Legal Theory Blog

Download of the Week

The Download of the Week is Constitutional Expectations by Richard Primus.  Here is the abstract:

This essay uses the restaging of the Oath of Office after the public inauguration of President Barack Obama to explain how and why it can be constitutional for the District of Columbia to elect a voting member of the House of Representatives.

And from the paper:

Constitutional expectations are intuitions about how the system is supposed to work. They arise from a combination of experience, socialization, and principle. Obviously, Americans do not all share a single, precisely defined set of expectations. Indeed, conflicts among rival sets of expectations help to account for many disagreements about constitutional law. Over a relatively broad domain, however, informed Americans share expectations about the rules of government. Those expectations are often closely related to the constitutional text, but the text does not always capture them precisely. On the contrary, our shared expectations go well beyond the strict textual requirements of the Constitution.

And:

The argument that the Act is unconstitutional has a reasonable basis. Article I, Section 2 says that the House of Representatives “shall be composed of Members chosen every year by the people of the several States.”29 The District of Columbia is not a state. Accordingly, the constitutional objection runs, admitting D.C. to the House would ignore the written requirements of Section 2. And that cannot possibly be acceptable.30 Yet this argument is not as tight as it seems, because our system for electing Members of Congress already—and uncontroversially—deviates from Section 2 on a regular basis. If we were more aware of those deviations, the argument that Section 2 requires excluding D.C. might have less weight. But like the practice of inserting the President’s name in the inaugural oath, our accustomed departures from the text of Section 2 have become well integrated into our constitutional expectations. We tend not to notice them.

Finally:

Suppose, however, that constitutional expectations were to shift on the issue of representation for D.C., just as they earlier shifted on the question of whether the Constitution requires the same racial equality regime in the District that it requires everywhere else. Suppose, in other words, that large majorities of American officials came to believe that our basic constitutional values demand letting the residents of Washington D.C. vote and be represented. A different set of textual readings would then seem natural. To be sure, the new received wisdom in American law would not necessarily be the one that I have suggested about the meaning of “composed.” Perhaps a different textual reconciliation would emerge. Or perhaps the prevailing explanation would not take the form of hard textualism at all. Constitutional lawyers might simply learn to shrug their shoulders at the mismatch between the language of Section 2 and the fact of representation for D.C., just as they now overlook the practice of letting criminal defendants waive jury trial. If pushed, they might say that mature respect for the constitutional text means reading it in a reasonable way rather than a crabbed and literal one. But one way or another, the text would not prohibit the practice.

Short, elegant, and highly recommended. Download it while its hot!

Download of the Week

The Download of the Week is Placeholders: Engaging the Hayekian Critique of Financial Regulation by Annelise Riles. Here is the abstract:

Since Friedrich Hayek, debates about the proper relationship between the state and the market, and about the optimal design of regulatory institutions, often turn on assumptions about the workings of legal expertise — and in particular about the difference between public expertise (bureaucratic knowledge) and private expertise (private law). Hayek’s central argument, adopted uncritically by a wide array of policy-makers and academics across the political spectrum, is a temporal one: bureaucratic reasoning is inherently one step behind the market, and hence effective market planning is impossible. In contrast, Hayek argues, private ordering is superior because it is of the moment, happening in real time. My research suggests that Hayek’s description of the limitations of bureaucratic planning resonates with the sense of powerlessness and frustration experienced by many government officials themselves as they attempt to manage economic fluctuations. But Hayek’s rich (and even empathetic) account of the limits of well-meaning public legal expertise is far less complete when it comes to the strengths of private legal reasoning. Public reasoning has temporal weaknesses, so private reasoning must have equivalent temporal strengths, the argument goes. This chapter from a forthcoming book, Collateral Knowledge: Legal Reasoning in the Global Financial Markets, takes on Hayekian arguments against government regulation through a detailed examination of real-world examples of how public and private legal technologies manage the temporal dimensions of risk in the over-the-counter derivatives markets. It draws upon over ten years of fieldwork conducted among regulators and market participants involved in the global derivatives markets in Japan. The specific examples are: the usage of collateral on the private law side, and the usage of “real time gross settlement” payment settlement systems on the public side. My research shows that while there is no reason to believe that either of these is actually more effective than the other as a stop-gap against future uncertainties in the market, there is nevertheless a kind of “Hayekian” perception, by market participants and government officials alike, that the private devices are more legitimate, and that the experts who deploy these are more knowledgeable, more expert. In order to understand the root of this legitimacy gap, the paper explores in detail how collateral, as a private legal technology, handles the temporal uncertainties surrounding market risk. At the heart of “collateral” is a deceptively mundane, but actually quite audacious legal trick called the legal fiction. In legal terms, a legal fiction is a statement that is consciously understood to be false, and hence is irrefutable. An example would be the statement that “a corporation is a person”. Collateral is actually just a set of legal fictions, layered one on top of another. I explain how these fictions — which are just as problematically related to market “realities” as government planning technologies — nevertheless come to be much more readily accepted predictors, and indeed creators of market realities. So does this mean that private regulation is inherently superior to public regulation? The fallacy of the Hayekian argument is the assumption that these “private” technologies can only be deployed by private actors. In fact, there is nothing inherently private or public about the legal fiction or other similar devices of private law. The paper demonstrates this by showing how financial regulators in Japan redeployed the trick of the legal fiction and hence regained legitimacy in their own eyes and in the eyes of market participants.

