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The Investing Rules Judges Must Follow

Publication Date: 
June 23, 2010
Source: 
Marketplace
Author: 
Kai Ryssdal and Brett Neely

Professor Deborah Rhode talks to Bret Neely of Marketplace about legal ethics regarding a federal judge's possible conflict of interest in his decision to throw out the drilling moratorium for the Gulf of Mexico:

A federal judge threw out the Obama administration's six-month ban on drilling yesterday. Critics quickly discovered the judge held shares in a number of oil firms, including Transocean -- the company that owned the Deepwater Horizon rig. Brett Neely reports.

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Kai Ryssdal: Interior Secretary Ken Salazar said today he's going to come up with another way to get a drilling moratorium for the Gulf of Mexico. A federal judge in New Orleans threw out the administration's first pass at a six-month ban yesterday. Critics of that decision quickly discovered that the judge in the case, Martin Feldman, has held shares in a number of oil and gas firms, including Transocean -- the company that owned the Deepwater Horizon rig that's at the root of the current troubles.

We got to wondering, what sort of rules do federal judges have to follow when it comes to investing? Brett Neely has more.

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Brett Neely: It's usually up to judges to decide whether they have a conflict of interest in a case.

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Deborah Rhode: Once you have this issue raised, I think that's the kind of basis on which judges either need to make full and complete disclosures or take themselves off the case.

Deborah Rhode teaches legal ethics at Stanford Law School. She thinks more judges ought to put their assets in a blind trust so that there aren't these perceived conflicts of interest.