Law Student Connection

Dear Readers:

These are the times that try law students' souls. Final exams are in full swing, just in time for the nicest weather of the year. Chances are, you've taken at least a couple of exams by now on days where you'd rather be doing anything but sitting in a testing room for three or four hours. Yet good news is in sight: the end of another semester is almost here.

And when your semesters end, you can immediately go to the newest edition of The Law Student Connection to check out our latest offering of articles. Even after a steady diet of law during the semester, you'll want to read these pieces. Well-researched, interesting, and often controversial, this will provide you with the perfect reading material for a warm post-exams spring evening.

Everyone seems to have strong feelings about the United Nations, and Anne Jelliff is no exception. Check out her piece on how the UN has been spending its money lately, ending with a call for greater transparency. Amelia Wong has equally strong feelings about the scourge of counterfeiting. Be certain to read her article about how a unique type of counterfeiting is plaguing the fashion industry, complete with suggestions about legal responses.

We feature two in-depth articles about arbitration in this issue: Marcin Tustin's examination of expert determination in relation to the New York Convention and Emily Belfer's look at judicial review of religious arbitration. We bring you a look at guardianship law in New York State, focusing on the challenging balance between autonomy and protection. And any Canadian readers interested in attending an American law school must read Reema Mahbubani's extremely helpful guide to navigating this process.

So what are you waiting for? Finals are over. Now you can sit back, relax . . . and enjoy the thrill of reading something without worrying about being tested on it.

Sincerely,

Benjamin Pomerance
Editor-In-Chief

I. Introduction

Under American law, the parties in most disputes can elect to have their case decided by a religious tribunal in the place of a secular court. Religious tribunals are classified as arbitration bodies by the civil legal system, with the decisions rendered by religious arbitration as rewards that generally cannot be appealed, like any arbitration award. Amanda Mauriello Baker, A Higher Authority: Judicial Review of Religious Arbitration, 37 VT. L. REV. 157 (2012).

While religious arbitrations often operate smoothly without stirring controversy, some decisions made by religious arbitral tribunals can contradict American legal notions of fairness; this tension has historically come up in family law disputes. Caryn Litt Wolfe, Note, Faith-Based Arbitration: Friend or Foe? An Evaluation of Religious Arbitration Systems and their Interaction with Secular Courts, 75 FORDHAM L. REV., 427, 447-448, (2006); see also Ayelet Shachar, Privatizing Diversity: A Cautionary Tale from Religious Arbitration in Family Law, 9 THEORETICAL INQUIRIES L. 573, 576 (2008). For example, the division of marital property between a divorcing couple according to a religion's standards of equity and ownership might diverge from a court's standards. See Hirsch v. Hirsch, 774 N.Y.S.2d 48 (N.Y. App. Div. 2d Dep't 2004). Clashes between religious and civil law also arise in employment law disputes, where former employees of religious institutions contest both the termination of their employment and enforceability of a pre-contacted arbitration clause. See, e.g., Hosanna-Tabor Evangelical Lutheran Church and Sch. v. EEOC, 132 S. Ct. 694 (2012); Graves v. George Fox Univ., 2007 WL 2363372, *1-6 (D. Idaho 2007). In the cases that will be discussed below, parties in family and employment law disputes submit to religious arbitration but are unhappy with the tribunal's decision. These parties sometimes appeal the award issued by religious arbitration by petitioning for judicial review by a civil court.

After evaluating the facts of any contested case using the cocktail of applicable statutory and common law standards, courts apply the relevant standard of review to grant or deny motions to review arbitration proceedings. For example, the public policy vacatur,a common law rule in some jurisdictions, permits courts to vacate religious arbitration awards if they are deemed to have violated a strong public policy or interest. N.Y. C.P.L.R. § 7511(b) (2012). While this discretionary policy-driven vacatur is available to judges in New York, judges in many other jurisdictions are subject to a highly restricted and limited set of exceptions that permit them to review arbitration awards. Recent scholarship has questioned the powers available to judges when agreements to arbitrate using a religious panel or awards from religious panels are contested.

Judicial review of religious arbitration is particularly relevant in light of a 2005 decision issued by the Fifth Circuit in Prescott v. Northlake Christian School. 141 F. App'x 263, 263 (5th Cir. 2005). The court held that civil courts cannot automatically vacate remedies awarded by religious arbitrations just because an award clashes or is inconsistent with state law. Id. at 272. In other words, there may be no basis to ever vacate a remedy that conflicts with secular law as long as the award originates from the authority given to the arbitrators.

The current mechanisms for judicial review should be scrutinized to determine if reevaluation, reform, expansion, or limitation, are required. The following analysis will conclude that while there are some flaws in the current bases for judicial review, especially in the context of family law where groups such as women are often vulnerable within the legal contexts of traditionally minded religious communities, the system is generally sound, though it would benefit from peripheral reforms. While a judicial clearer standard for using the public policy vacatur in applicable jurisdictions would be a positive first step, the most important thing for courts to do is retain some oversight over arbitration operations and carefully evaluate arbitration decisions on appeal for signs of unconscionability. Enacting reforms focused on the pre-arbitration phase of a dispute could ideally solve all of the system's current flaws and ultimately eliminate the calls to expand or curtail a largely functional system.

II. Background

In a religious arbitration, disputants agree to use an arbitrator who consults a religious legal system as an alternative to American civil law in order to resolve a dispute. Shachar, at 381. A religious tribunal arbitrates the dispute, though a secular and recognized umbrella entity such as the American Arbitration Association (AAA) or Judicial Arbitration Mediation Services (JAMS) administers and oversees the arbitration. Wolfe, at 436.

Religious arbitration is an appealing method of dispute resolution to adherents of religious faiths. First, the parties have great flexibility and control over the proceeding through their statutory right to exercise discretion over the procedures applied to resolving their dispute. Second, parties may opt to use a faith-based arbitration over secular arbitration because of the comfort and familiarity that comes with presenting an argument to someone who shares their value system. A religious tribunal is better equipped to resolve disputes by incorporating the religious ideals that the parties value or religious laws that the parties adhere to than a secular court that need only consult civil law. Wolfe, at 441.

The Federal Arbitration Act ("FAA") is the controlling statute that regulates arbitration in the United States. See, e.g., Allied-Bruce Terminix Co., Inc. v. Dobson, 513 U.S. 265, 270-272 (1995). The Uniform Arbitration Act ("UAA"), a model statute, is a second statutory influence on arbitration administration in the United States. The FAA was enacted in the 1925 to provide the judicial facilitation of private dispute resolution through arbitration. Id. at 270-272. The FAA stipulates that arbitration is valid only if the parties validly agree to arbitrate. Baker, at 7. Valid agreements can be formed either by including a written provision into a contract that agrees to settle all disputes through arbitration or by executing a written agreement to arbitrate a dispute that already exists. Id. The FAA lists limited grounds of appeal to the civil judiciary. The statute allows judges to review and vacate arbitration awards only when the award was fraudulent, if the arbitrators were biased or corrupt, guilty of misconduct, or if exceeded their powers. 9 USCA § 10(a)(1)-(4) (2012). Unconscionable conduct that meets this standard can be substantive, such as a blatant disregard for one party's argument, or procedural, such as an employer giving an employee an insufficient amount of time to read the terms of an employment agreement including an agreement to arbitrate written in clear and easily locatable language. Graves, 2007 WL at *5-6.

Judicial review of religious arbitration is not only constrained by statute but is also limited by the U.S. Constitution and other legal doctrines. The freedom to practice religion freely under the Establishment and Free Exercise clauses in the First Amendment makes it difficult for the judiciary to review decisions that stem from religious entities without impinging on constitutionally guaranteed rights. Michael C. Grossman, Note, Is this Arbitration?: Religious Tribunals, Judicial Review, and Due Process, 107 COLUM. L. REV. 169, 169-170 (2007). However, the First Amendment does not place religious organizations above the law. Meshel v. Ohev Sholom Talmud Torah, 869 A.2d 343, 343 (D.C. Cir. 2005); Steven C. Bennett, Enforceability of Religious Arbitration Agreements and Awards, 64 DISP. RESOL. J. 24, 29 (2010). Therefore, a doctrine emerged at common law that judicial review of religiousarbitration can occur without interfering with the free practice of religion: courts must use only "neutral principles of law" in their analysis and may not scrutinize religious doctrinal matters. Encore Prod. v. Promise Keepers, 53 F. Supp.2d 1101, 1112 (D. Colo. 1999); Bennett, at 29.

Religious question, a related doctrine, is also derived from the First Amendment. Under the religious question doctrine, religious institutions are entitled to a degree of independence and insulation from secular courts. In order to comply with the Establishment clause, civil courts should be precluded from adjudicating any questions of law that relate to religious dogma or doctrine. The rationale behind this doctrine posits that religious arbitrators are experts in faith-based issues whereas civil court judges do not have this expertise and are therefore unqualified to hear certain issues. See Baker, at 26, (citing John Witte Jr., & Joel A. Nichols, RELIGIONS AND THE AMERICAN CONSTITUTIONAL EXPERIMENT 241 (3d ed. 2010)). Courts are hesitant to review decisions made by religious tribunals in light of these statutory and doctrinal constraints.

Courts have minimal powers of review over arbitral decisions due to the clear-cut permissible grounds for appeal under the FAA and UAA. Bennett, at 26. Judicial authority to review religious arbitration awards, though limited, is possible in a few ways. First, a court can use the neutral principles of law approach to determine if the parties validly agreed to arbitrate. Baker, at 33. If there was no valid agreement then the court can deem that arbitration invalid and vacate its award. If the court finds a valid agreement to arbitrate, it next evaluates if the arbitration process was corrupt in any way. Id. Second, the reviewing court can also vacate the arbitration award if finds that procedural defects, such as bias or lack of notice, took place at any point during arbitration. Walter, at 522. Additional grounds for vacating an award include: overstep of the arbitrator's power, evident mistake, or if the arbitrator showed a blatant disregard for the rules. Walter, at 518, 544. Generally, these types of procedural or substantive unconscionable conduct warrant judicial review if they are evident in the agreement to arbitrate or the arbitration award. The above-listed grounds of judicial review originate from the FAA and UAA though some jurisdictions have additional, more substantively based, grounds for judicial review, such as New York's public policy vacatur.

Christian, Jewish, and Muslim religious communities use religious arbitration in the United States most frequently, though tribunals for other faiths are also active. Grossman, at 177. Christian dispute resolution is adjudicated according to the laws and teachings of Jesus and the New Testament. Id. The most common form of Christian dispute resolution is Christian Conciliation, defined as "the voluntary submission of a dispute for biblically based conflict counseling/coaching, mediation, arbitration, or mediation/arbitration." Baker at 22, FN 94 (citing Rules of Procedure, Institute for Christian Conciliation). The primary entities that handle Christian dispute resolution today are Peacemaking Ministries and its affiliate, the Institute for Christian Conciliation (ICC). Grossman, at 177. Jewish religious tribunals are known as the Beth Din (or "Beit Din.") The judges that sit on the Beit Din apply Jewish law, halacha, to the cases before them. Grossman, at 176. The Beth Din of America (BDA) is currently the most elaborate network of Jewish courts in the United States today, and it decides religious issues such as conversion as well as commercial cases that involve Jews. Grossman, at 180. Naomi Maryles, a former administrative attorney at the BDA, adds that the BDA is meticulously careful to make sure that its policies and procedures comply with state and federal rules because it wants its decisions to be enforceable and upheld in the event of judicial review. Telephone Interview with Naomi Maryles, Former Administrative Attorney, Beth Din of America (Feb. 5, 2013).

Islamic panels are typically less organized and less pervasive throughout the United States, possibly because there is no permanent Muslim court system in the United States.In light of this, American Muslims to prefer to mediate their disputes themselves rather than submitting to arbitration and appointing a religious arbitrator. Grossman, at 179. Muslims who elect to use religious arbitration submit to panels organized though local mosques through a process that has yet to be structured or supervised under a unified religious court system. Id. Though this system has been criticized, decisions made by Muslim panels are enforceable in civil courts.

The operation of religious arbitration in the United States and how it is subject to judicial review are relevant issues in today's legal and social landscape where faith has taken the front seat on a host of issues. Interestingly, the Supreme Court has not ruled directly on the issue of enforceability of contested religious arbitration awards, leaving a morass of unanswered questions about this active issue. A facet of the religious arbitration discussion that has spurned tremendous recent dialogue is the enforceability of awards that follow Muslim shari'a law in Canada, after Canadian legislation sought to end civil recognition of Muslim arbitration. See, e.g., Donald Brown, Comment, A Destruction Of Muslim Identity: Ontario's Decision To Stop Shari'a-Based Arbitration, 32 N.C.J. INT'L L. & COM. REG., 495, 510 (2007). While Canadian law cannot be explored here, these legislative changes are important to bear in mind. They demonstrate that democratic governments today may be willing to render a previously enforceable type of religious arbitration unenforceable.

III. Illustrative Case Law

Examples from a few employment and family law cases illustrate the interplay between religious awards on appeal and the American judicial system. It is important to note that some unique doctrines apply to religious institutions within the context of employment law. For example, the ministerial exception is a subset of religious question doctrine that protects faith-based institutions from litigating employment discrimination lawsuits by not penalizing churches and religious institutions that discriminate while hiring clergy members. The doctrine demonstrates judicial deference to religious bodies. See, e.g.,Corp. of Presiding Bishop of Church Jesus Christ of Latter Day Saints v. Amos, 483 U.S. 327, 330 (1987). The United States Supreme Court noted just last year that it was addressing the ministerial exception for the first time in Hosanna-Tabor and yet declined to offer a formula for how similar cases could be analyzed past this case of first impression. Hosanna-Tabor, 132 S. Ct. at 705, 707. The intersection of guaranteed religious rights, employees of religious institutions, and termination of those employees from their jobs is an issue that is on the rise and remains judicially unresolved.

A. Employment Cases

The most recent appellate commentary on reviewing religious arbitrations came from the employment dispute in Prescott. The plaintiff in Prescott alleged violations of federally guaranteed rights after she was fired from her position as principal of a Christian school. Prescott, 141 F. App'x at 265. Plaintiff also alleged that the Christian arbitrator had overstepped the bounds of his authority and issued a substantively biased decision. Id. at 270.

Had the Fifth Circuit accepted these arguments, plaintiff would have had the basis to have her Christian arbitration award reviewed and possibly vacated. However, the Court refused to review the award and enforced its highly restricted scope of review of the case in light of the procedural language in the arbitration agreement. This decision demonstrates the high evidentiary standard that most states require in order to show that an arbitrator acted in such a manifestly biased manner so as to warrant the judicial review of an arbitration award.

Other plaintiffs challenging their termination of employment at a religious institution have asserted procedural challenges to religious arbitration.In Graves v. George Fox Univ., plaintiff attempted to challenge the arbitration award that upheld his termination on the basis that the award was unconscionable. Graves, at *5-6. The United States District Court in Idaho held that the award was not unconscionable because the plaintiff was given sufficient time to review the terms of his employment contract, which included the arbitration agreement in clear and easily locatable language. The court additionally held that the agreement to arbitrate was mutual and not one-sided as plaintiff alleged, noting,"adhesion contracts were a fact of modern life and not against public policy." Id. at 7.

In contrast, a New York lower court vacated an award issued by a Jewish arbitration panel on procedural grounds. Brisman v. Hebrew Academy of Five Towns and Rockaway, 887 N.Y.S.2d 414 at 919, rev'd, 895 N.Y.S.2d 482 (2010). The trial court found that: (1) the reinstated salary that Beit Din awarded plaintiff, a teacher fired from a Jewish day school, was irrational because it was double the salary he had previously received, (2) the Beit Din exceeded its powers by giving itself indefinite jurisdiction over the case and thereby violating CPLR § 7511, and (3) that the Beit Din had violated public policy by infringing the rights of private schools to make routine employment decisions. This remarkable decision not only reviewed the contested appeal but surmounted the strong juridical preference for arbitration by vacating the Beth Din's award. However, two years later, the Second Department of New York's Appellate Division reversed the trial court's order against the Beit Din of America's decision and affirmed the religious tribunal's original award. The $100,000 annual salary deemed irrationally high by the trial court was, in fact, rationally based since plaintiff's average annual compensation before his attempted termination had exceeded that amount. The Beit Din's extension of its jurisdiction had not invalidated its award because its jurisdiction was not entangled with the facts of the case. Finally, the Second Department held that the policy protecting tenured school faculty from getting fired not for cause exceeded other policy concerns mentioned by the lower court. In other words, the policy issues in Brisman were insufficient to trigger the public policy vacatur. The judicial treatment of the Brisman case shows not only how two benches applied the bases for vacating a religious arbitration award differently to same facts. The case ultimately represents the great, and arguably intractable, strength of the judicial preference to uphold arbitration.

