Cultivating SEED

Caitlin Stachon '17, Stephen Choi, and Yujia Feng '17

Over the past two years, NYU Law students have played a central role in building a pioneering database that sheds new light on the federal government’s pursuit of civil securities law cases. Launched last fall by the NYU Pollack Center for Law & Business and Cornerstone Research, the Securities Enforcement Empirical Database (SEED) tracks and records information on US Securities and Exchange Commission (SEC) enforcement actions against public companies.

A great deal of what the SEC does is a matter of public record. But without the public material being evaluated, organized, and made easily accessible, it has been hard to discern trends in how the agency operates. How have enforcement division priorities shifted over time? What proportion of cases does the division file in federal court versus before its own administrative law judges? With SEED, it’s finally possible to gain insight into these and other questions, and having worked hard to create the database, students are among those who can now draw on it for their own research in corporate law and governance.

“Students have been integral to the whole undertaking,” says Stephen Choi, Murray and Kathleen Bring Professor of Law and director of the Pollack Center (a joint venture of the Law School and the Stern School of Business). “They helped build the dataset, they continually update it, and they have the opportunity to draw on it for their own projects.”

VIDEO: Professor Stephen Choi discusses the idea behind the SEED database

Yujia Feng ’17 and Caitlin Stachon ’17, for example, are part of a team of student research fellows (JDs, LLMs, and MBA candidates) that have been collecting, evaluating, and entering information into the database. The 2Ls came to the project through very different paths. After growing up in China, Feng attended Yale, majoring in economics and history and employing econometrics for her senior thesis. (The Law School recently awarded her a Lederman Fellowship in Law and Economics.) Stachon grew up in Urbandale, Iowa, and earned a BA in psychology from Columbia. They met and signed up to work on SEED as 1Ls in a Corporations class taught by Choi. “We both have backgrounds in social science, so were interested in the chance to work with data again,” says Stachon.

Stachon and Feng are now tapping SEED to write papers for the JD program’s substantial-writing requirement. Stachon is using SEED as a resource to assess how the SEC treats individuals in enforcement actions, including the positions of individuals charged, the basis of the allegations, and the outcomes.

Feng is examining how the SEC’s ability to pursue “aiding and abetting” charges in securities fraud cases has been strengthened by the Dodd-Frank Act. Various law firms have written memos on the topic, generally highlighting the legal basis for the SEC’s strengthened authority. But with SEED, Feng can try to identify patterns and quantify developments across a large number of SEC enforcement actions. “I’m interested in what the data can show, especially how the SEC has used its new authority,” she says.

VIDEO: Professor Stephen Choi discusses student involvement with the SEED database project

Posted March 7, 2016

Reposted July 6, 2016