The Futures Exchange
Lawyers predict the legal issues that will top the agenda for President-elect Barack Obama's administration.
Most lawyers don’t keep a crystal ball in their office, but if pressed, some will take a crack at forecasting the future. We asked a selection of litigators to share their predictions about the legal and political issues that could have an impact on their practice areas over the next four years. Many suggested that the legal pendulum will swing away from eight years of policies broadly sympathetic to financial institutions, pharmaceutical companies, and the oil industry. Regardless of which side of the political aisle they stand on, our experts agreed that this year’s financial crisis is likely to lead to sweeping changes in bankruptcy and securities law, energy policy, and financial regulation.
But our litigators didn’t agree on everything. Securities and white-collar lawyers raised questions about who will take the lead in enforcement: state attorneys general, the U.S. Department of Justice, or the Securities and Exchange Commission. Employment lawyers debated whether organized labor will regain lost ground through passage of the Employee Free Choice Act. And antitrust litigators wondered if the Federal Trade Commission might suddenly clamp down on price-fixing.
Between the challenges of funding a budget and appeasing an electorate deeply divided over the use of taxpayer dollars for a multibillion-dollar financial bailout, one thing was clear from our experts’ predictions: The next presidential administration will inherit no easy tasks.
Some of the amendments to the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) of 2005 will be repealed, especially the ones that made Chapter 11 less of a safety net for companies. It has become in vogue in recent years to have quickie Chapter 11s. But as more companies are forced into Chapter 11, there will be more of a sentiment that bankruptcy protections are more important. BAPCPA took out the rights of Chapter 7, making it harder for individuals to hold onto nonexempt assets. But as we see more and more mortgage foreclosures, I think people will try to reform this law.
Bruce Zirinsky, Cadwalader, Wickersham & Taft, Bankruptcy
In football and basketball, college sports is a multibillion-dollar business. The questions of how rights fees are handled and how student athletes are treated may have national impact. This could end up being a congressional issue if the money keeps getting bigger. A class action was settled with students a year ago, and there’s a lot of political pressure to continue to reform this area.
Jeffrey Kessler, Dewey & LeBoeuf,
There has been a lot of debate about tax credits for renewable energy investments. Current credits are still set to expire in 2008. This has had a significant impact on deployment of renewable energy systems, with the solar industry in particular effectively put on hold by the fact that consumers are waiting to see if there will still be a tax credit in 2009. There is broad support for extending the credits, but in the current environment of financial instability and budget concerns, it is difficult to predict whether they will survive. Obama has strongly supported extension of the credits as part of a comprehensive energy independence plan; McCain has also generally stated his support, but has repeatedly missed votes that would extend them.
Steven Holtzman, Boies, Schiller & Flexner, Antitrust
What the new attorney general will have to decide is how aggressively to use criminal law to address business misconduct, which can also be addressed through regulatory or civil lawsuits. . . . Are we going to prosecute people for making bad judgments, or just fine them for breaking rules? There are questions of whether [these] resources are rightfully allocated for the [Justice Department], or whether these cases should be left to a regulator with a greater degree of knowledge and understanding of how the industry operates.
Steven Molo, Shearman & Sterling, White-Collar Criminal Defense
Whoever is in the White House will have an interest in seeking to ensure that the antitrust regulations in Asia develop in a way that is more supportive of innovation and growth than in the European Union. The next administration will also have to bring harmony between the antitrust division of the Department of Justice and the Federal Trade Commission. They have taken pretty different stances on monopoly issues.
Gregg Levy, Covington & Burling, Antitrust
Whether or not we will see significant change is based on the social and political priorities of the new administration. The question of federal safety regulations is up for debate. Resources are stretched at the Food and Drug Administration. Under [longtime FDA commissioner] David Kessler there were huge changes to health and welfare legislation, but the tort system was not prepared to handle that. The question is now: How well does the FDA need to be funded, and how powerful will the next administration allow the agency to be on social issues? Another question is whether the National Highway Traffic Safety Administration is well funded. The same goes for OSHA and the [Equal Employment Opportunity Commission]. Questions of fuel efficiency and alternative energy requirements may depend on funding of these agencies.