American University Business Law Review
There are radically differing views as to whether Dodd-Frank took the right approach, and whether it will be successful or even beneficial. But even the most optimistic scenario leaves a significant problem unaddressed. One important cause of the crisis was that some banks and their lawyers had been looking for-and finding-clever ways to honor the letter of the law while violating its spirit, including by "pushing the envelope" as far as it will go (and in some cases, further). The legal opinion rendered in Lehman Brothers' Repo 105 transaction, discussed more fully below, is but one example of the type of lawyering that gave clients what they wanted in the short term while ignoring the true meaning of the law. We call this type of lawyering "loophole lawyering."
Claire Hill and Richard W. Painter, Of the Conditional Fee as a Response to Lawyers, 1 Am. U. Bus. L. Rev. 42 (2011), available at http://scholarship.law.umn.edu/faculty_articles/380.