CRITICAL FAILURE TO HAWK, HAGGLE AND DICKER CAUSED ECONOMIC CRASH: REPORT

YOUR ECONOMY TODAY

In a groundbreaking report issued yesterday, the Federal Trade Commission conclusively revealed the reasons behind America's persistent economic woes.

"Basically, sellers are not hawking, peddling, pushing, scalping and mongering enough," explained Commissioner Jon Leibowitz.

"But sellers aren't the only ones to blame," he continued. "Buyers, too, have critically failed to haggle, bargain, dicker and lay out cash. Combined, these selling and buying behaviors led to today's catastrophic economic climate."

Economic experts expressed shock over the report. "For several years now, we thought that the Great Recession resulted from risky loans, rising debt levels and an imploding housing market. Now, however, we see the real reasons for our hard times: A colossal failure to hawk, hock and dicker," wrote eminent economist Paul Krugman. "This is really mind-blowing news."

Commissioner Leibowitz pointed out that economic recovery will not happen until people understand why the economy failed in the first place.

"People need to see that we face a multifaceted problem. We are not just talking about mongering and haggling. True, we need car salesmen to monger more and first-time homebuyers to dicker more. But just a little mongering won't cut it. We need full-scale mongering and hawking, as well as nonstop dickering to get moving in the right direction. Americans need to start driving bargains again; and that means that sellers need to start stepping up their hawking game, too."

President Obama praised the Commissioner's report. "I'm glad we have a sense about where we need to go with our economy," he said. "For all this time, we've been quarreling about stimulus, job creation and spending limits. But now we see that what we really need to do is get people dickering again. I'm confident that Americans will be able to put country before party and really start mongering, pushing, scalping and laying out cash. This is America. We have a long history of haggling, bargaining, hawking and peddling. We have been doing these things since our earliest colonial history. We know how to hawk and haggle. We even know how to hock and pawn. This is the greatest country in the world because we have the greatest peddlers and dickerers. It's time to find our stride again."

According to the Commissioner's report, economic progress depends on more than increased mongering, haggling, bargaining and hawking. Instead, other factors will play a role, namely, behaviors within the financial services industry.

In analyzing the Recession's causes, the report also noted that reduced mongering, haggling, bargaining, hawking, pushing and scalping were matched by rampantly negative bank practices, including chicanery, hoodwinking, bamboozling, hornswoggling, rooking and wheedling. The report also observed that banks repeatedly pulled contractual wool over customers' eyes between 2004 and the market collapse in 2008.

"Put simply, our financial crisis involved unprecedented hornswoggling," Mr. Leibowitz explained. "While our free market economy has always provided ample room for hoodwinking and bamboozling, banking practices between 2004 and 2008 saw a meteoric increase in hornswoggling and wheedling. Combined with lower levels of consumer dickering, haggling and mongering, this created a perfect economic storm. We just couldn't handle it."

Despite the gloomy analysis, Mr. Leibowitz expressed hope for the future. "Understanding a crisis is necessary to solving it. Since 2009, the Federal Government has taken steps to eradicate rooking in the financial industry, and data show that wheedling has fallen dramatically. The Commission has also set up a special department to decisively root out hornswoggling. Once we eliminate that, we are confident that consumers will return to robust dickering and mongering levels."

Treasury Secretary Timothy Geithner concurred with the Commission's findings on the financial industry. "As a former Wall Street banker, I know that hornswoggling was the straw the broke the camel's back in 2008. When we eliminate it, I am certain that the banking industry will return to customary--and acceptable--hoodwinking and bamboozling practices."

Republicans disagreed with the Commission's analysis, claiming that hornswoggling is absolutely vital to job creation.

"I come from a background in business, and I can tell you that uninhibited hornswoggling is what made us strong," said Republican presidential candidate Mitt Romney. "You can't run a business or make money if you tie a manager's hands behind his back. In business, you need the freedom to hoodwink, rook, bamboozle, and most of all hornswoggle in order to deliver the highest quality goods and services. And if a business doesn’t make money, it can't create jobs."

Congresswoman Michelle Bachmann objected to the report on liberty grounds. "We're a nation of liberty and laws, and you can't take away liberty from people," she explained. "People in business need more liberty than most, because they're job creators. And to be a job creator, you need all the liberty you can get. That includes the liberty to hornswoggle, hoodwink, rook and bamboozle. When government starts taking away those liberties, it's trampling our free enterprise spirit. The bottom line is that hornswoggling creates jobs and pays a lot of salaries. And it's flat-out tyranny when the Federal government says it's going to take it away."

Texas Governor Rick Perry disagreed with the Commission's findings in less abstract terms. "Look, I don't believe a word that comes from any Federal agency, least of all a Federal agency controlled by President Obama. It was President Obama who made the economy bad, and it's President Obama who has to pay for it. Simple as that."

Overall, markets responded well to the Commission's report. The DOW rose 1.9% on data indicating a modest rise in dickering, a strong rise in haggling, an encouraging rise in hawking and a remarkable rise in bamboozling.

For their part, consumers expressed hope for the future. "If all it takes for me to me to help the economy is to haggle and dicker a little more, I'm willing to do my part," said freelance handyman Willie Williams of Ozone Park, New York.

HOW TO BE A GOOD PERSON : IN A LANDLORD'S EYES

OESTERHOUDT STRIKES

At some point in our lives, we all wonder whether we are "good people." We live with others. We know how "good people" act. We have an intuitive sense about what makes a person "good." We even hear things about what makes a person "good:" They are friendly, kind, forbearing, compassionate, ethical, honest, caring, loving, trustworthy, gracious, forgiving and generous. "Good people" do not hurt you. They do what they say; and they apologize if they do not. They consider you at the same time they consider themselves. Aristotle and many other philosophers have written tomes about what it takes to be "good." It is an age-old question.

Of course, not everyone can agree on what is "good." You can't know you are a good person until you know what is good in the first place. What is good in one person's eyes may be bad in another. It is easy to lay down absolute standards for goodness. Yet like all ethical dilemmas, only we can say whether we subjectively feel that we have done right. Nonetheless, we can generally all agree that being "good" involves living without intent to injure other people. In that sense, being a "good person" essentially depends on positive motivation. And that positive motivation shines through in good actions toward others. Good people think selflessly; they refuse to hurt others to advance their interests. Bad people do the opposite; they are willing to hurt others to help themselves.

Being a good person is an individual lifestyle. It does not depend on how much money you make or what you do for a living. While it is possible to identify "objective" factors that hint whether a person is "good," true goodness comes from the heart, not from action alone. Enron fraud artists probably donated some money to charity the same year they robbed millions; that donation did not make them good people. No, being good is internal; and good shines through in external action. It is hard to verify. But everyone knows it when they see it.

It is refreshing to know a truly good person because they are rare. In our world, it is hard to be selfless and honorable. There are so many impulsions to discard goodness toward others in order to advance yourself. By the same token, it is hard to be patient. No one wants to wait or understand others' problems. Nor do they want to waste their time on others without reward. After all, people need to fend for themselves. They only have a limited time to get the job done. If they waste their time being nice to others, they might injure their own fortunes. And no one likes to do that. Put simply, we expect most people not to be good; our society frustrates goodness. That is why it is a welcome relief to meet a good person.