Download of the Week

The Download of the Week is Two Ways to Think About the Punishment of Corporations by Albert W. Alschuler.  Here is the abstract:

This article compares the criminal punishment of corporations in the twenty-first century with two ancient legal practices - deodand (the punishment of animals and objects that have produced harm) and frankpledge (the punishment of all members of a group when one member of the group has avoided apprehension for a crime). It argues that corporate criminal punishment is a mistake but that viewing it as frankpledge is less ridiculous than viewing it as deodand. The article considers the implications of the choice between these concepts for standards of corporate guilt and for the sentencing of corporate offenders. After a brief historical description of deodand and frankpledge, the article traces the history of corporate criminal liability from William Blackstone through Arthur Andersen. It emphasizes that this liability punishes the innocent, and it argues that the punishment of innocent shareholders and employees should not be regarded as “collateral” or “secondary.” The article notes that subjecting corporations and their officers to punishment for the same crimes creates sharp conflicts of interest. It reviews the history of the Justice Department’s efforts to exploit these conflicts - initially by encouraging corporate officers to deliver corporate guilty pleas to gain leniency for themselves and more recently by pressing corporations to gather and deliver information about their employees. The article suggests that defenses of corporate criminal liability fall into two categories. Arguments in the first category are expressive and match those that once might have defended deodand. Arguments in the second category are instrumental and match those that once might have supported frankpledge. “Expressive retributivists” champion the deodand perspective. They blame mindless legal entities for crimes committed by their employees. This article considers the implications of their arguments. Other defenders of corporate criminal liability view it as frankpledge - a device for persuading everyone in an organization to monitor everyone else. This article questions the propriety of declaring some people guilty of other people’s crimes simply to encourage them to police one another. On the assumption that corporate liability is here to stay, however, the article argues that it is better regarded as a means to induce internal monitoring than as bona fide criminal punishment. This article then considers the implications of the deodand and frankpledge positions. Neither of these positions justifies the federal rule of respondeat superior that authorizes the conviction of a corporation whenever an employee acting within the scope of his employment has committed a crime. The champions of both the deodand and frankpledge positions have in fact sought revision of this rule. Expressive retributivists propose replacing the rule with a “corporate ethos” standard. The article argues, however, that this standard is incoherent and unworkable. The reform advocated by the frankpledge proponents is more sensible. If the goal of corporate criminal liability is to induce appropriate monitoring, the creation and maintenance of an appropriate corporate compliance program should provide a defense to liability. Proposals for such a defense have not fared well, and this article considers their prospects. It suggests that, although the respondeat superior standard is truly indefensible, it survives because it affords broad powers to prosecutors. The article examines how prosecutors have used and misused their extraordinary powers. A final section of this article considers the implications of the frankpledge perspective for sentencing corporate offenders. A judge’s goal in punishing a corporation should be to induce a level of monitoring that will prevent more criminal harm than the monitoring will cost.

