Class actions remain a work in progress in many jurisdictions around the globe. Several amendments to Federal Rule 23 took effect on December 1, 2018, after more than four years of deliberation by the Advisory Committee on Civil Rules. The Ontario Law Reform Commission is in the final stages of an eighteen-month comprehensive review of class actions, the first in the class action statute’s history in that province. Likewise, the Australian Law Reform Commission recently submitted its report to the Attorney General recommending amendments to its class action procedure, while the Victorian Law Reform Commission’s report on Litigation Funding and Group Proceedings was tabled in the Victorian Parliament in June 2018. Efforts at legislative reform in the United States, however, have stalled. No doubt to the considerable relief of the plaintiff bar, sweeping changes to class action procedure introduced by a Republican Congress in the Fairness in Class Action Litigation Act of 2017 (FICALA) will not come to pass, as the bill failed to advance in the Senate prior to the end of the previous Congress and Democratic control of the House of Representatives in the new Congress.
Still, the appetite for reforming class actions remains, not least among corporate interests eager to capitalize on legislative efforts to cut regulations and curb litigation. Anticipating that reform efforts will continue and FICALA will reappear in reincarnated form, Howard Erichson usefully dissects the proposed amendments in Searching for Salvageable Ideas in FICALA, one of six papers published as part of a symposium at Fordham Law School entitled “Civil Litigation Reform in the Trump Era: Threats and Opportunities.” FICALA represents “the most aggressive attempt in recent memory to dismantle the apparatus of mass litigation through procedural reform.” Introduced less than three weeks after President Trump took office and passed by the House along party lines, FICALA appears to be less about improving judicial efficiency or updating an outmoded procedure than a “defendant-driven effort to reduce liability exposure by making it difficult for plaintiffs to aggregate claims.” While most of the bill has little to commend itself to Erichson and other class action experts, a few proposals have the potential to improve the litigation process. In his essay, Erichson discusses the irredeemable and the salvageable ideas in the reform bill, both in convincing fashion.
Erichson identifies three principal reasons why most of the bill is highly problematic. The bad proposals either (1) are solutions in search of a problem; (2) address real problems in an ill-conceived way; or (3) target issues better solved by the courts, not Congress. He then discusses the few laudatory aspects of the bill.
One of FICALA’s most draconian provisions would prohibit class certification unless the plaintiff “affirmatively demonstrates that each proposed class member suffered the same type and scope of injury as the named class representative” (H.R. 985 §103(a)). Requiring identical harm among class members would eliminate many appropriate class actions, such as those on behalf of consumers and employees, just because the degree of harm between them may differ. Rule 23 already requires that common issues predominate and that the class representative be typical of the class; there is no good reason to deny certification solely because class members suffered non-identical harm. Indeed, with certification having become more difficult for plaintiffs in the past decade, a stricter test for certification purports to solve a problem that does not even exist.
In the second category of defect is the proposed prohibition on determining or paying class counsel fees until all class members are paid. According to Erichson, at best the proposal “represents a clumsy effort to defer the determination of class counsel fees until after the value of the remedy is known.” An absolute prohibition on the payment of even interim fees would create problematic incentives to negotiate settlements with short claims processes even where a longer process would be appropriate.
A proposal to impose strict limitations on who may serve as a representative plaintiff falls within Erichson’s third category. Class action reform in the United States can take place in three different ways: by the courts’ rulemaking committees; in the development of case law as issues percolate in the appellate courts; and through Congress. Procedural reforms linked to federal substantive statutes are within Congress’ institutional role. Procedural reforms not connected to subject matter jurisdiction, however, are more properly the purview of deliberative rulemaking bodies or appellate consideration in the context of live disputes. Concerns about conflicts of interest between class representatives and class counsel, for example, are better left to the discretion of the judge looking at the relationships and the circumstances of a particular case, whereas legislative intervention may impose an unnecessarily rigid rule.
Despite its many flaws, FICALA contains a few salvageable ideas. Erichson discusses three – reforms to class counsel fees, class settlement reporting, and subject matter jurisdiction – but devotes the most attention to the first. He recognizes that reforms that aim to improve class actions for class members (as opposed to entrepreneurial attorneys or defendants) are the least likely to be represented in judicial rule-making processes. I would add that class member interests are also unlikely to be pressed by political lobbyists, which is why the fee provisions in FICALA represent the most promising and nonpartisan aspects of the bill. Plaintiff attorneys’ and defendants’ interests align to the extent that both prefer expedient settlements. As a matter of brute economics, the “best way to incentivize class counsel to negotiate remedies of real value to class members is to link fees to what class members get.” Too often, however, class counsel obtain a fee based on the face value of a settlement that differs significantly from the actual value to the class, due to coupon settlements, large (and unnecessary) cy près awards, or low claims rates attributable to a flawed distribution process. Determining the true value of a settlement may require waiting until the end of the distribution process, followed by a report to the court. Erichson would not defer all fees to the end of that process, as contemplated under FICALA, but he proposes interim fee payments following a periodic accounting of the settlement distribution. He also would include appropriate cy près remedies for the purpose of calculating counsel’s fee. Erichson’s proposal makes sense; it’s very similar to one that I have advocated in my own jurisdiction’s reform efforts and an approach adopted by several Canadian judges.
Erichson persuasively argues that most FICALA provisions are draconian, “driven not by a desire to assure fair and prompt recoveries, but rather by a desire to make recoveries difficult for all plaintiffs in class actions.” With equal conviction, he makes the case for supporting legislative reform that would improve class actions for the people they are meant to serve: class members. It’s an idea worth salvaging.