There is no formula to being a good person. Yet people throw the term around far more than they should. In many cases, they say someone is "good" solely because they act in a way that enriches them. That misunderstands what it means to be good. A truly good person acts with malice toward no one. The fact that a person acts the way another person wants them to does not make him good. To the contrary, expecting a person to act in a way that is beneficial to you undermines their value as an individual. It "instrumentalizes" them; it makes them pawns in a game you want to win. Just because someone pays you according to a contract does not make them "good." Merely fulfilling an external legal obligation is no shortcut to goodness. A good person holds to his word because it is his word, not because the law threatens him to do so.

Yet many people think that observing external obligations makes you "good." It is easy to make this mistake. After all, complying with the law seems like a "good" thing to do. But the law is indifferent to intention. And intention is the only thing that determines whether a person is good. In that sense, it is possible to seem good by fulfilling every imaginable legal standard. Yet it is also possible to have only bad intentions while complying with the law. You can be a total scoundrel yet do nothing illegal. If a person did not know you, they might say: "Well, he is law-abiding. So he must be a good person." To that extent, fulfilling external obligations can disguise ethical flaws.

I encountered an example to illustrate this easily confused distinction in the New York Post a few days ago. I read an article about some poor web designer who got run over in a Brooklyn street. See N.Y. Post, Horror hit-run in B'klyn, April 19, 2010 at p. 9. The article quoted his landlord. She spoke about his character: "He works. He comes home. He's a very good person (emphasis added)."

What did the landlord know about this guy? How did she know he was a "very good person?" She based her assessment on the fact that he works and comes home. What does that have to do with ethical goodness or pure intention? Nothing. If anything, it reveals that the landlord thinks the web designer was a "good person" solely because he went to his job, came home every night and ostensibly paid the rent. He might have been an utter scoundrel who doublecrossed his friends and broke women's hearts. Yet as far as the landlord was concerned, he was a "good person" because he adhered to his contractual obligations to pay rent. He also was a "good person" because he quietly went to his job and caused no disturbances.

I suppose this is what it takes to be a "good person" in a landlord's eyes. Landlord apply a "formula" for goodness: Have good credit; make an income; cause no trouble; pay your rent; keep your mouth shut; pay next month's rent; pay a late fee after the first. Your intentions do not matter. And "being a good person" means acting exactly the way the landlord wants. In this case, the landlord happened to like the way her tenant behaved because he did what enriched her. She morally approved him because his behavior coincided with her interests. His own ethical qualities did not influence her appraisal. It was "all about her." And that determined whether he was "good."

This gravely misunderstands what it means to be a "good person." A person is not "good" simply because he acts in a way that enriches another. Nor is he "good" simply because he adheres to contractual obligations under law. Rather, goodness is more subtle than that. There is no checklist. Action is not enough. It takes real reflection to see whether someone is good. Getting a rent check in the mail every month does not suffice to prove goodness.

Criminals and scallywags can mail rent checks, too. That does not make them good people.

But who has time to sit down and really think about character in our society? It seems we only care about character when we want to damage a foe with some embarrassing "flaw." And once again, we do that to merely to advance ourselves at their expense. By hurting them, we help ourselves. And hurting others is rarely good.

FAIR LABOR CONTRACTS? WHAT ARE THOSE?

THE MYTH OF EMPLOYMENT IN AMERICA

PART 3 - CONTRACTS

Commerce would not work without contracts. Contracts provide legal assurance that people will adhere to their commitments. Both commerce and the law presume that men do not naturally hold to their word. But no one would take financial risks if they knew their fellow man would not fulfill his promises. So the law supports commerce by forcing men to do what they say. If they don't, they must face dire economic consequences. Men don't like dire economic consequences, so they adjust their behavior to avoid them.

In theory, contracts reflect a perfectly equal bargain between two perfectly equal commercial parties. One party wants something the other has. Each parts with something in order to gain something from the other. It is not gratuitous; it is methodical. One party suffers detriment in the precise proportion that the other obtains benefit. And there are no flaws in the bargaining process: The law presumes that both parties are rational, shrewd, cynical businessmen who know all the risks before committing to do something. Thus, neither can complain when something goes awry: After all, when two rational, equal adults bargain for something, they have a right to delineate who bears the risk if it does not work out.

But does this sound like commercial reality? Certainly not. In most commercial exchanges, parties are not equal. One party inevitably has more money and power than the other. As a result, the stronger party can leverage his strength to foist more risk and burden on the weaker party. After all, the weaker party needs what the stronger party has. So what authority does the weak party have to influence the bargain? He can take it or leave it. If he leaves it, he does not get what he needs. That is commercial reality: A perennial Hobson's choice. The legal myth of "equal exchange between equal bargainers" is a tiny exception to the rule: Unequal, unfair exchange between parties with gross disparities in power.

I always marvel at inconsistencies between legal myths and practical realities. They always reveal a tension between theoretical aspirations and cruel commerce. After all, theory and reality follow different paths. Just because something exists in theory--as it may in legal doctrine--does not mean that it exists in reality. Theory is just an overlay. Theory concerns objective abstractions; as long as a situation exhibits a few technical requirements, it is "so." But practice is more fluid. It does not restrict itself to formulae or aspirations. In practice, the only inquiry is: "Does it work?" If it works in accordance with principle, fine. If not, no big deal.

In most cases, people just want things to work. That is certainly true in commerce. It is one thing to strike a technically enforceable contract. It is quite another to strike a just one. After all, practical realities reflect existing power structures. Things "work" when they please those who have power. Contracts are usually unfair because they work best when they are unfair. The strong offer terms to the weak in a manner that satisfies legal requirements. As a practical matter, they maintain the unequal relationship. The law has nothing to say about that. And that suits the strong just fine.

On some level, everyone knows this. Everyone suspects that contracts somehow "screw them over." They do not exactly know how. They just know that if the other guy does not deliver, they will have no recourse against him. But if you do something wrong--or if something unforeseeable happens--he will have recourse against you. This is why everyone fears "fine print." It is as if everyone who signs a contract resigns himself to the idea that the bargain is one-sided. They know the "fine print" will work against them when push comes to shove. They just hope it doesn't come to that.

So much for equality in bargaining: Everyone who signs a contract knows that he is subjecting himself to the other's unlimited authority. He doesn't even know how much power he's giving the other guy. He just knows the "fine print" gives the other guy license to do almost anything to him.

I see support for my analysis everywhere. Just yesterday, for instance, I watched a clip from the 1998 movie "Player's Club." In it, Bernie Mac plays a sleazy strip club owner named Dollar Bill. In one scene, his DJ (Jamie Foxx) enters his office to complain about how much money he has to forfeit from his paycheck every week. Bernie Mac looks him straight in the eye and says: "I got a contract between me and you that says you do what I tell you to do. Therefore, shut the fuck up. Don't say nothing, don't speak to me, don't look at me."

That concludes the negotiation. Bernie Mac is the employer with power. Jamie Foxx is the employee without it. The contract symbolizes their unequal relationship. It embodies a fundamental disparity in power. By law, it allows the strong party to tyrannize the weak one; it even allows him to silence the weak one when he complains about the terms. True, the weak party can walk away from the deal. But what if he has mouths to feed? Another Hobson's choice.

These are the practical realities. There is no "equal exchange" between "equal partners" in most commercial relationships. Rather, in most cases, the result is more like the exchange in "Player's Club": One party needs a job and a paycheck; another offers a job and paycheck in return for the power to dictate all the terms and control the employee's conduct. As a practical matter, contracts grant power to one party while subjecting the other to the same power. They generally operate in one direction. And if the weak party complains, the strong party just has to whip out the contract and explain why he has the legal authority to do what he is doing. If there's a dispute, the strong party wins. That's practical reality.

