Education & Honors

University of Chicago Law School, 1999, J.D.

University of Chicago Graduate School of Business (financial economics), 1999, Ph.D.

University of Chicago Graduate School of Business, 1999, M.B.A.

University of Illinois (liberal arts and finance), 1990, A.B., magna cum laude

Bar admissions


New York

Professional Activities

American Bar Association

American Finance Association

American Law and Economics Association

American Statistical Association

International Society for Bayesian Analysis


Lecturer, The University of Chicago Law School, 2008 to 2010.

Adjunct Professor of Finance, The University of Chicago Graduate School of Business, 2005.

Adjunct Associate Professor of Finance, Duke University Fuqua School of Business and Duke Law School Global Capital Markets Center, 2001-2003. Winner, Excellence in Teaching Award in the Weekend Executive M.B.A. Program.

Adjunct Assistant Professor of Finance, The University of Chicago Graduate School of Business, 2000-2001.

James B. Heaton, III

Chicago Office
Courthouse Place
54 West Hubbard Street, Suite 300
Chicago, IL 60654
Back to previous page

Professional Practice

J.B. Heaton has practiced with the firm since 1999.  With a strong background in financial economics, including a Ph.D. from the University of Chicago, J.B. focuses his practice on cases that involve complex economic and financial issues.  

J.B. has published widely in both finance and law, and his scholarly work has been cited numerous times by courts and legal scholars.


Overconfidence, Compensation Contracts, and Capital Budgeting, Journal of Finance, Vol. 66, No. 5, pp. 1725-77 (2011) (with Simon Gervais and Terry Odean).

Returns, Risk, and Financial Due Diligence, Chapter 5 in Finance Ethics: Critical Issues in Theory and Practice, J. Boatright, ed. (Robert W. Kolb Series) (Wiley, 2010) (with Christopher L. Culp). 

The Limits of the Limits of Arbitrage, Review of Finance, 14(1):157-187 (2010) (with Alon Brav and Si Li), runner-up for the 2010 Deutsche Bank Prize in Financial Economics for Best Paper in the Review of Finance.

CSX Corporation v. The Children's Investment Fund: Total Return Swaps as Evasions of Section 13(d) Reporting, Securities Litigation Journal, pp. 16-18 (Summer 2009).

Naked Short Selling, Regulation, Vol. 31, No. 1, 46-51 (2008) (with Christopher L. Culp). 

Solvency Tests, Business Lawyer, Vol. 62, No. 3, 983-1006 (2007).

The Uses and Abuses of Finite Risk Reinsurance, Journal of Applied Corporate Finance, Vol. 17, No. 3, pp. 18-31 (2005) (with Christopher L. Culp).

Deepening Insolvency, The Journal of Corporation Law, Vol. 30, No. 3, pp. 465-500 (2005).

Settlement Pressure, International Review of Law and Economics, Vol. 25, pp. 264-275 (2005).

The Rational-Behavioral Debate in Financial Economics, Journal of Economic Methodology, 11(4) 2004 (Lead Article) (with Alon Brav and Alexander Rosenberg).

Market Indeterminacy, The Journal of Corporation Law, Vol. 28, No. 4, pp. 517-539 (2003) (with Alon Brav, Duke University).

Managerial Optimism and Corporate Finance, Financial Management, Vol. 31, pp. 33-45 (Summer 2002). 

Competing Theories of Financial Anomalies, The Review of Financial Studies, Vol. 15, No. 2, pp. 475-506 (2002) (with Alon Brav, Duke University). Winner, Barclays Global Investors (BGI) Michael Brennan Award for the best paper published in The Review of Financial Studies

Incomplete Financial Contracts and Non-Contractual Legal Rules: The Case of Debt Capacity and Fraudulent Conveyance Law, Journal of Financial Intermediation, Vol. 9, pp. 169-183 (2000). 


