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James R. Copland Archives



On last Thursday and Friday, I was in Charlotte for the spring meeting of the Civil Justice Task Force of the American Legislative Exchange Council, to which I presented my thoughts on how today’s securities litigation affected states. Uptown Charlotte was visited by various protesters affiliated with labor unions, the Occupy movement, and other left-leaning causes who were objecting to ALEC’s meeting and at the earlier-in-the-week annual shareholder meeting for Bank of America.

The protests against ALEC have been led by Van Jones’s Color of Change organization, which has attacked the free-market organization for drafting “stand your ground” model legislation arguably (though not really) at issue in the Trayvon Martin shooting. (Note: Florida’s stand-your-ground law pre-dates ALEC’s model bill, and the group has now disbanded the task force responsible for advancing that model legislation.) Like Ted, I’ve found the left’s attacks on ALEC to be profoundly disingenuous. First, it’s clearly the case that those opposed to ALEC’s reform work—in the case of the Civil Justice Task Force, for instance, the American Association for Justice, formerly known as the Association of Trial Lawyers of America—offer up legislation and legislative amendments to further their own interests. Second, if ALEC didn’t exist, corporations would still offer draft legislation and legislative amendments to further their own interests; it just wouldn’t be vetted by a broad group including legislators across several states and thinkers like myself, my former colleague and Point of Law founding editor Walter Olson (now at the Cato Institute), our editor Ted Frank and others at his Center for Class Action Fairness, and ALEC Civil Justice Task Force co-chair Victor Schwartz, who edits the most-used law school casebook on torts. Exactly how is ALEC supposed to be an unusually nefarious force, apart from the fact that its critics disagree with its agenda?



Next week, the Supreme Court will be holding extended oral arguments on the constitutionality of the landmark 2010 health-care reform law, the Patient Protection and Affordable Care Act, known popularly--at least among the law's critics--as Obamacare. Beginning on Tuesday, Point of Law will be hosting an exceptional panel of legal scholars and analysts, across the political spectrum, to discuss the oral arguments and the rationales for and against the law's constitutionality:



We're thrilled to have such a distinguished group visiting Point of Law to shed light on this landmark constitutional case. Thanks to the Center for Legal Policy's Isaac Gorodetski for working hard to pull this together.


On October 20, our friends at the Cato Institute published a study by Cato adjunct scholar Shirley Svorny claiming that existing empirical evidence suggests that "medical malpractice awards do track actual damages" and that noneconomic damage caps and other "policies that reduce liability or shield physicians from oversight by carriers may harm consumers." An economics professor at California State University, Northridge, Svorny has since publicized her findings in outlets such as the Huffington Post, in which she not only argued against the medical-malpractice reform provision of the Jobs Through Growth Act but also suggested that "[r]educing liability, as caps do, is rarely a good idea in any situation."

Needless to say, Svorny's position is at odds with that we've generally taken here at Point of Law (see back posts here), including our former editor, Svorny's Cato colleague Walter Olson (see, e.g., here, here, here, here). (See also this seminal contribution by MI visiting scholar Richard Epstein and this Manhattan Institute study by libertarian economist Alex Tabarrok.)

This week, Professor Svorny has graciously agreed to come to Point of Law to discuss her paper with MI adjunct fellow and PoL editor Ted Frank. The featured discussion will be available here; please check back throughout the week as the discussion continues.

Join the debate! Please send your questions and commentary via Twitter, #PoLdiscussion.

Paul Howard on the PPACA

My colleague Paul Howard, who heads the Manhattan Institute's Center for Medical Progress, discusses the constitutional challenge to the Patient Protection and Affordable Care Act with a focus on the policy problems with the new legislation. See his thoughts here at our sister blog, Medical Progress Today.