A second case, Easterly v. Heritage Christian Schools, Inc.,sums up many salient points related to employment law and enforcing religious arbitration awards. 2009 WL 2750099, (S.D. Ind. 2009). In Easterly, a United States District Court held that the FAA reaches employment contracts and reminded plaintiffs of the Supreme Court's position that "mere inequality in bargaining power, however, is not a sufficient reason to hold that arbitration agreements are never enforceable in the employment context." Id. at FN 1 (quoting Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 33 (1991)). Plaintiff asserted that biblically based arbitration would be structurally and procedurally biased, but the court rejected her claim. First, because plaintiff did not explain precisely how the arbitration was unfair but primarily because of the judicial presumption that arbitration is fair. The court also rejected Easterly's contention that the agreement to arbitrate was unfair because of the arbitration high fees that could be imposed on her, again because the strong preference to favor arbitration agreements took precedence over prohibitive costs that might be imposed on a party under the agreement. The court explained and then denied each of plaintiff's arguments,recognizing the many challenges that employees may face when they have signed a religious arbitration agreement, while upholding the strong preference for arbitration. Easterly provides a recent example of the judiciary declining to vacate a religious arbitration's decision. However, the case importantly clarified the degree of unconscionability required at arbitration in order to qualify a dispute for judicial review.

B. Family Law

Plaintiffs also contest arbitration awards in family law disputes and claim similar procedural or substantive violations at arbitration. However, a key difference between employment law and family law is that the parties in a family law dispute are typically two individuals, often a divorcing couple, whereas one party in an employment dispute tends to be a corporation or organization. This element of interpersonal emotional strife combined with the gravity of legal decisions such as divisions of marital property and child custody arrangements make the personal stakes of a family law cases quite high.

Perhaps as a consequence of these high stakes, courts have clearly outlined certain legal issues that can never go before any arbitration panel - including a religious tribunal - and which must be decided by a civil court. In some states, such as New York, these include: child custody, child support, and guardianship proceedings. See, e.g., Glauber v. Glauber, 600 N.Y.S.2d 740 (N.Y. App. Div. 2d Dep't 1993); Hirsch v. Hirsch,774 N.Y.S.2d 48 (N.Y. App. Div. 2d Dep't 2004); In re Meisels,807 N.Y.S.2d 268, 271 (N.Y. Sup. Ct. 2005). Ample case law on family issues demonstrate the strong preference for upholding arbitration agreements with hints of judicial willingness to vacate those awards for policy reasons.

In Hirsch,an appellate court affirmed the vacation of an entire award awarded by a Beit Din. Hirsch, 4 A.D.3d at 451. The rabbinic council had allocated a sum of child support that the court deemed insufficient to support the couple's six children based on the husband's income and requirements of the Child Supports Standards Act. The lower court found and the appellate court affirmed that the Beit Din award had further violated public policy in both its inequitable distribution of assets to the husband and deprivation of the wife's constitutional right to seek protection by a secular court with its order to withdraw the pending criminal complaint against her husband. Id. at 452.In this case, judicial concerns over equity were significant enough to override a decision issued by a religious arbitral body.

In a similar case, a New York court vacated the child support award issued by a Beit Din because the award was not in the best interests of the children of a divorcing couple and thereby violated public policy. Rakoszynski v. Rakoszynski, 663 N.Y.S.2d 957, 960-61 (N.Y. Sup. Ct. 1997). Though the court was able to rectify an inequitable child support award through the public policy vacatur, the plaintiff in this case had waived her right to a civil proceeding by agreeing to arbitrate with a Beit Din, and arguably still received a less beneficial result under religious law than she might have had she initially brought the entire proceeding under civil law. Solutions to unsatisfactory outcomes like these could include anything from changing judicial guidelines and arbitration legislation in order to grant more permissive judicial review of contested arbitration awards to offering better education to the public on their legal rights. See Baker, at 1.

Civil courts have allowed plaintiff's to assert their concerns over inequitable decisions and policy violations in family law cases, even when to do means reviewing an arbitration proceeding. Where appropriate, courts have been able to vacate unfair arbitration awards.

IV. Problems And Solutions

Scholars argue that problems with the current standards of judicial review for arbitration awards run deep and require reform. Among the flaws that have been identified are: (1) judges' assumptions that their deference of religious arbitrations is wholly restricted by the First Amendment, (2) problematic judicial deference to religious law when aligned with the 'standard' notion of unfairness, and (3) that judges overlook the fact that parties are under duress when they agree to religious arbitration due to communal pressure exerted by their religious communities, mitigating the legitimacy of agreements to arbitrate in many circumstances. Baker, at 1.

Various solutions that would address these problems have been proposed. One means of reform advocates limiting the subject matter jurisdiction of religious panels. Religious tribunals would be barred from reviewing any case that could be handled by a secular court that applied neutral principles of law to decide the matter. In effect, all secularly based disputes, such as commercial cases, would be removed from religious arbitration panels. See Walter, at 552-53. Religious tribunals would no longer have the scope, latitude, and breadth it has now.

One more intellectual theory argues that it would be unconstitutional for religious tribunals to hear cases beyond those that deal with religious doctrine. Under this line of reasoning, religious arbitration is deemed violative of the disputant's constitutional right to freely practice his or her religion when it adjudicates an issue that is not religious in nature. Because decisions from religious arbitrations are binding, any given panel's award based on that particular religion's law would effectively trap the instant parties into that religion's legal reasoning. For example, if a Beth Din heard a contract dispute between two Jewish business orders and issued an arbitration award, that arbitration based on Jewish law would be binding and final on the parties. However, the Constitution also protects one's right to change religious beliefs under the Establishment Clause. In other words, if one of the parties from that Beth Din dispute later converted to Islam, he or she would be bound to an arbitration award predicated on a religion that the party no longer adhered to, which would violate that individual's constitutional rights. This theory portrays portrays those who change religious beliefs by converting or leaving religion as unfairly bound to a faith they no longer practice with no recourse to appeal. Id. at 549-50. A binding award from religious arbitration thereby traps the disputant and renders that religious arbitration unconstitutional. Secular law then must be applied to all non-religious disputes.

Ayelet Shachar, a professor of law at the University of Toronto and visiting professor at Harvard Law School, advocates a small-scale reform. She argues that re-framing the identities of parties to religious arbitration will usher much-needed changes and effectual her goal to promotemore equitable outcomes from religious arbitration in family law cases. Shachar notes that the current deference granted to religious awards by civil courts has yielded dangerous results in family law disputes where inequitable gender roles in traditional communities can result in uneven bargaining power between the parties. If women's multiple identifications with and commitments to their religious communities and governments were recognized, then reform would take place. Once it became "apparent that individuals and families should not be forced to choose between the rights of citizenship and group membership" and that instead the dispute resolution community recognized that women"should be afforded the opportunity to express their commitment to both" then Shachar argues that fairer arbitration proceedings would begin to take place. Shachar, at 573.

Other scholars are largely content with the status quo and do not advocate for major systemic reform. According to this view, the scope of religious arbitration and its review in civil court is well balanced. "[A]lthough courts note that religious panels present problems that conventional arbitrations do not, they have still enforced religious tribunal awards that do not confirm to FAA or UAA requirements as binding under the guise of "common law arbitration," or under case law that holds that arbitrations that do not meet statutory requirements can still be valid." Grossman, at 191. The proposal here advocates for the continued judicial review of religious questions and argues that, "judicial inquiry is not the equivalent of a civil determination of religious doctrine, which would be barred by the Establishment Clause's prohibition on advancing or endorsing religion." Grossman, at 207.

Michael Helfand, an associate Professor of Law at Pepperdine Law School, agrees that the overall system for judicial review of religious arbitration can be maintained, though he suggests that two changes in policy would be beneficial. Michael A. Helfand, Religious Arbitration and the New Multiculturalism: Negotiating Conflicting Legal Orders, 86 N.Y.U. L. REV. 1231, 1249 (2011). Helfand focuses on policy concerns from the perspective of new multiculturalism in his article on the judicial review of religious arbitration awards. See Helfand, at 1231. He suggests that the scope of enforceability of religious arbitration awards requires redefinition by civil courts. Id. He offers two policy recommendations: first, courts should limit application of public policy to vacate religious arbitration awards. Id. at 1231, 1232, 1238. Second, courts should expand application of the unconscionabilty doctrine to void religious arbitration agreements.

Others have sided with Helfand and contributed additional recommendations for how the current system could be improved. These critics highlight the dangers that religious arbitrations pose to vulnerable minorities such as women and children and suggest that these pitfalls could be mitigated if there was greater oversight of the system. The implementation of procedural safeguards would ensure that all parties agreed to religious arbitration under absolutely fair circumstances. Safeguards that have been suggested include (1) requiring religious tribunals to inform parties of their rights, such as alternative legal remedies from the court system, before entering arbitration, (2) encouraging governments to accept greater responsibility for legal education and (3) implementing stricter screening mechanisms for recognized religious arbitrators. Wolfe, at 468.

V. Analysis And Conclusions

Recent decisions from federal courts suggest that the current system for judicial review of religious arbitrations is sound and does not require large-scale reforms. An Indiana District Court in 2012 suggested that cases where the issues are not religious in nature or connected to the church entity any longer can come into the purview of the courts without violating the Constitution. McCarthy v. Fuller, 2012 WL 1898858, *1-3 (S. D. Ind. 2012). In this case, the Archbishop Secretary of a local Roman Catholic Church asked the court to take judicial notice of some facts in a dispute the Church was having with a woman who had previously been identified as a nun in the Church. The court held that a jury could determine whether defendant was, in fact, a Catholic nun without affecting the Catholic Church at all and thereby not entangle a civil judicial proceeding with a church's internal affairs. Id. This broad application of the neutral principles doctrine sanctioned a jury to hear issues that were not quite dogmatic or ritualistic in nature but undoubtedly connected to a church's internal operations. This suggests that judges can continue to review issues in a religiously arbitrated dispute if its religious content had somehow become less relevant. In light of the strict application of the neutral law doctrine in the past, this would be a significant departure from established precedent. Furthermore, the McCarthy holding analyzed in combination with the Fifth Circuit's holding in Prescott suggests that courts feel comfortable reviewing pertinent issues that arise out of religious arbitrations. While the constitutional arguments against judicial review of religious arbitrations are intellectually compelling, it applies to a narrow class of individuals who might theoretically convert or leave a religious community after using it to arbitrate a dispute. Therefore, until a court is presented with a case such as this, it seems impractical to alter presumptions based on hypotheticals.

Outcomes in cases like Rakoszynski illustrate the real effects of entering into arbitration agreements: once a party knowingly agrees to arbitrate, that party's rights to appeal the outcome from arbitration are significantly curtailed if not waived entirely. This plain and simple reality may result in outcomes that appear inequitable, but a large-scale overhaul of a system that does allow for judicial intervention in circumstances of gross inequity would be an overreaction to this problem, not a helpful solution. Instead, the optimal solutions to inequities presented by lower-income spouses in divorce proceedings or employees in employment disputes are increased rights education before arbitration ever starts. If legislation required religious tribunals to counsel prospective parties to arbitration of the ramifications to entering an arbitration agreement, perhaps fewer parties would be faced with a result that was neither satisfactory or eligible for appeal and judicial review.

Emily Belfer is a second-year student at the Benjamin N. Cardozo School of Law in New York City. She plans to practice Trusts and Estates upon graduating law school. Belfer earned a BA in European History at the University of Pennsylvania and a MA in Medieval Jewish History from Yeshiva University's Bernard Revel School of Jewish Studies. Deep thanks go to Professor Lela Love, David White, and Suzanne Stone as well as Yonatan Tammam and Brian Farkas for giving their editorial and other advice in regards to this article.

Introduction

The United Nations (UN) was established in 1945, and was seen by many in the international arena as the fulfillment of a long-standing ambition foran organization whose goal was "to promote international cooperation and to achieve peace and security." History of the United Nations, UNITED NATIONS, http://www.un.org/en/aboutun/history/, last visited Mar. 3, 2013. These goals are undeniably noble, and many individuals who work within the organization are honorable people who do their best to help achieve this international peace. However, over the course of its nearly seventy-year history, the UN has grown ever larger, more bureaucratic, and less transparent.

The unnecessary complexity, and often redundancy, of the UN internal system has frequently caused frustration for those trying to make a difference in world conditions. See Matthew Saltmarsch, A Bloated U.N. Bureaucracy Causes Bewilderment, N.Y. TIMES, Jan. 5, 2011, http://www.nytimes.com/2011/01/06/world/europe/06iht-nations06.html?pagewanted=all; see also George Russell, U.S. Diplomats Growing Frustrated at United Nations' Budget Games, FOXNEWS.COM, Oct. 7, 2011, http://www.foxnews.com/world/2011/10/07/us-diplomats-blow-whistle-on-united-nations-budget-games/. Furthermore, it has all-too-often resulted in needlessly duplicative work product, and has often led to unintended consequences with frequently ludicrous or even tragic results. See, e.g., Stefan Halper, A Miasma of Corruption: The United Nations at 50, CATO POLICY ANALYSIS, Apr. 30, 1996, http://www.cato.org/pubs/pas/pa-253.html; Elizabeth Rosenthal, Profits of Carbon Credits Drive Output of a Harmful Gas, NY TIMES, Aug. 8, 2012, http://www.nytimes.com/2012/08/09/world/asia/incentive-to-slow-climate-change-drives-output-of-harmful-gases.html?pagewanted=all (noting that protective environmental measures enacted by the UN actually encouraged manufacturers in several locations to increase production of harmful gases), see also Charles Anthony Smith, Human Trafficking: The Unintended Effects of United Nations Intervention, 32 INT'L POL. SCI. REV. 125 (2011); The United Nation's Role in Haiti Cholera Outbreak, HAITIAN-TRUTH.ORG, Nov. 20, 2012, http://www.haitian-truth.org/the-united-nations-role-in-haiti-cholera-outbreak/.

This article provides a brief overview of the financial transparency problems in the UN and the pressing need for reform. Part I looks at some concerns raised by the UN's recurring budget troubles. Part II synopsizes the disquieting financial blunders associated with the UN's recent peacekeeping missions. Part III addresses a likely reason these problems have,so far, been tolerated by members of the international community, and explains why this reason can no longer be accepted. Part IV notes the pressing nature of the call for a solution to this issue. This paper then concludes with a brief reminder of the valuable role the UN is capable of playing in international affairs, and urges that much-needed changes be implemented so that the organization's tremendous potential for advancing humanitarian causes will not be lost to the combined effects of mismanagement and dishonesty.

I. United Nations Financial Concerns

Increasingly over the last few years, the UN has shown itself hopelessly inept at managing its own finances. In 2012, for example, the UN announced that it would go over its $1.9 billion budget by about 4% (or roughly $80 million) in the renovation of its headquarters in New York City. Brett D. Schaefer, The Costly United Nations, NATIONAL REVIEW ONLINE, Mar. 13, 2012, http://www.nationalreview.com/articles/293261/costly-united-nations-brett-d-schaefer; see also Anita Snow, UN Complex in New York Gets $2 Billion Facelift, THE SEATTLE TIMES, Mar. 4, 2012, http://seattletimes.com/html/nationworld/2017668136_apunun2billionfacelift.html. As Senator Dirksen allegedly once quipped, "a billion here, a billion there, pretty soon you're talking real money." See Senator Everett McKinley Dirkson Dies, UNITED STATES SENATE, Sept. 7, 1969, http://www.senate.gov/artandhistory/history/minute/Senator_Everett_Mckinley_Dirksen_Dies.htm. But the truth is even more frustrating than it seems at first glance.

The $1.9 billion budget was a very large increase from the original estimate put out by the Government Accountability Office (or the U.S. General Accounting Office, as it was known then), which anticipated that the project would cost between $875 million and $1.2 billion. US GOV'T ACCOUNTABILITY OFFICE, GAO-01-788, PLANNING FOR HEADQUARTERS RENOVATION IS REASONABLE; UNITED STATES NEEDS TO DECIDE WHETHER TO SUPPORT WORK 7 (2001). Needless to say, the project grew a bit as new aspects were added. Yet, in spite of the fact that the new numbers are approximately double the amount originally discussed, it appears that even this new estimate may be an understatement of the fact.

