Wednesday, March 18, 2009

Professor Post in the New York Times

Our own Deborah W. Post, Professor of Law and the Interim Associate Dean for Academic Affairs, co-author of the book “Contracting Law,” and co-president of the Society of American Law Teachers, was published in the New York Times online op-ed section regarding the bonuses being paid to AIG employees.

As any lawyer knows, there are few things more common — or easier — than finding legal arguments that call into question the meaning and validity of contracts. Every day, America’s commercial courts are filled with litigations between parties to seemingly clear-cut agreements. Particularly in circumstances as extreme as those prevailing at A.I.G., there are arguments and legal strategies that any lawyer would immediately recognize that bestow A.I.G. with leverage either to be able to avoid these dubious payments or, at the very least, force substantial concessions.

There are almost certainly viable claims that the contracts were induced via fraud or that the bonus-demanding executives themselves violated their contractual obligations. Separately, there must be substantial counterclaims that A.I.G. could assert against any executives suing to obtain these bonuses, a threat which, by itself, provides substantial leverage to compel meaningful concessions. Many of these executives were, after all, the very ones responsible for the cataclysmic losses. The only reason for a company like A.I.G. to throw up its hands from the start and announce that there is simply nothing to be done is that it is eager to make these payments.

To read the rest of Professor Post's piece, go here.


lucas lae center said...

Congrats! NY Times, wow!


Anonymous said...

Prof. Post, We are proud of you! Bo Chen