Epstein and Tribe debate PPACA

As the Supreme Court has now granted cert to hear the constitutional challenges to the Patient Protection and Affordable Care Act, a/k/a "Obamacare," our readers might be interested in watching this video of a September 15 event we hosted at the Manhattan Institute in which professors Richard Epstein and Larry Tribe debated the subject, moderated by yours truly:


In two major decisions today that will interest the readers of this site, the Supreme Court held that the class alleging gender discrimination against Wal-Mart was improperly certified in Wal-Mart v. Dukes and that the EPA's governance of carbon-dioxide regulation under the Clean Air Act displaced the federal common law public nuisance suit brought by various states and municipalities in AEP v. Connecticut. The holding in both cases was unanimous, though not without underlying disagreement. In Dukes, the justices split 5-4 over whether to dismiss the suit outright (the majority decision) or whether to remand for further consideration as a 23(b)(3) class action (Justice Ginsburg's position, joined by Justices Breyer, Kagan, and Sotomayor). In AEP, the justices split 4-4 on whether the plaintiffs had standing to sue (presumably the same split as in Massachusetts v. EPA), and Justice Alito wrote separately, joined by Justice Thomas, to emphasize that his decision rested on the assumption that the Clean Air Act applied to carbon dioxide emissions (the position he rejected in Massachusetts v. EPA) (Justice Sotomayor, who was involved in the suit below, recused).

Those who didn't see our earlier discussion on Dukes, which pulled in various thinkers and practitioners, should check it out now and compare with the actual decision. The Manhattan Institute also wrote a fair amount on the AEP global-warming-as-public-nuisance case in last fall's Trial Lawyers, Inc.: Environment.

Josh Blackman summarizes Dukes here and AEP here. Walter Olson assesses Dukes here. And as Blackman notes, the Dukes decisions, both majority and dissent, are replete with citations to our dear departed friend Richard Nagareda's published writings, both The Preexistence Principle and the Structure of the Class Action, 103 Colum. L. Rev. 149, 176, n. 110 (2003) and Class Certification in the Age of Aggregate Proof, 84 N. Y. U. L. Rev. 97, 131-132 (2009).


If the new vote tally coming out of Waukesha County holds, JoAnne Kloppenburg's self-declaration of victory would seem even more premature than it did at the time. (And isn't it a bit unseemly for a prospective state-supreme court justice to be declaring victory with such a razor-thin margin? These are, after all, the monitors of due process, and a recount here was inevitable. Of course, unseemliness for the judiciary is also a bit inherent in such judicial campaigns overall -- one of the several critiques raised against this method of selecting judges. (But see also here, here, and here.))

I did want to clarify one small point of disagreement with Carter, though: unlike Carter, I tend to agree with Glenn Reynolds (citing Vincent Vernuccio) more than Greg Sargent here -- and Sargent's piece strikes me as a pretty weak political analysis. And that's even if Kloppenburg is ultimately able to prevail after all the inevitable legal wrangling and wind up on top at the end of the day.

Now, I fully agree with Carter that "a victory is a victory is a victory." And for Wisconsin, this election will have major, major implications (even if, as Carter notes, the outcome of Walker's reforms hinge less on it than Kloppenburg's supporters seem to believe).

But critically, Sargent, Reynolds, and Vernuccio are really writing about national, not Wisconsin, political implications. By mobilizing so agressively on what would have otherwise been a sleepy state supreme court race, organized labor was trying to scare the dickens out of anyone who'd try to emulate Scott Walker's approach in wrestling with public financing problems.

And on this score, like Glenn, I'm less than impressed. The unions did indeed go "all in" -- and in a low-turnout election in which their voter mobilization played a disproportionate role, they effectively eked out a tie.

Sargent writes about "a massive and astonishingly fast swing of support away from Prosser and in Kloppenburg's favor" and cites Prosser's primary-vote margin and Wisconsin's historic tendency not to reject incumbent justices as evidence for a big electoral shift here. Poppycock, in my view. Voters in general know not a lick about state supreme court races. They don't pay any attention whatsoever unless the races become highly contested with lots of outside dollars. It's not like Justice Prosser has wide name recognition or a big reservoir of public support on the Wisconsin streets.

Now, to be sure, those Republicans in Wisconsin facing recall elections do have some reason for concern: labor is mad, and they've shown a capacity to mobilize voters with disproportionate impact in a low-turnout race. But as for national implications, all this election shows is that the Left pushed a supreme court election into a virtual tie, after making the governor's controversial plan the defining feature of an otherwise-ignored supreme court race -- in a state that last supported a Republican for president in 1984. If the Democrats generally or the unions specifically read too much into this for the national political scene, then in my view they're deluding themselves.