A series of mostly hostile Supreme Court and court of appeals decisions, combined with the Court’s unwillingness to rein in boilerplate arbitration clauses in consumer agreements, has led a number of scholars to proclaim that class actions are dead, or at least dying. While appreciating that this framing puts the unquestioned decline of class actions into stark relief, I have been skeptical of the narrative. The recent amendments to Rule 23, for instance, show that policymakers still believe that class actions have salience, and the myriad state-court class actions that fly beneath the jurisdictional radar of the Class Action Fairness Act belie the class action’s demise.
In some retellings of the “class actions are dying” narrative, the ironic suplot is the rise of class-action practice in the rest of the world. Until recent years, only countries with a common-law heritage employed class actions, and even among those countries, only the United States used them with regularity. Over the past ten to fifteen years, however, many countries (I recently counted almost forty, and I was not attempting a comprehensive survey) have established some form of class or collective action. The terms of these processes vary across numerous measures: who can bring suit, for what types of claims, whether members must opt in or may opt out, and so on. But the moral of the subplot is that, just as American courts are moving away from one of the signal features of American procedural exceptionalism, the rest of the world is embracing the device.
The new volume from Hodges and Voet throws some shade on this subplot, and at the same time adumbrates a future in which class actions might indeed wither away.
Although the European Commission recommended in 2013 that Member States develop collective-redress procedures, the recommendation went out of its way to take swipes at the “toxic cocktail” of incentives that fueled the American class action. The European view of the American class action is a nasty caricature of its worst features: greedy lawyers, abusive discovery, and cowering corporations pitchforking millions of dollars at meritless settlements to prevent juries from plunging companies into bankruptcy. The Commission’s message was: “Collective redress, yes; American class actions, most decidedly no.”
But consensus on this point dissipated when the rubber met the road. The authors document the post-2013 failure of Member States to agree on basic matters of class-action or collective-redress design. As a result, the results of collective-redress litigation have been unimpressive so far and the future effectiveness of such litigation is likely to be limited.
More important, those captivated by the rise of class actions in other countries may be neglecting a phenomenon that is bubbling up at the same time: a wide range of new mechanisms to resolve mass disputes, of which class actions or class-action-like devices are only one. Focusing on the responses of EU Member States to the problem of collective redress, the authors describe this welter of responses. The devil is often in the details, and this book is chock-full of case studies from European countries. Aided in their effort by rapporteurs from Member States who presented their findings at a series of conferences, the authors group these responses into four broad categories: collective actions (class actions and their ilk); criminal prosecutions that, among their sanctions, generate compensation orders for victims; regulatory mechanisms that seek to modify putative injurers’ future behavior (whether through influence or coercion) and that may include compensation as part of the regulatory response; and ombudsmen, who work in conjunction with regulatory agencies to process claims, provide information feedback designed to modify injurers’ behavior, and advocate for necessary changes in legislation or other regulatory rules.
In evaluating these options as they have played out in the EU over the past decade, the authors are enthusiastically disposed to the latter two options, particularly when the ombudsman has a full toolbox of remedial options that includes compensatory mechanisms for consumers and techniques to influence or coerce industry. The latter options are not an either-or choice. As the authors describe, the regulatory and ombudsmen models have been married in a number of high-profile cases to provide redress and prevent recurrence of improper behavior.
Ombudsmen, which act as alternative dispute resolvers en masse, earn the lion’s share of the authors’ praise. Ombudsmen enjoy “a number of strengths and few weaknesses.” Strengths include an automatic opt-in procedure for consumers who contact the ombudsman, the capacity to treat like cases alike, the ability to notify companies and affected consumers of common issues, and the power to resolve those issues on a classwide basis without binding consumers to the resolution. The process is also free to consumers (with companies or government agencies footing the bill) and faster than judicial resolution.
In contrast, the authors are cool to litigation options, like class actions, for corrective redress.
They seek to convince the reader of their conclusions along two paths. The first is descriptive: they lay out the successes and limits of each approach in the countries and cases in which they have been tried, often with accompanying data. The second is theoretical (a term the authors may not like, so perhaps functional is a better word): the principal goals of collective redress to consumers are compensation and influencing behavior to prevent similar conduct in the future. On these measures, the authors argue, the regulatory and ombudsman approaches outperform alternatives.
Both sets of arguments are contestable. On the descriptive side, the number of countries using ombudsmen is small, and experience is limited outside the United Kingdom. On the functional side, the authors, who throw in their lot with behavioral sociology and economics rather that rational-choice economics, swim against a strong tide to argue that affecting future behavior, not deterrence, is a principal function of system of mass dispute resolution. Following prior work by Hodges, the authors argue that compensation does little to deter bad conduct and that mechanisms other than ordering the payment of money are necessary to change behavior.
Those steeped in class-action literature will fault the authors for cherry-picking arguments that put the class action in its worst light as a compensatory and deterrence mechanism.
In addition, the authors would have done well to defend their ombudsman-favoring recommendations against evident critiques. One critique is the problem of regulatory capture. While it appears that this problem has not infected the professionalized British ombudsmen system, the closest American analogy to a broad consumer ombudsman — the Consumer Financial Protection Bureau (CFPB) — has been a political football that offers a cautionary tale of what can go wrong when an administration disagrees fundamentally with the ombudsman’s regulatory objectives. Another critique, which was beyond the remit of the authors to address, is whether it is possible to mold a regulatory-ombudsman approach to a legal culture, such as in the United States, that prefers to regulate action lightly at the front end and sort out harmful effects at the back end. Finally, it is unclear how much of the success of ombudsmen is due to the backstop of litigation: would ombudsmen have the same leverage without realistic litigation options?