Download of the Week

The Download of the Week is Preventive Adjudication by Samuel Bray. Here is the abstract:

This Article identifies, justifies, and explains the parameters of a largely ignored but important category of cases - what is here called “preventive adjudication.” In this category of cases, courts offer opinions without any “command” to the parties, and these opinions are meant to avoid future harm, not remedy past harm. Despite receiving little attention in the legal literature, preventive adjudication is pervasive throughout law. It happens in declaratory judgment actions about wills, patents, and unconstitutionally vague statutes; in paternity and maternity petitions; in petitions to have missing persons declared dead; in boundary disputes; in actions to quiet title. This Article explains what preventive adjudication is and how it should and should not be used.

Preventive adjudication is intuitively appealing, because it helps people avoid harm and clarifies the law. But there are downsides to deciding cases in advance instead of waiting for remedial adjudication. The argument for preventive adjudication is therefore a qualified one. This Article identifies not only the merits of preventive adjudication but also the crucial limiting principles. One limiting principle is administrative and error costs; another is the adequacy of discounting, i.e., taking into account the uncertainty of future events. People discount for many kinds of uncertainty, and discounting is usually adequate for uncertainty caused by law. But discounting is inadequate when the law causes uncertainty about inescapable threshold questions for human behavior, such as legal parenthood, citizenship, marital status, or death. Discounting is also inadequate for uncertainty about property rights, because uncertainty undermines the policy reasons for having property rules in the first place. Where discounting is inadequate, preventive adjudication is especially valuable.

This Article also shows how this normative understanding of preventive adjudication can be translated into the actual practice of courts in the United States. Legal systems in the United States have two ways of determining which cases should be decided by preventive adjudication: sometimes they rely on judicial discretion to decide if preventive adjudication is appropriate in each case (“retail sorting”); and sometimes they specify categories of cases in which preventive adjudication is available (“wholesale sorting”). An analysis of both approaches shows that wholesale sorting - which is common in state courts but almost unknown in federal courts - better aligns the actual practice of preventive adjudication with the cases in which it is justifiable.

Download of the Week

The Download of the Week is The Invisible Hand in Legal Theory by Adrian Vermeule. Here is the abstract:

Theorists have offered invisible-hand justifications for a range of legal institutions, including the separation of powers, free speech, the adversary system of litigation, criminal procedure, the common law, and property rights. These arguments are largely localized, with few comparisons across contexts and no general account of how invisible-hand justifications work. This essay has two aims. The first is to identify general conditions under which an invisible-hand justification will succeed. The second is to identify several theoretical dilemmas that arise from the structure of invisible-hand justifications and that cut across local contexts. These are the dilemma of norms, which arises because norms of truth-seeking, ethical action or altruism can both promote and undermine the workings of the invisible hand; the dilemma of second best, which arises because partial compliance with the conditions for an invisible-hand justification can produce the worst of all possible worlds; and the dilemma of verification, which arises where theorists claim that an invisible-hand process functions as a Hayekian discovery procedure - a claim that is empirical but pragmatically unverifiable.

And from the paper:

Do invisible-hand justifications actually work, in a given domain? Across all domains, theorists recognize that the question is at least partly empirical. The preferred mode of argument is then to implicitly shift the burden of proof to the other side. One criticism of Bickel’s contest theory of free speech, for example, is that “[t]he equilibrium theory remains impressionistic and relies on premises that are both unsupported and unlikely.”87 As for the broader claim that the marketplace of ideas produces truth, its “most prominent weakness” is “[t]he absence of . . . a demonstration, in the face of numerous counter-examples,” that truth tends to prevail over falsehood.88 Likewise, a standard criticism of the argument that the adversary system produces truth is that it is merely “a hopeful supposition derived from advocacy ideology. There is no empirical evidence indicating that the contests of advocates deliver truth in this manner.”89 Such arguments rarely explain why the invisible-hand justification should be rejected if there is no evidence for it; the situation is equally compatible with there being no evidence against it, and the lack of evidence favoring the invisible-hand justification is not the same as positive evidence that the justification fails. The critics, that is, confuse or exploit the distinction between absence of evidence and evidence of absence.

