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Remixing Resources
No full textThis Essay argues for an approach to resource access that connects rather than separates questions of efficiency and distribution. It proceeds from the premise that putting together the most valuable combinations of resources—including human capital—is of central and increasing normative importance. Structuring law to facilitate these combinations should be a primary task for property scholars working in the law and economics tradition. Doing so requires engaging with the processes through which complementary resources produce value in a modern society, recognizing how property doctrines work to put together and keep together complementary resource sets, and confronting the ways in which material inequality and unremediated injustice stand in the way of realizing valuable complementarities. Because a complementarity-based vision of property holds the potential to promote efficiency and distributive goals simultaneously, it illuminates how an integrative approach might offer policy-relevant traction toward both objectives
Embedded Rules
No full textVolume 39Rules are rules and orders are orders, and never the twain shall meet. Generations of scholars and practitioners were taught back in law school that the Administrative Procedure Act (APA) divides the universe of agency action into two exclusive and exhaustive categories: “rulemaking,” which is used for promulgating “rules,” and “adjudication,” which is used for issuing “orders.” Each of those modes of agency action has its formal and informal versions, and some statutes mandate “hybrid” procedures with an intermediate level of formality. But the starting point for analyzing a given agency action is to decide whether that action falls into the “rule” box or the “order” box, which are separate and distinct. That is what then-Professor, now-Justice Elena Kagan taught me back when I took her Administrative Law class as a 2L, and it’s what I’ve taught my students for the last fifteen years.
But it’s not quite right. “Rules” and “orders” are not, in fact, completely separate and non-overlapping categories. Sometimes an administrative action that is properly classified as an order contains within it—usually in the portion explaining the order’s legal basis—a statement that qualifies as a rule and ought to be treated as such. The fact that such a rule is embedded within an order does not make it any less of a rule. And that means that the process for formulating an embedded rule counts (or ought to count) as a “rulemaking” under the APA
Corporate Crime and Punishment: An Empirical Study
No full textFor many years, law and economics scholars, as well as politicians and regulators, have debated whether corporate punishment chills beneficial corporate activity or, in the alternative, lets corporate criminals off too easily. A crucial and yet understudied aspect of this debate is empirical evidence. Unlike most other types of crime, the government does not measure corporate crime rates; therefore, the government and researchers alike cannot easily determine whether disputed policies are effectively deterring future incidents of corporate misconduct. In this Article, we take important first steps in addressing these questions. Specifically, we use three novel sources as proxies for corporate crime: the Financial Crimes Enforcement Network (FinCEN) Suspicious Activity Reports (SARs), consumer complaints made to the Consumer Financial Protection Bureau (CFPB), and whistleblower complaints made to the Securities and Exchange Commission (SEC). Each source reveals an increase in complaints or reports indicative of corporate misconduct over the past decade. We also examine levels of public company recidivism and find that they are likewise on the rise. And we document a potential explanation: recidivist companies are much larger than nonrecidivist companies, but they receive smaller fines than non-recidivist companies (measured as a percentage of market capitalization and revenue). We conclude by offering recommendations for enforcement agencies and policymakers. In particular, our results suggest that enforcers are unlikely to achieve optimal deterrence using fines alone. Enforcement agencies should therefore consider other ways of securing deterrence, such as by seeking penalties against guilty individuals and the top executives who facilitate their crimes
Representing What? Gender, Race, Class, and the Struggle for the Identity and the Legitimacy of Courts