Some of the approaches that the authors describe have American analogs. As Adam Zimmerman and his co-authors have demonstrated, the American system increasingly relies on criminal or regulatory-enforcement proceedings to provide redress to victims in mass disputes. The CFPB and a few other ombudsman-like systems, such as FINRA, already exist. Thus far, however, Americans have not invested these mechanisms with the broad regulatory and compensatory powers of some of their European counterparts.
For me, the scenario likeliest to kill the American class action is a better alternative — a device that accomplishes most of the aims of class actions with fewer side effects. So far, such devices have been thin on the ground, at least in the United States. Despite its limits, the book offers a tantalizing look at an alternative universe of mass dispute resolution and is sure to stimulate the imagination of scholars who think about the future of aggregation in the United States. If regulatory and ombusdman approaches can be adapted to the American context, collective redress need not rely solely on class actions, multidistrict litigation, or less desirable options such as individualized consumer ADR. Debates about the strengths, weaknesses, and incentive structures of the present options will take on a different mien. The authors’ effort to sketch a possible future for aggregate dispute resolution creates an intriguing picture indeed.
Jeffrey S. Sutton, 51 Imperfect Solutions: States and the Making of American Constitutional Law (2018).
Jeffrey Sutton has much to teach us about the role of courts, state and federal, in making constitutional law. Sutton, well-known for his work as a judge on the United States Court of Appeals for the Sixth Circuit, has drawn on years of experience and research in this book-length rumination on the way state courts (and constitutions) can contribute to constitutionalism more broadly. Sutton served for some years as the solicitor general of Ohio, and knows the joys and heart-breaks of state constitutionalism first hand. Indeed, among the many happy turns of phrase in the book, one finds Sutton (many years after the fact) wistfully pursuing motions to reconsider the adverse decisions that most set his teeth on edge.
Sutton approaches his task with a deep appreciation of modern constitutionalism and an eye and ear for storytelling keen enough to engage readers both learned and lay. In brief, Sutton, argues, we have mistakenly come to view federal or national constitutionalism as the only game in town and have slighted state constitutionalism as a source of rights. Sutton describes a world hungry for rights articulation and suggests that state courts might play a more active role in the process. Sutton encourages lawyers to mount more state constitutional challenges, thereby giving their clients an extra shot at success. He also encourages state courts to take their own constitutions more seriously, noting that these documents often contain provisions missing from their national counterpart.
Sutton’s argument for state constitutionalism would advance three related goals. He invokes the familiar Brandeis idea of states as laboratories, extending it to judicial experimentation with constitutional rights. Rather than locking us all into a single national solution, state constitutionalism can flex in light of local conditions. States might vary in terms of the strictness with which they enforce the right to bear arms, depending on whether they tend to worry more about urban gun violence or the preservation of a rural hunting ethos. Other states, depending on their own history and patterns of migration and settlement, might take different views of the free exercise of religion or the guarantee of compensation for the taking of private property.
Apart from allowing states to experiment and adapt constitutional guarantees to local conditions, Sutton’s vision of state constitutionalism would allow the national courts to draw on state experience in considering when to nationalize a particular set of rights. Sutton points to the way the Court in Mapp v. Ohio drew on the experience of the states with the exclusionary rule, in contrast to Buck v. Bell, in which the Court, through Justice Holmes, refused to take opposing state court decisions seriously in the course of upholding the forced sterilization of Carrie Buck. Sutton’s dismay with Holmes, who upheld the Virginia law less as a dispassionate judge and more as an enthusiastic cheerleader for eugenics, leaps off the page. Sutton also observes that state courts led in developing a guarantee of same-sex marriage equality, providing the Obergefell Court with signposts to guide its way.
Finally, Sutton argues that, by virtue of their knowledge of local conditions and politics, state courts can better “manage” the implementation of the new rights they recognize than the far-away Supreme Court. Sutton offers the school finance cases as a lesson, tracing how state courts responded after the Supreme Court rejected an equal protection challenge to school funding disparities. Sutton sees the complexity in how states fund their public schools and doubts that the Supreme Court could have articulated a standard that would apply effectively to the wide array of local arrangements. He contrasts national incapacity with the more nuanced appreciation that state judges brought to task of reworking school funding decisions. While he recognizes some state-to-state disparities, Sutton views the state experience as a qualified success—virtually every state has re-worked its school funding models, without needing a federal obligation to do so.
Sutton proposes changes in the way state courts resolve constitutional claims. State courts facing challenges to state action based on parallel provisions of the state and federal constitution typically decide the federal question first. This sequencing stultifies state constitutionalism. Many state courts also interpret parallel state provisions in lockstep with their national constitutional counterpart and decline to give any independent content to state constitutional guarantees. Sutton would have state courts step out on their own, developing pockets of independent law that might grow over time as the judges gain greater confidence. Sutton asks law schools to give greater attention to state constitutionalism, hoping to generate more interest and more action as it were. Along the way, he devotes thoughtful attention to Justice Brennan’s attempt, some forty years ago, to encourage development of state constitutional law.