On Wednesday, the Manhattan Institute released a new "finding," looking at executive-compensation shareholder proposals, as part of the Proxy Monitor project. Key findings include:

  • Labor unions are playing a big role here. "The two most frequent shareholder sponsors of proposals related to executive compensation have been the American Federation of State, County and Municipal Employees (AFSCME), with twenty-three proposals, and the AFL-CIO, with twelve. Overall, labor unions and their pension funds introduced 70 proposals related to executive compensation to Fortune 100 companies since 2008, constituting over 38 percent of all identified proposals coming to a vote."
  • Shareholders are electing to hold annual say-on-pay votes. "Under Dodd-Frank's Section 951, executive-compensation advisory votes are now mandatory for public companies. In 2011, companies with annual meetings scheduled after January 21 must hold a vote to determine the frequency of such votes, which under the statute can be every one to three years. Of the four companies in the Fortune 100 to have voted on the issue thus far--Johnson Controls (JCI), Costco (COST), Emerson Electric (EMR), and Tyson Foods (TSN)--shareholders have supported annual advisory votes on executive compensation at each company save Tyson, which has a dual-share structure giving insiders effective voting control."

I discuss the new finding in a podcast here. Read the whole thing here.


Ted's absolutely right that it's very unusual for an administration to refuse to defend a duly signed federal statute, but it's hardly unprecedented. The closest relatively recent analogue of which I'm aware -- in which the constitutional rule being invoked in refusing to enforce the law is unsettled by the Supreme Court and politically charged -- is the George H.W. Bush administration's decision not to defend federal affirmative-action contracting in Metro Broadcasting. The acting solicitor general for that case was, interestingly, one John Roberts. See this interesting analysis from Marty Lederman.

Traditionally, the Justice Department has declined to defend a law when:


  1. The law is clearly unconstitutional under intervening Supreme Court decisions (not the case here, at least if the premise is that sexual orientation is entitled to heightened-scrutiny review, which the Court has never determined);

  2. The law infringes on Presidential powers (not the case here); or

  3. The President himself has openly stated that he believes the law to be unconstitutional (now the case here -- and likely a key reason why the attorney general invoked the president's position in his letter to the speaker)

Ed Whelan, no friend of the position that DOMA is unconstitutional, observes that "[t]oday's action at least has the modest virtue of bringing [the Obama administration's position] out into the open." Whelan has previously argued, with some force, that "the Obama administration has been sabotaging DOMA litigation from the outset." In general, litigation requires vigorous advocacy, though the aggressive participation of amici in this litigation removes a major obstacle otherwise inherent in an administration decision to give less than a full-throated defense.

The most interesting question to me is that posed by Dale Carpenter: who exactly, apart from the administration, has standing to defend this law? Where standing for an individual plaintiff would be pretty clear for the health-care law or affirmative-action program, it's not self-evident who exactly suffers the requisite harm here, if Congressional leaders aren't allowed to step in.

Also, there's an important point much of the coverage has been missing so far: the administration's position here extends only to Section 3 of the DOMA, which precludes same-sex married couples -- as recognized by their own state -- from receiving federal benefits due to married couples. Holder's letter does not express an opinion on DOMA's application of the Full Faith and Credit Clause to undergird states' decisions not to recognize other states' same-sex marriage licenses.

MORE: Here's an interesting article on the topic from Clinton-era Solicitor General Seth Waxman, related to his decision not to support a Congressional statute intended to overturn Miranda in Dickerson.

BREAKING: Bruesewitz v. Wyeth


In a major decision, the Supreme Court today ruled that the National Childhood Vaccine Injury Compensation Act of 1986 preempts state-law design-defect tort claims. The Court split 6-2, with Scalia writing for the majority; Justice Breyer concurred, and Justice Sotomayor dissented, joined by Justice Ginsburg. (Justice Kagan recused herself.) More to follow; the full opinion is here.

UPDATE: A Litigation Update (PDF) from the Washington Legal Foundation, which filed an amicus brief in the case.

 

 


Isaac Gorodetski
Project Manager,
Center for Legal Policy at the
Manhattan Institute
igorodetski@manhattan-institute.org

Bridget Carroll
Press Officer,
Manhattan Institute
bcarroll@manhattan-institute.org

 

Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.