Returns, Risk, and Financial Due Diligence

  • Good Timing? How One Bank Cut Its Link to a $1.2 Billion Ponzi Scheme, Journal of Legal Economics, J. Legal Econ. 1 (October 18, 2011) (Davis, L., Wilson, L.).

Naked Short Selling

  • In Pursuit of the Naked Short, NYU Journal of Law & Business, 5 N.Y.U. J. L. & Bus. 1 (Spring 2009) (Stokes, A.).
  • Upperworld Gangsters, Underworld Businessmen: Made Men, Corporate Raiders and the Discrepancies between the Enforcement of Organized and Organizational Crime.  Or, Why a Last Name that Ends with a Vowel Still Means Hard Time for a Defendant., Hamline Journal of Public Law and Policy, 30 Hamline J. Pub. L. & Pol’y 627 (Spring 2009) (Cobin, S.).
  • Short Selling and the News: A Preliminary Report on an Empirical Study, New York Law School Law Review, 54 N.Y.L. Sch. L. Rev. 645 (2009/2010) (Fox, M., Glosten, L., Tetlock, P.).
  • The Down-Low on the Uptick: Why Rule 10-A Will Not Deter Naked Short Selling, Nexus: Chapman’s Journal of Law & Policy, 15 Nexus: Chap. J. L. & Pol’y 163 (2009-2010) (Partington, J.).
  • Short Selling in a Financial Crisis: The Regulation of Short Sales in the United Kingdom and the United States, Northwestern Journal of International Law and Business, 30 Nw. J. Int’l L. & Bus. 201 (Winter 2010) (McGavin, K.).

Solvency Tests

  • Teleglobe USA, Inc. v. BCE Inc. (In re Teleglobe Communs. Corp.), 392 B.R. 561, 602 (Bankr. D. Del. 2008) (Walrath, J.).
  • Befuddlement betwixt Two Fulcrums: Calibrating the Scales of Justice to Ascertain Fraudulent Transfers in Leveraged Buyouts, American Bankruptcy Institute Law Review, 19 Am. Bankr. Inst. L. Rev. 71 (Spring 2011) (Ginsberg, J., Burgess, M., Czerwonka, D., Caldwell, Z.).
  • Corporate Fiduciary Liability to Creditors and Interested/Director Transactions: Two Key Distinctions between California and Delaware Fiduciary Duty Law That Come Under Scrutiny during Insolvency, California Bankruptcy Journal, 31 Cal. Bankr. J. 827 (2012) (Gilhuly, P., Dillman, T.).
  • The Future of European Creditor Protection and Capital Maintenance from a German Perspective, German Law Journal, 13 German L.J. 637 (June 1, 2012) (Haaker, A.). 
  • Redefining Possessory Liens in Bankruptcy: Property, Contract, and What It All Means, DePaul Business & Commercial Law Journal, 11 DePaul Bus. & Com. L.J. 75 (Fall 2012) (Minnes, O.).
  • The Rise of a Giant: Securitization and the Global Financial Crisis, American Business Law Journal, 49 Am. Bus. L.J. 859 (Winter 2012) (Solomon, D.).