No full textIn 1935, when the U.S. Supreme Court's new building opened and displayed the phrase "Equal Justice Under Law," racial segregation was commonplace, as were barriers limiting opportunities for men and women of all colors to participate in economic and political life. The justices on the Court and the lawyers appearing before them reflected those facts; almost all were white men. Today, the Supreme Court's inscription has become its motto, read as if it always referenced an understanding of equality that has become central to the identity and the legitimacy of courts. The judiciary "looks" somewhat different than it did and, in a sense, has become more "representative" of the range of people appearing in courts. Given the role that courts had played in sustaining discrimination, the impression that courts ought to welcome everyone is a major achievement. Yet, to assess the impact of new judicial demographics requires analysis of other major alterations in U.S. courts—the influx of diverse litigants newly entitled to pursue legal claims; the economic barriers facing many claimants; the emergence of judiciaries as agency-like promoters of agendas; and the displacement of public adjudication through the privatization of dispute resolution. Studies of women as judges focus mostly on their rulings, but probing the "difference that difference makes" requires looking beyond judicial opinions. Courts in the United States have developed structural capacities to propose rules and legislation, create education programs, commission research and task forces, and lobby for resources. When women of all colors and men of color became lawyers and judges, they created affinity organizations and pressed courts to research court-based bias and to revise rules of ethics, doctrine, and practice. Those changes are part of the impact of diversification within the legal profession, as is the backlash against affirmative efforts to reform practices. Another difference of the last decades is that new rights have brought into court many claimants with limited means. Participatory participation ("equal justice under law") remains elusive, while the "justice gap" (shorthand for the lack of sufficient governmental help for under-resourced litigants) is pervasive. Worse yet, in some jurisdictions, courts have served as "revenue centers," using court-imposed assessments as income. Failure to pay "legal financial obligations" can result in suspension of driver's licenses, the loss of voting rights, and other sanctions levied disproportionately on people who are poor and of color. Instead of being seen as fonts of fairness, courts are coming to be identified as sites of inequality. In addition, many courts have embraced alternative forms of dispute resolution that make both processes and outcomes less visible to the public. Through doctrine and rules, U.S. courts have shifted their own practices as well as enforced mandates imposed on consumers and employers that push them out of court and out of class or joint actions. In sum, the new faces on the bench ought not to obscure that the project of representation, inclusion, and equality is far from complete. The vivid inequalities in courts are problems for courts because such disparities undermine their ability to be places of justice
Obsolescence: The Intractable Production Problem in Contract Law
No full textContract law has long suffered from an institutional problem: Which legal institution can best create an efficient law for commercial
contracts that can overcome “obsolescence”—the persistence of rules that only solve yesterday’s contracting problems? Until the early twentieth century, contract law was largely created by common law courts. The law’s default rules were efficient when created, and courts updated them as commerce changed. But there were few rules, and the common law process was slow. In response, the twentieth century saw public and private lawmaking bodies enact commercial statutes in discrete legal areas such as secured credit, commercial paper, and bankruptcy. Cohesive interest groups rapidly updated these discrete rules, but the rules, both original and as changed, served only the creating groups’ interests. Private lawmaking efforts also assumed a generalist portfolio. In the Uniform Commercial Code, they reached beyond specialized fields to the law of sales and then, in the Restatements, to all contracting behavior. But because these generalist bodies lack the institutional capacity to update, many of their rules have not changed with changing commercial practice. Obsolescence is not innocuous: It can induce inefficient contracting practices and encourage parties to behave strategically. The need for a modern general law of commercial contracts remains. Specialized lawmakers are subject to interest group capture, and the generalist lawmaking bodies cannot update. Courts have responded better to the obsolescence concern, but they are slow and limited. Hence, we suggest a public/private regulatory response to the vexing production problem in contract law
Work and Employment for DACA Recipients
