Note

Making a Statement About Private Securities Litigation

In June 2011, the Supreme Court decided its latest case concerning the right of investors to sue for securities fraud under Rule 10b–5. The case, Janus Capital Group v. First Derivative Traders, completes a trio of cases beginning in 1994 which severely limit the scope of this private cause of action. In a 5-4 decision, the Supreme Court in Janus determined that only the entity with “ultimate authority” over a given statement can be its “maker” for purposes of Rule 10b–5. As a result, investors in mutual funds and arguably other securities are left with little remedy for fraud, a consequence that has drawn significant criticism to this decision.

Responding to such criticism, this Note examines the merits of the approaches taken in the majority and dissenting opinions, and argues that the case was decided correctly under an accurate construction of current securities laws. Next, this Note predicts that the Court’s ruling will be applied broadly, drastically limiting liability for corporate officers and management under Rule 10b–5.

Finally, this Note addresses potential measures of rectifying what is currently a lack of remedy for investors in securities. It then concludes by advocating that Congress expand the authority of the Securities and Exchange Commission to compensate defrauded investors for their losses.

Free Speech, Hate Speech, and the Hostile Speech Environment

Invoking 42 U.S.C. § 1983 to protect free speech rights, this Note proposes a new cause of action: the hostile speech environment claim. This claim is necessary to combat the continuing infringement of hate speakers’ First Amendment rights by public colleges and universities. After Part I reviews relevant case law to prove that hate speech is afforded First Amendment protection, Part II examines how and why public colleges and universities persist in regulating constitutionally protected hate speech. Part III explains and justifies the proposed hostile speech environment cause of action. Refuting the argument that hostile work environment law can support an analogous “hostile academic environment” claim against campus hate speakers, this Note draws the opposite inference: more protection of hate speech is needed if public universities are to abide by the First Amendment. Thus, this Note borrows from Title VII employment discrimination law to sketch the hostile speech environment claim. It consists of three elements: (1) severe or pervasive hostility (2) by the government (3) towards protected speech. Two strands of First Amendment law provide the claim’s constitutional foundation: the freedom of thought that inheres in the freedom of speech and the captive audience doctrine. Notably, nothing in its analytical mechanics restricts this new cause of action to higher education, which may lead some to argue that it opens the possibility for waves of First Amendment litigation against government speech and policy. Any such fear is illusory, however. The cause of action’s “severe or pervasive hostility” prong and the practical realities of other contexts—such as secondary education and the government workplace—make it unlikely that hostile speech environment claims could apply to other arenas.


Closing the Accountability Gap for Indian Tribes

The recognition of the right of Indian tribes to self-determination in federal and international law generates strong protections for tribal autonomy, allowing tribes to exercise extensive governmental powers. But federal and international law also combine to create an accountability gap for tribal human rights violations—that is, a space in which victims lack access to a remedy and tribes are able to act with impunity. Just as U.S. states and municipalities can use their governmental powers to both protect and violate human rights, so too can tribes. But when a tribe fails to provide a remedy for its violation, a victim may be unable to access a remedy under federal law due to federal deference to tribal sovereignty. A victim has no recourse directly against the tribe under international law, and tribal self-determination limits the ability of a victim to bring a complaint against the U.S under international law. 

This Note proposes filling the accountability gap by recognizing that the right of Indian tribes to self-determination under international law contains a duty to respect, protect, and fulfill human rights. Rather than looking to the United States to provide recourse, which would infringe on tribal self-determination, this proposal recognizes that when a tribe violates a human right, the tribe is breaching international law and owes the victim a remedy. This Note argues that recognition of such a duty would benefit tribes by legitimizing tribal self-determination and governance and closes by discussing how the duty would be implemented in practice.

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