According to Michael Adlerstein, the architect in charge of the renovation project, cost overrun may likely be closer to $265 million, which is nearly a 14% increase (rather than the officially published 4%) from the approved (increased) budget. Thalif Deen, Renovation Money Shortage, WEBPUBLICA PRESS, Mar. 29, 2012, http://webpublicapress.net/?p=10172. And the numbers for the second part of this project look equally ominous. The UN proposes to renovate the Geneva headquarters once the work on those in New York City is complete. UNITED NATIONS GENERAL ASSEMBLY, A/66/279, STRATEGIC HERITAGE PLAN OF THE UNITED NATIONS OFFICE AT GENEVA, 2 (2011). The current estimate for that job is about $600 million. ID. But there are, again, no safeguards to ensure that the organization will adhere to that number either.

If this were the full extent of the financial problem, no reasonable person would likely raise too strong an objection, since the renovation of the New York facility, which was built in 1952, is unquestionably long overdue. Associated Press, UN Renovation Cost Jumps $400M, CBSNEWS (Feb. 11, 2009, 6:59 PM), http://www.cbsnews.com/2100-202_162-1055381.html. However, the UN's cavalier treatment of finances extends to all areas of the organization's management, including (and most notoriously) its peacekeeping missions.

II. Peacekeeping Expenditures

Over the last several years, progressively more reports have been released noting the financial waste, and sometimes outright financial abuse, that exists within the UN peacekeeping missions. The mission to East Timor, for instance, saw an almost $9 million overcharge on a single transaction for air transportation. Colum Lynch, UN: Waste and Fraud Found in Peacekeeping Work, CORPWATCH, Jan. 24, 2006, http://www.corpwatch.org/article.php?id=13162. The expense records for the mission to the Congo show a quantity of wastewhich includes $2.4 million spent on just one unnecessary purchase. And between the Sudan and Haiti missions, the UN spent a total of $65 million on unneeded fuel alone. Id.

But this is only a brief glimpse of the money spent extraneously. It does not even touch on the number of contracts the UN struck with outside companies under questionable circumstances. See, e.g. , Colum Lynch, Two Accused of Taking Bribes in UN Contract Deal with U.S. Company, WASH. POST, Mar. 18, 2010, available at http://www.washingtonpost.com/wp-dyn/content/article/2010/03/17/AR2010031703747.html (reporting on investigations of UN workers who allegedly arranged for a contract to go to a company which promised cash payments to specific participants in return); see also Associated Press, U.N. Cuts Back on Investigating Its Own Fraud, FOXNEWS.COM, Jan. 12, 2010, http://www.foxnews.com/story/0,2933,582876,00.html (noting that during an investigation conducted between 2006 and 2009, approximately twenty schemes were uncovered which touched on over $1 billion in UN aid and contracts); Colum Lynch, Audit of U.N.'s Sudan Mission Finds Tens of Millions in Waste, WASH. POST, Feb. 10, 2008, http://articles.washingtonpost.com/2008-02-10/world/36903637_1_government-and-southern-rebels-sudan-s-islamic-internal-audits (telling of the more-than half-million dollar contract a UN official steered toward a company that in return helped the UN official's wife to obtain a visa).

Nor are these isolated incidents. An audit of just the peacekeeping mission to Sudan, for example, showed several millions of dollars in waste, and raised further questions of possible mismanagement or even fraud regarding a number of contracts that amounted to almost $300 million. Colum Lynch, Audit of U.N.'s Sudan Mission Finds Tens of Millions in Waste, WASH. POST, Feb. 10, 2008, http://articles.washingtonpost.com/2008-02-10/world/36903637_1_government-and-southern-rebels-sudan-s-islamic-internal-audits. Even allowing for the UN's explanation that the staff members responsible for these problems were not guilty of deliberate wrongs, but were in fact simply "in over their heads," the sheer number of unwise decisions made in the course of this mission should put UN management on notice that its staff is in need of greater oversight, and that its processes need to be reexamined for efficiency.

III. A Reason For The Continued Lack Of Restraint

An argument is made by some that these excesses and inefficiencies, bad though they may be, are an acceptable price to pay for the overall achievements in UN peacekeeping missions--even if the ratio of successes to failures is not very reassuring. This argument can sometimes go unchallenged for the simple reason that it is rooted in a measure of truth. A number of UN missions have been successful, and in the end, the current UN peacekeeping structure may not be very popular, but can be seen as a relatively inexpensive way to at least keep some of the worst effects of struggling nations' internal conflicts from affecting innocent neighboring peoples. See, e.g., Not Much Danger, Success Or Cash, STRATEGY PAGE, Feb. 8, 2013, http://www.strategypage.com/htmw/htun/articles/20130208.aspx.

However, the fact remains that many UN missions are unsuccessful. When it comes to settling actual conflicts (the image most often conjured by the term "peacekeeping"), the UN doesn't seem to be a good choice for the job. Those who doubt this conclusion are respectfully referred to the horrific results of the 1993 Somalia mission, the 1994 Rwanda mission, the 1995 Bosnia mission, and, of course, the still-ongoing mission to the Democratic Republic of Congo,among others. See, e.g., Alexandra R. Harrington, Victims of Peace: Current Abuse Allegations Against U.N. Peacekeepers and the Role of Law in Preventing Them in the Future, 12 ILSA J. INT'L & COMP. L. 125 (2005) (discussing the heinous acts that have been perpetrated against war refugees by UN Peacekeepers in the Congo, among other places). (It has been fairly noted that many of the UN's worst failures can be attributed to the combination of a lack of adequate resources, and the severely restrictive rules under which the peacekeeping forces are expected to operate. See, e.g., Who's Peacekeeping in Africa?, WORLD DISASTER REPORT Oct. 19, 2012, http://www.wdrep.com/_wp/war/whos-peacekeeping-in-africa

As has been noted by several scholars, the UN's greatest successes are primarily confined to the fostering of governance functions after conflict has already been resolved--such as ensuring a free election, or assisting a smooth diplomatic process. See, e.g., Thomas W. Jacobson, U.N. Peacekeeping: Few Successes, Many Failures, Inherent Flaws, INT'L DIPL. & PUB. POL'Y CENTER 1 (Apr. 2012), http://www.idppcenter.com/UN_Peacekeeping_Failures.pdf. So, while the UN does do some things very well, the areas of its greatest achievements do not coincide with the areas of its greatest financial abuses.

When viewed in light of these facts, the various financial embarrassments that have plagued the UN recently no longer seem like a minor wrinkle in an otherwise smooth process. The money wasted or lost in various ways may be dismissed as "water under the bridge," since no amount of money can come close the worth of a human life. And it is true that any lives saved by UN efforts would be worth the price if the monies involved were a one-time loss, or if they had gone toward the accomplishment of a humanitarian goal.

But the instances of wide-scale fiscal abuse seem to crop up most in some of the very missions that have become notorious as the UN's greatest failures. See, e.g., Colum Lynch, UN: Waste and Fraud Found in Peacekeeping Work, CORPWATCH, Jan. 24, 2006, http://www.corpwatch.org/article.php?id=13162; see also Colum Lynch, Audit of U.N.'s Sudan Mission Finds Tens of Millions in Waste, WASH. POST, Feb. 10, 2008, http://articles.washingtonpost.com/2008-02-10/world/36903637_1_government-and-southern-rebels-sudan-s-islamic-internal-audits. This disturbing truth robs the proffered excuse of its believability, and has the unfortunate effect of making the UN appear rather like a charlatan who demands large payments up-front while, in reproachful tones, warning all who look for accountability in the UN that they must "pay no attention to that man behind the curtain."

IV. Urgent Need For Change

The UN's careless treatment of the financial irresponsibility of its own officials is merely one symptom of an organization that has few incentives to live within its means, and there seems to be little hope that this will change. Even where the UN takes official measures to audit its own systems and procedures, these investigations are often "seriously compromised" from the beginning by ties between the investigators and the management staff subject to the audits. See George Russell, UN Investigators 'Seriously Compromised' by Relationship to Management Bosses, Report Charges, FOX NEWS.COM, May 23, 2012, http://www.foxnews.com/world/2012/05/23/un-investigators-seriously-compromised-by-relationship-to-management-bosses/. Because of this, they predictably produce few results, and are, ironically, nothing more than an additional expense on the budget. Id.

The UN is very comfortable going over budget, primarily because it is never made to feel the pinch of its own excesses. Any overage is simply forwarded to its membership (of which the United States is the highest paying member), and the membership is expected to pick up the balance. See George Russell, U.S. Diplomats Growing Frustrated at United Nations' Budget Games, FoxNews.com, Oct. 7, 2011, http://www.foxnews.com/world/2011/10/07/us-diplomats-blow-whistle-on-united-nations-budget-games/.

This arrangement is unrealistic, to say the least. Shakespeare once observed that "madness in great ones must not unwatched go." UN member states should insist that the UN increase its transparency by establishing a legitimate investigation process to audit each function of the UN. They should also demand that the organization abide by parameters that will force it to live within its allotted means.

Conclusion

The UN is an entity uniquely positioned to address many of the most pressing issues in the international community, such as equal rights for marginalized peoples, or protection and relief for victims of human rights violations. The UN is also extraordinarily blessed with nearly limitless resources. Member states have shown a remarkably long-suffering willingness to support the organization, and some of the world's brightest minds are eager to join its ranks, all because the UN still represents a cause in which the civilized world believes: the promotion of peace and prosperity for all peoples around the world.

However, a global body comprised of states with differing world views, and often opposing value systems must, of necessity, trade on both the continued good will of its membership and on its own prestige--the appearance of integrity and the "moral authority" that comes with it. The UN has imperiled its position by its own lack of transparency, and risks losing it altogether if the member states do not act now to make some much-needed changes to the organization's internal system.

The appalling debacles that have resulted from the UN peacekeeping missions of the 1990s, and the years following, have caused significant damage the organization's reputation, and when details of the infamous oil-for-food outrage began to surface, the UN lost still more esteem in the eyes of the world. Sadly, the organization has done little to redeem itself from these scandals, and as more fiscal indiscretions are discovered, its global standing becomes correspondingly less authoritative.

The financial problems within the UN are no small matter, and fixing them will take both time and determined effort. But the member states that once banded together to "maintain international peace and security," and to "promot[e] . . . economic and social advancement of all peoples," must now join ranks again to save the UN from itself.

Anne Jelliff is a 3L at Albany Law School, and holds a degree in Voice Performance from Bob Jones University. Among other things, she serves as the Executive Editor for the Albany Government Law Review and Vice-President of Albany Law School's chapter of the National Academy of Elder Law Attorneys. Her article about the jurisprudence of Justice Anthony Kennedy and its ties to his Catholic faith was just published in Vol. 76 of the Albany Law Review. She wishes to thank Professor Alexandra Harrington for her advice and guidance during the drafting of this article.

*Analysis based on the plot of the 1947 movie Christmas Eve, starring Ann Harding*

I The Scenario

Matilda A. Reid, age 81, is the sole heir of Harold Reid, a New York City billionaire. She lives alone in the Park Avenue mansion where she grew up, and where she has lived for all of her life. While somewhat frail and occasionally forgetful, her only medical diagnosis is a mild case of arthritis. Her daily needs are attended to by her 65-year-old butler, Stevens, who prepares her meals, cleans the house, drives her to doctors' visits, and takes care of virtually all other household business. Matilda has never executed a Health Care Proxy, a Power of Attorney, or any other advance directives.

Matilda and Harold never had any children. Her closest blood relative is a nephew, Phillip. Phillip lives in New York City, but rarely visits his Aunt Matilda, except on those occasions when he needs to ask her for a monetary loan. During their marriage, Matilda and Harold also adopted three orphan boys -- Michael, Mario, and Jonathan -- and raised them as their sons. None of these three "sons" have visited Matilda for at least five years.

While she has always given large donations to charitable organizations, particularly those involving children, Matilda's recent donations have been significantly larger than before. In the past year alone, she gave away more than $4 million of her inherited fortune to three seemingly bizarre charitable causes. One of these causes is what Phillip calls "half a million dollars in dead rats" -- recruiting several orphan children to kill rats that had been invading the mansion's basement, and paying those children $200 for each rat that they killed. The rest of the money went to opening a camp to counsel unhappily married couples -- which prevented only one divorce -- and to an association of retired scrubwomen. Donations given during the previous two years went to equally unconventional causes. Phillip has asked Matilda on several occasions to tell him just how much of the family fortune is left, but Matilda always flatly refuses to reveal her financial details to Phillip.

Matilda also engages in a number of unconventional behaviors. For instance, every day, she throws birdseed on the floor of her parlor and opens the windows so that bluebirds can fly inside and eat it. She also has a toy train set which covers her entire dining room table, and uses it to transport food items to her guests whenever she holds a dinner party.

About a month before Christmas, Phillip decides that he has seen enough. He contacts his close friend, Judge Austin, and states that his Aunt Matilda has "finally gone off her rocker." He tells the Judge that his aunt needs a guardian, and that he wants to be appointed as that guardian. The Judge is somewhat skeptical, but agrees to pay an "informal visit" with Phillip to Matilda's house. He brings with him Harold Lloyd, an attorney whom he frequently uses as a court evaluator.

On this visit, Judge Austin and Harold Lloyd have high tea with Matilda. Both of them witness Matilda bringing the bluebirds indoors to feed them and using the train set to bring them their tea. Judge Austin also asks Matilda about the donations that she has given during the past year. Matilda tells the Judge exactly how much money went to each cause, and says that she gave away this money because she likes "making people happy, particularly people everyone forgets about." When Judge Austin specifically asks Matilda about the dead rats, she shows him a makeshift broach that the orphan children made for her. "This," she states, "is worth half a million dollars to me."

Near the end of the visit, Harold Lloyd tells Matilda that it must be very difficult managing all of her affairs and taking care of herself in such a large, old mansion. "Why don't you turn all of your affairs over to Phillip and take it easy now?" he asks. Immediately, Matilda becomes upset. She declares that she would never trust Phillip to "look after her affairs." Harold Lloyd then asks Matilda if there is anybody who she would trust. "Any of my three sons," she responds immediately. "Come back here for a cup of punch on Christmas Eve, and I'll have all three sons here for you to meet, and you will surely see for yourselves what fine men they are." Dubious, Judge Austin and Harold Lloyd leave.

The next day, Matilda hires a private investigator to track down Michael, Mario, and Jonathan. Over the next two weeks, he tells her about their whereabouts. As it turns out, Michael is living right in New York City. He exists largely as a playboy, not working and spending money that he received from a lottery winning, and is engaged to marry his longtime sweetheart. Mario owns a nightclub in Havana, where he fled after getting into criminal trouble in the United States. A warrant is still pending for his arrest. As for Jonathan, he works as an itinerant rodeo athlete, drinking away most of his earnings in small town saloons. In the end, the private investigator tells Matilda that "none of her children are likely to show up" at her house on Christmas Eve.

Yet the investigator is wrong. Matilda tells the newspapers hear about Phillip's intentions to petition for guardianship over her, and the papers run front-page stories titled "Reid Fortune In Jeopardy", including quotes from Matilda calling for her sons to return on Christmas Eve. Michael, Mario, and Jonathan all read these stories. And Christmas Eve, they all arrive at Matilda's home. To Matilda's delight, Michael, Mario, and Jonathan tell Judge Austin that they would be happy to "do whatever they can to help and protect our mother and make certain that she is happy."

Phillip is furious. The day after Christmas, he files a petition to be named guardian of Matilda's person and property under Article 81 of the Mental Hygiene Law.

II Step One: Which Form Of Guardianship May The Petitioner Pursue?

New York State offers two major statutes under which a petitioner may pursue guardianship for an incapacitated person: Article 17-A of the Surrogate's Court Procedure Act and Article 81 of the Mental Hygiene Law. See N.Y. SURR. CT. PROC. ACT §§ 1750 et seq. (McKinney 2013); N.Y. MENTAL HYG. LAW §§ 81.01 et seq. (McKinney 2013). Given that these two statutes "reflect different motivations and purposes in their approach to guardianships," it is important to analyze whether Phillip has chosen the correct statute under which to bring his guardianship petition. See Rose Mary Bailly & Charis B. Nick-Torok, Should We Be Talking? -- Beginning a Dialogue on Guardianship for the Developmentally Disabled in New York, 75 ALB. L. REV. 807 (2012).

SCPA 17-A, the older of New York's two guardianship statutes, is "a simple guardianship device, based upon principles of in loco parentis." Id. at 808. Originally created to allow parents to serve as guardians for their children with disabilities, it allows a court to appoint a guardian for a "ward" who is diagnosed with mental retardation, developmental disabilities, or traumatic brain injury. N.Y. SURR. CT. PROC. ACT § 1750-a(1)(a) (McKinney 2013). To be deemed "developmentally disabled" under Article 17-A, an individual must have "an impaired ability to understand the nature and consequences of decisions" and be incapable of managing his or her own daily life and affairs. SURR. CT. PROC. ACT § 1750-a(1). Guardians hold widespread authority -- literally, the authority of a parent -- over person and property under Article 17-A. See, e.g., In re Chaim, A.K., 26 Misc. 3d 837, 843 (N.Y. Cnty. Sur. Ct. 2009).

