Teaching “Too Big to Fail”?

What is Too Big to Fail?  Tragically, it is clear, not a law school, an American city, or a government-constructed storm levee.  But banks, or more accurately certain staggeringly rich banks, are the raison d’etre  for the quasi-legal phrase “Too Big to Fail.”  This week I teach on corporate fraud and attorney liability in my Legal Ethics course. We will be zooming the lens way out and starting with a look at the 2008 financial meltdown and the government’s multi-billion dollar bailout of the banking industry.

What is the connection to lawyer liability in corporate fraud cases? As the casebook I’ve adopted points out, the financial scandals of the post-World War II U.S. economy have drawn public attention to fraud by accountants and other financial professionals. But lawyers? Not so much.  And not for lack of involvement.

What is the law, if not a rubric to regulate human behavior? We reward and punish each other with laws, take away with one hand and feed with the other, all in a messy attempt to keep ourselves in check.  When we behave badly, the law metes out a corrective measure, overtly or tacitly. We trust that, by and large, this approach yields ever better results over time. As citizens, we honor this code with order when it works and dissidence when it doesn’t.

As teachers, though, how do we teach these distinctions?  More importantly, how do we teach self-regulation to future lawyers in a time when lawyer culpability is barely visible?  Lawyers are vilified in many contexts, to be sure. But our responsibilities for corporate governance and, at least in part then,  for our nation’s economic health, are crucial aspects of a budding lawyer’s knowledge base.  I think ethical inquiry belongs in every law school classroom, and gives our students the foundation they need to strengthen our legal system’s scaffolding.

 

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2 Responses

  1. “More importantly, how do we teach self-regulation to future lawyers in a time when lawyer culpability is barely visible?” By including professional identity training in the curriculum of every law school. See E. Scott Fruehwald, Developing Your Professional Identity: Creating Your Inner Lawyer (2015).

  2. Thanks, Scott, for the comment and the link to your piece–great resource!

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