I mention all this because it coincides with my weekly motif concerning employment in the United States. Contracts perpetuate the "Myth of Employment in America" by granting legal authority to strong parties to dominate weak ones. Employment "terms" in America are rarely equal. And they certainly do not reflect full and fair bargaining between two evenly-matched commercial entities. Rather, a weak party needs a paycheck. A strong party offers one; and that gives him the right to dominate the weak party's life in exchange for almost nothing.

According to the law, contracts reflect equality. But practical realities paint a vastly different picture. When it comes to contracts, there is a disparity between law and reality. The real questions are: Who wants what; who's giving it; and who gets to say who does what in exchange for it. Those questions are invitations to tyranny. And when private employers operate under the "profit principle," do you really think they will treat employees in a way that threatens their bottom lines? Certainly not: And that is exactly why contract law allows them to function as they do.

So to all the employees out there who are disgruntled with their lot: "Shut the fuck up, don't say nothing. Don't speak to me, don't look at me."

You signed it. You wanted it (kind of). So live with it.

Go ahead and leave. Think you'll be able to pay your rent if you do? It's your choice.

That's not just practical reality. That's commercial reality, too. It's not a fair game.

CONTRACTS OR CONSCIENCE? AN ETHICAL DILEMMA

AN ESSAY

During my first year in law school, I struggled to learn the endless verbal formulas and doctrines that apparently made the law a flawless machine. I did not have time to reflect on the law's theoretical weaknesses or its cynical role in maintaining power structures in our society. No, I was more worried about learning all the recipe-like elements for particular torts, contract defenses and crimes. I spent my time memorizing lists and hoping I would remember them for the exam.

It was a stressful time for me. It probably did not need to be, but I made it so. It likely had something to do with all the other stressed-out, high-striving, perspiring people around me. Put yourself in a room full of panicked people and chances are you'll soon feel panicked, too.

Despite all the stress and anxiety, however, I remember certain moments with great clarity. Now that several years have passed since law school, I understand these moments in a new way. At the outset I must confess that--in hindsight--I was never really law school material. I might have studied it well; but it was difficult for me--and almost unnatural--to suspend my creative powers for three long years. True, I always retained my satirical mistrust for power. But in law school, I had to suppress my bitter urge to laugh for long enough to get through the rigid curriculum.

I'm glad I managed it then, because there's no way I could have managed it today. I've returned to Nietzsche. I have reverted to my nature. I am--to use a Shakespearean phrase--a "satirical rogue." Yes, an analytical satirical rogue to be sure; but a rogue nonetheless. I have trouble taking anything too seriously, especially so-called "authorities." I have a socially-dangerous ability to see through pretense and to sniff out unfairness. I am not very discreet either. I call spades spades. I don't even whisper. I listen to my conscience and I speak my mind. These are not admirable characteristics for those who wish to make partner at a law firm.

Having returned to my natural habitat over the last few years, I now analyze my law school memories in a way that affirms my identity. Here's a good example: I was sitting in our first-year contracts class. Our professor had stumped everyone. It was some hypothetical problem about some guy who made a promise to another then broke it. The question was whether the aggrieved person could sue the other for breach of contract. The professor asked what legal rule justified recovery in the case. Several uneasy moments passed. About 90 twentysomethings sat there staring at their laptops in an effort not to be noticed.

Finally, I raised my hand and said: "Well, he made a promise and broke it." The professor sneered at my response. I will never forget the look on her face. Then she said: "So what if you break your promise? What does that have to do with anything."

At the time, I did not think too much about the professor's response. I was too worried about memorizing legal recipes. But over time, I have come to see this moment as a perfect illustration for the proposition that law and ethics virtually exclude each other. And I have also come to see this moment as an expression of my own character. It should have alerted me that I was ethically uneasy with the law. After all, in my heart I care whether I tell the truth. If I make a promise, my heart hurts if I break it. Yet my heart does not concern the law. The law deals only in extrinsic indicia, not ethical worries. The law is about empirically observable factors, not the pangs of conscience. When I raised my hand in that class, I showed my nature: At that early time in my law school career, I thought the law and ethics overlapped. I could not have known at the time that they do not.

From an ethical perspective, a promise is a promise. You fulfill it because it is the "right thing to do." You do not hem, haw, qualify, vacillate or renege. You do what you say because it bothers your heart if you do not. If you have a conscience, it hurts to break a promise. Then again, if you are unethical, it does not bother you to break a promise. Your heart does not torture you for the decision. You just move on; you break your word as necessary to suit present circumstances. That may be realpolitik. It may even be legal. But it is not ethical. Ethics is internal; it is about the heart and intuitive feelings. By contrast, law is external; it has nothing to do with the heart. Detective Alonzo, Denzel Washington's unscrupulously corrupt (and successful) character in Training Day (2001), put the distinction best when he told his ethically troubled partner: "It ain't what you know. It's what you can prove."

In ethics, you know. In the law, you prove.

From a legal perspective, there are mere promises and there are contracts. Contrary to popular belief, contracts are not necessarily imposing-looking official documents that you sign. You can assent to a contract without ever seeing a paper. Rather, contracts are legally-enforceable promises, whether written or not. To make a promise legally enforceable, it must meet certain objective elements. A "promise in the wind" might trigger an ethical responsibility to honor it. But unless the promise meets technical legal elements, you cannot go to court to force the other guy to honor his word.

Contracts serve commerce. They support our economic system. They give assurance to business people that others will adhere to their promises. As such, the law only enforces promises that arise in "bargained-for exchange." The law calls this "consideration." In theory, this means that both sides haggle over a deal. Each side benefits and suffers detriment in equal measure. One party parts with money. That is detriment. The other party gains the money. That is benefit. But to get the money, one party must do something. That is detriment. The other party receives something desirable from the activity. That is benefit.

This is what makes a promise enforceable at law: Bargaining. Exchange. Haggling. Negotiation. Dickering. It is commercial. It is not gratuitous. In fact, gifts are not contracts. Quite the contrary: If only one party in a transaction receives benefit without a bargain, there is no contract. A kid can't sue his father if his father simply tells him he'll buy him an Xbox, then he breaks his word.

I mention all this to show that contracts are strictly technical. As such, the heart plays no part in their formation or performance. Put another way, ethics exerts no influence on contracts, even if it exerts influence on individuals who make promises. In fact, sometimes it makes more economic sense to break a contract than to keep performing it. For example, if a farmer promises to sell corn to a wholesaler at $1 a pound for a year, but then the price of corn suddenly rises to $10 a pound, it makes more sense to break the contract than keep performing it at a loss. After all, the law only provides a remedy for the contract price. In this case, the farmer could easily break the promise to sell for $1, pay the wholesaler $1 damages, then sell his corn at $10 a pound for a huge profit.

It might be unethical to break promises, but in circumstances like these, money talks and ethics walks. From the law's perspective, it makes more sense to break a promise than continue performing at a loss. The law actually encourages this unethical result. This demonstrates once again that contracts exist to support our free market economic system, not ethical imperatives.

