Note

Patent Claim Construction

In 1998, the Federal Circuit decided Cybor Corp. v. FAS Technologies, holding that patent claim construction was a purely legal issue subject to de novo appellate review. This highly controversial decision has since become the focus of intense scrutiny and empirical studies exposing the problematic nature of de novo review. In November 2006, the Federal Circuit issued a divided opinion indicating its most significant movement towards reconsidering Cybor, prompting some observers to forecast the impending demise of de novo review.

This Note introduces Chevron deference as the proper standard of review for patent claim construction. A default rule adopting the narrowest reasonable claim interpretation would serve as a valuable information-forcing adjunct. Together, these rules would simultaneously address the inefficiency, indeterminacy, and information costs that currently plague the patent system. Ultimately, this proposal would achieve sweeping, multi-institutional patent reform from both ex ante and ex post perspectives.

State Redistricting Law: Stephenson v. Bartlett and Judicial Promotion of Electoral Competition

This Note attempts to answer the question, “What can state courts do to solve problems in the legislative redistricting process?” To answer this question, the Note examines one recent case from the North Carolina Supreme Court, Stephenson v. Bartlett. At the time the suit was filed, the North Carolina redistricting process was already subject to many state and federal constitutional restraints, as well as the federal statutory restraints of the Voting Rights Act. Relying on a dubious interpretation of the state constitution’s equal protection clause and an elevation of “traditional redistricting principles” to the level of a constitutional mandate, the North Carolina Supreme Court took the opportunity to create even more restraints on legislative redistricting process. Whitaker examines possible justifications for the opinion, and after rejecting textualist, purposivist and partisan political explanations, explains the opinion as an attempt by the judiciary to increase electoral competition by reducing the discretion of the state legislature over redistricting.

Toward a Controlling Shareholder Safe Harbor

This Note surveys the law governing transactions between public corporations and their controlling shareholders. It explains that Delaware courts review these “controlling shareholder transactions” under the “entire fairness” standard. Yet, Delaware and the Model Act provide safe harbors to review independently approved transactions between corporations and their directors under the business judgment rule. This Note questions the disparate treatment and suggests that the same constraints on interested directors—namely, disinterested approval and market checks—are at least as effective in supervising controlling shareholders.

Next, this Note proposes that a safe harbor doctrine extend to controlling shareholder transactions. The premise is that, so long as the interests of controlling and minority shareholders are aligned, independent approval and market checks together provide sufficient constraints that challenge the utility of the current entire fairness rule. Yet, because these constraints fail when shareholder interests diverge in the so-called “final period,” this Note suggests that controlling shareholder transactions be separated into (1) final period and (2) non-final period categories. Business judgment is appropriate when shareholder interests are aligned, but entire fairness is necessary in the final period to protect the minority from the controlling shareholder’s self interest.

This argument relies on two principal Delaware cases: Puma v. Marriott (1971) and Kahn v. Lynch Communications (1994). It suggests that Lynch implicitly recognized the final period problem, while Puma declined judicial review because the aggregate interests of shareholders were aligned. Thus, read together, they are seen as wholly consistent with the theory underlying a controlling shareholder safe harbor.

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