Larry is flunking Social Studies. There are notes from the teacher in red marker like : Spelling? and Use a dictionary! The subject of the paper is the Louisana Purchase.
The Dude finds Larry's Homework in the cracks of the driver's seat in his Le Baron after hitting a lamp post, leading him to believe that his car had been stolen by The Homework's author. After some snooping around (never seen in the movie) Walter gets the kid's address and it turns out he is the son of Arthur Digby Sellers who penned the bulk of the popular TV series Branded. In a plastic Ziploc bag, Walter presents The Homework as evidence when interrogating a stonefaced Larry Sellers at his home.