By contrast, Article 81 of the Mental Hygiene Law, the more recently adopted guardianship statute, authorizes appointment of a guardian whose authority is tailored to the personal and/or financial needs of the incapacitated person. See N.Y. MENTAL HYG. LAW §81.01 (McKinney 2013). Under Article 81, the court may consider a much wider range of factors to decide whether an individual needs a guardian. See MENTAL HYG. LAW §81.01. As long as the court determines that the allegedly incapacitated person needs a guardian to manage certain personal or financial affairs, and the allegedly incapacitated person either consents to a guardianship or is deemed incapacitated by the court, then the court may appoint a guardian. See MENTAL HYG. LAW §81.02(a); MENTAL HYG. LAW §81.02(b). If the court does appoint a guardian, though, powers of that guardian are to be narrowly tailored to impose only absolutely necessary restrictions upon the ward's personal autonomy. See, e.g., In re Albert S., 286 A.D.2d 684 (App. Div. 2d Dep't 2001) (internal citations omitted) ("A guardian is to be appointed solely as a last resort, where no available resources or other alternative will adequately protect the person.").

Here, Article 81 is clearly the appropriate statute for this case. Matilda has never been medically classified to have mental retardation, developmental disabilities, or traumatic brain injury within the diagnosis-driven definitions of SCPA 17-A. Furthermore, the blanket authority granted to a guardian under SCPA 17-A is not proper here, given that Matilda's level of independent functioning still seems quite high. narrow tailoring provided for under Article 81 is a far better fit. Thus, Phillip has chosen the proper statute under which to bring his petition.

Under Article 81, Phillip's petition must include the following "specific factual allegations": a description of Matilda's functional level, including her ability to manage the activities of daily living; specific factual allegations about personal actions and/or financial transactions claimed to demonstrate that Matilda is likely to suffer harm; and the approximate value of Matilda's assets. MENTAL HYG. LAW §81.08; MENTAL HYG. LAW §81.15. Matilda cannot be adjudged incapacitated by the court without a hearing. MENTAL HYG. LAW §81.11(a). She will be entitled to be present at that hearing, to call witnesses, to cross-examine witnesses, and to present evidence in her defense. MENTAL HYG. LAW §81.11(b); MENTAL HYG. LAW §81.11(c).

III Step Two: Is It Proper To Grant Guardianship In This Situation?

It is an established principle of New York law that awarding guardianship over person and property is an act of last resort, not of first reaction. See, e.g., In re Albert S., 286 A.D.2d 684. Courts are required to consider all other reasonable less intrusive alternatives before they can award guardianship over another individual. See N.Y. MENTAL HYG. LAW §81.01; MENTAL HYG. LAW §81.02; MENTAL HYG. LAW §81.03(d).

Under Article 81, the essential elements for appointment of a guardian are twofold: (1) Necessity and (2) Incapacity or Consent. See MENTAL HYG. LAW §81.02(a). In the instant case, Matilda refuses to consent to appoint Phillip as guardian. Therefore, Phillip, as the petitioner in this action, bears the burden of proving by clear and convincing evidence that Matilda needs a guardian. MENTAL HYG. LAW §81.12(a). Specifically, Phillip must prove that appointment of a guardian is necessary to meet Matilda's essential personal needs, and that Matilda is likely to suffer harm because of her inability to care for herself and her concurrent inability to appreciate the nature and consequences of her actions. MENTAL HYG. LAW §81.02(a); MENTAL HYG. LAW §81.02(b).

Commentators frequently observe the need for judges to avoid "playing doctor" in guardianship cases. See, e.g., Joseph A. Rosenberg, Medical Privacy in Article 81 Guardianship Cases: So What or Now What?, NYSBA JOURNAL, January 2013, at 37-38. Adhering to this advice will be especially important here. Matilda engages in behaviors that most people would consider "outside the mainstream", and her choices of charitable causes could be viewed as odd. However, eccentric behavior and unique charitable giving is not the legal definition of incapacity. Article 81 requires a much higher threshold, including consideration of the "functional levels and functional limitations of the alleged incapacitated person." See MENTAL HYG. LAW §81.02.

For the sake of argument, let us say that Phillip's petition alleges that Matilda frequently engages in unsanitary practices (like spreading birdseed all over her floor and opening the windows so the bluebirds can fly in and eat) and childlike pursuits, squanders millions of dollars of the family fortune without comprehending the consequences of what she is doing (the large-scale donations), belligerently refuses to discuss family financial matters with Phillip even though Phillip is merely trying to look out for her best interests, lives alone in a house that is far too large for an 81-year-old woman to maintain, and has developed an unhealthy attachment to Michael, Mario, and Jonathan even though they are individuals of shady repute and have had no contact with Matilda for years.

Let us also assume that the court evaluator's report brings up the bluebirds, the toy train, the refusal to discuss financial matters with Phillip, the large donations, the size of the house and Matilda's alleged frailty, and the fact that Matilda's three sons all have been out of the picture for some time. However, let us further assume that the court evaluator's report mentions the willingness of Michael, Mario, and Jonathan to help Matilda, the fact that Matilda has never actually been medically diagnosed with a mental or physical illness, the fact that Matilda proved to be well-aware of her financial donations, and the fact that she does not exhibit any signs of wanting for the basic necessities in life (food, adequate clothing, a generally clean living environment, etc.).

Presented with this information, it seems that the court should deny Phillip's petition. In examining Matilda's functional levels and limitations, it appears that her understanding of her actions and their consequences is actually quite high. For example, when asked about her charitable contributions, she knew precisely to whom she gave the money and precisely how much money she gave to each recipient. Furthermore, when pressed by Judge Austin about the "dead rats" money, she articulated a perfectly logical and sensible reason for making this gift to the orphans. This indicates strongly that she is not someone who has "lost her mind," but rather somebody who knows her own mind very well.

Just because Matilda is spending money in a way that Phillip does not like -- and in a way that could be seen as financially unsound -- does not mean that she needs a guardian. See Cassandra G. Jones, Facing a Guardianship? You Are Not Alone, HOUGHTON JONES BLOG, Sept. 18, 2012, http://hou2plan.com/lawyer/2012/09/18/Elder_Law/Facing_a_Guardianship___You_are_Not_Alone._bl5247.htm ("Mismanagement of funds by itself is generally not grounds for a guardianship. A competent adult has the constitutional right to make bad decisions."). Even if the donations were dramatically reducing Matilda's financial situation -- which is not the case here -- a guardianship under Article 81 still would not be guaranteed. See, e.g., In re David C., 742 N.Y.S.2d 336 (2d Dep't 2002) ("[A] precarious housing situation and meager financial resources do not, without more, constitute proof of incapacity such that a guardian is warranted under Mental Hygiene Law §81.02.").

Regarding Matilda's refusal to discuss personal financial matters with Phillip, this is likewise not an indication that Matilda actually lacks capacity. Indeed, at least one New York court has found that an allegedly incapacitated person's refusal to disclose financial information "may be some indication of awareness as opposed to incapacity." In re Parker, 619 N.Y.S.2d 238, 239 (Onondaga Cnty. Sup. Ct.1994). The same principle applies here. Matilda is lawfully permitted to withhold this highly personal information without this choice being used against her as a sign of incompetence.

Matilda's decision to feed the bluebirds indoors on her parlor floor could be seen as unsanitary. However, nothing indicates that she is living in filthy or otherwise dangerous conditions. Perhaps one of her butler's household duties involves cleaning up after the birds each day. Similarly, Matilda's decision to use the train set to bring people their meals, while eccentric, does not show that she cannot appreciate her actions and their consequences.

Concerns about Matilda living in such a large house are certainly understandable. Given that she is 81 years old and in somewhat frail physical condition, it is reasonable to believe that she might be better suited to live in a different environment. Again, though, the court must be cautious about substituting its own judgment for Matilda's right to make choices. Nothing indicates that Matilda has let her house fall into disrepair. Nor are there signs that Matilda is frequently injuring herself because she cannot manage in this large house. Stevens seems to do a fine job of looking after her and attending to her daily needs. Indeed, when Judge Austin and Harold Lloyd wanted to come over, Matilda did not shut them out, but instead invited them in and served them high tea. She also invited both of them to come back on Christmas Eve. Notably, the court evaluator's report makes a point of stating that Matilda seems to be living quite well in a clean, safe environment.

Matilda potentially could benefit from certain adaptations and alterations to the mansion that might help her "age in place" in greater safety and comfort. Yet in keeping with the principle that a guardian is a measure of last resort, this alone does not mean that she needs a guardian to exercise control over her decisions in this area. For now, she appears to have worked out arrangements so that she can function safely and comfortably in this familiar environment. Giving somebody guardianship power over her person, and thus allowing that guardian to remove Matilda from this environment or alter it without Matilda's consent merely because she might be better off with these changes, does not meet the purposes for which Article 81 was enacted. See, e.g., In re Eugenia M., 867 N.Y.S.2d 373 (2008) (denying the guardianship petition because although the allegedly incapacitated person lived in an apartment that needed several repairs, the flaws were not blatantly dangerous to her health, and she had acclimated to those particular flaws in a way that worked well for her).

Lastly, there is Matilda's relationship with Michael, Mario, and Jonathan to consider. Once again, Phillip's arguments in his petition seem unfounded. Matilda and her husband legally adopted Michael, Mario, and Jonathan, and raised them as their sons. It is perfectly understandable that Matilda should "dote on them" and trust them even though they had all been out of contact with her for a long time. This is not a sign of incapacity. Plenty of perfectly "sane" parents would do the same. Furthermore, there is no sign that Michael, Mario, or Jonathan are preying on Matilda in any way. In fact, they seem quite earnest in their statements that they will do anything to help her.

In addition, there are other facts which demonstrate that Matilda is aware of her decisions and their consequences. For instance, her choice to hire a private investigator to locate her sons was independently made and aimed at a specific desirable outcome. Likewise, her decision to tell the newspaper reporters that she needed her sons to come back and visit her on Christmas Eve proved to be a brilliant plan for reaching Michael, Mario, and Jonathan when she had no other way to contact them. These are rational, thoughtful, and even creative choices -- not the types of decisions one would expect from a person in need of a guardian.

In one notable case, the trial judge emphasized that guardianship "is not some pro forma legal vehicle to be used merely to perpetuate parental control of an incorrigible child." In re John Doe, 696 N.Y.S.2d 384, 386-87 (Nassau Cnty. Sup. Ct. 1999). By the same token, Phillip cannot be allowed to exploit a guardianship law just to "perpetuate control" over his aunt's behaviors because he finds her eccentric. Deprivations of an individual's constitutionally protected liberties should never be awarded lightly. Given the degree of capacity exhibited by Matilda in this case, it certainly should not be awarded here. Phillip's Article 81 petition should be denied.

IV Step Three: What Alternative Measure(s) May Be Proper Here?

Article 81 requires the court to consider alternatives to appointing a guardian, including but not limited to "visiting nurses, homemakers, home health aides, adult day care, trusts, and representative and protective payees." See N.Y. MENTAL HYG. LAW §81.03(e) (McKinney 2013). Guiding these decisions is the question of which measure is "the least restrictive alternative yet adequate to meet the (individual's) needs." See MENTAL HYG. LAW §81.01; MENTAL HYG. LAW §81.02(a)(2); see also In re Joseph V., 307 A.D.2d 469, 470 (App. Div. 3d Dep't 2003). This final section looks at which alternatives may be appropriate for Matilda in this case.

The most logical and least restrictive step here is to encourage Matilda to draft and execute advance directives, preferably with the help and guidance of an attorney. As already discussed above, Matilda certainly seems to possess the capacity necessary to execute a Will, a Health Care Proxy, and a Power of Attorney. With these validly executed directives stating her intentions in place, there should be no need for any dissension about appointing a guardian if Matilda ever does become incapacitated. It will allow Matilda's wishes to be not only expressed, but memorialized in legal documents.

Worthy of discussion, however, is the question of whom Matilda should appoint to positions of responsibility in these directives. Certainly, Phillip should not be chosen as Matilda's health care agent or attorney-in-fact, nor should he be selected as executor of her Will. The interactions between Matilda and Phillip demonstrate a definite apprehension, if not a complete lack of trust, between the two relatives. In addition, the fact that Phillip has rarely visited Matilda except when he wants to borrow money from her indicates that he may be more interested in helping himself than helping his aunt. Lastly, the fact that Phillip brought a guardianship proceeding against his aunt over her vehement objections sends up red flags against the notion of Phillip serving in any of these positions of trust and responsibility.

Matilda likely would be willing to appoint Michael, Mario, or Jonathan in these positions. The greatest challenge will be making her wishes known to these individuals who have been out of her life for a significant period of time. However, all three men have stated that they would help Matilda in any way that they can. Assuming that they do hold true to this promise, any one of these three individuals would probably say "yes" if asked by Matilda to serve.

The key hurdle, though, would be selecting which son would be best. The fact that a warrant is still pending for Mario's arrest probably eliminates him as a logical choice. If he ever came back to the States for a significant period, he would be arrested. This would not make him very useful to Matilda if she became incapacitated and needed him to make decisions on her behalf. Next, we look to Jonathan. He lacks Mario's criminal history, which is good. Yet his drinking is a concern. An even greater worry is his job, which constantly keeps him away from New York City. His itinerant lifestyle could be problematic if he should need to suddenly assume responsibility for Matilda.

This leaves Michael. His extravagant habits are a mark against him when it comes to being appointed as Matilda's attorney-in-fact. However, if appointed in this role, Michael would be under strict fiduciary obligations imposed by state law. See N.Y. GEN. OBLIG. LAW §5-1505 (McKinney 2013). This would require him to make financial transactions in his aunt's best interests, preventing him from abusing her finances. See N.Y. GEN. OBLIG. LAW §5-1505 (McKinney 2013) (establishing that the attorney-in-fact owes a fiduciary duty to the principal, and must enter into transactions only in the principal's best interests). What's more, the fact that Michael is extravagant with his own money does not mean that he will be the same way with his aunt's resources. Additionally, Michael lives in New York City, and plans to remain there with his new bride. Of the three sons, he resides closest to Matilda, and would presumably be the best person to have "on call" if his aunt needed him. Therefore, it seems that Michael would be the best choice among the three sons to be Matilda's attorney-in-fact and health care agent.

Other alternatives listed in Article 81 seem overly restrictive in these circumstances. Phillip might argue for appointment of a representative or protective payee, but the court definitely should not do so. The evidence described earlier shows that Matilda understands her finances and the details about how she is spending her own money. There is no determination that she cannot manage her funds on her own. Similarly, there is no current need for Matilda to have a home health aide or a visiting nurse, as she seems to be managing quite well with Stevens' assistance. Naturally, should her health later take a turn for the worse, these options can be re-visited.

V Conclusions

Phillip chose the proper form of action in pursuing a guardianship under Article 81 of the Mental Health Law rather than Article 17-A of the Surrogate's Court Procedure Act. However, since Matilda did not consent to the guardianship and does not meet the criteria for incapacity under Article 81, Phillip's petition for guardianship should be denied.

Matilda would be well-advised to draft and execute advance directives in order to avoid a situation of this nature in the future. She has the capacity to do so, and it would be in her best interest to memorialize her wishes in these documents. Assuming that she would want to appoint one of her three adopted sons in these positions of responsibility, it appears that Michael, while not perfect, would be the most logical choice. However, should she wish to appoint a different son in any of these important roles, or somebody else entirely, she naturally could do so.

Counterfeiting has been a trend that has plagued corporations endlessly. The fashion industry specifically has taken big hits due to the legal problems of counterfeiting. A fashion law professional recently described counterfeiting efforts as "fighting a losing war,"because a fashion brand's name is diluted once the counterfeits are accessible to the public. This is exemplified by a stroll down Canal Street where street hustlers attempt to appeal to the public by yelling "Louis, Gucci, Rolex" at passersby, scoping potential buyers into side alleys or hidden upstairs rooms. Cheap prices for knock-off expensive designer goods seem to pull young buyers into the counterfeit markets. The average buyer probably wonders, "What is the problem with buying cheaper bags that look the same? I still look good."

The answer is that counterfeiting is a domino effect. Counterfeit bags seem almost harmless to the average young consumer, who fails to consider the problem on a large-scale level. Consider counterfeit trucks, wheels, and subway trains. Now the average consumer begins to worry a little.