In our free market economic system, people want to profit from their bargains. If they make a deal, they want their money. Contracts provide them with a weapon to either force compliance with the bargain or force the bad party to pay the expected profit. That is why contracts exist: To ensure that commercial men make their profits. They protect expectations. And contract law is completely indifferent to ethical considerations if they cut against those expectations.

Despite the law's requirements, sometimes ethical considerations wield very strong influence on individual people. And sometimes the imperative to tell the truth is not the only ethical conundrum that intervenes to interrupt a contract.

In the movie, Ray (2004), for example, Ray Charles makes a contract to play several concerts in racially segregated Georgia during the early 1960s. While he leads his band into a concert hall, protestors clamor that he is ethically wrong to support an unjust social custom. At first, Ray says that he has a contract with the promoters to do the show. But then he stops and thinks. Finally, he says: "No, no, they're right. Everybody get back on the bus. We're not doing any more shows at segregated venues." The promoter gets furious and says: "You have a contract to do these shows! I'll sue your black ass for this, Ray, and I'll win!"

Ray had profound ethical qualms about performing a contract that indirectly supported racial segregation. His conscience compelled him to refuse to perform it. But from a legal perspective, the promoter was right: He would win the case against Ray. Contract law cares nothing for ethics; if you make an enforceable contract and you refuse to perform it, it is no excuse to say: "I had an ethical problem with the subject matter." As admirable as that sentiment may be, it would not save you from paying full damages to the other party in a contract case. In this light, contract law once again supports commercial expectations, not ethical imperatives. It even supports commercial expectations when those commercial expectations perpetuate fundamental injustice. As long as there is a bargained-for exchange, the show must go on. Ethics is no excuse.

In hindsight, Ray could have avoided the problem altogether if he had raised his ethical objection prior to making the contract. Ethics can dissuade a person from entering into bargains that implicate ethical problems. But once made, ethics cannot excuse performance.

Still, this is hypertechnical rubbish. Conscience does not always materialize on cue. Sometimes our ethical sensibilities only awake once a contract begins. Perhaps it is not possible to foresee ethical difficulties in a contract until after we strike the deal. Yet the law does not see it that way. Once you make a deal, you are stuck with it, no matter what your conscience says about it. You might be able to shed your obligations by pleading some other, legal, defense. But neither ethics nor conscience is on the list of acceptable legal defenses.

And why should they be? Contracts are about commercial expectations. What does conscience have to do with those? The most successful commercial men easily escape all these issues by adopting a simple tactic: Just don't have a conscience.

Without a conscience, life is easy. You just follow the rules in the contract and go with the flow.

QUICK BREAK

My Mom dropped into town today. I haven't seen her in a month. So I will go see Mom today!

I actually needed a small break anyway to handle a few more administrative things. Whenever I have errands to run, I just can't focus on my writing as much as I'd like.

I have a long list of new issues to discuss, including some troublesome insights about contracts. Aren't contracts wonderful? Sometimes the law favors the morally wrong party in a transaction. You know why? Because the law cares not a fig for morality. In fact, the law serves economic values. And when it comes to social influence, economic values utterly overshadow morality. There's right and wrong: As long as big money isn't at stake. When it is at stake, other rules apply.

I will be back to tackle these questions tomorrow morning. In the meantime, don't forget the archives.

Oesterhoudt

A LAWYER'S VALENTINE (SUBJECT TO APPLICABLE LIMITATIONS CONTAINED THEREIN)

PLAINMAN, SCHNORRING & DRYE, LLP

Attorneys at Law Specializing in Mergers & Acquisitions

"We Help You Combine. Every Time."™

DATE : February 15, 2010

TO: Ms. Gabriella D. Purdy, B.A. (no relevant accolades) ("VALENTINEE")

FROM : Mr. Herbert J. Plainman, Esq., Senior Partner (Top 100, American Lawyer P.P.D. (Profit-Per-Deal List)); Silver Medal Winner, Monopoly Advocates of America, LLC (2008)("VALENTINOR").

RE : Valentine's Day

Ms. Purdy,

Pursuant to applicable law, rules and any provision of the Civil Procedure Law and Rules of the State of New York (NYCPL), please accept this Expression of Valentinary Intent (hereinafter "Valentine") done on or before February 15, 2010, in the City of New York, County of New York, State of New York, Country of the United States of America, from aforementioned attorney Mr. Herbert J. Plainman, Esq. (hereinafter the "Valentinor")(State Bar No. 987125).

ARGUMENT

Now, therefore, comes VALENTINOR, and in recognition of certain amorous feelings, having arisen in aforementioned Valentinor, and subject to all limitations applicable under any relevant law, ethical guideline, handbook, employee manual, offer, contract, pamphlet or written item having direct pertinence hereon, and giving due deference thereto (and disclaiming any intent to violate any such limitations, liability wherefor is hereby expressly disclaimed), Valentinor hereby presents this certain "Valentine" to and for aforementioned Valentinee.

It is expressly and unequivocally understood that Valentinor finds certain bodily and psychical characteristics in aforementioned Valentinee "appealing," both as a matter of taste and as a matter of law. Those characteristics include--but are in no wise limited to--her lips, hips, chest, legs, eyes, face, stomach, voice, charm and fashion choices. According to the Court of Appeals, "appealing" means "objectively pleasant to the satisfaction of any office or officer duly appointed under law to judge pleasantness, be that pleasantness aesthetic, erotic, artistic, intellectual or otherwise bearing upon the human senses." See, e.g., Quaker v. Booty-Licious Bumshakers Dance Hall Ltd., 4 N.Y.3d 165,190 (2005)(Kaye, C.J.).

In view thereof, and in view of Valentinor's express finding (under all relevant State evidence rules) that Valentinee is "appealing," Valentinor hereby concludes that it is both reasonable and prudent to present this Valentine, unless Valentinor in any way concludes that Valentinee is not appealing, either in body or spirit, in his sole and unreviewable discretion. Valentinee's expression of affection for any persons--or animals--other than aforementioned Valentinor shall result in the immediate rescission of this Valentine in toto, with treble damages not to exceed $400,000, U.S. currency, to be assessed against Valentinee as liquidated compensation therefor.

This Valentine serves as a symbol of Valentinary Intent and no more. This Valentine is not a contract. It creates no legal duty or obligation in Valentinor. Valentinor's failure to perform according to this Valentine creates no claim whatsoever in Valentinee. Valentinor is under no obligation whatsoever to show good faith in the performance of this Valentine, nor must Valentinor continue to show affection in any appreciable way beyond a time reasonable for showing affection consistent with office protocols or any other applicable decency standards, including the criminal law. (Valentinee is hereby advised that Failure to Appreciate Your Employer is a crime under New York Law.) But upon acceptance of this Valentine, Valentinee assumes an absolute and nondelegable duty to show Unlimited Affection (hereinafter "UA")--in both mind and body--to Valentinor, in excess of the customary employer-employee affection expected in the course of office service. UA includes, but is not limited to: Making remarks as to Valentinor's good looks; praising Valentinor's masculinity; rubbing Valentinor's body in all places directed by Valentinor; dressing in an appropriately alluring way as directed by Valentinor (subject to Valentinor's rejection and imposing a duty to cure such rejection upon Valentiee); removing aforesaid clothing at any time (and at any place) directed by Valentinor; shaking any body parts in any manner directed by Valentinor (in this context, "shaking" includes erotically oscillating movement both in contact with Valentinor's body and outside Valentinor's body), and delivering various gifts to Valentinor subject to decency and Valetinor's request. Valentinee's failure to perform any of above-mentioned duties under this Valentine shall result in immediate termination, negative reporting to all major credit bureaus and referral to police authorities for disorderly conduct.

