1. ELEMENTS B1 & B2 POWER POINT SLIDES
Class #26 Wednesday, October 26, 2016 Thursday, October 27, 2016

2. More Music to Accompany Rose: Sting, Dream of the Blue Turtles (1985) (Imaginary)
WORLD SERIES QUIZ
What MLB team has won its last nine World Series games?
What hall-of-fame outfielder ended a World Series by getting thrown out trying to steal second base?

3. WORLD SERIES QUIZ
What MLB team has won its last nine World Series games?
1975 game Sweeps in 1976 & 1990
What hall-of-fame OF ended a World Series getting thrown out trying to steal 2d base?
Babe Ruth (1926 World Series)

4. EXAM Q1 (CUSTOM): REVIEW PROBLEM 2B Does Custom Apply to Ads in Q (i) Cane-Ade KG Ad (Oxygen) & (ii) BB Online Ad (Krypton) Easy Qs/Hard Qs (Degree of Difficulty)

5. EXAM Q1 (CUSTOM): REVIEW PROBLEM 2B (i) & (ii)
Custom in Question (Sample Breakdown)
In the U.S. advertising and broadcasting industries
ads for ordinary commercial products and services
can’t
closely imitate; or
use major components of
ads for charitable organizations.
Apply to problem like a legal standard.

6. EXAM Q1 (CUSTOM): REVIEW PROBLEM 2B (i) & (ii)
MERE Ad in Q
MERE is charitable organization that arranges to build extra rooms onto the houses of families who are taking care of multiple foster children.
In MERE’s TV and internet, L-Bow stands in front of a house before renovations and does the EG.
At the sound when his arms come together, the camera jumps to a view of L-Bow playing with smiling children in front of the renovated house.

7. EXAM Q1 (CUSTOM): REVIEW PROBLEM 2B (i) & (ii)
Custom in Q: Apply Like Legal Standard
In the U.S. advertising and broadcasting industries
ads for ordinary commercial products and services
can’t
closely imitate; or
use major components of
ads for charitable organizations. YES. (Easy Q!)

8. REV. PROB. 2B (i): Cane-Ade Ad (OXYGEN)
Cane-Ade’s Kerry Grinder (KG) Ad
KG in college game “complet[ed] a spectacular dunk shot that included a complete 360 degree turn in the air and then doing the EG as she landed.”
KG signed a multi-million dollar contract to become a spokesperson for popular sports drink Cane-Ade.
Cane-Ade ran TV ads that included footage of KG’s famous dunk including the EG.
Networks disagree as to whether it violates custom. [Strong hint that I expect two-sided discussion.]

9. REV. PROB. 2B (i): Cane-Ade Ad Oxygen: Easy Qs/Hard Qs?
Custom in Q: Apply Like Legal Standard
In the U.S. advertising and broadcasting industries
ads for ordinary commercial products and services
can’t
closely imitate; or
use major components of
ads for charitable organizations. YES. (Easy Q!)

10. REV. PROB. 2B (i): Cane-Ade Ad Oxygen: Easy Qs/Hard Qs?
Custom in Q: Apply Like Legal Standard
In U.S. advertising/broadcast industries. YES. (Easy Q!)
Ad for ordinary commercial product. YES. (Easy Q!)
“All the health benefits of Gator-Ade, but it Tastes Good!”
can’t
Closely imitate: Maybe need more info?
Use major components of: Harder Q: Discuss
Ads for charitable organizations. YES. (Easy Q!)

11. REV. PROB. 2B (i): Cane-Ade Ad Oxygen: Policy as Tie-Breaker?
Custom in Q: Apply Like Legal Standard
Can’t
Closely imitate: Maybe need more info?
Use major components of: Harder Q: Discuss
If unsure, can look to purpose of custom:
“Many people in the industry believe that it is unethical when for-profit companies take advantage of the efforts of charities, especially if their ads might suggest to consumers that they are part of the charitable enterprise.
Does Cane-Ade Ad Do This?

12. REV. PROB. 2B (ii): BB Online KRYPTON
Note: 2 Ads in Same Q  Different Analysis
Online Footage of BB Doing the EG
BB developed a diet and exercise program. After using his own program for several years, BB succeeded in doing the EG.
BB began marketing his program for profit on the internet to allow more people to do the EG.
To demonstrate that the program worked, website provided footage of BB doing the EG himself.

13. REV. PROB. 2B (ii): BB Online Krypton: Easy Qs/Hard Qs?
Custom in Q: Apply Like Legal Standard
In the U.S. advertising and broadcasting industries
ads for ordinary commercial products and services
can’t
closely imitate; or
Use major components of (Already Done Discussion of EG as Major Component; Cross-Reference)
ads for charitable organizations. YES. (Easy Q!)