This implicit burden-shifting is the usual stuff of legal argument, but I believe that the empirical problems surrounding invisible-hand justifications go deeper than in many other domains. The key problem is that invisible-hand justifications typically include an express or implied claim that competition serves as a discovery procedure.90 The action of participants in express or implied markets itself generates information, to which the analyst may have no other means of access.

Hayek famously made this claim as to explicit economic markets, yet Hayek also suggested an analogy between markets and many other social and political institutions that harness competition, such as “sporting events, examinations, the awarding of government contracts, [and] the bestowal of prizes for poems, not to mention science.” Such institutions, Hayek suggested, are justified when and because we do not otherwise know the information that the competition is designed to reveal. “It would be patently absurd to sponsor a contest if we knew in advance who the winner would be. . . . The only reason we use competition at all has as its necessary consequence the fact that the validity of the theory of competition can never be empirically verified for those cases in which it is of interest.”91

On the logic of this claim, we might have no independent access to the information by which to judge whether an invisible-hand justification does or does not work. As to explicit markets, the analyst who asks the question is a single mind, and on Hayekian premises can never generate the information that socially distributed knowledge can produce through the price system. In the context of adversary criminal trials, “[w]e can’t learn directly whether the facts are really as the trier determined them because we don’t ever find out the facts.”92 This is slightly overstated, because in a tiny fraction of cases DNA evidence or other conclusive proof emerges after the fact, yet it seems a valid generalization. In the setting of free speech, it might be argued – although to my knowledge no one has done so – that it is pointless to ask whether the marketplace of ideas really tends as a general matter to produce truths that cannot otherwise be discovered. Putting aside the possibility of divine revelation, it is not obvious what independent source of truth could be appealed to without begging the question.

The lack of independent access to the information supposed to be generated by competitive processes insulates Hayekian invisible-hand justifications from criticism, but the price is high. Where competition is said to function as a discovery procedure, the success of the invisible-hand justification will be empirical but pragmatically unverifiable. This makes it just as hard for proponents of the invisible-hand justification to prove their case as it is for critics to disprove.

Given this inherent difficulty of direct access to the necessary evidence, proponents and critics fall back upon indirect strategies of assessment. For their part, critics examine the inputs into the competitive discovery procedure in order to indirectly impeach its outputs. A typical response to the informational argument for the adversary system, for example, is that it would be astonishing if the partisan motivations and rhetorical tricks of advocates tended to cancel each other out, rather than simply deepening the jury’s confusion and thus tending to produce random outcomes.93

The problem with such arguments is that all invisible-hand processes are astonishing,94 in the sense that their inputs always seem disreputable taken in isolation. A narrow focus on the self-interested motivations and self-serving actions of individuals in local contexts will always make it seem surprising that the aggregation of individual motives and behaviors could produce social goods overall. That is the very point of invisible-hand justifications, their central alchemy. It is a straightforward fallacy of composition to assume that because market participants are self-interested, the market as a whole cannot serve the public interest, however defined. It is equally fallacious to assume that because advocates in jury trials use rhetorical tricks, the interaction of their efforts must simply sow more confusion.

Highly recommended. Download it while it's hot!

Download of the Week

The Download of the Week is Moral Luck and Liability Lotteries by Guy Sela. Here is the abstract:

Adversaries of Moral Luck (AMLs) are at pains to explain why wrongdoers are liable to bear burdens (punishment, compensation etc.) which are related to the harm they cause, because the consequences of what we do are a matter of luck. One attempt to solve this problem suggests that wrongdoers who cause more harm are liable to bear a greater burden not because they are more blameworthy but rather because they get the short straw in a liability lottery (represented by the apparently indeterminate causal process). In this paper I argue that this attempt fails on several grounds. Apart from the fact that it is hard to see how the implementation of liability lotteries can be motivated and the fact that such scheme presupposes a political order (whereas the notion of liability does not seem to presuppose one), detaching liability from the outcomes of a culpable action undermines whichever justifications there were for imposing liability in the first place. Moreover, relying on the determination of the causal process as a good indication of the wrongdoer’s degree of culpability is mistaken, because the luck brought about through the causal process is not necessarily the only element involved in cases of harmful conduct which lies beyond the wrongdoers’ control.