This bracing effort to revive state constitutionalism will open eyes and might change constitutional practice. One can, of course, question one or two particulars. The Supreme Court does not stand alone in crafting constitutional rights or in managing their implementation. Having learned the lessons of Brown, the Court relies extensively on the creativity and energy of lower federal court judges to carry its pronouncements into effect. In thinking about how courts might manage a guarantee of equality in school funding, Sutton may focus too much on the comparative isolation of the Supreme Court and too little on the managerial capacity of local federal district judges. Sutton’s account of the role of federalism in constitutional rights development may also teach unexpected lessons about the viability of originalist precepts. He explains that one cannot premise a national constitutional right on “local traditions, cultures, or history . . . of one region of the country or one group of citizens.” While addressed to constitutional lawmaking today, this analysis may cast doubt on the relevance of the traditions, cultures, and history that surrounded the relatively narrow slice of individuals who made up the founding generation. If so, that is just one of the many insights one gains from reading this lively and informative book.
Public litigation implicating national security issues faces a particularly thorny problem: the need for secrecy. On one hand, this kind of litigation—whether challenging the military’s use of Agent Orange in Vietnam, or the practice of putting individuals’ names on a No Fly list, or the Trump Administration’s “Muslim Ban”—raises important public issues and represents a paradigm case for judicial transparency. On the other hand, government defenses rely on state secrets with potentially vast consequences for national security, a situation where transparency can be dangerous.
Traditionally, courts have confronted the secrecy problem in national security litigation in one of two ways. Courts may abstain from hearing national security cases “because adjudication will lead to the dangerous exposure of sensitive national security information or to intractable challenges in reviewing and managing such information.” Alternatively, courts may defer to the executive branch’s judgment on a particular factual or judgment question. Both solutions often stop litigation in its tracks, preventing the court from evaluating cases on their merits.
Shirin Sinnar’s new article identifies a set of cases where courts have moved beyond these initial hurdles and resolved the constitutional merits. To do so, the judges have experimented with several different procedural tools to address the secrecy problem. Sinnar’s rich account of these experiments provides food for thought for procedure scholars. In her narrative, the secrecy problem is Goliath and procedural experimentation is David. While Sinnar is careful not to overstate the prevalence of these experiments, the lesson is that the power of procedure can prevail.
After describing the secrecy problems that can stymie litigation, Sinnar identifies six procedural experiments in national security cases that have not fallen prey to various abstention doctrines. Two are specifically designed for protecting secrets: “conducting ex parte and in camera review of protected information” and “using cleared counsel to access protected information.” The other four are less secrecy-specific: consolidating and transferring cases via MDL; appointing special masters and experts; facilitating interlocutory review; and using judicial management to determine rights and remedies in an incremental and dynamic fashion. Sinnar explores these practices and their ability to “supplement the traditional adversarial process, spur the growth of an institutional architecture to protect secrets, encourage the executive to disclose information voluntarily, reduce cognitive biases, and enable judicial learning over the course of litigation.”
Two of the examples I found most interesting were the use of special masters and of judicial management. As to the first, Sinnar cites two recent cases where judges considered, and rejected, appointing an FRE 706 expert “to assist the judge in determining whether disclosures in discovery would create a reasonable danger of harm to national security.” But she highlights that special masters have succeeded in the past. In a 1987 FOIA case, Judge Oberdorfer appointed a former DOJ intelligence lawyer with top secret security clearance to review documents relating to hostage release efforts that the Department of Defense sought to withhold from the Washington Post. In the Agent Orange litigation, Judge Weinstein appointed a special master to review state secrets assertions. To alleviate the government’s burden of asserting state secret privilege over all the documents, which would require approval by a department head for each document, the special master first ruled on relevance. Sinnar recounts that “the government granted extraordinary access to the special master, who spent weeks in a ‘special guarded room in the Pentagon’ examining tens of thousands of documents prior to the government deciding whether they qualified for state secrets protection.”
This use of special masters is reminiscent of—or perhaps foreshadowed—the prevalence of special masters in modern MDL and other complex litigation, such as the 9/11 Victim Compensation Fund run by Ken Feinberg, or the appointment of then-less-well-known Robert Mueller as the special settlement master in the VW clean diesel litigation. In the secrecy cases and in these more modern examples, special masters devise specialized procedures—sometimes with input from or review by the judge and parties—to enable the litigation to function.
Judicial management, another familiar tool for adapting procedures to suit the needs of particular cases, can use specially designed procedures in a similar way. Sinnar singles out Latif v. Sessions, a constitutional challenge to the terrorist No-Fly watch list, as exemplifying the judicial-management approach. Judge Brown of the District of Oregon originally dismissed the plaintiffs’ complaint. After the Ninth Circuit reinstated the case, she used what Sinnar calls “incremental and dynamic judicial management” to avoid or minimize the secrecy issues. For example, Judge Brown front-loaded certain questions of law that could be decided on a set of stipulated facts, such as whether the process for contesting one’s placement on the list violated procedural due process. She thereby delayed consideration of the substantive due process questions that would require discovery of “potentially sensitive information about individual plaintiffs.” This sequencing allowed the judge to conclude that the process for contesting inclusion on the list was constitutionally insufficient, marking “not only a rare victory for plaintiffs challenging watch lists, but also one of the first watch list challenges to even proceed to a determination on the merits.”
In short, these procedural fixes work—they help litigation perform its functions and allow the parties and judges to get to the merits of national security cases. Sinnar points to five additional benefits. They supplement adversarialism, insofar as methods such as in camera review enable judges to see documents when opposing parties are not allowed access. They “spur the development of architecture to protect secrets.” In other words, the more experience courts and the Justice Department have with providing secret information to courts in secure ways, the better they can develop infrastructure for providing and securing that information. Relatedly, more experience can prompt the Executive to be more receptive to requests to disclose information through secure processes. More experience can counter judges’ natural biases in favor of deferring to the government. And bringing several of these themes together, Sinnar identifies a fifth benefit in promoting judicial learning.