No full textVolume 39Deferred Action for Childhood Arrivals (DACA) has brought job opportunities and a brighter future to somewhere around 700,000 undocumented immigrant youth. Yet some contend that the employment authorization conferred upon DACA recipients renders the program illegal, because it converts it from a mere program of prosecutorial discretion into an ultra vires benefit. This essay sets aside the host of other legal issues raised by DACA and focuses on the narrow question of whether the federal government exceeds its statutory authority when it confers employment authorization on DACA recipients. There is a short answer to this question that is based on the unambiguous text of the Immigration and Nationality Act (INA), which is an emphatic no. The relevant statute defines an “unauthorized alien” for employment purposes to exclude anyone designated as authorized for employment by the agency; the agency has long designated deferred action as a category authorized for employment, and DACA is a species of deferred action. Yet some courts have found this answer unsatisfying, referring to the provision as a “mousehole” that pales beside the vast social and economic questions at stake in making large numbers of undocumented immigrants eligible for employment. Federal courts in Texas have enjoined DACA and a related program called Deferred Action for Parental Accountability (DAPA) based on their inference that a purpose of the INA is to parsimoniously guard employment authorization as part of a broader scheme to enforce immigration law and protect jobs for native workers
Time Enough for Counting: A Unicorn Retrospective
No full textVolume 39Legal scholars worry that existing laws cannot adequately regulate large private companies (“unicorns”). At the same time, unicorns seem to be a key part of flourishing markets. Are unicorns a problem that requires solving or a sign that entrepreneurial finance is working? This essay addresses that question by tracking outcomes for the 32 startups that qualified as unicorns when the moniker first emerged. It introduces a new typology of unicorn outcomes to guide policy makers and offers a preliminary hypothesis that private ordering by founders, employees, and investors is proving an effective alternative to ambitious regulatory reform
The Accoucheur Comes: Interpreting Measure for Measure as Administrative Midwifery
No full textThe purpose of this article is to perform an act of midwifery. I will begin by considering and summarizing the view, argued by Adrian Vermeule and Eric Posner, that our system of government has loosed the bonds of Madisonian design and now exists and operates as a postliberal largely post-republican executive administrative state. I will briefly highlight the philosophic features and legal doctrines which define this new regime. I will then turn to a challenge issued by these same legal scholars: if this view—regardless of being good or bad—is the true and unalterable reality of our government, then how does a legal thinker or political theorist properly act as a midwife to this burgeoning constitutional administrative order? What would a scholarship unconcerned with the classical constitutional mandates entail? I will posit first that our culture lacks the aesthetic vocabulary needed for this kind of work. I will then posit that the law and literature movement—in considering the roles of rhetoric and aesthetic preferences in justifying and ultimately explaining legal regimes—provides the best path forward for aspiring administrative midwives. I will conclude with a demonstration of midwifery by offering an interpretation of Shakespeare’s play, Measure for Measure, which approaches the play from the vantage point of a literary critic saturated in the dictates of a post-Madisonian regime
Zoning and the Cost of Housing: Evidence from Silicon Valley, Greater New Haven, and Greater Austin
No full textMunicipal zoning, shockingly, may be the most consequential regulatory program in the United States. This Article develops metrics for measuring the extent to which a locality's zoning practices are exclusionary, that is, limit construction of least-cost housing. It applies the metrics to actual zoning ordinances and zoning maps, materials that legal scholars have seldom closely appraised. The municipalities chosen for study lie in three metropolitan areas, the ones listed in the Article's title. Of the three, zoning in Greater Austin, one of the fastest growing metropolitan areas in the United States, is-to no one's surprise-the most conducive to housing development. Austin suburbs have less large-lot zoning, more small-lot zoning, and fewer restrictions on the construction of multifamily housing. Housing prices in Silicon Valley, currently by far the highest in the United States, were only slightly above the national median in 1970. The extreme escalation of Silicon Valley housing prices has stemmed in significant part from its suburbs'
multifaceted efforts, after 1970, to limit further densification. Some towns in Greater New Haven, by contrast, adopted exclusionary policies as early as the 1930s. These towns' enactments have distorted the region's urban form and reduced its agglomeration efficiencies but had little effect on housing prices.
The final parts of this Article are more overtly normative. They present the case for boosting permitted residential densities in urban areas of the United States. To counter neighborhood NIMBYism, state legislatures should either preempt local
discretion over what can be built or reward localities that allow denser housing