From owner-fx-propose@ideosphere.com Mon Apr 27 23:36:17 2015
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In-Reply-To: <201504271307.t3RD72l1029873@ideosphere.com>
References: <201504271307.t3RD72l1029873@ideosphere.com>
Date: Mon, 27 Apr 2015 20:36:15 -0700
Message-ID: <CAP2eGiveXhVYO3gPccrZyZG_qZ7vajuheHMikBmhQy2aFXozUw@mail.gmail.com>
Subject: Re: fx-propose: Revision of Proposal: 'SSCBSA'
From: David Klempner <klempner@imsanet.org>
To: fx-propose@ideosphere.com
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 On Mon, Apr 27, 2015 at 6:07 AM, FX <info@ideosphere.com> wrote:
>
> In the case that either Philippon wins or loses his case, but the
> Supreme court hears the case,this claim will be judged on a scale
> based on how many supreme court justices vote in favour of Philippon,
> divided evenly among those Supreme Court Justices that heard the case
> and delivered a verdict one way or the other.
>
> If for example of the nine Justices, one did not hear the case or
> died before delivering a verdict, two abstained and the remainder
> voter 4-2 in Philippon's favour then the claim will pay 4/6*100 =
> $0.67 after rounding to the nearest cent.
> bad format given for 'due date': TBD
>

To be clear, the focus of the claim as you have structured it is the
Supreme Court split rather than the actual outcome of the case itself,
which I find kind of weird and discontinuous.

If you care more about the outcome of the case, you're better off with a
claim that drops all this Supreme Court stuff and simply pays out based on
the ultimate outcome of the case after appeals are settled. At that point
the value of the claim has a reasonably clear interpretation -- a
probability that he will win his case. (but what exactly does "win" mean?
Are there weird loopholes?)

Once you include this Supreme Court stuff, suddenly there's a split
interpretation. If I think he's absolutely going to lose his appeal 2-7 if
they hear it, that's worth 22 -- unless they don't hear it, in which case
it is worth 0. Is a low value because FX participants believe the SC is not
going to hear his case, or because they don't think many justices will
support it?

There's an additional issue: what if the Supreme Court makes multiple
decisions related to the case? (Is this possible? I'm ignorant of the
Canadian system.) Could there be scenarios where, for example, a Supreme
Court ruling results in a retrial which ultimately results in another
appeal to the Supreme Court and a second ruling?

For that matter, are there situations where there, for example, may be a
majority ruling in his favor, and a minority dissenting position which is
also in his favor but with a less broad interpretation of the law? Is the
"vote in his favor" actually well defined?