Experimental Evidence that Retaliation Claims Are Unlike Other Employment Discrimination Claims

The type of discrimination claim that strikes fear in the hearts of all employers is the dreaded retaliation claim. While employers contend, and plaintiffs admit, that retaliation is different from other discrimination complaints, employee advocates have put forth legislation that would equalize retaliation with the other types of discrimination. This bill, Protecting Older Workers against Discrimination Act (POWADA), would expand the so-called mixed-motive jury instruction to age, and disability, as well as retaliation. Moreover, it would allow plaintiffs, not judges, to decide which types of instruction the jury would receive. In this article, the authors argue that retaliation claims should not receive the same treatment as other discrimination claims (including age and disability), because it’s easy for juries to believe that retaliation is a factor, regardless of other facts. Once a fact-finding jury checks the box to indicate that an employer’s motive might include retaliation, the employer will likely have to pay fees and costs, at minimum, regardless of the claim’s final resolution.

Asset Management and Investment Banking

We find evidence that conflicts of interest are pervasive in the asset management business owned by investment banks. Using data from 1990 to 2008, we compare the alphas of mutual funds, hedge funds, and institutional funds operated by investment banks and non-bank conglomerates. We find that, while no difference exists in performance by fund type, being owned by an investment bank reduces alphas by 46 basis points per year in our baseline model. Making lead loans increases alphas, but the dispersion of fees across portfolios decreases alphas. The economic loss is $4.9 billion per year.