And from the paper:

The underlying assumption of both Lewis' and Waldron's proposals is that the amount of risk imposed by wrongdoers can serve as a measurement of the level of culpability that their wrongdoing entails. To some extent this seems intuitively right. Grossly negligent driving is more culpable than marginally negligent driving because it bears greater risk of harm. Hence, both Lewis and Waldron maintain that we should expose the wrongdoer to the same amount of risk that he imposes on his victim – the more risky his behavior, the more culpable he is and, correspondingly, the greater risk of punishment/liability that he will incur. That seems sound, but how will the risk imposed by the wrongdoer be measured? Lewis makes several suggestions: (1) It could be the objective probability of the occurrence of harm; or (2) The reasonable degree of belief for a hypothetical observer who has all the possible relevant information regarding the situation; or (3) The reasonable degree of belief for a hypothetical observer who has all the information the wrongdoer actually has; or finally (4) The wrongdoer's actual degree of belief whether reasonable or not. It would be nice not to have to decide, says Lewis, and suggests that a reenactment of the wrongful act (or using the act itself instead of reenacting it) will impose the same level of risk on the wrongdoer irrespective of how we decide to measure it.

Unfortunately, it does not. Think of the following situation. Abe plans to kill Ike. For that purpose he buys a gun, learns how to operate it and carefully plans how he will snare Ike. It so happens that the Big Brother Police learns about the plan and decides to let Abe carry out his plan (in order to frame him) while taking measures to protect Ike. Unbeknownst to Abe, a Big Brother agent enters his house and replaces the bullets in his gun with identically looking empty cartridges. In the next morning Abe carries on his plan. He meets Ike in a dark alley and shoots him at the head from range zero. To Abe's surprise the bullets don't even injure Ike and seconds later a police force shows up and apprehends him.

The objective probability of the occurrence of harm in this case was zero36. This is also the reasonable degree of belief for an observer who knows the relevant facts (most importantly, the replacement of the bullets). On the other hand, Abe believed that his chances of killing Ike were 100%37 and so would believe every rational observer who knows the same facts as Abe and is unaware of the replacement of the bullets by the policeman. Now what's the relevant level of risk for determining Abe's culpability? It seems that the relevant level is 100% as in option 4 – Abe's actual degree of belief. Abe wanted to kill Ike, took the measures to do it and, as far as he knew, he was about to succeed in carrying out his plan. If his moral standing is determined by his response to moral reasons, he seems to have openly rejected them in pulling the trigger38. He is no different, in that regard, from his counterpart Abe1, whose gun is loaded with real bullets and whose shot kills Ike1. The penal lottery he should be facing is one in which he will (almost) certainly get a severe punishment. But the penal lottery he actually faces is one in which he is bound with (almost) certainty to get the more lenient punishment. His actual chances of killing Ike (and thus losing the draw and getting a severe punishment) are zero. It turns out that the actual act does not provide an adequate substitute to an established penal lottery. Why is that?

The reason is that the wrongdoer's degree of culpability is not measured by the actual level of risk he imposes on his victim, but rather by the subjectively perceived level of risk that he imposes (Lewis' fourth option). An act is more culpable not when it imposes a greater risk of harm in the actual world but rather when it is done with the intention of imposing a greater risk of harm (whether or not it succeeds in carrying out that intention). When the result of the draw is determined by the outcomes of the act, it reflects the risk implicit in the act itself and not the risk that is intended by the agent. It subjects the wrongdoer to a level of risk that is proportional to his doing but not to the culpability implicit in his wrongdoing.

Highly recommended. Download it while its hot!

Download of the Week

The Download of the Week is Towards a Right Against Risking by John Oberdiek. Here is the abstract:

Morality forbids treating people in certain ways, and one way that it does so is through the recognition of rights. Rights form a part of every plausible moral theory, if not at a fundamental level, than at the practical level of application. Indeed, moral theories typically recognize a whole host of rights, like the rights to life and bodily integrity, and of free expression and free association, to name a few. These are uncontroversial, core rights. In this paper I explore a question at the boundary of rights, namely, whether morality also recognizes a right against risking, and if it does, what that right consists in. Do persons have a claim that others not treat them in certain risky ways?

Highly recommended.

