecution must be dismissed.[5] However, on September 18, 2014, a Texas court granted the SEC’s motion for summary judgment on the violations of anti-fraud and registration provisions of several securities laws and imposed fines of over $40 million on Shavers and BTCST. Because Shavers admitted most of the factual basis of the SEC’s argument, once the court held that an investment contract existed, he had no defense to the charges.[6] This ruling was one of the first to determine the status of bitcoin as a security in a United States court. Although Bitcoin may be a newcomer to the securities industry, defining bitcoin as a security gives regulators at the SEC significant and necessary power to combat fraud in this developing area of finance.

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The Changing Tide of Employee Classification

Author: Brynn Stylinski, Associate Member, University of Cincinnati Law Review

For years, many employers have chosen to hire independent contractors rather than employees because contractors are not entitled overtime or benefits like those under the Family and Medical Leave Act (FMLA), but employees are. Many workers have filed lawsuits against employers, alleging that they been misclassified as independent contractors and are entitled to benefits as employees. In Alexander v. FedEx Ground Package System, Inc., the Ninth Circuit addressed this type of claim of misclassification by current and former FedEx drivers attempting to obtain back wages and benefits under the FMLA.[1] The court’s determination that the drivers were employees signals a shift in the judicial system’s approach to determining employee status. Though that shift will likely lead many employers to modify their agreements with contractors and employees to minimize the employers’ liability, hopefully it will allow more plaintiffs to obtain the benefits of which they have been deprived by their employers.

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To Arbitrate, or Not to Arbitrate: A Question of Contractual Interpretation

Author: Collin L. Ryan, Associate Member, University of Cincinnati Law Review

Arbitration. Most know and understand the term and its function for resolving differences. Yet if asked to classify the act of arbitrating a legal dispute under a broader category, where would the term fit? Is it an action? Is it a proceeding? Or is it something entirely separate and apart from such umbrella terminology, incapable of categorization? A current circuit split exists regarding that precise issue.[1] Specifically at issue is whether a party’s right to arbitrate a dispute is encompassed and superseded by a forum selection clause stating that “all actions and proceedings” be brought in a particular court, thus precluding the party’s right to commence arbitration.[2] The correct approach is that of the Fourth Circuit, which has held that arbitration rights are not precluded by this forum selection clause.

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What’s in a Name? A Look into the Washington Redskins Trademark Dispute

Author: Ashley Clever, Contributing Member, University of Cincinnati Law Review

Many currently debate whether or not the Washington Redskins name and logo should be changed for disparaging Native Americans, but a closer look into trademark protection raises questions about the role of the United States Patent and Trademark Office (USPTO) and where this push for change should ultimately come from. A quick search on the Trademark Electronic Search System (TESS) reveals 130 records of trademarks containing the f-word (26 of which are currently being used in commerce). Live trademarks include “F—k You,” “F—k It,” “F—k Yeah,” and, quite possibly the most original, “All You F—n’ Hillbillies Shut the F—k Up,” which claims to be a brand of t-shirts.[1] Numerous comedy shows have poked fun at the trademark controversy, such as the South Park episode “Go Fund Yourself,” in which the characters begin a start-up company using the trademark “the Washington Redskins.”[2] While the controversy is being parodied in the news, it raises very relevant questions of why trademarks exist, what can be trademarked, and when a trademark should be canceled. The USPTO may have had good intentions in cancelling the trademark, but all they succeeded in accomplishing was potentially harming consumers by making it more difficult for the Washington Redskins to prevent companies from producing counterfeiting goods bearing the Redskins logo.

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