Deepening Insolvency

  • The Expansion of Deepening Insolvency Standing: Beyond Trustees and Creditors’ Committees, Emory Bankruptcy Developments Journal, 22 Emory Bankr. Dev. J. 221 (Fall 2005) (Gordon, D.).
  • In re Citx Corp., 448 F.3d 672 (3d Cir. 2006). 
  • Official Comm. of Unsecured Creditors of Verestar, Inc. v. Am. Tower Corp. (In re Verestar, Inc.), 343 B.R. 444 (S.D.N.Y. 2006).
  • OHC Liquidation Trust v. Credit Suisse First Boston (In re Oakwood Homes Corp.), 340 B.R. 510 (Bankr. D. Del. 2006).
  • Deepening the Blows Against Deepening Insolvency?, American Bankruptcy Institute Journal, Am. Bankr. Inst. J. 24 (September 25, 2006) (Brighton, J.).
  • Lawyer Liability and the Vortex of Deepening Insolvency, Saint Louis University Law Journal, 51 St. Louis U. L.J. 127 (Fall 2006) (Richmond, D., Lamberth, R., Delawalla, A.).
  • A Critique of “Deepening Insolvency,” a New Bankruptcy Tort Theory, Stanford Journal of Law, Business & Finance Spring, 12 Stan. J.L. Bus. & Fin. 536 (2007) (Thompson, D.).
  • Christians v. Grant Thornton, LLP, 733 N.W.2d 803 (Minn. Ap. 2007).
  • In re Parmalat Sec. Litig., 501 F. Supp. 2d 560 (S.D.N.Y. 2007).
  • Schnelling v. Crawford (In re James River Coal Co.), 360 B.R. 139 (Bankr. E.D. Va. 2007).
  • The Erroneous Application of the Defense of In Pari Delicto to Bankruptcy Trustees, California Bankruptcy Journal, 29 Cal. Bankr. J. 275 (2007) (McGrane, W.).
  • Don’t Throw Away Your Deepening Insolvency Materials Just Yet, American Bankruptcy Institute Journal, Am. Bankr. Inst. J. 28 (October 27, 2008) (Silberglied, R.).
  • Still Solvent: The Third Circuit Continues To Support “Deepening Insolvency” As a Viable Tort Claim In In Re Lemington Home for the Aged, Villanova Law Review, 57 Vill. L. Rev. 739 (2012) (Kim, E.).
  • Plumbing the Depths of Corporate Litigation: Reforming the Deepening Insolvency Theory, University of Illinois Law Review, U. Ill. L. Rev. 2087 (2013) (Tully, J.).
  • Institutional Free Exercise and Religious Land Use, Cardozo Law Review, 34 Cardozo L. Rev. 1693 (June, 2013) (Infranca, J.).

Settlement Pressure

  • “We’re Scared to Death”: Class Certification and Blackmail, New York University Law Review, 78 N.Y.U. L. Rev. 1357 (October, 2003) (Silver, C.) (citing working paper version).
  • Contract Theory and the Limits of Contract Law, Yale Law Journal, 113 Yale L.J. 541 (December, 2003) (Schwartz, A., Scott, R.) (citing working paper version).
  • The Unexpected Value of Litigation: A Real Options Perspective, Stanford Law Review, 58 Stan. L. Rev. 1267 (March, 2006) (Grundfest, J., Huang, P.).
  • Preserving LLC Veil Piercing: A Response to Bainbridge, Journal of Corporation Law, 31 J. Corp. L. 1063 (Summer 2006) (Rapp, G.).
  • Some Realism about Mass Torts, University of Chicago Law Review, 75 U. Chi. L. Rev. 1949 (Fall 2008) (Marcus, D.).
  • Why Barring Settlement Bars Legitimate Suits: A Reply to Rosenberg and Shavell, Cornell Journal of Law & Public Policy, 18 Cornell J.L. & Pub. Pol’y 57 (Fall 2008) (Sichelman, T.).
  • Toward Procedural Optionality: Private Ordering of Public Adjudication, New York University Law Review, 84 N.Y.U. L. Rev. 514 (May, 2009) (Rhee, R.).
  • A Production Theory of Pure Economic Loss, Northwestern University Law Review, 104 Nw. U. L. Rev. 49 (Winter 2010) (Rhee, R.).
  • Procedure’s Ambiguity, Indiana Law Journal, 86 Ind. L.J. 645 (Spring 2011) (Moller, M.).
  • A Financial Economic Theory of Punitive Damages, Michigan Law Review, 111 Mich. L. Rev. 33 (October, 2012) (Rhee, R.).
  • Corporate Social Responsibility in a Remedy-Seeking Society: A Public Choice Perspective, Chapman Law Review, 17 Chap. L. Rev. 413 (Spring 2014) (Kochan, D.).
  • Litigation Funding Versus Liability Insurance: What’s The Difference?, DePaul Law Review, 63 DePaul L. Rev. 617 (Winter 2014) (Silver, C.).