Download of the Week

The Download of the Week is The Political Economy of Youngstown by Edward T. Swaine. Here is the abstract:

The time is ripe for a non-doctrinal assessment of Justice Jackson’s famous three-category framework for challenges to presidential action, elaborated in Youngstown Sheet & Tube Co. v. Sawyer (also known as the Steel Seizure Case). Recent national security controversies have given the Youngstown framework a whole new lease on life, and its relevance for courts, Congress, and executive branch officials has never been higher. During the same period, empirical and analytical studies of presidential policymaking have advanced beyond personality-driven accounts of particular administrations. Together, these developments offer a terrific opportunity to assess how well the Youngstown framework fulfills its objective of advancing congressional interests and constraining presidential power.

A political economy approach better explains the problem to which Justice Jackson was responding - the capacity of presidential unilateralism to establish policy that can withstand statutory correction, regardless of whether it has a legal basis - and also explains more formally how Youngstown’s categories offer a practical, if legally unorthodox, constraint. The assessment becomes more negative, though, once those categories are treated endogenously - that is, once the political branches are modeled as behaving dynamically and reacting to the framework itself. For example, both empirical surveys of executive orders and case studies suggest that the President may react to the risk of legislative disapproval (which under Youngstown will likely result in judicial disapproval as well) by avoiding Congress altogether or by seeking only its indirect blessing. Because these and other results disserve the framework’s objectives, this Article proposes several more benign alternatives - and, in general, advocates re-seizing Steel Seizure.

Highly recommended.

Download of the Week

The Download of the Week is The Uneasy Case for Product Liability by Steven Shavell and A. Mitchell Polinsky. Here is the abstract:

We explain in this Article that the benefits of product liability may well be outweighed by its costs in a wide range of circumstances. One benefit is that the threat of liability may induce firms to improve product safety. However, this benefit is limited: even in the absence of product liability, firms would often be motivated by market forces to enhance product safety because their sales are likely to fall if their products harm consumers; moreover, their products must frequently conform to safety regulations. Consequently, product liability might not be expected to exert a significant additional influence on product safety — and the available empirical evidence suggests that such liability does not in fact have a measurable effect on the frequency of product accidents. A second benefit of product liability is that it causes product prices to increase to reflect the riskiness of products and thereby may improve consumer purchase decisions. But this benefit also involves a detriment, because product prices may rise excessively and undesirably chill purchases. A third benefit of product liability is that it compensates victims of product-related accidents for their losses. Yet this benefit is only partial, for accident victims are already often compensated by their insurers for some or all of their losses. Potentially offsetting the benefits of product liability are its costs, which are great. To transfer a dollar to a victim of a product accident requires more than a dollar on average in legal expenses. Given the limited benefits and the high costs of product liability, we conclude that it may be socially undesirable — especially for widely sold products, with respect to which market forces and regulation are relatively strong. This judgment is in tension both with the broad social endorsement of product liability and with proposals for its reform, which generally do not question its existence. Our more critical assessment of product liability stems from the fact that we engage in an analysis of its benefits and costs, whereas neither the proponents of product liability nor its reformers undertake to do so.

Download of the Week

The Download of the Week is Specific Performance and the Thirteenth Amendment by Nathan B. Oman. Here is the abstract:

Black-letter law declares that a contract to perform personal services cannot be specifically enforced. Many courts, scholars, and commentators have claimed that such enforcement would constitute “involuntary servitude” under the Thirteenth Amendment. This Article, however, rejects that conventional wisdom. A careful reading of the history leading to the ratification of the Thirteenth Amendment reveals that, at the time of its adoption, “involuntary servitude” had a specific legal meaning, one that did not extend to any specific enforcement of a personal service contract. Rather, courts that were forced to draw the line between contract enforcement and “involuntary servitude” looked to coercion in the creation of the contract, the length of its duration, the power of the master over the servant, and the adequacy of the servant’s compensation to determine if enforcement of an agreement would constitute “involuntary servitude.” Since the Thirteenth Amendment’s adoption, the U.S. Supreme Court has never found involuntary servitude in any case except those in which at least one of these factors and arguably all four of them was present. In short, neither the original meaning of “involuntary servitude” nor its subsequent interpretation by the Court justifies a per se prohibition on specific performance of personal service contracts.

Very interesting & highly recommended.