A few years ago when the New York City Metropolitan Transit Authority unknowingly bought counterfeit wheels and subway trains, large-scale transportation problems began to occur. The low-quality counterfeit trains fell off the tracks. The low-quality wheels burned through themselves. How about the food and drug industries? Expanding counterfeits to food and pharmaceutical drugs could drag in a whole slew of health problems. Consider if a pill marked Tylenol no longer contained Tylenol and if jugs of milk were filled with white paint instead. From a large-scale view, counterfeiting can cause major problems and potential risk of death. If consumers believe it is okay to buy a counterfeit bag, consumers are setting themselves up for an acceptance of a counterfeit market that can be expanded to create danger and harm in industries that are considered "safe".

The Anti-Counterfeiting efforts have been fighting back against the counterfeit market. In Washington, DC, the International Anti-Counterfeiting Coalition has been established. International fashion corporations such as Louis Vuitton and Chanel have established counterfeiting departments to specifically target the problem. Other fashion companies have established brand enforcement departments, realizing how important it is for a brand name to be protected.International organizations such as the International Trademark Association (INTA) have been established to support trademark and intellectual property protection to protect consumers and promote fair and effective commerce. See INTA, Overview, INTA, available at http://www.inta.org/About/Pages/Overview.aspx.Lawyers have also gotten involved, working with the New York Police Department and U.S. Customs to assist workers in identifying counterfeits, perform investigations, and lobby for greater standards involving enforcement.

Heather McDonald, a partner at Baker & Hostetler and a pioneer of anti-counterfeiting litigation and intellectual property enforcement, was one of the first attorneys on the scene of this issue. She worked on lobbying for new laws at the federal and state levels to make the sale of counterfeit goods a crime and to increase the penalties of those convicted of this crime. Ms. McDonald also achieved litigation of third-party liability actions against landlords, holding landlords liable for the sale of illegal goods in their property, exemplifying how lawyers could get involved in anti-counterfeiting efforts on both a litigation basis and a legislation basis.

Anti-counterfeiting efforts have strongly focused on third-party liability. Due to Ms. McDonald's work, third-party landlords are now liable for counterfeit goods sold on their property. On real estate terms, third-party landlords can no longer pretend to not know about or ignore the sale of counterfeit goods on their property. This legislation aims at pushing landlords to action to prevent counterfeit markets. Third-party liability in real estate has been demonstrated by the recent case of Coach v. Popular Fashions. On March 25, 2013, Coach filed a federal lawsuit in a Nashville District Court against Popular Fashions, a store in Murfreesboro, Tennessee. Emily Kubis, Coach Inc. Sues Murfreesboro Store Over Knockoffs, THE TENNESSEAN, Mar. 26, 2013, available at http://www.tennessean.com/article/20130326/NEWS03/303250061/1969/NEWS?nclick_check=1. Coach alleged that Popular Fashions had been selling Coach imitation bags and is demanding $14,000,000 in damages. Id. Coach had been aware of the counterfeit sales since June 2012 and sent investigators and secret service agents to gather information about the store's owners and staff. Id. The investigators had made purchases, verifying the items as counterfeits. Id. The counterfeit items purchased by the investigators were used for a training session in identification of counterfeit items for Nashville law enforcement in July 2012. Id.

Investigators continued to make purchases at the store until December 2012, when the store was served a warrant and twenty-six counterfeit bags and nineteen counterfeit wallets were found. See Kubis, supra. Coach has brought eleven claims against Popular Fashion involving claims from deceptive practice to trademark infringement. Id. Popular Fashion owners and staff were aware of the counterfeits being sold on their property and therefore should be held accordingly liable. However, real estate is only one of the few markets the counterfeiters have tapped.

One of the biggest recent problems involving third parties is E-commerce. Due to the rise of the Digital Age after the start of the new millennium, the Internet has made it possible to do everything simpler--including everything involving counterfeiting. Sites like eBay and IOffer have been the prime markets for people selling counterfeit goods, allowing access of counterfeits from anywhere in the world. Now a consumer no longer needs to go down to Canal Street for a counterfeit bag. With a few clicks of the mouse, a consumer can now have a high quality counterfeit bag delivered to his or her door from China.

Anti-counterfeiting efforts have aimed to deal with E-commerce by writing the merchants cease-and-desist letters. Many in-house corporations have specific departments dedicated to drafting cease-and-desist letters, which tend to work efficiently in the removal of the counterfeit goods from the websites. In fact, due to third-party liability, eBay and IOffer have teamed up with big fashion corporations and anti-counterfeiting efforts. If notified, eBay and IOffer will remove counterfeit goods from their sites. Not only are auction sites like eBay and IOffer involved, but also the payment money processing sites. Third-party sites like Paypal may also be held liable and are working with auction sites to track and prevent counterfeits.

In the case of Tiffany, Inc. v. eBay, Inc., Tiffany charged eBay of contributory trademark infringement because eBay had listings of counterfeit Tiffany jewelry. See 600 F.3d 93 (2d Cir. 2010). EBay took down the specific listings that Tiffany brought claims about but did not stop other listings from being posted. See Anne Gilson LaLonde, Supreme Court Denies Cert in Tiffany v. Ebay, MARK MONITOR, Dec. 10, 2010, available at https://www.markmonitor.com/mmblog/supreme-court-denies-cert-in-tiffany-v-ebay/. The Court held that eBay was not liable for contributory infringement even if eBay had general knowledge that counterfeit Tiffany products were sold on its site. See Tiffany, 600 F.3d 93. The Court's rationale was that eBay did not continue to give its services to those who sold counterfeit Tiffany jewelry knowing that the merchants sold Tiffany trademark infringement products and eBay did not turn a blind eye to ignore trademark infringement issues. See id.; see also LaLonde, supra. The focuses on contributory infringement involved continued services from third parties to merchants who sold counterfeits and action done by third parties to stop counterfeit merchandise from being sold.

Since the Tiffany case, eBay has continued to move forward with anti-counterfeiting efforts. EBay now has an anti-counterfeiting warning, guides, and a partnership with the International Anti-Counterfeiting Coalition. Also, eBay joined with the Council of Fashion Designers of America in a "YOU CAN'T FAKE FASHION" campaign to raise awareness against counterfeits to celebrate original design. See Ebay and Council of Fashion Designers of America Advance Anti-Counterfeiting Efforts with the Return of "You Can't Fake Fashion", BUSINESSWIRE, Feb. 8, 2012, http://www.businesswire.com/news/home/20120208006362/en/eBay-Council-Fashion-Designers-America-Advance-Anti-Counterfeiting. "We hope broader awareness will help fight counterfeits and the harm they cause, and eBay is proud to partner with the CFDA on the second iteration of this campaign," said Alan Marks, eBay's Senior Vice President of Global Communications. "Counterfeits not only are illegal, they also damage brand owners, frustrate shoppers and undermine consumer confidence. eBay invests substantial resources to help provide millions of consumers a trusted, confident marketplace experience; this campaign is another example of our commitment to being a leading industry voice in the fight against counterfeits." Id.

E-Commerce is not the only way to deal with counterfeits online. Corporations have also worked with Google to remove counterfeit listings like "100realguaranteeLouboutin.com" or "GuarantyrealGucci.com" from the first few pages of the search results. Due to targeting technologies, corporations have put their main websites and official retailers on the first few pages of the search and attempted to remove the counterfeit listings from Google's Ads. Although most of the "100GuarantyGucci" websites may never be removed, these sites may be sent cease-and-desist letters and pushed to page 48 or 49 of the Google search results, pages not usually viewed by average consumers.

Although E-Commerce has been the recent focus of counterfeiting, the rise of 3D printing has brought unanswered questions. At Fashion Law Week 2013 in Washington, D.C., keynote speaker Harley Lewin strongly expressed that 3D printing would be the upcoming "new front" focus in terms of anti-counterfeiting. 3D printing is a technology that allows one to "print out" 3D objects from computers. See Christopher Barnatt, 3D Printing, EXPLAINING THE FUTURE, http://www.explainingthefuture.com/3dprinting.html. These printers can now output plastic materials, semi-liquids, cheese, chocolates, concrete, and, most recently, titanium. Id.

Experts have recently been calling 3D printing the "Third Industrial Revolution" because now consumers can choose the color, texture, and design to custom make their items. Experts call 3d Printing "Third Industrial Revolution", TEXTILE NEWS, Mar. 8, 2013, available at http://www.fibre2fashion.com/news/textile-news/newsdetails.aspx?news_id=122027. Now, the average consumer can hit "make" instead of "print" to create their new products. Id. Terry Wohlers, an independent analyst of the 3D printing sector stated that with 3D printing, consumers "are almost unlimited as to the geometric complexity" of what they can purchase. Id. Although in its infancy, 3D printing will soon be available for printing in homes, according to Massive Dynamics President Oscar Hines. Id.

The fashion industry has been quick to take up 3D printing. At the Mercedes-Benz [New York] Fashion Week, designer Kimberley Ovitz partnered with Shapeways to send 3D printed jewelry looks down the runway for her Fall 2013 collection. See Chandra Steele, 3-D Printed Jewelry's Designs on the Future, PC MAG (Feb. 16, 2013), available at http://www.pcmag.com/article2/0,2817,2415536,00.asp. This year, 3D printed garments hit the runways in both New York and Paris. Jeff Meltz, Dita Von Teese Flaunts Fibonacci-Inspired, 3-D Printed Gown, WIRED, Mar. 5, 2013, http://www.wired.com/design/2013/03/dita-von-teese-3-d-printed-gown/. According to Michael Schmidt, one of the designers of a 3D printed dress, Dita Von Teese wore an entire dress designed on an iPad, refined over Skype, rendered digitally by Francis Bitonti, and printed by Shapeways for a private runway event. Id. The entire dress was printed in 17 parts on a 3D printer EOS P350. Damir Brdjanac, 3D Printers in the Fashion World, DECRYPTED TECH, Mar. 10, 2013, http://www.decryptedtech.com/news/3d-printers-in-the-fashion-world. This concept demonstrates that 3D printers can make garments as well. Id.

Also, New Balance has been quick to the 3D printing game to now customize running shoes for athletes. Chris Reidy, New Balance Uses 3D Printing Technique to Customize Track Shoes, BOSTON GLOBE, Mar. 8, 2013, available at ttp://www.boston.com/businessupdates/2013/03/08/new-balance-uses-printing-technique-customize-track-shoes/v0GgY5NN9efZpCWrfq0pTN/story.html.
New Balance's manager of studio innovations Katherine Petrecca stated in an email that "printing will allow us to be incredibly efficient by making products on-demand and eliminating large chunks of a traditional supply chain...we will see significant opportunities to expand our usage and the scale of production." Id. The 3D printing technologies have even been set to launch 3D printing stores in Russia, Ukraine, and Kazakhstan to bring upscale shopping experiences to these places. Brian Heater, Solidoodle 3D Printing Stores Set To Bring "Upscale Fashion Shopping" to Russia, Ukraine and Kazakhstan, ENGADGET, Feb. 28, 2013, http://www.engadget.com/2013/02/28/solidoodle/.

If used properly, 3D printing is said to revolutionize garment making. Customized clothes can now be easily made and sent quickly to the consumer. Factories and manual labor can be eliminated. But if 3D printing falls into the wrong hands, counterfeiting can quickly develop into a big problem. 3D printing can open up an entire can of worms and even completely undermine the entire trademark registration and protection system. 3D printing is soon supposed to be available to the common consumer. If the common consumer desires, he or she can print a pair of red-bottom heels quickly, infringing the Christian Louboutin design. In fact, it would be extremely difficult to enforce trademarks if the consumer had the capability to custom design any clothing, jewelry, or item he or she wanted.

What measures of accountability can be taken when the consumer can quickly design, print out, and go off with the 3D printed item? A potential solution would be to limit the access to 3D printers to corporations by keeping the 3D printing technologies at a higher cost. The corporations could then customize merchandize consumers wanted at an agreed upon cost. However, this would undermine the very notion of allowing the public access to 3D printing technologies. What then, would be an appropriate measure to take to allow the public access to 3D printing and attempting to prevent abuse? Monitors on 3D printers to prevent printing of trademarks registered with the trademark office could be potentially effective. Perhaps with the development of advanced technology to match 3D printing can methods of enforcement be available to protect fashion corporations' intellectual property rights.

Overall, anti-counterfeiting is an up-and-coming legal niche that is being established, especially in fashion law. Anti-counterfeiting is often linked to law enforcement, brand enforcement, and brand protection. However, counterfeiting is important because it is not a small problem that affects only the fashion industry. Counterfeiting has stretched over transportation and potentially the food and drug industries. Preventing counterfeiting is the key. Third-party liability through real estate was one of the first anti-counterfeiting movements, which held landlords liable for counterfeit goods sold on their properties. But the counterfeiting markets spread to the World Wide Web and E-commerce, which spurred the recent lawsuits such as eBay v. Tiffany. In terms of E-Commerce, websites such as eBay and IOffer have been taking action and partnering with organizations like the International Anti-Counterfeiting Coalition and Council of Fashion Designers of America and taking down counterfeit listings. But the new trend of 3D printing raises new trends in relation to infringement and counterfeiting. Although some may argue that counterfeiters will always have the newest technology to sell counterfeit goods, 3D printing is said to be the "Third Industrial Revolution" and able to change the entire garment manufacturing and textile industry. If 3D printing is abused, infringement and counterfeit issues may unravel the entire trademark system. Therefore, with the new 3D printing technology, new methods of enforcement and accountability must be established.

Amelia Wong is a second-year student at American University Washington College of Law. During her first year she attended law school in New York City, where she was exposed to fashion law and trademark. She has since started her own fashion law blog with an intern from Vogue, assisted a professor of fashion law on writing for his fashion law blog, and volunteered for events and as a writer for Fashion Law Week 2013.

Expert determination, together with related mechanisms such as dispute resolution boards, are private summary dispute resolution mechanisms intended to provide faster resolution than the quasi-judicial process of arbitration, in part because they usually escape the local supervisory mechanism for arbitration. This paper examines how several jurisdictions have drawn the distinction between arbitration and non-arbitral procedures in the enforcement of awards under the New York Convention, to determine the extent to which successful parties in expert determination may benefit from the New York Convention enforcement regime.

What Is Expert Determination?

A. According To The Commentators

The type of expert determinations this paper addresses are described by Douglas Jones, Expert Determination and Arbitration, 67 ARB. 17 (2001):

Jones provides in the same paper an overview of the relative practical merits of expert determination, and an indication of the growing significance of the procedure. It is these cases which motivate this paper: awards which finally resolve the dispute, rather than solely consisting of findings of fact.

Unhelpfully, the New York Convention itself provides no definition of an award for experts' awards to comply with, although final resolution is generally considered a requirement. Judith Gill, The Definition of Award Under the New York Convention, 2 DISP. RESOL. INT'L 114, 120 (2008).

i. Approaches To Distinguishing Expert Determination From Arbitration

This paper uses the term "substantive approach" to denote approaches which focus on elements of the substantive nature of the dispute resolution process (such as the question asked, the manner in which the procedure is carried out, and the nature of the award produced). The term "formalist approach" denotes a focus on the consequences of the categorization, and the juridical nature and status of the dispute resolution process, rather than its actual contents. Under a formalist approach, processes carried out otherwise identically may attract a different categorization, for instance because of party intention.

ii. Substantive Definitions

The major commentators on arbitration have generally drawn their substantive definitions to define away the category of expert determination with which this paper is concerned. Fouchard, Gaillard, Goldman states "If the parties confer a power of decision [...] on a third party to whom they refer to as an expert, that third party is in fact either an arbitrator, or in the absence of a dispute, an agent of the parties". FOUCHARD, GAILLARD, GOLDMAN ON INTERNATIONAL COMMERCIAL ARBITRATION para. 26 (Emmanuel Gaillard & John F. Savage, eds., 1999) (cf. JEAN-FRANÇOIS POUDRET & SÉBASTIEN BESSON, COMPARATIVE LAW OF INTERNATIONAL ARBITRATION 15 (Stephen V. Berti & Annette Ponti trans.,Sweet & Maxwell Ltd 2d ed. 2007) (2002)). Park gives the following illustration:

It follows that what these commentators consider expert determination can never be enforceable under the New York Convention because courts enforce orders and rights, rather than facts. Likewise, expert determinations which ask the expert to determine "what are the legal rights of the parties?" fall within these authors' definition of arbitration.

iii. Formalist Definitions

Kendall offers the following summary of the formalist distinction:

But note that the substantive elements mentioned may be dispensed with in look-sniff arbitrations (see below), and, for example, under the CIETAC Rules, arbitral tribunals may adopt an inquisitorial approach. China International Economic and Trade Arbitration Commission (CIETAC) Arbitration Rules, Feb. 3, 2012, Art 33(3), available at http://www.cietac.org/index/rules/47607adcbb68427f001.cms.