14. REV. PROB. 2B (ii): BB Online Krypton: Easy Qs/Hard Qs?
Custom in Q: Apply Like Legal Standard
In U.S. advertising and broadcast industries (Interesting Q: Discuss)
ad for ordinary comm’l services. YES. (Easy Q! Lots of Workout Programs on Internet)
can’t
closely imitate (Interesting Q: Discuss)

15. REV. PROB. 2B (ii): BB Online Krypton: Easy Qs/Hard Qs?
Custom in Q: Apply Like Legal Standard
In U.S. advertising/broadcast industries (Interesting Q)
Can’t closely imitate (Interesting Q)
If unsure, can look to purpose of custom:
“Many people in the industry believe that it is unethical when for-profit companies take advantage of the efforts of charities, especially if their ads might suggest to consumers that they are part of the charitable enterprise.
Does BB Ad Do This?
Matter that EG Closely Tied to Product Itself?

16. EXAM Q1 (CUSTOM): Should Custom be Treated as Law: Relevant Analysis
Swift Factors:
Affect Outsiders
Used by Whole Industry for Long Time
Easier to Use than Existing Legal Rules (Certainty)
Reasonableness
Ghen: Necessary for Industry to Operate
Could do as separate factor
Could do as part of Reasonableness analysis
NOTE: Can’t be REQUIRED b/c not true in Swift (other regions had different customs)

17. EXAM Q1 (CUSTOM): Should Custom be Treated as Law: Relevant Analysis
Swift Factors:
Affect Outsiders
Used by Whole Industry for Long Time
Easier to Use than Existing Legal Rules (Certainty)
Reasonableness
Ghen: Necessary for Industry to Operate
Could do as separate factor
Could do as part of Reasonableness analysis
FRIDAY: We’ll do for Review Problem 2C & EG Ad

18. DEMSETZ FIRST THESIS (Recap) Refresh: We’ll Use on All Unit III Cases
Identify decision/activity at issue
Identify old rule
Identify neg. externalities under old rule
Identify change in circumstances
Does change increase neg. externalities?
If cost of externalities > cost of change  change in rule

19. DEMSETZ FIRST THESIS & DQ2.18 Development of Ghen Custom (Uranium)
Activity = Collecting Whales from Beach
Old Rule = Finder’s Keepers
Ext. = Sometimes whaler lost whale he killed (= investment)  might mean less whaling
Identify change in circumstances?
Does change increase neg. externalities?
If cost of externalities > cost of change  change in rule

20. DEMSETZ FIRST THESIS & DQ2.18 Development of Ghen Custom (Uranium)
Activity = Collecting Whales from Beach
Old Rule + Finder’s Keepers
Ext. = Sometimes whaler lost whale & investment
Change: Killing Finbacks w Marked Bomb-Lances (from causes we’ve discussed + marking to limit disputes)
Does change increase neg. externalities?
If cost of externalities > cost of change  change in rule

21. DEMSETZ FIRST THESIS & DQ2.18 Development of Ghen Custom (Uranium)
Activity = Collecting Whales from Beach
Old Rule = Finder’s Keepers
Ext. = Sometimes whaler lost whale he killed
Change: Killing Finbacks w Marked Bomb-Lances
Ext.  Industry arises/more whales & $$$
Cost of externalities > cost of change  change in rule? (Describe)

22. DEMSETZ FIRST THESIS & DQ2.18 Development of Ghen Custom (Uranium)
Activity = Collecting Whales from Beach
Old Rule = Finder’s Keepers
Ext. = Sometimes whaler lost whale he killed
Change: Killing Finbacks w Bomb-Lances
Ext.  Industry arises/more whales & $$$
Higher Externalities > Social Inertia  Custom Develops

23. DEMSETZ FIRST THESIS & DQ2.18 Development of Ghen Custom (Uranium)
Ext.  Industry arises/more whales & $$$
High Externalities > Social Inertia  Custom Develops
NOTE: If some folks on shore don’t follow custom (as in Ghen), externalities remain high, so pressure for further change should lead to litigation or legislation and (perhaps) adoption of custom as law.
QUESTIONS?

24. Closing Up Whaling Cases
Whaling Cases on property rights & custom = “Animals Cases” for purposes of exam
Treat salvage as alternative, not part of ACs
Useful exercise: Apply Whaling cases & Rose to wolverine problem.
Might do charts of Whaling cases mapping, e.g., Labor; Marking; Applicability of Custom (fact Q); Decision to Treat Custom as Law (legal Q)
QUESTIONS?

25. Rose Article & DQ2.20 (Radium)
Cf. RANE (~1981)

26. Possession as the Origin of Property
Rose Article (1985)
Possession as the Origin of Property
Recall idea of theory as a way to determine what kinds of facts are relevant to addressing particular problems.

27. Rose Article (1985) 2 principles tying “Possession” to ownership
Reward useful labor
Provide “Clear Act” giving notice of ownership.
Substantial overlap between the two
Right kind of labor can constitute the “Clear Act”
Sending clear signals itself is useful labor we might wish to reward

28. Rose Article & DQ 2.20 (Radium): Rewarding Useful Labor
Benefits of Rewarding Labor Clear:
Want people to do useful labor so reward them
Labor-“Desert” Theory = Deserving
Cf. Labor-“Dessert” Theory: “If you clean your room, you can have some cake.”
What (two) problems does Rose see with labor theory?