Valentinor herewith acknowledges that this Valentine comes one day late. In view of the fact that the Holiday commonly known as "Valentine's Day" fell upon February 14 in this calendar year, and in view of the fact that February 14 fell upon a Sunday in this calendar year, Valentinor hereby submits that it was legally impossible to deliver this certain Valentine on a Legal Workday (see, i.a., 5 U.S.C. § 6103). Legal Impossibility is a defense to any action based in contract. See., e.g., Combs v. Work-It Records, Co., Inc., 84 N.Y.2d 143, 150 (1994). Pursuant to law, Valentinor had no duty to deliver this Valentine to Valentinee on Valentine's Day; and Valentinee hereby waives any cause of action for Valentinor's failure to deliver this Valentine on February 14, 2010, any exception in the common law of the State of New York, the law of the United States or the Constitutions of the United States and the State of New York absolutely notwithstanding.

In the alternative, Valentinor asserts that this Valentine is purely gratuitous and may not be enforced against Valentinor in any way whatsoever. But because Valentinor is Valentinee's employer, Valentinor reserves the right to enforce this Valentine against Valentinee to the full extent of law, morality, decency, justice, right and any other authority deemed controlling hereon, including Valentinor's subjective jealousy and envy.

Valentinee is under no obligation to accept this Valentine. According to law, acceptance is only valid if it is free and voluntary. See, e.g., Morris Carburetor Repair of Queens Boulevard v. Fuggett Supply House, Inc., 1 N.Y.3d 363, 370 (2004). But if Valentinee does not accept this Valentine, Valentinor cannot warrant Valentinee's future employment at this firm, nor can Valentinor warrant Valentinee's future employability or income. Valentinor further promises that he will make best efforts to torpedo Valentinee's career if Valentiee does not freely and voluntarily accept this Valentine without qualification. Valentinor therefore must advise Valentinee to accept this Valentine and all duties appurtenant thereto, it being a relatively small price to pay for incumbent benefits.

Valetinee has no right to bargain for or alter the terms of this Valentine. This Valentine represents the full and final agreement of the parties hereto, any prior or contemporaneous oral declarations thereagainst notwithstanding. It is offered solely on a "take-it-or-leave-it" basis.

CONCLUSION

In view of the foregoing, would you please by my Valentine, subject in all events to controlling legal authorities, limitations and exclusions, unless those authorities be held invalid prior to acceptance?

I have hereby set my hand hereunto, this 15th Day of February, 2010,

__________________________
Mr. Herbert J. Plainman, Esq.

NEIGHBORS ARE RARELY GOOD, AND EVEN MORE RARELY THERE WHEN YOU NEED THEM

OESTERHOUDT STRIKES

I reserve especially harsh criticism for insurance companies. In the past, I have mocked them in satires and rebuked them in essays. I know what insurance companies are all about: Demand money from you, then stubbornly refuse to pay when disaster strikes. Neither cockney-speaking GEICO® geckos nor ditzy discount-dishing Progressive® saleswomen nor confident black men telling me "Allstate's® stand" will ever persuade me that insurance companies are anything other than what I already know: Insatiable, vicious, unsympathetic private profit machines that capitalize on human qualms about the future.

Insurance companies advertise all the time. I use insurance advertising as a thematic backdrop for my criticism. I analyze insurance advertising to show inconsistencies between messages and practices. For example, I have analyzed GEICO®'s vacuous advertising several times to show that commercial actors rarely provide the most essential information to consumers, like information about prices, risks and even services. Rather, they merely create "visual candy" that forges a mental link between the product and the company. This implants a sensory impression in the viewer, which then yields an increased likelihood that he will remember the image when it comes time to buy insurance. This has nothing to do with educating the consumer about advantages and disadvantages between competing products. It is merely a cynical ploy to trigger a mental reflex to buy something in particular circumstances.

But this is what advertising is all about. It is not about education or even information. It is about sensory perception. For commercial actors, the end is always profit. To make a profit in the free market, you need customers. To get customers, you need to convince people to part with their money. To make customers part with their money, you need to make sure they know you have something they need or want. Advertising does that: It merely advises potential customers that a company has something they need or want. It shows it to them in a memorable way. It plays to their senses. Once it makes an impression, it increases the chance that they will spend their money in the right place. And that fulfills the profit goal.

Still, my purpose today is not to analyze sensory mechanics in American advertising. Rather, I am writing today to take a hard look at a particular advertising message on its own terms. In the end, I will reveal its absurdity.

Insurance companies use slogans to reinforce their visual advertising. In addition to leaving a visual impression with consumers, they also leave an audible one. For example, GEICO® not only hammers a visual connection between geckos and car insurance. It also pairs the image with the ever-repeated phrase: "Fifteen minutes could save you fifteen percent or more on car insurance." Allstate® uses the phrase: "You're in good hands." And State Farm® matches its imagery with: "Like a good neighbor, State Farm is there." Sometimes State Farm even sings the slogan to make sure you remember it. Hey, they need to make sure you reflexively think State Farm® when you need some insurance. And people remember tunes a lot better than just spoken words.

"Like a good neighbor, State Farm is there." What a curious slogan. It reflects an incredibly naïve view of human nature. And that's ironic, because State Farm obviously does not hold that view. I know for a fact it doesn't. I have litigated cases involving State Farm, and I can tell you firsthand that they do not treat claimants--or their opponents--as "good neighbors." In fact, they treat them as mortal enemies whom they would rather see die than pay a red cent.

What is a "good neighbor," anyway? Do people really like their neighbors? Do neighbors actively help each other in this society? It sure doesn't seem so to me. In that light, I find it bizarre that State Farm adopted a slogan that equates its insurance service with the service you can expect from a "good neighbor." In my experience, I have generally found that my neighbors could not give a damn about whether I lived, died or prospered. Some have said hello. Some have not. Actually, most did not. Most just went to work, came home, locked their doors, attended to their own shit and went to bed without even looking at me in the hallway.

In fact, most of my relationships with neighbors over the years have been negative. If they knock on my door, it's usually to complain about something I'm doing. They never stop over to check on me or to ask how my life is going. They never volunteer to help me with anything. To the contrary, they just grumble about me and spread gossip if they suspect me doing something "inappropriate."

And they certainly don't make house calls if I'm suffering a crisis. If I have a problem, they'll never know about it. Even if they did, I seriously doubt they would rush in to help me.

And why should they? American law says that we are not our brothers' keepers. If you pass a person dying on the street, you have absolutely no legal obligation to render assistance, even if you're a doctor. That reflects our society's views about "neighbors" much more than any corny State Farm slogan. That is why I find it flat-out laughable for State Farm to equate its insurance service with the "help" you can expect from a "neighbor" in the United States. You might as well say that you won't provide any help at all, because that's how much help you'll receive from your neighbor. In truth, your neighbor is much more likely to complain about you or even report you to the authorities than help you in a pinch.

This is the world we inhabit.

If this is the level of support we can expect from neighbors, what can we expect from State Farm? State Farm says that it will be "there" for you "like a good neighbor." Well, no neighbor has never been "there" to help me with anything, let alone a "good" one. By that standard, I guess that means that State Farm will leave you hanging just the way your neighbors do.

