I found the full-text of the new University of California policy on romantic and sexual relations between students and faculty at their web site. It attempts to formalize what had been unwritten policy at UC, and in fact most campuses in the US. At first glance, the key point on which the regulation will surely be tested in the courts is the question of applicablity.
In other words, it seems obvious and reasonable to prohibit relations between a professor and the students currently in his or her class. Equally obvious, it seems to me, is that interfering with a relationship between a professor of Neurosurgery and a graduate student in Art History would be an unacceptable invasion of privacy.
The question, therefore, is where and how to draw the line between these two extreme cases. The wording used by UC is “a romantic or sexual relationship with any student for whom a faculty member has, or should reasonably expect to have in the future, academic responsibility (instructional, evaluative, or supervisory). Read the full policy….