29. Rose Article & DQ 2.20 (Radium): Rewarding Useful Labor
Problems with Labor Theory?
Not clear why you own your own labor
e.g., could be duty owed to community (like universal military/gov’t service)
How much labor must you add to a thing to make the thing yours?
Pouring tomato soup into ocean
Broader Version: What is scope of right that labor creates?

30. Rose Article & DQ 2.20 (Radium): “Clear Act”
Benefits flowing from “Clear Act”
Gives notice to people who want to use or purchase property. (Similar idea in Demsetz)
Facilitates trade  highest (most valued) uses
Minimizes conflicts

31. Rose Article & DQ2.20 (Radium): “Clear Act”
Benefits flowing from “Clear Act”
Gives notice to people who want to use or purchase property. (similar idea in Demsetz).
Note relationship to language in Pierson & Shaw:
Intent to retain animal insufficient
Need act demonstrating that intent

32. Rose Article & DQ 2.20 (Radium): “Clear Act”
Possible problems arising from attempt to provide the “Clear Act”?

33. Rose Article & DQ 2.20 (Radium): “Clear Act”
Possible problems arising from attempt to provide the “clear act”?
Making clear to people who actually use or might want to use the thing in Q.
Making clear at relevant time.
Expensive to establish/maintain symbols.
Difficulty Marking Some Types of Property

34. Rose Article & DQ 2.20 (Radium): “Clear Act”
Expensive to establish/maintain symbols
Registration system is often useful alternative to consider for XQ2, but often expensive
By contrast, first possession systems often relatively cheap to administer

35. Rose Article & DQ 2.20 (Radium): “Clear Act”
“Relevant Audience”
Clear act never clear to everybody; needs to be clear to people who need to know (= rel. aud.)
Clarity of act can be dependent on …
culture (aliens buying sunshine)
technology (marks embedded in computer programs)

36. Rose Article & DQ 2.20 (Radium): “Clear Act”
“Relevant Audience”
Rose: In our system, acts showing property in land often depend on not conforming to nature
See Adverse Possession.
Relevant audience of Americans working with land recognizes as signs of possession, e.g., cultivation, improvements, enclosure
QUESTIONS?

37. Rose Article & Intro to DQ 2.21: Characterize Cases in Rose’s Terms
Westmoreland choosing 1st Possession rules for wild animals instead of rules for solid minerals.
Relationship to “Clear Act”
For claims to coal/metals, ownership of surface = Clear Act
For Minerals fn (oil, gas, water):
Ownership of surface not Clear Act re claims of adjoining surface owners
Extracting = Clear Act to anyone.
Relationship to “Rewarding Useful Labor”: Extracting and containing oil & gas on surface = Useful Labor worth rewarding.

38. Rose Article & DQ 2.21 (Radium): Characterize Cases in Rose’s Terms
Next Class, Radii be ready to do for:
Shaw rejecting perfect net rule
Mullett broadly defining Natural Liberty
Albers limiting Mullett rule
Swift & Ghen adopting respective customs

39. Argument By Analogy Oil & Gas: 1st Possession
Are Pierson/Liesner/Shaw Good Tools for Determining 1st Possession of Oil & Gas?
Intro then Three Common Approaches
Significance of Factual Similarities & Differences (DQ2.23 = OXYGEN)
Usefulness of Doctrine (DQ2.24 = OXYGEN)
Usefulness of Alternatives (DQ2.25 = KRYPTON)

40. Oil & Gas: 1st Possession
DQ2.22: Someone Remind Us:
Under Westmoreland, if a pool of gas lies under two adjacent parcels of land and the owner of one parcel drills a well, how much of the joint pool is he entitled to take through his well?
How is this result related to the court’s description of gas as a mineral ferae naturae?

41. Oil & Gas: 1st Possession
DQ2.22: Cf. Hammonds p.96
“[O]il and gas are not the property of any one until reduced to actual possession by extraction, although by virtue of his proprietorship, the owner of the surface, or his grantee …, has the exclusive right of seeking to acquire and of appropriating the oil and gas directly beneath. This theory of ownership or, perhaps more accurately speaking, lack of ownership is practically universally recognized. ...”

42. Argument By Analogy Oil & Gas: 1st Possession (OXYGEN)
DQ2.23. Arguments re Usefulness of Pierson/Liesner/Shaw
from Factual Similarities
between
Hunting Wild Animals Generally &
Extraction of Oil & Gas

43. Argument By Analogy Oil & Gas: 1st Possession (OXYGEN)
DQ2.23. Arguments from Factual Similarities re Usefulness of Pierson/Liesner/Shaw
Could Try, e.g., :
Mobility Across Property Lines
Labor Necessary to Capture

44. Argument By Analogy Oil & Gas: 1st Possession (OXYGEN)
DQ2.23. Arguments re Lack of Usefulness of Pierson/Liesner/Shaw
from Factual Differences
between
Hunting Wild Animals Generally &
Extraction of Oil & Gas

45. Argument By Analogy Oil & Gas: 1st Possession (OXYGEN)
DQ2.23. Arguments from Factual Differences re [Lack of] Usefulness of Pierson/Liesner/Shaw
Could Try, e.g.,
Mineral Movement More Predictable
Value of Oil/Gas Generally Higher