Liebscher offers that expert determinations are those binding processes conducted by a third party which lead to an award not having the effect of a judgment. CHRISTOPH LIEBSCHER, THE HEALTHY AWARD: CHALLENGE IN INTERNATIONAL COMMERCIAL ARBITRATION 137 (2003).

B. According To The Courts

The majority of jurisdictions which are significant in international arbitration take an approach which assimilates to arbitration expert determination of the type considered here. Those jurisdictions include France, Switzerland, Italy (in relation to international, but not domestic awards) and arguably the USA (under the Federal Arbitration Act), applying a substantive criterion to identify arbitration. Germany applies a formalist approach and does not allow enforcement of experts' awards. The UK applies a formalist approach, and would seem likely to allow enforcement, although no case in point has come before the courts for decision.

i. France And Switzerland

The approach taken in France and Switzerland is to distinguish between arbitration, which finally determines the rights and obligations of the parties, and expert determination, which rules on a point of fact, notwithstanding that that fact may be fully determinative of the disputed obligations between the parties. See, e.g., i.S. Nachmann gegen German und Mitb. Bundesgericht [BGer] [Federal Supreme Court] Dec. 9, 2003, 130 Entscheidungen des schweizerischen Bundesgerichts [BGE] III 125; Mutuelle Fraternelle d'Assurances v Chetouane, Cour d'Appel [CA] [regional court of appeal] Paris, 1e ch., Dec. 21, 2000, 2001 Revue de l'Arbitrage 178. This is a substantive approach because it addresses the features of the procedure as actually undertaken in the case in order to draw the classification.

The Swiss Bundesgericht puts it thus in a case where a contract provided for a third party to determine whether termination of that contract was reasonable:

The Swiss Bundesgericht has applied the same approach to decide what is an international arbitration in i.S. Nachmann gegen German und Mitb. The Bundesgericht upheld enforcement of a German award in Switzerland (in part) on the basis that it was an arbitral award because it provided a binding determination of the parties' rights.

The French Cour d'Appel de Paris, applying almost identical reasoning to that quoted above, has held that a decision of a doctor fixing the proportion of damages to be paid by an insurance company was an expert determination, because the doctor was not asked to draw a legal conclusion from his factual conclusions; and that a procedure to determine the value of a car (which would then be the amount owed by one party, being an insurer, to the other, being the insured) was an expert determination because the decision was one of pure fact, and could not function as a judgment. Mutuelle Fraternelle d'Assurances v Chetouane, Cour d'Appel; Thouzery v AXA Assurances CA Paris, Mar. 14, 2002, 2002 Revue de l'Arbitrage 772.

Courts following this approach have regard to both the agreement, to ascertain the nature of the question that the third party should be answering, and to the form of the answer given, to ascertain whether the answer amounts to an order determining the legal rights and obligations of the parties, or a pure determination of fact. It can be seen that this maps neatly to the distinction drawn by Park, and Poudret and Besson, above.

This analysis is also supported by Fouchard, Gaillard, Goldman, who state that a defining characteristic of an arbitration is that it resolves disputes, relying on the New York Convention Art II(1) that "parties submit 'differences' to arbitration", and on Art. 1496 of the French New Code of Civil Procedure, "stating that '[t]he arbitrator shall resolve the dispute.'" GAILLARD & SAVAGE, supra, at para. 30. They go on: "experts will only be acting as the parties' agents where they confine themselves to making comments and leave the parties or arbitrators to review the contract or to resolve the dispute themselves." ID. at para. 32.

ii. The U.S. Approach

It appears that the U.S. takes the French-Swiss approach domestically, and would almost certainly take the same approach internationally. Born describes the approach: "a defining and distinguishing characteristic of arbitration is its mandatory use of adjudicatory procedures to resolve the disputes and claims presented by the parties." 1 Born, supra, at 229. Under this approach, "what is important is that the parties clearly intended to submit some disputes to their chosen instrument for the definitive settlement of [their] grievances." McDonnell Douglas Fin. Corp. v. Pennsylvania Power & Light Co., 858 F.2d 825, 830-31 (2d Cir. 1988) (internal punctuation omitted). Likewise Rau: "So it should not be too surprising to find many American courts simply unable to find any reason at all why the legal regime of arbitration should not now extend equally to appraisals or expert determinations." Alan Scott Rau, The Culture of American Arbitration and the Lessons of Adr, 40 TEX. INT'L L.J. 449, 487 (2005) (internal punctuation omitted).

Unfortunately, the question of the appropriate international approach has been directly addressed only once in the US, in the case (well known in the literature, but never cited by another US court, according to the Westlaw online citator at the time of writing) of Frydman v. Cosmair, Inc. 1995 WL 404841 (S.D.N.Y. July 6, 1995). In that case, the court suggested that it would not enforce an "award" from a French price appraisal, both because the procedure supplied a term of a contract, rather than resolving a dispute, and also because of the juridical status of the procedure in France (which, as above, also does not have the status of arbitration there):

It is submitted that the juridical status in France is a red herring, as the same substantive criterion is applied in France as in the US in order to decide that the procedure does not produce an award having the effect of a judgment. It is to be hoped that this decision will not be received by subsequent American courts as laying down that the true test for enforceability under the New York Convention is that a foreign procedure must both meet the US substantive test for an arbitration, and also have the status of a judgment in its home country. Instead it should be understood as applying a single substantive test, which exists in both American and French domestic law to identify an arbitration.

At the appellate level, the enforcement of awards from Italian arbitrato irrituale (a summary dispute resolution process provided for in Italian legislation, and domestically not considered equivalent to arbitration) proceedings have twice come before the US courts in relation to motions to stay enforcement proceedings until such time as set aside proceedings have been completed in Italy. Europcar Italia, S.p.A., v. Maiellano Tours, Inc., 156 F.3d 310 (2d Cir. 1998); Spier v. Calzaturificio Tecnica S.p.A., 663 F. Supp. 871 (S.D.N.Y. 1987). In each case, the appellate court was able to avoid directly addressing the issue of enforceability, remanding the question of a stay to the lower court. Crucially, in both cases, the appellate court rejected the defendants' argument that the federal courts lacked subject matter jurisdiction to hear the case because arbitrato irrituale falls outside the ambit of the New York Convention.

It follows as a matter of logic that if arbitration is defined in the U.S. substantively, and federal courts have subject matter jurisdiction over enforcement under the Federal Arbitration Act, that there is no reason in principle why awards from foreign expert determinations should not be capable of enforcement as if arbitral awards, unless some other definition of arbitration is adopted in international cases.

iii. The German Approach

The distinction drawn by the German courts is that arbitral procedures are those which by definition result in an award having equivalent status to a court judgment under the legal system of the seat of the arbitration; expert determinations are seen as merely being binding in contract. Bundesgerichtshof [BGH] [Federal Court of Justice] Oct. 8, 1981, VIII Y.B. Com. Arb. 366; 1982 Eur. Com. Cases 516; see Stefan M. Kröll, Recognition and Enforcement of Foreign Arbitral Awards in Germany, 5(5) INT'L ARB. L. REV. 160 (2002). This same approach was formerly applied by Swiss courts, and remains the correct approach in Italian domestic (but not international) cases. Zanetta & Moretti c. Comune di Vacallo, BGer May 13, 1981, 107 BGE Ia 318; Gaetano Butera c. Pietro e Romano Pagnan, Cass., sez. un., 18 settembre 1978, n. 4167, IV Y.B. Com. Arb. 296. According to Born, this insistence that the juridical nature is judicial also determines certain substantive aspects of German arbitrations, such as that they cannot be limited to certain issues, and that the proceedings must have a judicial-style process. 1 Born, supra, at 226, 226 n.119.

The quite extraordinary reasoning given by the German Bundesgerichtshof ("BGH") for this rule is: (a) the word "arbitration" in the English text of the New York Convention should be analogized to the German Schiedsverfahren procedure; (b) accordingly foreign arbitral awards should also have the effect of a judgment, as do Schiedsverfahren awards; and (c) the prior Geneva Convention of 1927, by dint of requiring so-called double exequatur, required awards to have the status of a judgment, and that the New York Convention was not intended to apply to any wider class of awards than the Geneva Convention. BGH Oct. 8, 1981, VIII Y.B. Com. Arb. 366,367; United Nations (Secretariat of the League of Nations), Convention on the Execution of Foreign Arbitral Awards, 26 September 1927, 92 L.N.T.S. 301 [hereinafter the Geneva Convention of 1927].

The arguments given by the BGH for this chain of reasoning were, first that they considered that to analogize between the term in the text and the local procedure promotes autonomous interpretation of the New York Convention. That appears to this author to be the very definition of a contradiction.

Secondly, the BGH considered that the purpose of the New York Convention is to harmonize the law of enforcement of foreign arbitral awards. In this case, an Italian award lacked the status of a judgment in Italy, and granting enforcement would have conferred the status of a judgment in Germany. This argument has found some academic support. Poudret and Besson consider (attributing the position to Van den Berg) that to give the award the status of a judgment in the foreign country would be "paradoxical". POUDRET & BESSON, supra, at para. 21.

The New York Convention appears explicitly to contemplate diversity of effect. The Arts. V(1),(2) criteria for refusing enforcement allow a state to enforce an award which is set aside or not binding. Art. III explicitly states that the purpose of the convention is to assimilate the treatment of foreign awards to the treatment of local awards on enforcement ("Each Contracting State shall recognize arbitral awards as binding and enforce them in accordance with the rules of procedure of the territory where the award is relied on"). Art. III prohibits discrimination against foreign awards, but does not refer to parity with, or status in, the legal system at the seat of the arbitration.

The only reference to the status of the award in the seat legal system is in Art. V(1)(e) that "Recognition and enforcement of the award may be refused [. . .] if [. . .] (e) [t]he award has not yet become binding on the parties"). Even this is optional. No particular juridical doctrine creating that binding effect, nor any requirement that the binding effect has any particular content (for instance that the subject of the award be res judicata) is specified.

To treat the language and scope of the New York Convention as being restricted by a requirement of the previous international instrument, which prior requirement the New York Convention has explicitly abandoned, is a quite extraordinary approach to construction.

Kröll considers that the restriction to arbitration arises from Art. 101 of the German Grundgesetz (which provides that "[n]o one may be removed from the jurisdiction of his lawful judge"), that no-one can be deprived of access to the courts without a valid arbitration agreement. If that is so, the public policy ground under New York Convention Art. V(2)(b) would be available. Stefan M. Kröll, Recognition and enforcement of foreign arbitral awards in Germany, 5 INT'L ARB. L. REV. 160, 165 (2002). It is unfortunate that the Bundesgerichtshof did not articulate this argument as part of its reasoning, rather than importing this policy into its construction of Art. V(1)(e).

iv. The Italian International Approach

The approach taken by the Italian Corte di Cassazione in relation to foreign awards is simply to address whether or not the award is final and binding. The court's reasoning is that, first, the language of a multilateral treaty such as the New York Convention is intended to operate in a variety of different legal systems, and so cannot be read restrictively. Gaetano Butera c. Pietro e Romano Pagnan, supra.

Secondly, a literal reading of the treaty does not disclose any requirement that the award have the status of a judgment, only that the award be final and binding, and that the agreement comply with the New York Convention Art. II(2) formality requirements. The finality requirement seems inferred from the ground permitting refusal in case the award is "not yet binding on the parties."

Thirdly, the court inferred that the abandonment of the Geneva Convention of 1927 requirement of double exequatur indicates an intent that awards not capable of obtaining exequatur can still be enforced under the Convention.

This formalist approach is quite different from that taken by the German courts - it focuses solely on a single legal factor, whether the award is binding (and final). It appears equivalent to Poudret and Besson's articulation of the criterion for (non-)vulnerability under Art. V(1)(e) of the New York Convention, that there must no longer be the possibility of "a complete judicial review of the award on the merits by a judge or a superior arbitral authority". POUDRET & BESSON, supra, at para. 918.

Conclusion

The weight of judicial support in Switzerland, France, Italy, and the United States supports making the New York Convention's enforcement procedures available to any foreign award, no matter how categorized in the seat legal system, as long as the purpose of the award is to finally resolve a legal dispute. Only Germany stands apart, and requires that awards be capable of double exequatur as a prerequisite to recognition in Germany. The German position appears to be based on a desire to give effect to certain constitutional provisions without explicitly relying on the public policy provisions of the New York Convention.

This is a positive position for the use of expert determination (and similar mechanisms) for dispute resolution in international contracts, as the jurisdictions surveyed are major centers of international commerce where enforcement of awards is likely to be sought.

Marcin Tustin is a qualified English solicitor who formerly worked in the area of international arbitration and bankruptcy in England, and has now completed the LL.M. in Dispute Resolution and Advocacy at Benjamin N. Cardozo School of Law. He is the 2013 recipient of the Louis Henkin Award for academic achievement and superior scholarship in the LL.M. program. Marcin plans to remain in New York and pursue his career here. Marcin has a number of papers from his LL.M. which he is seeking to publish. He can be reached by email at marcin.tustin@gmail.com.

As a Canadian citizen and a first-year law student studying in New York, I found myself full of questions. How could I possibly attain valuable work experience under current visa status restrictions? How would that impact job prospects after graduation? I found myself struggling with these questions as I dealt with the competitive spirit of law school and the nuances of living in a different country.

There are many reasons why Canadian students choose to study at a law school in the United States. I chose to start my legal career in the U.S. because of my interest in cross-border commercial transactions. My hope is that this article will provide insight through my experiences as a first-year law student. The focus of this piece is to provide helpful advice to Canadian students at United States law schools by exploring two main areas: working in the U.S. and networking.

Quite often, Canadian students studying in the U.S. are included within the broader category of international students. However, it is important to remember that Canada and the U.S. share a special relationship which affords Canadian students studying in the U.S., and likewise, U.S. students studying in Canada with distinct privileges.

One of these privileges is the ability of Canadian citizens to study in the U.S. without a visa. Canadian students are able to study in the U.S. under an F-1 status which is outlined on required I-20 and I-94 documentation.

Under the status of an F-1, students can only work on campus during their first academic year. See United States Citizenship and Immigration Services, http://www.uscis.gov/portal/site/uscis/ (last visited Mar. 9, 2013). Although I would highly advise against working during the first semester of law school, I am fully aware of the financial burdens associated with being a law student. I was employed as a note taker for one of my classes during my first semester. Since it entailed the relatively easy task of forwarding my notes along, it did not impair my ability to focus on the curriculum. However, first-year marks are substantially important. This point cannot be stressed enough.

During my second semester, I had the opportunity to work as a research assistant for one of my law professors. Through this position, I was able to refine my research and writing skills. In addition, I was able to explore and understand a vast practice area about which I previously had no knowledge.

Valuable and substantial on-campus work opportunities are hard to find. Since this is the only category under which an F-1 status student can work, it is imperative to be creative. Take advantage of your law school's department of career services and your school's office of international student affairs by discussing how you can attain work experience and build your skills while still staying within the ramifications of your F-1 status.

For example, one of my peers and I had the opportunity to represent a claimant at an unemployment benefit hearing as student advocates on behalf of the Unemployment Action Center. It was a rewarding experience that allowed for the development of various skills, such as, developing a case strategy and timeline, conducting direct and cross examinations, and presenting a concise argument in front of an administrative law judge. Since this was a volunteer-based position, it was permitted under the F-1 status restrictions. Therefore, it is important to seek out volunteer opportunities that allow you to gain legal experience.

After completing one academic year at a U.S. law school, F-1 status students are granted the opportunity to work during the summer under Curricular Practical Training ("CPT") or Optional Practical Training ("OPT"). Most students prefer to utilize part of the 12-month CPT during their first-year summer, rather than the 12-month OPT grant because the OPT process is highly extensive and time consuming.

The United States Citizenship and Immigration Services ("USCIS") defines CPT as "alternate work/study, internship, cooperative education, or any other type of required internship or practicum which is offered by sponsoring employers through cooperative agreements with the school." See Aliens and Nationality Rule, 8 C.F.R. §214.2(f)(10)(i) (2010). This usually takes the form of an externship, and it "must be an integral part of the established curriculum and directly related to the field of study." 8 C.F.R. §214.2(f)(10)(i). An employment position under the CPT status can be either full-time or part-time, and you must apply for CPT after attaining an offer of employment. 8 C.F.R. §214.2(f)(10)(i). You must not exceed your 12-month grant of CPT within your three years at law school, because if you do, then you are automatically ineligible for OPT. See United States Dep't of Homeland Security, http://www.ice.gov/sevis/practical-training/ (last visited Mar. 9, 2013).

Although the USCIS does not place restrictions on whether you can get paid if attaining CPT, the American Bar Association ("ABA") does. According to the ABA's regulations, if a student is attaining CPT credit, then he or she cannot be paid by the employer for work provided.