But State Farm has a greater legal obligation to help than some undifferentiated neighbor. After all, if you pay money for a State Farm insurance policy, you enter into a contractual relationship. Contracts mean that two people promise to do things for each other on pain of legal penalty. Contracts create legal duties to act or refrain from acting. Neighbors have no such duties. In that sense, if you buy insurance from State Farm, you are buying something more than a neighbor's obligation. You are enlisting services for a fee. You are engaging in commerce. You are creating a legal relationship. If State Farm acts like a "neighbor" after you hire it as a "servant," it would violate its legal duties to you. Hey, you signed a contract so that State Farm would give you more than a neighbor would give. But that's still not that much, because neighbors have no obligation to give you anything at all.

Of course, State Farm does not want you to think this way. It wants you to think that neighbors help each other when they are in need. In fact, it wants you to accept the fantasy that your neighbors will actually sacrifice themselves to help you for no reward. That is an extremely Christian delusion; and State Farm fully exploits it. After all, Christian doctrine advises us to "love our neighbor as ourselves" and to help those in need without expectation of reward. State Farm taps into that notion to cast itself as a "magnanimous patron," not a profit-hungry private corporation. And State Farm knows that many consumers equate the term "neighbor" with selfless Christianity.

This is cynical exploitation at its worst. While Christ might have helped his undifferentiated neighbor without hope of reward, most neighbors are not Christ-like. In fact, experience tells us the opposite.

State Farm is no exception. During Hurricane Katrina, State Farm acted exactly like the neighbors I know: It refused to help out at all when people really needed help. State Farm wiggled out from paying "hurricane damages" because it said its policies did not cover flooding. In my own experience practicing law, I recall a case in which State Farm refused to pay its own customer's $60,000 medical bill because it disputed the doctor's belief that the injury was "permanent." So it left its "neighbor" holding the bag with a $60,000 bill and a deformed arm--even though the "neighbor" dutifully paid his premium every month. How's that for service?

But that's how neighbors treat each other. So I guess State Farm was just doing as it advertised: It was just acting like a neighbor.

I find it utterly shameless for State Farm to exploit Christian overtones in the word "neighbor" to lull customers into thinking it actually cares about their welfare. No private corporation cares about anything beyond its quarterly profits. That is the law. Corporations owe no duties to anyone except their own shareholders; and shareholders could care less about magnanimity toward non-shareholders. They want money; and they don't really care if they're "nice" about getting it.

Commerce and Christianity just don't mix. State Farm knows that. It simply proceeds on the assumption that consumers are too stupid to understand the same thing.

Then again, most advertising functions on that premise. If people were too smart, it would really hurt business.

HOUSING SPECIALS FOR TOUGH TIMES

REAL ESTATE MINUTE

At Reason, Commerce, Justice and Free Beer, we care about your well being. We understand that in tough economic times like these, even hard-working citizens find it difficult to secure basic necessities. Housing is a particularly difficult issue for many Americans. As employment shrinks, so too does the opportunity to locate affordable housing. For centuries, buying a home was the American dream. And now it is getting more and more difficult to realize that dream.

We understand that it is simply not possible to buy a home anymore. You need a lot of ready money to buy a home. And when you do not have a job, you don't have ready money. With unemployment now hovering around 20% nationwide, new homebuyers are virtually non-existent these days. Renting is the only way to go. In that light, we are pleased to offer our readers special information about rental properties.

We are committed to helping you survive this crisis. We encourage you to keep looking for work even if you've submitted 750 resumes since last fall and no one interviews you. We all need to dig deeper. We all need to cut expenses and save. We need to start hoarding coupons and looking for deals. When money is scarce, we need to adapt. That is why we are happy to provide some inside information about affordable housing deals. After all, you can't look for a job if you're homeless. You can't revise your resume if you live in a garbage can and spend all your time scrounging for discarded restaurant food.

Today, we are proud to associate with brokers from New York City's Manhattan Happy Homes Co., Inc. Like us, Happy Homes is committed to helping you find the home of your dreams--on a budget. Below, Happy Homes lists five excellent deals on New York rental properties. This is an exclusive offer. You--our readers--are getting a special first look at them before Happy Homes opens them to the public.

We are honored that Happy Homes cares about our readers. We sincerely hope that you will find a home today. And good luck on your job search! Keep your chin up. If you are determined, you will get a job, even on the 1000th try. Winners don't give up. From all of us here at Reason, Commerce, Justice and Free Beer, we salute our readers for their determination and resolve as they make their way through the storm.

Best wishes--and happy home hunting.

LISTING #1 - SPACIOUS LOFT!!! UNBELIEVABLE RENT!!! WON'T LAST!!!

You won't get space like this very often in New York! This is a must-see converted loft space for the adventurous tenant. It's a charming prewar building with reliable running water and optional heat. You will LOVE the period windows and high ceilings. Great ventilation and lighting from all sides, including skylights. Space is available for dishwasher, washing machine and dryer. Your friends will love the old-fashioned wall fixtures. Original flooring will blow you away. A little work will help. Wiring and plumbing negotiable. You even get FREE WATER! This is real, gritty New York living at its best. Pet-friendly building! And for $17,500 a month, it's a steal. Call today--it will be gone soon! (Two months' security, plus credit check, bank verification and board approval required for lease signing).

LISTING # 2 - CHARMING STUDIO IN CHELSEA - A BARGAIN HUNTER'S DREAM

Now THIS is a deal! Cozy Chelsea studio in a beautiful modern building complete with functioning elevator and lighting. Great neighborhood near nightlife, schools, transit, bars, buses and grocery stores. AMAZING SQUARE FOOTAGE : Plenty of room for furniture and appliances, too. Simple design with great potential for decoration and entertainment. Electricity included in rent! Pets allowed! A perfect bachelor pad or first apartment for new college grads. Best of all, it's a budget apartment: Only $8600 a month!!! That's right, only $8600 a month!!! You won't get a great price like this ever again to live in such a hot neighborhood. Isn't it time to treat yourself? Come on down and live in one of New York's HOTTEST areas in a HOT apartment--all for a bargain price (Full employment history must be submitted along with application, plus four months' rent and a blood sample. Landlord reserves right to reject African tenants, financial ability notwithstanding).

LISTING # 3 - OH YES - ORGANIC LIVING RIGHT IN CENTRAL PARK

Isn't it about time you went green? Well now you can with this UNBELIEVABLE rental smack dab in Central Park. Great views and lighting at all times. Heating optional (wood is available nearby for fires). Homemade plumbing system and spacious rooms make this apartment a MUST-SEE. Windows are original and charming. Pet friendly! Your dog will LOVE IT HERE! No worries about walk-ups here; it's all on the ground floor. This home is a MUST for culture and nature lovers. Plus you're just a stone's throw from the Guggenheim, 5th Avenue and all the bus lines. If you are committed to the environment AND you're chic, this is the apartment for you. Central Park address... does it get any better than that? And what a deal: It's yours for just $24,940 a month!!! Rent-stabilized!!! Call today. Don't let this one get away. (Tenant must replace all thatch, mud and dirt. Tenant is responsible for digging own privy. No exceptions. Only tenants with verifiable income over $450,000 per year (net) need apply).

LISTING # 4 - EAST VILLAGE - JUST WOW !

