Donald Langevoort Inaugurated as First Thomas Aquinas Reynolds Professor of Law

The Thomas Aquinas Reynolds Chair, established by the family of the late Thomas Aquinas Reynolds (L’24), was inaugurated with a lecture and dinner at the Law Center on May 6. After the formal investiture of Professor Donald Langevoort in that position by Dean Judy Areen, Professor Langevoort delivered the inaugural lecture, entitled “Second Thoughts about Enron and Its Aftershocks,” an edited version of which appears in the Faculty Articles section of this magazine.

      Reynolds, the 1918 valedictorian of Boston College, first in his class at the Law Center in 1924, and esteemed securities law partner in the Chicago law firm of Winston & Strawn, was honored by his family, friends, and the Law Center community at the lecture and the dinner that followed. At the dinner, Dean Judy Areen welcomed Mr. and Mrs. Thomas Aquinas Reynolds Jr., Mr. Thomas Aquinas Reynolds III, and other Reynolds family members together with the family of Professor Langevoort. Areen noted that the elder Reynolds “was a wise and accomplished man whose philosophy is perhaps best illustrated by the advice he once offered to his son, ‘balance your life between your God, your family, and your work.’” Of the six children and 29 grandchildren of the late Reynolds and his wife Claire, Areen said, sons Thomas Jr. (C’48) and John (C’52) are Hoyas, as is grandson Thomas III (B’74). Thomas Jr., chair of Winston & Strawn for nearly 20 years, also served as the founding chair of the Law Center’s board of visitors.
      Professor Jeffrey Bauman introduced Langevoort’s talk by outlining his academic accomplishments, mentioning his career at Vanderbilt University as a faculty member and associate dean, his 34 articles (and counting), his two-volume treatise on insider trading, and his co-authored leading casebook on securities regulation. Bauman also pointed out that Langevoort is an alumnus of the Securities and Exchange Commission, but that he also recognizes the SEC’s need to reform itself: “Although sympathetic to the SEC, he has nevertheless analyzed how bureaucratic pressures operate to make it more difficult for the agency to anticipate and react quickly to new problems.” Chief among Langevoort’s scholarly contributions to his field, Bauman noted, is his behavioral approach to securities regulation. “As an early legal academic pioneer in what is now called behavioral finance, Don seeks to examine non-rational aspects of financial markets by using cognitive and social psychology.” Langevoort opened his lecture with the questions, “Is the next Enron now prevented?” and, “Has the law changed enough to make sure such failures will never happen again?” He explained that recent financial scandals are rooted in transformations in executive compensation. “Capital markets imposed expectations to justify high salaries,” he said, effectively altering the balance in those markets by giving investors unrealistic expectations of profit generated by such highly-paid executives. Revolutions in finance technology in the 1980s “outpaced the ability of regulation to keep pace with it,” which caused a “devolution” in the norms of finance reporting. “Once aggressiveness, self-serving answers, and subjectivity in accounting become commonplace,”
Langevoort concluded, “it’s very easy for an executive to say that financing reporting… has moved in some other direction, it’s artificial, it’s gamesman-like.” He left the audience with hope, however, by saying that deterrence has been strengthened by, among other measures, improvements in the SEC’s “cease-and-desist power” under the the recently passed Sarbanes-Oxley Act.
     At the dinner that evening, Dean Areen, on behalf of the Law Center, thanked the Reynolds family for endowing the Chair. “The endowment of a Chair demonstrates faith in the academic excellence of the university,” Areen said. “At the same time, it ensures that excellence will be available to future generations of students. We are deeply grateful to the Reynolds family for their faith in Georgetown and for making possible this gift in support of academic excellence for generations to come.”
Thomas Aquinas Reynolds Jr. closed the celebration by reminding attendees of his father’s legacy: “Money and prestige and status were not important elements to his life. Material success did not define him. He was without pretension. He lived for his God, his family and his firm.”