In essence, with respect to summer employment, there are five options for Canadian students after completing their first year of law school: (1) attain an on-campus position (i.e. research assistant) with compensation, (2) utilize part of their CPT credit to attain externship credit and experience rather than being compensated,(3) attain a legal position at a Canadian company or law firm with compensation, (4) take extra courses during the summer, or (5) participate in their law school's international summer externship program if applicable.

I chose to spend my first-year summer working at a Canadian law firm after considering the pros and cons of working without compensation while paying for externship credit, along with the chances of attaining a valuable externship opportunity within the current U.S. job market. Through my current summer position, I will be able to attain substantial hands-on legal experience while being compensated. However, I did consider how working in Canada would impact my overall job prospects in the U.S. My first-year summer position is with a Canadian business law firm, through which I hope to gain and build transferable skills that will be instrumental in future positions.

OPT grants an F-1 status student to work for 12 months while getting paid. F-1 law students usually utilize this option while studying for the Bar. The process for attaining OPT involves filing an Application for Employment Authorization (Form I-765) with USCIS. See United States Dep't of Homeland Security, http://www.ice.gov/sevis/practical-training/ (last visited Mar. 9, 2013). In turn, USCIS will provide you with an Employment Authorization Document (Form-I766) which will allow you to work in the U.S. See id. OPT applications are the norm and must be submitted in advance of attaining an employment position; however, as a Canadian F-1 status student, this is not required. Rather than applying for OPT, you may choose to work in the U.S. under the TN NAFTA Professionals classification.

One of the other privileges afforded by the special relationship between Canada and the U.S. is the North American Free Trade Agreement ("NAFTA"). Under NAFTA, law is recognized as a professional employment category that allows Canadian citizens to work in the U.S. In order to qualify under the TN category, Canadian citizens must present: (1) proof of Canadian citizenship,(2) offer of employment by a U.S. employer with respect to title, purpose of employment, length of stay, and educational qualifications, (3) credentials evaluation (i.e. law degree), and (4) applicable fees at a designated U.S. port of entry. See United States Citizenship and Immigration Services, http://www.uscis.gov/portal/site/uscis/ (last visited Mar. 9, 2013).

After establishing the eligibility of an F-1 status law student to work in the U.S., it is important to address how to build and foster meaningful professional opportunities and relationships. During my first semester of law school, I was invited to many networking events, which first-year law students mistakenly believe to be disguised job opportunities. I attended these events not having a clear idea of what my purpose was in being there among hundreds of other law students. Why was I networking? An automatic response to this question is to meet legal professionals, but it is important to ask what is gained by the exchange of mass networking.

Networking is important, but it is not just about collecting business cards. It is about maintaining a professional connection and dialogue that affords both parties to gain from the exchange. The best way to build such relationships is by joining a committee at your local bar association in an area of law that you are interested in, and also by attending committee meetings. Through this exchange you will be able to build your professional network by creating meaningful relationships.

In addition, the relationships between your colleagues, professors, and others within your law school community are instrumental because they have first-hand knowledge of your abilities, level of professionalism, and ethics. Therefore, it is crucial to maintain those relationships, rather than simply attending mass networking events and collecting business cards.

It is essential to have a clear idea of your professional goals, and the requisite modes of achieving them. Working in the U.S. is a challenge, but because of the special privileges afforded by the relationship between Canada and the U.S., the process is achievable through strong strategic strides. By building meaningful relationships in a practice area that is of interest, you are building your professional network for not only your law school career, but the rest of your legal career.

Reema Mahbubani is a student at Hofstra University's Maurice A. Deane School of Law. Her past experience includes working in various capacities at a Canadian business law firm. She has experience working in the practice groups of labor and employment and commercial real estate. Reema has a strong interest in diversity initiatives. Through this interest, she developed a SharePoint intranet highlighting key diversity developments throughout her past employer's history. In addition, Reema also sat on the firm's Equity & Diversity Committee.

Dear Readers:

Welcome to the first Law Student Connection issue of 2013. We hope that your year has been a good one thus far, and that your semesters are off to an enjoyable--or at least interesting--start.

Plenty of things change from year to year. One thing that does not change, though, is the mission of this publication: to feature unique articles on a wide variety of legal topics, all written by law students who belong to the New York State Bar Association. We take great pride to bring these works to you four times a year, providing you with plenty of food for thought to savor between issues.

Of course, one thing that does change from edition to edition is our content. This time, we lead off with a piece by Margarita Golden that will make people think twice about selling textbooks, lest they violate U.S. copyright laws. Next, Michael Liptrot studies New York State's narrow interpretation of force majeure clauses in contracts, and offers suggestions to contract drafters within the state.

Turning to International Law, Briana West looks at the due process impacts of Schuler-Zgraggen v. Switzerland, one of the major cases heard in recent years by the European Court of Human Rights. And as if that wasn't enough, we bring you Anne Jelliff's humorous but informative look at oral arguments before the Appellate Division, Third Department, and a look at the human rights challenges faced by prison inmates with mental disabilities in New York State.

Have a wonderful year, a wonderful semester, and a wonderful time reading this latest offering of the Law Student Connection.

Sincerely,

Benjamin Pomerance
Editor-In-Chief

The Jurisprudential Foundation Of Force Majeure In New York State

Force Majeure is a defense that excuses performance of a contract. TINA L. STARK, NEGOTIATING AND DRAFTING CONTRACT BOILERPLATE 321 (2003). In general, the nonperforming party is "relieve[d]... from its contractual duties when its performance has been prevented by a force beyond its control or when the purpose of the contract has been frustrated." Phillips Puerto Rico Core, Inc. v. Tradax Petroleum Ltd., 782 F.2d 314, 319 (2d Cir. 1985). With respect to lease contracts, New York courts have construed the force majeure defense narrowly, finding relief only in instances where the intervening event was wholly unforeseeable and has made performance objectively impossible. The following cases illustrate New York's narrow interpretation of the common law force majeure doctrine as well as its narrow reading of force majeure contract provisions, and highlight the need for thoughtful, granular drafting of the force majeure contract clause.

A. New York's Narrow Interpretation of the Common Law Doctrine

In Kel Kim Corp. v. Cent. Markets, Inc., Kel Kim Corporation (Kel Kim) entered into a ten-year lease agreement with Central Markets, Inc. (Central Market). 70 N.Y.2d 900 (1987). The lease was for a vacant supermarket, which Kel Kim used as a roller skating rink. The lease required Kel Kim to acquire and maintain a public liability insurance policy in the aggregate amount of not less than $1 million on account of any single incident, which Kel Kim was able to do for six years. After six years, Kel Kim's insurance policy expired, and the insurer would not renew the policy because of the uncertainty of its own financial condition. Thereafter, Kel Kim could not find any insurer who would write a policy in excess of an aggregate amount of $500,000. In response to this failure, Central Market sent a notice of default directing Kel Kim to cure the default within 30 days or vacate the premises. Kel Kim then brought an action for declaratory judgment, arguing that it be excused from performance under the common law doctrine of force majeure or under the lease's force majeure clause.

The court refused to recognize a force majeure defense in this case both under the common law and under the contract. The court held that a force majeure event means "destruction of the subject matter of the contract or [when] the means of performance makes performance objectively impossible." Kel Kim Corp., 70 N.Y.2d at 902. The court further held that even in the event that performance is made impossible or the purpose of the contract is frustrated, "the impossibility must be produced by an unanticipated event that could not have been foreseen or guarded against in the contract." Id. In this case, the court found that because Kel Kim specifically undertook the obligation to get public liability insurance, it could have foreseen being incapable of acquiring such insurance, and thus could not avail itself of the common law force majeure defense. Id.

Kel Kim Corp. is representative of the current New York jurisprudence regarding the common law doctrine of force majeure. The Northern District of New York recently reaffirmed New York's commitment to recognizing the defense only in extreme circumstances. See Beardslee v. Inflection Energy, LLC, 2012 WL 5522912 (N.D.N.Y. Nov. 15, 2012). In Beardslee, the court reaffirmed the holding in Kel Kim Corp. that the force majeure event must have been unforeseeable or guarded against in the contract, and that with respect to frustration of purpose, performance is only excused if a "virtually cataclysmic, wholly unforeseeable event renders the contract valueless to one party." Id. (internal quotations omitted). In the case, an oil drilling company claimed a force majeure event occurred when former Governor David Patterson signed a directive that required the company to use a drilling method other than the one they originally contemplated using. The court found that because the drilling method the company originally wanted to use was not contemplated by the existing governing regulation, they could have foreseen that a government directive might be issued banning its use.

B. New York's Strict Reading of Force Majeure Contract Clauses

In Kel Kim Corp., the parties included a force majeure clause in their lease. However, the section was silent on whether common law claims were excluded, and Kel Kim was able to argue for relief under both the contract provision and the common law doctrine. The clause reads as follows:

The court found no relief for Kel Kim under the contract provision. The court held that "[o]rdinarily, only if the force majeure clause specifically includes the event that actually prevents a party's performance will that party be excused." Id. at 902-03. Despite the catchall phrase at the end of the clause, the court held to its narrow reading, explaining that such catchall phrases "are confined to things of the same kind or nature as the particular matters mentioned." Id. at 903. In this case, Kel Kim's failure to obtain public liability insurance because his original insurer was financially incapable of renewing the policy did not fall into any of the articulated events. The court found that the enumerated events were "day-to-day commercial operations," while maintaining an insurance policy is an ongoing obligation that is not affected by such daily operations. See id.

An example of successful contract drafting can be found in the New York Appellate Division case Bouchard Transp. Co., Inc. v. New York Islanders Hockey Club, LP. 40 A.D.3d 897 (2d Dept. 2007). In that case, Bouchard Transportation Company, Inc. (Bouchard) paid the New York Islanders professional hockey franchise (Islanders) to lease a suite at the Nassau Veterans Memorial Coliseum for the duration of the 2004/05 National Hockey League regular season. However, the season was canceled because of a league-wide lockout.

Bouchard subsequently sued for breach of contract. The Islanders sought to dismiss the complaint, arguing that it was protected under the force majeure clause of the lease, and countersued for nonpayment of rent. The lease's force majeure clause provided in relevant part that the Islanders' performance is excused "by cause or causes beyond Lessor's control which shall include, without limitation, all labor disputes." Id. at 898. Bouchard argued that for the clause to trigger excused performance, the labor dispute must be beyond the Islanders' control, and the Islanders could end the lockout by settling. Nonetheless, the court found that the contract clause was specific in excusing the Islanders' performance in this case. Although the court agreed with plaintiff that, under strict reading of the contract, the labor dispute must be beyond the Islanders' control, the court found that because the Islanders were but one of the 30 teams participating in the lockout, the labor dispute was in fact out of the Islanders' control. With that, the court announced that the Islanders' summary judgment motion be granted and that Bouchard must pay the unpaid rent.

Beyond The Core Concept: Common Pitfalls In Force Majeure Contract Clauses

Clearly, in New York, "it is well settled that performance of a contract should be excused only in extreme circumstances." Radiosurgery New York L.L.C. v. Cabrini Med. Ctr., 19 Misc. 3d 1102(A) (Sup. Ct. 2008). These circumstances are limited to events that make performance objectively impossible; "[m]ere impracticality or unanticipated difficulty is not enough to excuse performance." Phibro Energy, Inc. v. Empresa De Polimeros De Sines Sarl, 720 F.Supp. 312, 318 (S.D.N.Y. 1989). Moreover, such events must have been wholly unforeseeable. However, the contract drafter can circumvent this strict standard with a contract clause that satisfactorily allocates risk among all parties. But, as has been previously shown, merely including a boilerplate force majeure clause in the contract will not suffice. Courts are equally strict in their reading of the contract clause. They refuse to interpret enumerated terms broadly, and give narrow construction even to catchall phrases. See Kel Kim Corp., 70 N.Y.2d at 902-903.

Thus, in order for the contract drafter to allocate appropriate risk among the parties, he or she must be very specific when drafting the force majeure clause. The following cases deal with common pitfalls of the force majeure contract clause, from which useful drafting tips can be derived.

A. The "Litany" Approach

In response to the requisite specificity of the force majeure contract clause, drafters commonly draft a "stand alone litany." Stark, supra, at 328. This method simply enumerates in a list all of the events that will qualify as force majeure events under the contract. This approach indeed has the virtue of being specific, but its inadequacy in anticipating future circumstances has spawned additional case law.

As has already been discussed, the attempt by drafters to include a catchall provision at the end of a stand alone litany did not bring about the desired result. Kel Kim Corp. issued the accepted rule that catchall provisions in a litany of events will be construed narrowly.

Next, the Supreme Court of the United States in United States v. Brooks-Callaway Co. addressed the issue of how to interpret a litany in the context of the entire force majeure clause. 318 U.S. 120 (1943). In that case, the force majeure clause excused performance "because of any delays. . . due to unforeseeable causes beyond the control and without the fault or negligence of the contractor, including. . . acts of God, or of the public enemy, acts of the Government, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes, and unusually severe weather. . . ." Id. at n. 1. The Court ruled that events set out in the "including" phrase of the litany section will be modified by the requirements for excuse set out in the contract. Thus, since the requirements were that the event be unforeseeable and beyond the control of the nonperforming party, the Court found that those requirements modified each enumerated event in the litany (for example, under the terms of the contract between the parties in this case, "floods" meant unforeseeable floods beyond the control and without the fault or negligence of the contractor).

Despite these shortcomings, the litany is a helpful tool for drafting a robust force majeure clause. The reasons for this are two-fold. First, the litany allows drafters to greatly expand what may be considered a force majeure event. This is because the litany of events does not need to be limited to events or occurrences commonly considered to be force majeure events. See Capital City Gas Co. v. Phillips Petroleum Co., 373 F.2.d 128 (2d Cir. 1967). Second, drafters can circumvent the aforementioned flaws of the litany by using it as a component of a larger force majeure framework, rather than having it stand alone as the entire understanding of the parties. Used in this way, the litany can serve as an explicit, specific, non-exhaustive list of examples of events that meet the requirements of force majeure contained in the agreement.

B. The Unforeseeability Requirement

A fundamental part of the common law doctrine of force majeure is that the intervening event must have been unforeseeable. See VJK Productions, Inc. v. Friedman/Meyer Productions, Inc., 565 F.Supp. 916, 920 (S.D.N.Y. 1983) (force majeure defense not available if "the event which renders the performance impossible could have been anticipated and provided for in the contract."). Contract drafters might think that by simply enumerating possible events in the force majeure clause they can sufficiently allocate risk away from their client. However, if the contract is silent on foreseeability, "there is a danger that a court will read one in." Stark, supra, at 330.

The Eastern District of New York did just that in Vernon Lbr. Corp. v. Harcen Const. Co. See 60 F.Supp. 555, 558 (E.D.N.Y. 1945). There, a lumber company sought to be excused from performing under a sales contract because there was a change in the law that made it impossible for it to deliver the goods. The parties agreed that performance of the contract was "subject to conditions beyond control [of the lumber company]." Id. at 558. The court agreed that changes in law are indeed beyond the control of individual parties, but refused to excuse performance because it read an unforeseeability requirement into the clause. Thus, only unforeseeable changes in the law could excuse performance, and in this case the lumber company could have foreseen the change that occurred.

Therefore, parties should draft the force majeure clause to eliminate or modify the unforeseeability requirement. Even if parties desire an unforeseeability test, they should articulate in their own words what "unforeseeable" means, instead of being "subject to the vagaries of the court's or jury's imagination." Stark, supra, at 330.

C. The Due Diligence Requirement

The due diligence requirement, while not a default rule in the common law, is "commonplace in negotiated force majeure provisions." Id. at 331. The purpose of the requirement is to ensure that the nonperforming party cannot use the force majeure contract clause to walk away from its obligations without making a reasonable effort to continue performance in the face of an intervening event.

What constitutes due diligence, however, is debatable, and the case law in New York on the issue is not entirely clear. For example, in one case the Supreme Court of New York defined due diligence as "the duty of the promisor to make a bona fide effort to be relieved of the restraint which operates to prevent his performance." Brown v. J.P. Morgan & Co., 177 Misc. 626 (Sup. Ct. 1941) rev'd on other grounds, 40 N.Y.S.2d 229 (1st Dept 1943) aff'd sub nom. Brown v. J. P. Morgan & Co., 67 N.E.2d 263 (1946). Compare that to another New York Supreme Court case where due diligence was construed to mean "it is defendant's duty to perform in whatever way is left open to it." Van Der Veen v. Amsterdamsche Bank, 178 Misc. 668, 671 (Sup. Ct. 1942). Thus, the lower courts have had varying opinions as to the level of effort that the nonperforming party must exercise to constitute due diligence, and drafters might want to consider more definitive language for the due diligence requirement.