Market Indeterminacy

  • Antitrust Violations in Securities Markets, Journal of Corporation Law, 28 J. Corp. L. 607 (Summer 2003) (Hovenkamp, H.).
  • Speculations on the Idea of “Speculation” In Trust Investing: An Essay, Real Property, Probate and Trust Journal, 39 Real Prop. Prob. & Tr. J. 439 (Fall 2004) (Dobris, J.).
  • Fraud-On-The-Market Theory: Is a Market Efficient?, American Bankruptcy Institute Journal, Am. Bankr. Inst. J. 58 (May 24, 2005) (Feinstein, S., Michel, A., Shaked, I.).
  • Searching for Rational Investors in a Perfect Storm, Journal of Corporation Law, 30 J. Corp. L. 539 (Spring 2005) (Lowenstein, L.).
  • The Essential Role of Securities Regulation, Duke Law Journal, 55 Duke L.J. 711 (February, 2006) (Goshen, Z., Parchomovsky, G.).
  • Securities Law Fraud-On-The-Market First Circuit Defines an Efficient Market for Fraud-On-The-Market Purposes. In Re Polymedica Corp. Securities Litigation, 432 F.3d 1 (1st Cir. 2005); Harvard Law Review, 119 Harv. L. Rev. 2284 (May 2006).
  • Note: Corporate Governance: Economic Analysis of a “Comply or Explain” Approach, Stanford Journal of Law, Business & Finance, 11 Stan. J.L. Bus. & Fin. 386 (Spring 2006) (Steeno, A.).
  • Teamsters Local 445 Freight Division Pension Fund v. Bombardier Inc., 2006 U.S. Dist. LEXIS 52991 (S.D.N.Y. August 1, 2006).
  • Effective Efficiency Analysis: Reforming Judicial Decision Making on Market Efficiency in Fraud-On-The-Market Securities Litigation, University of Toledo Law Review, 39 U. Tol. L. Rev. 129 (Fall 2007) (Birkam, E.).
  • Securities Litigation – Class Certification – Fifth Circuit Holds That Plaintiffs Must Prove Loss Causation before Being Certified As a Class. – Oscar Private Equity Investments v. Allegiance Telecom, Inc., 487 F.3d 261 (5th Cir. 2007); Harvard Law Review, 121 Harv. L. Rev. 890 (January, 2008).
  • Basic at Twenty: Rethinking Fraud on the Market, Wisconsin Law Review, Wis. L. Rev. 151 (2009) (Langevoort, D.).
  • Compared To What? Econometric Evidence and the Counterfactual Difficulty, Journal of Corporation Law, 35 J. Corp. L. 183 (Fall 2009) (Langevoort, D.).
  • Regressing: The Troubling Dispositive Role of Event Studies In Securities Fraud Litigation, Stanford Journal of Law, Business & Finance, 15 Stan. J.L. Bus. & Fin. 183 (Fall 2009) (Kaufman, M., Wunderlich, J.).
  • Reading Stoneridge Carefully: A Duty-Based Approach to Reliance and Third-Party Liability under Rule 10b‑5, University of Pennsylvania Law Review, 158 U. Pa. L. Rev. 2125 (June, 2010) (Langevoort, D.).
  • The Enlightenment and the Financial Crisis of 2008: An Intellectual History of Corporate Finance, Theory, Saint Louis University Law Journal, 54 St. Louis U. L.J. 1257 (Summer 2010) (Hackney Jr., J.).
  • Understanding Causation in Private Securities Lawsuits: Building on Amgen, Vanderbilt Law Review November, 66 Vand. L. Rev. 1719 (2013) (Cox, J.).
  • Building on Kahneman’s Insights in the Development of Behavioral Finance, Loyola University Chicago Law Journal, 44 Loy. U. Chi. L.J. 1401 (Summer 2013) (Shefrin, H.).