Sinnar also highlights important concerns. Secrecy is an ideal issue to address through bespoke procedures because these national security cases create risks to core rule of law values such as due process, transparency, pluralism, and the avoidance of bias. Sinnar applauds the use of experimental procedures to address secrecy issues, but cautions against using them as “‘off the rack’ solutions for national security cases.” She urges courts to consider whether the procedures satisfy due process and ensure “that their value outweighs their risks” before using them.
As a verdict on these experiments, Sinnar rejects the criticism that they are “too little, too late,” concluding instead that they are “necessary, but insufficient.” It remains true, as Margaret Kwoka documents, that this procedural experimentation is the exception to the general rule of judicial deference in national security cases. Sinnar poses “the real question” as “whether ad hoc judicial experimentation on secrecy can succeed in the absence of more systemic legislative change.” She doubts that such change is likely, a common place at which both scholars and judges land when facing difficult procedural obstacles. It thus seems natural for Sinnar to conclude by offering insights for procedure more generally. In addition to insights about the potential for diffusion of innovative procedures across subject matter and across the civil-criminal divide, these experiments provide evidence of the pervasiveness of “bottom-up” ad hoc procedure “in response to functional needs” of particular litigations. In the national-security context, the executive branch plays an outsized role, triggering different institutional dynamics. But particularly in the absence of systemic procedural change, Sinnar predicts judges will continue to experiment with ad hoc procedure in the national security context.
Interestingly, Sinnar argues that the scope and capacity of judicial discretion to address these issues are unclear. The Supreme Court has reached conflicting results when reviewing judicial capacity to devise procedural solutions in this space. In Boumediene v. Bush, a Guantanamo detainee habeas case in 2008, “the Court expressed confidence that the district court had the ‘expertise and competence’ to resolve evidentiary challenges, including the protection of classified intelligence.” But one year later in Ashcroft v. Iqbal, “the Court was equally sure that, without an across-the-board change to pleading standards, district courts could not be relied upon to regulate discovery in a manner that sufficiently respected the needs of high-level national security officials.”
This framing shows the important contribution of Sinnar’s work. National security expert Rebecca Ingber argues that “it’s important to pull away the veil of mystery draped over national security law” that courts often hide behind in these cases. Sinnar is uniquely positioned to help judges overcome their biases against delving into national security issues and to help national security experts understand procedural tools that can lift the veil. She can address both perspectives because she speaks both languages—national security and procedure—so fluently. Her work therefore facilitates both further conversations across these disciplines and a richer understanding of both fields.
This article is an excellent example of the important genre of procedural scholarship that focuses on the procedure of particular substantive areas, supporting the thesis that even trans-substantive procedure is not trans-substantive and simultaneously providing interesting insights for procedure more broadly (dare I say, trans-substantively). Other recent complements include Jessica Erickson’s Heightened Procedure and Maria Glover’s The Supreme Court’s ‘Non‐Transsubstantive’ Class Action. Anyone interested in procedure, procedural innovation, or trans-substantivity—not to mention procedural issues in national security litigation—should read Sinnar’s article in full.
Approximately four years ago, the Federal Advisory Committee on Civil Rules established a subcommittee to reform Federal Rule of Civil Procedure 23, the class action rule. The subcommittee engaged in a meticulous review of various class action practices, focusing on such controversial issues as cy pres awards, bad faith objectors, and class action settlements. The subcommittee’s work resulted in the Advisory Committee adopting a package of amendments to Rule 23, which went into effect on December 1, 2018. A good overview of the amendments can be found here.
Anticipating passage of these amendments, the Bolch Judicial Institute at Duke Law School assembled an all-star team of class action practitioners and experts to draft a compilation of “guidelines and best practices.” Because the amendments “codify emerging or best practices of courts,” the goal of the publication is to “add detail to the general guidance provided in the amended rule.” The publication has all the attributes of a great resource—it is concise while remaining crystal clear.
But what I find remarkable about the publication is how its focus on the on-the-ground experience of administering class actions sheds light the thorniest issues in class action law. Take standing, an issue the Supreme Court focused this Term in Frank v. Gaos. In 2016, the Court decided Spokeo v. Robins, concluding that to establish standing, a class representative must allege a harm that is both concrete and particularized. There is some question whether standing must be established for all class members, not just the class representative. Tyson Foods, Inc. v. Bouaphakeo addressed but did not decide whether standing can exist when there is the prospect that “uninjured” class members may recover.
This publication does not address this issue directly, nor does it intend to, but it does discuss some aspects of the actual administration of class actions that bear on the issue. For example, it states that, with respect to information concerning the distribution of proceeds from a settlement, “a court should not assume that automatically distributing benefits to all class members is superior to distributing benefits based on submitted claims.” (Best Practice 3C). It makes the reasonable point that in some class actions, such as those involving consumer claims, a submitted-claims process can be invaluable in identifying individuals who have suffered actual harm by requiring, for example, proof of purchase to recover. This suggests that in many cases issues of class member standing can be obviated on the back end by processes ensuring that uninjured class members cannot recover. In Tyson, the Court hinted that such a back-end process can satisfy these standing issues. The Court admonished the Tyson defendants for opposing a “bifurcation” process that would have permitted the district court to determine liability in one phase and individual class members to submit claims for damages in a second phase.