Incredible East Village one-bedroom in TOTALLY HAPPENING tenement building near Tompkins Square park. If you want cool, you've come to the right place. All original staircases, windows, fixtures and plumbing. FREE walls and FREE doors. We're talking EAST VILLAGE HIP here, baby. Steps from AWESOME coffee shops, thrift stores and wine bars. Not far from train lines, grocery store and pharmacy. A little work would make this classic New York apartment EVEN BETTER. Perfect for the working professional with demanding standards. Perfect for dinner parties, guests and business meetings. If you're ready to GET ON THE VILLAGE SCENE, look no further. It gets no better than this. And all for a measly $11,500 per month!!! Believe me, you WILL NOT find a rent this low ANYWHERE else in the village. Do it now. Don't lose out. (Subject to board approval. Only applicants with credit scores over 900 will be considered. No unemployed people. No homosexuals unless they agree to pay two years' rent upfront and indemnify landlord against property damage arising from homosexual activity (including unauthorized decorating)).

LISTING # 5 - MIDTOWN STUNNER - AMAZING VIEWS - GRANITE COUNTERTOPS

You will LOVE this cute and CAVERNOUS two-bedroom right off Bryant Park. Steps from 6th Avenue and Times Square. STUNNING all-granite countertops, modern kitchen and bath make this beauty a STEAL. Amazing West views provide great sunlight. Some electrical work needed, but not much. Original, modern flooring with a twist of natural charm. Your friends will LOVE the quaint lighting and brand new appliances. FREE running groundwater. Pets ALLOWED! Stalactites offer INCREDIBLE and UNIQUE decorating opportunities. Take it from us--when it comes to midtown, you will NOT find value like this for the money. When you're ready to dig your own hole in Manhattan, THIS IS IT. It's yours for just $37,000 a month. Don't wait! Call today! (Bathrooms and doors not included. Underground lake provides free plumbing. Tenant agrees to generate own electricity. Tenant agrees to hold landlord harmless for injuries resulting from cave collapse, falling rocks or subterranean animal attacks--no exceptions. Six months' security plus criminal background check required. Signed lease grants landlord right to sleep with anyone in tenant's household subject to notice. Failure to honor such right will result in material breach of lease and render tenant liable for full outstanding lease amount, plus treble damages. Tenant agrees never to bring any legal action against Landlord for any dispute arising out of this Lease for any reason whatsoever, including death).

CONTRACTS ARE CONTRACTS, SUPREME COURT RULES

NEWS FLASH

WASHINGTON, D.C.--Reason, Commerce, Justice & Free Beer has just learned that the United States Supreme Court has ruled that "a contract is a contract" in the much-followed case Gaffaello Mutual Equity Partners LLP v. Marquez, No. 08-9851. Scholars and lawyers alike have reacted with surprise to the Court's decision. "We expected a narrower ruling," said Mr. Thomas J. Knickerbocker, Esq., partner at New York's Knickerbocker, Chance & Willoughby LLC, a prominent Wall Street law firm. "We thought the Court would be more straightforward. But it simply said 'a contract is a contract.' This is a complicated idea. It is hard for both lawyers and the public to understand."

Today's ruling has broad implications for the business community. It also represents a milestone in legal reasoning and rhetoric. The case arises from a dispute between a janitor, Mr. Rodolfo G. Marquez, of Grand Concourse, The Bronx, and Gaffaello Mutual Equity Partners, a large Wall Street investment house handling more than $45,000,000,000 in assets.

According to filings and the Court's decision, Mr. Marquez orally agreed to "use best efforts" to "satisfactorily" clean every toilet located at Gaffello's office building in downtown Manhattan. In return, an unnamed agent acting for the investment house promised to pay Mr. Marquez $40 per day "until told otherwise" and "subject to all reasonable alterations by promisor." The agent allegedly also told Mr. Marquez that he had "to supply his own materials" and he had to "wipe all shit and piss from all affected toilet facilities to the satisfaction of any Gaffaello director to the extent permitted by applicable law." Mr. Marquez allegedly acquiesced to Gaffaello's terms. He further acquiesced to Gaffaello's demand that he "waive all remedies, at law or equity, or at common justice, for any alleged breach of aforesaid agreement, be it oral or in writing."

Mr. Marquez immediately went to work. Both employees and officers found Mr. Marquez' work excellent. According to one Vice President in the Appropriations Department: "I've never seen a cleaner shitter. That muchacho sure knows what the fuck he's doing." Around the same time, an authorized Gaffaello budget deputy presented a written contract to Mr. Marquez. The written contract included all the terms to which he orally agreed, as well as a clause that imposed a duty on Mr. Marquez to "act in good faith in the performance hereof; but such duty shall not extend to promisor, Gaffaello Mutual Equity Partners LLP; and it is further agreed, covenanted and promised that promisee , Mr. Rodolfo G. Marquez, shall have no right of action, cause of action or any other legal, equitable, natural or other remedy, either now or hereafter, today or tomorrow--or forever--for promisor's wanton or negligent failure, refusal, or decision not to use good faith in the execution, performance, observation or fulfillment of the mutual covenants set forth in this, the Master Contract for the Performance of Toilet Cleaning Services, notwithstanding all oral assertions to the contrary hereof, so help him God."

Mr. Marquez signed the contract, even though he did not read English. According to a Gaffaello witness, he said: "I understand it."

For two months, Mr. Marquez dutifully upheld his end of the bargain. He cleaned 4000 toilets, scrubbed 50,000 square feet of tile bathroom flooring every night and purified 4000 toilet stalls. In the process, he overcame horrific sights and odors. He worked at least 12 hours each day. He received $31.02 for his first day's work less taxes, fees and Social Security contributions. Although he was not eligible for Gaffaello's health coverage plan, he nevertheless paid toward it because he could not understand his paycheck statement. Over the next week, Gaffaello began paying Mr. Marquez a dollar less each day. Beginning the second week, it began subtracting two dollars per day from his daily check. After reducing his daily wage to $3.29, Gaffaello stopped paying Mr. Marquez at all. Instead, it sent a junior supply clerk to inform him that "he would be paid later."

Trusting that Gaffaello would honor the contract they signed, Mr. Marquez continued working. Eventually, however, Mr. Marquez gave up. He allegedly told a Gaffaello employee that he "could not continue working without pay" and that he "had a family to feed." In response, the employee said: "You can't leave. You promised to use best efforts and to act in good faith under this contract until told otherwise." Mr. Marquez said "they could sue him." With that, he walked off the job.

Gaffaello did sue him. Within two days, it served papers on Mr. Marquez and haled him into the United States District Court for the Southern District of New York for breach of contract. Although the trial judge wondered why the dispute fell under Federal jurisdiction, Gaffaello's legal team presented evidence to show that Gaffaello was a Delaware limited liability partnership, while Mr. Marquez was a New York resident. It also showed that the contract between Gaffaello and Mr. Marquez "represented a lucrative business relationship implicating more than $75,000 in janitorial services." These facts, according to established Federal law, warranted Federal court jurisdiction. Mr. Marquez, who could barely speak English, let alone understand an argument involving Federal diversity jurisdiction, said nothing in response.