Managerial Optimism and Corporate Finance

  • Corporate Governance: Still Broke, No Fix in Sight, Journal of Corporation Law, 31 J. Corp. L. 39 (Fall 2005) (Dent, G.).
  • Too Much Pay, Too Much Deference: Behavioral Corporate Finance, CEOs, and Corporate Governance, Florida State University Law Review, 32 Fla. St. U. L. Rev. 673 (Winter 2005) (Paredes, T.).
  • Overvalued Equity and the Case for an Asymmetric Insider Trading Regime, Wake Forest Law Review, 41 Wake Forest L. Rev. 1045 (Winter 2006) (Lambert, T.).
  • Workers, Information, and Corporate Combinations: The Case for Nonbinding Employee Referenda in Transformative Transactions, Washington University Law Review, 85 Wash. U. L. Rev. 871 (2007) (Bodie, M.).
  • Attacking the Classified Board of Directors: Shaky Foundations for Shareholder Zeal, Business Lawyer, 65 Bus. Law. 441 (February, 2010) (Murphy, M.).
  • Insider Trading As a Signaling Device, American Business Law Journal, 47 Am. Bus. L.J. 1 (Spring 2010) (Prentice, R., Donelson, D.).
  • Tax Authority As Regulator and Equity Holder: How Shareholders’ Control Rights Could Be Adapted to Serve the Tax Authority, Saint John’s Law Review, 84 St. John’s L. Rev. 851 (Summer 2010) (Beylin, I.).
  • The Corporate Governance of Iconic Executives, Notre Dame Law Review, 87 Notre Dame L. Rev. 351 (November, 2011) (Lin, T.).
  • Corporate Philanthropy As Signaling and Co-Optation, Fordham Law Review, 80 Fordham L. Rev. 1889 (April, 2012) (Shapira, R.).
  • Getting Incentives Right: Is Deferred Bank Executive Compensation Sufficient?, Yale Journal on Regulation, 31 Yale J. on Reg. 523 (Special Issue 2014) (Bhagat, S., Bolton, B., Romano, R.).
  • CEOs and Presidents, U.C. Davis Law Review, 47 U.C. Davis L. Rev. 1351 (April, 2014) (Lin, T.).
  • Performance-Sensitive Debt: From Asset-Based Loans to Startup Financing, University of Pennsylvania Journal of Business Law, 16 U. Pa. J. Bus. L. 1077 (Summer 2014) (Shadab, H.).

Competing Theories of Financial Anomalies

  • Taming the Animal Spirits of the Stock Markets: A Behavioral Approach to Securities Regulation, Northwestern University Law Review, 97 Nw. U. L. Rev. 135 (Fall 2002) (Langevoort, D.).
  • A Family Tale: Behavioral Finance and the Seagram-Vivendi Merger, Journal of International Business and Law, 2 J. Int’l Bus. & L. 7 (Spring 2003) (Raifman, L.).
  • Forcing Multinationals to Play Fair: Proposals for a Rigorous Transfer Pricing Theory, Alabama Law Review, 54 Ala. L. Rev. 1251 (Summer 2003) (Chorvat, E.).
  • Trust Law, Corporate Law, and Capital Market Efficiency, Journal of Corporation Law, 28 J. Corp. L. 565 (Summer 2003) (Sitkoff, R.).
  • Speculations on the Idea of “Speculation” in Trust Investing: An Essay, Real Property, Probate and Trust Journal, 39 Real Prop. Prob. & Tr. J. 439 (Fall 2004) (Dobris, J.).

Incomplete Financial Contracts and Non-Contractual Legal Rules: The Case of Debt Capacity and Fraudulent Conveyance Law

  • Limited Liability and Creditors’ Rights: The Limits of Risk Shifting to Creditors, Georgia Law Review, 34 Ga. L. Rev. 547 (Winter 2000) (Tung, F.).
  • Insolvency and Employment Protection: The Mixed Effects of the Acquired Rights Directive, International Review of Law & Economics, 22 Int’l Rev. L. & Econ. 443 (December, 2002) (Armour, J., Deakin, S.).