Another thorny issue concerns class attorney compensation, where there is a concern that class attorneys profit at the expense of class members who receive little to nothing from the lawsuit. The publication speaks to this issue (again, not intentionally or directly) through the debate over whether the attorney’s fee in a class action settlement should be based on the percentage of the total monetary awards made available to the class or the money “actually delivered” to class members. The notes to the 2018 amendments emphasize the latter, stating that “the relief actually delivered to the class can be a significant factor in determining the appropriate fee award.” At first glance this make sense—why should an attorney be paid if the class members are not also actually paid?
But the publication makes an important point about the actual operation of class actions that informs the “actual value” the class members receive. In a sense, class actions arise because class members do not want to be paid, or at least do not want to go to the trouble of filing a lawsuit to recover. A class action goes to that trouble. In investigating and settling the case, class attorneys make proceeds available that otherwise would not be available through efforts of class members who otherwise would not have sued. The publication cites cases to argue that “the opportunity to recover meaningful relief by availing themselves of a claims process that is procedurally fair, even though many fail to do so, is ‘actual value’ to the class members.”
The publication also tackles appointment of “interim class counsel” in multidistrict litigation (MDL). Although this concept was introduced in 2003 amendments to Rule 23, the publication discusses the importance of this designation and its effect on current practice. Interim class counsel corrects a “Catch 22” situation that has arisen from heightening class certification requirements, itself a response to courts’ unease with the near-unilateral control of the class attorney. Class certification is now “often preceded by substantial fact and expert discovery,” which requires “time and resources to develop a record in the case sufficient to enable the court to make an informed class certification decision.” The availability of interim class counsel allows for the appointment of counsel with the power and incentive to perform this work for the benefit of the class.
The publication also addresses this practice in MDLs. In theory, MDLs avoid the unease that arises from counsel control by consolidating claims, because each plaintiff retains her own counsel. But class actions can arise within MDLs. And there remains great benefit in having “lead counsel” coordinate the efforts of the individual plaintiffs, even if each retains separate counsel. “Class actions and MDL have converged in recent years,” with “MDL transferee judges, who must appoint plaintiff leadership at the outset of the proceedings, . . . often adopt[ing] the Rule 23(g) factors as qualifications in such leadership roles.” The publication discusses guidelines and best practices for interim class counsel within MDLs. And it (again unintentionally) makes an important point about not only the persistence of the class action, but its utility. The very power of class counsel that makes courts uneasy is the same power that allows for the investment and coordination necessary to litigate the plaintiffs’ claims in the first place.
There are many more gems in the publication, too many to discuss here. This is a perfect example of the kind of work I like “lots”—it looks at on-the-ground practice with a sensitivity to finding solutions. That it also speaks to important class action issues shows the importance of paying attention to the great work being done by courts and practitioners.
Cite as: Sergio J. Campos, Practice Makes Perfect
(December 20, 2018) (reviewing Bolch Judicial Institute, Duke Law School, Guidelines and Best Practices Implementing 2018 Amendments to Rule 23 Class Action (2018)), https://courtslaw.jotwell.com/practice-makes-perfect/
Alan M. Trammell, Demystifying Nationwide Injunctions
(Nov. 26, 2018), available at SSRN
One of the hottest topics on the current legal landscape is the propriety of national injunctions. Federal district court judges are increasingly enjoining the federal government from enforcing statutes, regulations or policies nationwide—fashioning remedies far beyond the parties and the court’s geographic purview. While this practice initially took hold in the 1960s, it escalated during the Obama Administration and has intensified under the Trump Administration.
For example, a district judge in Texas barred enforcement of Obama’s Deferred Action for Parents of Americans and Lawful Permanent Residents (DAPA)—applying the bar not only to the twenty-six states who complained, but to the entire nation. Similarly, a district judge in Hawaii barred enforcement of Trump’s travel ban, which excluded travelers from seven countries—most predominantly Muslim—on alleged religious discrimination grounds; the court forbid the Administration from applying the ban not only to the parties in the case, but to non-parties across the country.
This has led many people to ask themselves, “Hey, wait a minute! Can they do that?” They are not alone. The recent uptick in judgments rebuking executive action and issuing sweeping reforms at the hand of singular judges has invigorated a robust debate over the propriety of this practice in particular and the power of federal judges in general. Just recently, former Attorney General Jeff Sessions expressed skepticism over the legitimacy of national injunctions, joining Justice Clarence Thomas’s assessment of them, in Trump v. Hawaii, as “legally and historically dubious.” A number of scholars have expressed similar doubt and concerns.
But a burgeoning view among academics is challenging this narrative. The latest entry is Alan Trammell’s Demystifying Nationwide Injunctions, which takes on the challenge of addressing the constitutional and structural arguments made by national injunction opponents, persuasively explaining how national injunctions do not violate Due Process, contravene judicial hierarchy, or eclipse the “judicial power” of Article III courts.
First, Trammell contends that core Due Process concerns are not threatened by national injunctions. For example, one such concern is that a non-party should not be bound by an adverse judgment because that person has not had his or her proverbial “day in court.” However, this concern is inapt in the case of national injunctions against the enforcement of an unconstitutional law, where a non-party benefits from the universal ruling. Similarly, preclusion law used to require “mutuality”— only parties to a prior lawsuit could get the preclusive effect of a beneficial ruling in a subsequent lawsuit. Courts, however, have relaxed this requirement, allowing non-parties to benefit as well because the defendant had its “full and fair” opportunity to defend itself in the initial action.
Trammell takes the same position even where non-parties do not actually want the national injunction, but are bound nonetheless. This is not a Due Process violation either, given the circumscribed right an individual has to challenge public rights. Like the Rule 23(b)(2) context, which provides no individual notice and “opt-out” rights for a class seeking primarily equitable relief (including injunctions), the national injunction fairly binds non-parties in cases involving public rights and indivisible relief.