Gaffaello demanded a fast track trial. The trial judge--A. Harry Peters--had no sympathy for a recent immigrant like Mr. Marquez because President George H.W. Bush appointed him to the bench. He quickly surveyed the evidence and found that Mr. Marquez breached the contract. In a detailed opinion, the trial judge wrote: "Mr. Marquez knowingly and voluntarily assumed the obligations set forth in the contract he signed with Gaffaello. It is not for courts to pass upon the providence or fairness of written agreements between mature business actors. Rather, we must merely apply relevant law to resolve any allegation that one party breached the terms upon which they mutually agreed. Under law, we assume all terms to be valid and voluntary. In this case, Mr. Marquez has no answer to contradict the assertion that he walked off a job he contractually agreed to perform. He says he left because Gaffaello did not pay him, but that is not technically true. Gaffaello said it would 'pay him later.' This does not mean it 'did not pay' him. Gaffaello never breached the contract. Only Mr. Marquez did. Furthermore, Mr. Marquez promised to use best efforts and to comply with the contract in good faith. By walking off the job without notice or cause, he violated both obligations. In sum, Mr. Marquez breached the contract. I order him to return to work immediately, or to pay Gaffaello the reasonable value of his lost services, in an amount not less than $75,000.01."

Mr. Marquez appealed the trial court's ruling to the United States Court of Appeals for the Second Circuit. His case attracted notice from the Puerto Rican Legal Defense Fund, and their lawyers hastened to his cause. They argued that the contract was invalid because it was "unconscionable" and because no contract may bind a man to work in the United States. The three-judge panel--including two Clinton appointees--agreed. They said: "We find the contract by and between Gaffaello Mutual Equity Partners LLP and Mr. Rodolfo G. Marquez unconscionable as a matter of law. We find every argument to the contrary unconvincing. No matter what anyone says about our country or its free enterprise spirit, we refuse to entertain appellees' contention that the United States Constitution guarantees the 'unlimited freedom to bargain for employment terms.' This agreement verifiably 'shocks the conscience.' We cannot permit the contract to stand, no matter how 'voluntary' it may have been at signing. Appellees' conduct in this case borders on the sadistic. Judgment reversed."

Judge Ferguson H. Klosterbach, George W. Bush's lone appointee on the appellate panel, dissented. He wrote: "I think the trial judge was right. A contract is a contract. Mr. Marquez breached it. He is also an immigrant."

Dissatisfied with the Second Circuit's reasoning, Gaffaello applied to the United States Supreme Court for certiorari. In its brief, Gaffaello phrased the case as follows: "This is a case about the freedom to contract. It is not about fairness. It is about a willful contract breacher who did not do what he promised to do." In response, Mr. Marquez' lawyers said: "This is not a case about the freedom to contract. This is a case about unfairness and injustice. This is a case about a powerful company forcing one-sided terms upon a powerless immigrant. If this Court has a shred of decency and compassion, it will affirm the judgment of the United States Court of Appeals for the Second Circuit."

Chief Justice John G. Roberts, Jr. delivered the Court's opinion to a packed house. In a calm, steady voice, he began: "Our free market economy values fairness. But it values contracts more. In our view, contracts are contracts. Promises are promises. When commercial actors make promises, we do not excuse them lightly for failing to adhere to their commitments. This case involves promises and contracts. No matter how 'unfair' or 'unjust' those promises may seem in hindsight, we refuse to second-guess reasonable commercial actors who voluntarily make commitments. Contrary to Respondents' contention, this Court has no power to rule on 'elementary justice.' This Court applies the law. And the law in this case has a simple answer: Contracts are contracts.

"Our common law values contracts. Commerce prospers when commercial men feel assured that others will fulfill their commitments. That is why courts in our system rarely allow litigants to escape voluntary contractual obligations. True, contractual obligations only arise to the extent that parties make them freely. But there is no evidence in this case that Mr. Marquez faced 'coercion' to bargain with Gaffaello. He agreed to act in good faith, to waive his remedies and to use 'best efforts' while cleaning every toilet at Gaffaello's downtown facility 'until told otherwise.' At the same time, Gaffaello freely and voluntarily agreed to pay Mr. Marquez $40 per day 'subject to all reasonable alterations.' Mr. Marquez says that Gaffaello did not pay him. But the record clearly shows that it did. The fact that Gaffaello slowly decreased Mr. Marquez' daily wage did not change the contract. In fact, Gaffaello had every right to make 'reasonable alterations' to Mr. Marquez' pay. Mr. Marquez acquiesced to this term when he signed the contract. And--unlike Mr. Marquez--Gaffaello had no obligation to perform the contract in good faith. If Gaffaello somehow acted in bad faith, that was a risk Mr. Marquez knowingly and voluntarily assumed when he signed the contract. It is not for us to question these private contractual relations.

"We hold as a matter of constitutional law that contracts are contracts. Neither the Judiciary nor the Legislature has power to retroactively invalidate private contractual terms concerning legal subject matter. We are neither philosophers nor moralists. We are legal technicians. We do not interfere with private bargains, nor do we save private individuals from their improvident business decisions. No matter how 'shocking' the terms may have been in Mr. Marquez' case, we are not fairness referees. We simply look to the contract and the circumstances to determine whether both parties freely and voluntarily assumed their duties. If we determine that they did, our inquiry ends. If we scrutinized every private bargain for terms we considered 'unfair' or 'oppressive,' we would undermine the spirit of private enterprise that drives our free market system. We are not paternalistic. We trust the market. We do not second-guess it.

"This is not new law. Our courts have held that 'contracts are contracts' for centuries. Even our English forebears so held. In the case Coxwell v. Bainbridge (King's Bench 1612), Lord Chief Justice Coke stated the basic principle that we continue to follow today: "Hath the yeoman signed the Pact of Free Wille as aforesaid? Say he the Parchmente be void for offending that Certaine Spiritte or Ghoste of Justice that doth dwell at the Hearte of all the dealings of Menne? What of it? This Courte judgeth not for Justice nor Rightte, but for Lawe. Promise a Manne he shall builde a Bridge o'er the Thames for a threepence in Two Days' Tyme, so he must, so long he have said so of Free Minde. I be of mind that pacta sunt servanda. It be of no Moment what the bound Manne saith. The Lawe doth presume a Manne do a Thinge with Free Minde. Comes now no Evidence or Witnesse thereagainst, it being a Cleare Thinge, et.c., what be left for a Court to say? Let Menne bargainne as they please. What they say be no Matter for the Lawe, but that the Lawe allow it.'

"We could not agree more. We find that Mr. Marquez knowingly and voluntarily assumed the obligations set forth in his contract with Gaffaello. We express no judgment on the 'fairness' or 'equity' of that contract. We refuse to entertain the Respondents' invitation to sit as a permanent referee for contractual fairness. Such a role would contravene our duty to apply the law and to defend private autonomy in a free market system. Judgment REVERSED. This case is REMANDED to the United States Court of Appeals for the Second Circuit with an order to issue judgment against Respondent consistent with this opinion.

"It is so ordered."

Justices Scalia, Kennedy, Thomas and Alito joined the Chief Justice's opinion. Justice John Paul Stevens wrote a dissent. In it, he blamed the majority for "enshrining unfairness" and "exulting the powerful over the powerless." He concluded as follows: "The Constitution imposes limits upon the freedom to contract when contract terms offend our most basic sense of justice."

In a separate concurrence, Justice Scalia responded to Justice Stevens' dissent: "Justice Stevens once again proves his unrivaled ability to put his head up his dumb wrinkled ass. L0s3r, pwned!!!!"

Reason, Commerce, Justice & Free Beer is pleased to see that both collegiality and prudence are alive and well at the Supreme Court as it begins its new session.