D. The Notice Requirement

Also not a default rule, but commonly included in negotiated force majeure clauses, is a notice requirement. The notice requirement demands that the nonperforming party give the other party notice in a prescribed manner and time after realizing that a force majeure event has occurred. When drafting the language of the notice requirement, it is important to make sure that it is clear that a force majeure defense is conditional upon giving notice. If the force majeure defense is not expressly made conditional on giving notice, then the nonperforming party is not barred from excusing itself from performing under the contract in the event that a force majeure event occurs. See Toyomenka Pac. Petroleum, Inc. v. Hess Oil Virgin Is. Corp., 771 F.Supp. 63, 67 (S.D.N.Y. 1991) ("Under New York law, a contractual duty will not be construed as a condition precedent absent clear language showing that the parties intended to make it a condition.").

E. To Excuse, or Not to Excuse (Performance)?

When a court upholds a defense of force majeure, the general rule is to excuse performance entirely. See United States v. Gen. Douglas MacArthur Senior Vil., Inc., 508 F.2d 377, 381 (2d Cir. 1974) ("The common law of contract excuses a party from performing his contractual obligations because of 'impossibility of performance' or 'frustration of purpose.' "); In re Fontana D'Oro Foods, Inc., 122 Misc. 2d 1091, 1093 (Sup. Ct. 1983) aff'd as modified, 484 N.Y.S.2d 644 (2d Dept 1985) aff'd, 482 N.E.2d 1216 (1985); Sage Realty Corp. v. Omnicom Group Inc., 183 Misc. 2d 574, 579 (Sup. Ct. 2000); Restatement (Second) of Contracts § 261 (1981).

In New York, it makes sense that this would be the default rule, since the courts only grant relief under the doctrine in extreme circumstances of objective impossibility or frustration of purpose. If a drafter is looking to expand the instances of force majeure in her contract, however, then it is possible that she might want a remedy other than discharge of the contract if a force majeure event occurs.

In other states, some courts have held that a supervening event does not completely discharge performance, but instead requires the parties to renegotiate, modify, and reform the contract to reflect the new understanding of the parties. See, e.g., Aluminum Co. of Am. v. Essex Group, Inc., 499 F.Supp. 53, 57 (W.D. Pa. 1980) (Nonperforming party entitled to reformation of long-term toll conversion service contract because nonlabor production costs rose significantly beyond foreseeable limits of risk). Drafters may want to build this out-of-state jurisprudence into their contracts if their clients have an interest in keeping the agreement alive even if costs rise.

Another way to modify the default rule would be to suspend performance, instead of permanently discharge it. This language can become a negotiating point whereby the parties agree to suspend performance for a certain amount of time until it becomes to costly for one or both of the parties, and at that point the parties can elect to renegotiate the terms or permanently discharge obligations. This approach has the advantage of maintaining the original understanding of the contract for as long as possible, keeping renegotiation on the table (but not requiring it), and preserving the option to walk away from the contract.

F. Obligations After Performance is Excused

It may not be obvious that, in the event that a force majeure event discharges performance, the nonperforming party can still have obligations under the agreement. One such obligation is paying damages resulting from its nonperformance. It is well settled that a successful defense of force majeure excuses performance. But see United Equities Co. v. First Natl. City Bank, 52 A.D.2d 154, 157 (1st Dept. 1976) aff'd sub nom. United Equities Co. v. First Natl. City Bank, 363 N.E.2d 1385 (1977) ("The purpose of a Force majeure clause is to limit damages.") (emphasis added). However, the parties may wish to allocate costs incurred in the result of a force majeure event.

Another possible obligation of the nonperforming party after the occurrence of a force majeure event is its obligation to cure breaches that existed prior to the force majeure event. The New York courts have not addressed this issue yet, but the Eastern District of Pennsylvania in Wartsila Diesel, Inc. v. Sierra Rutile, Ltd. announced the common sense holding that a force majeure event does not excuse existing liabilities or obligations to cure pre-existing breaches. See 1996 WL 724929 (E.D. Pa. Dec. 16, 1996). Since the issue has not been addressed in New York, and "such claims [to be excused from pre-existing defaults] have been made nonperforming parties," Stark, supra, at 349, a force majeure contract clause should expressly hold nonperforming parties liable for their breaches.

Conclusion

New York courts have construed force majeure strictly, and grant relief under the common law only in rare and extreme circumstances. However, courts will look to the contract to determine the meaning of force majeure in each case, and careful, granular drafting of the clause can better protect both parties in a real estate deal. Thus, contract drafters should not overlook the force majeure clause, but instead should take care to tailor it to suit their clients' needs.

Michael Liptrot is in his third year at Brooklyn Law School and is a candidate for J.D. in spring 2013. He received his B.A. from The American University in 2010, with a major in Law & Society and minor in Sociology. While in law school, he has interned for the New York City Housing Authority and the New York City Housing Development Corporation. He has also worked in Brooklyn Law School's Corporate & Real Estate Clinic and is currently working in the law school's Community Development Clinic. He is also a contributing author to the online law blog Developments in Real Estate Finance.

The start of the fall and spring semesters in medical schools, law schools and graduate schools across the country, marks the commencement of textbook season. Students experienced in the art of discount scour websites such as Half.com and Amazon in order to get books in as good of a condition as possible, without paying a sum of money that could make up half of one's monthly rent. And if the student has chosen to load up on classes, then maybe even the whole of one's monthly rent. During textbook season, many students double as educated consumers and reputable, sometimes profitable, textbook resellers. Careful with their books throughout the year, they prepare them for resale when the time comes, and sometimes sell at a profit high enough to buy another textbook, and maybe if they're lucky, a pack of highlighters.

Within any community of students, it is well understood that when a publisher creates a subsequent edition to a textbook, very little key information has changed and while it is enticing to be frugal and get an earlier edition, it is likewise common to purchase the newer edition for the sake of owning a brand new textbook and not having to worry about information that may not have been included in the earlier edition. Therefore, while many students engage in reselling used books, others are sellers of brand new copies, and it is unlikely that either set of students would think to worry about copyright infringement when they act as resellers. But should they?

Section 106 of the Copyright Act lays out the exclusive rights of the copyright owner and her ability to authorize the reproduction of the copyrighted work in copies or phonorecords, her right to derivative works, and among other rights, the right "to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease or lending." See 17 U.S.C. §106. It therefore follows that any unauthorized public distribution of copies or phonorecords that were unlawfully made will result in an infringement.

Section 109 of the Copyright Act, on the other hand, provides that while the above is true, the copyright owner's exclusive right to distribution is limited, and ceases to exist with respect to the particular copy or phonorecord once he has parted with ownership of it. See 17 U.S.C. §109(a). Section 109, also known as the first sale doctrine, functions as an exception to Section 106(3), in that it substantially limits the right of distribution.

The seminal case in this area, Bobbs-Merrill Company v. Straus, begs mention here. See 210 U.S. 339 (1908). In Bobbs-Merrill, the publisher was engaged in the sale of a copyrighted novel and notified the public that no other may sell the book for a lower price, and doing so would be an infringement. Id. at 341. Defendant R.H. Macy & Co. subsequently purchased the novel in bulk from a wholesaler and began to sell it on their own, and this suit followed. Id. At issue in the case was whether a copyright owner's Section 106(3) "sole right to vend secure to the owner of the copyright the right, after a sale of the book to a purchaser, to restrict future sales of the book..." Id. at 350. The Court's ruling established what came to be known as the "first sale doctrine", finding that copyright law gave the copyright owner the right to restrict others from making their own copies of a work. See id.

However, in doing so, the Court did not also confer upon copyright owners a right to control what happens to the books after the sale is done and over with. Additionally, while the Court held that a copyright owner's right to "multiply and sell" the work on their own terms is protected by the copyright statutes, the statutory right to sell did not simultaneously create a right to limit the resale of said books. See id.

Like many of the students mentioned above, Supap Kirtsaeng, a graduate student and Thai native, resold college textbooks in order to help recoup the cost of his education. The textbooks, however, were manufactured overseas by the Asian subsidiary of the John Wiley & Sons Publishing Company, and as a result, Kirtsaeng was able to resell the books for a higher price on eBay. See Utsav Rai, Supreme Court Hears Case Over Textbook Resale, CORNELL SUN, Nov. 5, 2012, http://www.cornellsun.com/section/news/content/2012/11/02/supreme-court-hears-case-over-textbook-resale. The Publishing Company subsequently sued Kirtsaeng in District Court, arguing that Section 602(a) of the Copyright Act made it unlawful to "import a work without the authority of the owner." Id.; see also 17 U.S.C. §602(a)(2) (providing that such importation into the United States of unauthorized copyright works constitutes an infringement of the exclusive right to distribute copies or phonorecords under Section 106).

In response, Kirtsaeng asserted the first-sale doctrine codified in Section 109(a) of the Copyright Act, arguing that a legally purchased copyrighted work may be sold without obtaining the copyright owner's permission. The district court as well as the Second Circuit sided with the Publishing Company, in that Section 602(a) provides for infringement where importation to the United States consists of copyrighted works acquired outside of the States and without the authority of the copyright owner. According to the courts, it therefore follows that Section 109(a), likewise only applies to works that are made in the United States, thereby causing Kirtsaeng's defense of the first-sale doctrine to fail. Id. The issue in front of the Supreme Court was the meaning of "lawfully made under this title" as stated in Section 109(a). 17 U.S.C.A. § 109(a). If the Publishing Company is correct, then "lawfully made under this title" directly refers to the part of Section 602(a) that reads "in the United States" and then Kirtsaeng's defense truly does fail.

Enter Quality King Distributors Inc. v. L'anza Research International, Inc. In that case, L'anza, a California manufacturer of hair care products sued Quality King Distributors for "importing" its U.S. made products via L'anza's United Kingdom distributor. 523 U.S. 135. The arrangement was quite simple and, just like Kirtsaeng's above, a lucrative one. L'anza, in an effort to widen its business's reach, engaged in sales in foreign markets by establishing strong relationships with distributors who were to sell L'anza products to its local retailers. See id. Quality King, a large New York based reseller of products at discounted prices, arranged for purchase of the L'anza products through the U.K distributor: a plain vanilla, gray market maneuver.

At the trial level, Quality King's first sale defense under Section 109(a) was rejected and the district court claimed that allowing such a defense would swallow up the purpose of Section 602(a), which gave copyright owners the right to prohibit the unauthorized importation of copies. Id. at 136. Just like for Kirtsaeng at the trial level, Quality King's defense failed. When Quality King made its way to the Supreme Court, however, its luck turned around. Id. The Court held that Section 602(a) "merely provides that unauthorized importation is an infringement of an exclusive right," and since 602(a) refers to the distribution right in 106(3), that right is not violated when the importation or resale results from a lawful owner. Id. Moreover, "§602(a)'s literal text is simply inapplicable to both domestic and foreign owners of L'anza's products who decide to import and resell them here." Id. ("After the first sale of a copyrighted item "lawfully made under this title," any subsequent purchaser, whether from a domestic or a foreign reseller, is obviously an "owner" of that item. Read literally, § 109(a) unambiguously states that such an owner "is entitled, without the authority of the copyright owner, to sell" that item.").

The Court ruled for Quality King, and when the Court addressed the question of what "lawfully made under this title" means, the answer flowed smoothly. Section 109(a) states, "[t]he owner of a particular copy or phonorecord lawfully made under this title, or any person authorized by such owner, is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy or phonorecord." Id. The Court interpreted "lawfully made under this title..." to mean "made in the United States." In Quality King, therefore, the first sale defense worked to its advantage.

Kirtsaeng's defense would have been a home run if it weren't for Omega S.A. v. Costco Wholesale Corp. See 541 F.3d 982, 987 (9th Cir. 2008). In Omega's suit against the bulk-buying club Costco, the Ninth Circuit ruled that Section 109(a) was not a defense to the issue at hand. Being careful not to arrive at a ruling that was contra Quality King, it expressly held that Section 109(a) wasn't a defense, but for different reasons. Omega, a watchmaker, made copies of its Omega Globe Design in Switzerland, and Costco thereafter sold the copies without Omega's authority in the United States.

Given these facts, Omega's main argument was that Quality King doesn't apply because unlike L'anza's products in Quality King, Omega's products were designed and manufactured overseas. Section 109(a), therefore, is no defense to Section 602(a) infringement claims, since items made overseas were not "lawfully made under this title . . . " a factor that must be met in order for the 109(a) defense to apply. Id. Quality King, on the other hand, used the Section 109(a) defense, and rightfully so. The Ninth Circuit in Omega described the actions in Quality King as a round-trip importation, specifically, "a product with a U.S.-copyrighted label was manufactured inside the United States, exported to an authorized foreign distributor, sold to unidentified third parties overseas, shipped back into the United States without the copyright owner's permission, and then sold in California by unauthorized retailers." Id.

Therefore, as both the Supreme Court in Quality King and the Ninth Circuit in Omega demonstrated, Quality King was properly decided, and Section 109(a) applied as a defense to Section 602(a). But according to the Ninth Circuit, only because the copies were initially made in the United States, and then exported to the foreign distributor. Whilst here, Omega's copies were originally manufactured and designed in a foreign market. See id.

Additionally, the court in Omega brought up an argument from Quality King that almost literally speaks to Kirtsaeng's case. The Court opined:

Therefore, if Quality King, and, in turn, the Omega rulings, are consistent, it should also follow that Kirtsaeng's defense fails. The court in Omega brings up several points that are definitely worth mentioning. First, if Section 109(a) were to equally apply to works manufactured inside and outside of the United States, then United States Copyright law would be extending itself extraterritorially. Id. at 987. Needless to say, countries other than the United States are well equipped to protect their own copyrights without having to subject themselves to U.S. law. Another key point is that Section 602(a) would be rendered meaningless "as a tool against the unauthorized importation of non-piratical copies because importation is almost always preceded by at least one lawful foreign sale that will have exhausted the distribution right on which § 602(a) is premised." Id. at 986.

At oral argument, Kirtsaeng's attorney brought up some important points in front of the Court. See James G. Ryan, Copyright Issues in Textbook Case, Nov. 19, 2012, http://www.jdsupra.com/legalnews/copyright-issues-in-textbook-case-26428. He argued that secondary markets, such as eBay, Craigslist, and the typical garage sale, all of which thrive off of the resale business, would all be forced to shut down if individuals were not permitted to resell works in the United States which they have brought in from other parts of the world. Id. Additionally, during the same oral argument, Justice Stephen Breyer brought up some important hypothetical situations. He asked, "[d]oes that mean that consumers violate copyright law when they resell their cars?" Id.

Naturally, we want to encourage the resale of products that have already been entered into the marketplace by the copyright owner. While the copyright owner has the "right to vend", this exclusive right is limited to the first sale of the copyrighted work. Quality King, 523 U.S. at 135 (see also Bobbs-Merrill Co., 210 U.S. 339). Indeed, eBay wouldn't be eBay without the gray market and without consumers endlessly turning to the gray market for all sorts of goods. According to a 2009 Deloitte LLP analysis conducted by Bloomberg, approximately $63 billion in sales resulted from goods that were entered into the gray market. Greg Stroh, Discounted 'Gray Market' Goods Draw Top U.S. Court Review, BLOOMBERG, Apr. 16, 2012, http://www.bloomberg.com/news/2012-04-16/discounted-gray-market-goods-draw-top-u-s-court. This in turn, represents a multi-billion dollar benefit to American consumers, a benefit which the Retail Industry Leaders Association highlighted in their brief, urging the Court to take on Kirtsaeng's case. The Retail Industry Leaders Associations is comprised, among others, of Wal-Mart, Target Corp, Costco Wholesale Corp, and EBAY, Inc. Id.

Kirtsaeng is effectively asking the Court to turn a blind eye on the source of manufacture, an important consideration for deciding issues such as these. Without this consideration, the logical conclusion is easy: as long as the goods were, at some point, purchased legitimately from the copyright owner, the rest is history. The first sale doctrine and the language of 109(a), "lawfully made under this title . . . " would wholeheartedly apply to goods that were purchased (and made) inside or outside of the United States; in effect, cancelling out Section 602 by using 109(a) as the ultimate defense. 17 U.S.C.A. § 109.

This case deserves a close watch, as its result will surely take a toll on eBayers and their equivalents everywhere. And as the next textbook season rolls around, students needing money for textbooks may find themselves filling out employment applications at the local Starbucks.

Margarita Golden is a third-year law student at the Benjamin N. Cardozo School of Law, with concentrations in both Intellectual Property and Litigation. In addition to being an Associate Editor of the Cardozo Arts and Entertainment Journal, she is currently a legal intern for the Business and Legal Affairs Department at Sony Music, and summered at the St. Petersburg office Hannes Snellman.