Second, Trammell argues that national injunctions are not foreclosed on the grounds that the remedy crosses vertical and horizontal boundaries that usually cabin the effect of district court decisions. On the vertical axis, a district judge who issues a national injunction may bind a higher court, in contravention of judicial hierarchy. On the horizontal axis, that same judge may bind its sister district courts and even those outside the judicial circuit, in contravention of normal geographical limits.
But preclusion law allows such exceptions. And a court’s remedial power in one case is distinct from supervisory authority and geographic jurisdiction. Trammell correctly recognizes the risk of inconsistent rulings that could result from national injunctions issued by different district courts, but concludes that is a prudential problem for comity to solve. To the extent that one believes the courts are likely to respect comity and self-regulate accordingly, Trammell’s position is satisfying, even as others bristle at the indeterminacy of such a laissez-faire approach.
Third, Trammell pushes back on the notion that national injunctions are beyond the scope of Article III. National injunctions meet the case-or-controversy requirement because they are brought by plaintiffs with proper standing–a concrete and particularized injury caused by the defendant that is legally redressable. Lest you think Trammell’s arguments are motivated by the current political climate, he uses the Texas district court’s national injunction against Obama’s DAPA to illustrate how the state of Texas had standing. While one may disagree with the ultimate ruling on the merits of the case, the issue of Article III standing seems clear.
Finally, Trammell makes a broader point about the push back against national injunctions. The criticism of district judges’ expansive remedial reach reflects a larger and familiar debate about the proper role of judges. Are they really just umpires calling balls and strikes? Trammell situates the propriety of the national injunctions issue in the debate over two models of adjudication: dispute resolution and law declaration. While this tension may ring true for Supreme Court jurisprudence, the same cannot be said for district courts, whose mandate as trial courts is far different.
After this brush-clearing (establishing the court’s power to issue national injunctions), Trammell offers a compelling context in which to rest his position—the parallel development of preclusion law. Trammell analogizes the evolution of the national injunction to the evolution of preclusion, illustrating how the underlying premises of the latter support the former. This insight, made concurrently by Zachary D. Clopton in National Injunctions and Preclusion, __ Mich. L. Rev. __ (forthcoming 2019), situates national injunctions in a wider frame that helps the reader understand why a singular judge issuing relief far beyond its participants or geography isn’t so fantastical after all.
Trammell relies on the principles underlying preclusion for determining normatively when a national injunction is appropriate. As a starting point, Trammel analogizes nonmutual offensive issue preclusion to a national injunction, noting that in both instances an individual gets the benefit of an adverse judgment against a government defendant in a lawsuit in which he was not a party. Because the defendant had a full and fair opportunity to be heard, due process has been met.
He identifies a number of problems with offensive nonmutual collateral estoppel: it encourages a “wait and see” approach by individual plaintiffs bringing litigation seriatim; exacerbates inconsistent rulings; and promotes preclusive asymmetry. But these pitfalls have not justified a complete bar to such preclusion, so neither should they bar national injunctions—which can pose similar concerns. To the contrary, preclusion law models the circumstances under which a court should refrain from issuing a national injunction. Drawing on the majority rule permitting offensive non-mutual issue preclusion so long as there is not evidence of inherent unfairness, Trammell endorses the existence of national injunctions.
This endorsement, however, is tempered by the Supreme Court’s holding in United States v. Mendoza, where the Court held that a private party could not use non-mutual issue preclusion against the government. But Trammell rejects Mendoza as a categorical ban on such preclusion, arguing that the Court’s conclusion is cabined to the particular case and is merely a guidepost that identifies circumstances that should militate against preclusion.
Trammell then pivots to a different doctrinal and theoretical hook for discerning when national injunctions affirmatively are appropriate: non-acquiescence. This practice involves the government (usually an administrative agency) prospectively refusing to follow a judicial interpretation of the law. This practice is generally accepted when limited to a particular circuit among many but frowned upon when done within a circuit in flagrant disregard of its precedent. Non-acquiescence, he argues, is justifiable when the law is unsettled and the government genuinely seeks to promote its position. But national injunctions are justifiable when the government flagrantly rebukes settled law, thereby demonstrating bad faith.
Trammell ends his article by concluding that although courts have the power to issue national injunctions and can justify them prudentially for many of the same reasons that justify preclusion, courts should only issue them under certain limited circumstances. Borrowing from preclusion law, Trammell proposes a standard for when national injunctions are appropriate, with a set of limiting principles as a power check. There is a presumption against national injunctions as the go-to response, giving the government an opportunity to make a course correction and courts a chance to develop law. But a national injunction is proper when plaintiffs can demonstrate the government is acting in bad faith, as evidenced by rebuking settled law or failing to sincerely vindicate its position in the courts; this exception vindicates equality and promotes rule-of-law norms.
Trammell’s proposal offers much food for thought. The default rule puts Trammell squarely in the camp of those who reject an outright ban on national injunctions but are nonetheless concerned about prudential problems they pose and the frequency with which courts are ordering them. He uses the policy considerations raised by preclusion law and Mendoza as a proxy for determining when law is settled. This is inexact, but addresses some of the most common complaints about national injunctions—inconsistent rulings, “one-and-done” rulings by a singular judge, forum shopping, lack of law percolation, and asymmetric preclusion. His proposal covers much ground.
With “settled law” being so central, much rides on how it is defined. Trammell emphasizes flexibility, arguing that the law need only be “settled enough,” with the burden on the government to defend its decision to depart. The national injunction against the first travel ban offers a perfect example–with every court to consider the matter, and eventually the White House, all agreeing on the illegality of certain provisions, the law was sufficiently settled to warrant a national injunction.
Similarly, nothing says “settled” more than a definitive ruling by the Supreme Court. A perfect example of this was Obergefell v. Hodges, holding that same-sex couples have a fundamental right to marry in all states. When Kim Davis, a local Kentucky clerk, refused to issue marriage licenses to same-sex couples post-Obergefell, this provides “the quintessential scenario of when a broad injunction is most appropriate.” The alternative is to require every same-sex couple seeking to marry in the United States to sue to enforce their Constitutional rights under Obergefell whenever they face a clerk who defies the rule of law. This not only encourages lawlessness by government officials, but “essentially leads to government by litigation”—an untenable, impractical and immoral outcome “antithetical to the entire governance structure.”
Although Trammell’s proposal offers a way to promote national injunctions while erecting guardrails that cabin their proliferation, it raises some questions and concerns. For example Trammell suggests a “rule of three” for when law is settled—conditioning a national injunction on three consistent adverse lower court rulings. While not new, this is arbitrary and malleable. Moreover, there is no reason that the plaintiff should bear the burden of proving settled law or for making bad faith the primary justification for national injunctions. Other policies may justify such expansive relief, including the need to address national crises, promote efficiency, prevent irreparable harm, check executive abuse of power, provide complete relief, and account for access to justice problems.
There are no easy answers. But Trammell has made an important contribution to the debate with an analogy to preclusion law thqt is groundbreaking and insightful.
Michael Vitiello, Animating Civil Procedure (2017).
For civil procedure teachers seeking to accompany their casebook with an insightful account of procedural justice, Michael Vitiello’s Animating Civil Procedure provides an excellent complement to case-centric courses. Among its many virtues, Vitiello’s book weaves a compelling procedural-justice argument around the leading procedure cases all first-year students encounter in their introduction to the American legal system.
Vitiello’s main thesis details how the Supreme Court’s procedural jurisprudence – especially in the last decade—effectively denies plaintiffs’ access to justice and represents a closing of the courthouse doors. While these themes are manifestly familiar to the professoriate and comprise the dominant narrative among commentators, the impact of procedural law may not be so apparent to new law students. By focusing on the compelling importance of procedure in shaping substantive justice, Vitiello’s book provides a useful resource to bridge a novice’s gap in knowledge and understanding.
At the outset, Vitiello rightly frames his book with the observation dear to the heart of all civil procedure teachers: that procedure is as important, if not more so, than the substantive law that occupies so much of the first-year curriculum. He observes how—in contrast to headline-grabbing substantive issues such as gun control, same-sex marriage, and campaign financing—the Court’s procedural decisions go largely unnoticed and unheralded. Vitiello illustrates the point with the famous story of how The New York Times and other newspapers failed to report the Court’s 1938 decision in Erie R.R. v. Tompkins, completely missing the significance of that decision.
Having established the central case for the importance of procedure, Vitiello’s book segues into separate chapters advancing his argument that the Court’s recent procedure jurisprudence has largely been anti-plaintiff and pro-corporate defendant. He focuses on seven areas of procedural law to illustrate this thesis: personal jurisdiction, pleading, discovery, summary judgment, transfer of venue, class actions, and arbitration. In reviewing the Court’s leading decisions, he analyzes the holdings in the context of the Court’s liberal-conservative ideological divide.
Each chapter presents a veritable hit-parade of the Court’s most controversial procedure decisions during the past decade. In discussing the Court’s increasingly constrictive views on personal jurisdiction, he focuses on the infamous trilogy of courthouse-closing cases: Goodyear Dunlap Tires Operations, S.A. v. Brown, Daimler AG v. Bauman, and J. McIntyre Machinery, Ltd. v. Nicastro. As all procedure teachers appreciate, nothing engages students more than the saga of Mr. Nicastro of the severed four fingers, with the Court telling him he has nowhere to sue. Vitiello employs these cases to point out the increasing inability of injured plaintiffs to enter the courthouse to hold bad-actor corporate defendants accountable for wrongdoing.
Vitiello’s chronicle of the Court’s personal jurisdiction jurisprudence sets the tone for ensuing chapters, perhaps none so scathing as that on pleading under the Federal Rules. He first sets out the historical basis for nineteenth-century pleading reforms as the precursor of modern federal notice pleading, providing a succinct summary of the context for understanding the philosophy of modern pleading that students may not otherwise receive. The pleading backstory is a procedural tease, coming undone in Bell Atlantic Co. v. Twombly and Ashcroft v. Iqbal. In truth, attacking the Court’s Twombly/Iqbal decisions is picking-off low-hanging fruit, although they are the archetypes of the Court’s anti-plaintiff, pro-corporate bias.
The twin themes of denying access to justice and closing the courthouse doors frame the discussion in Vitiello’s remaining chapters on summary judgment, transfer and venue, and class action litigation. Similar to his jurisdiction and pleading chapters, Vitiello’s book ranges over a collection of prominent, challenging, and dubious Court decisions, including Scott v. Harris(on summary judgment) and Atlantic Marine Construction Company v. U.S. District Court(on transfer of venue). Vitello’s discussion provides students with a thoughtful analysis of the impact of these somewhat arcane procedural mechanisms.
The Court’s recent class action jurisprudence comes in for especial notoriety, focusing predictably on the Court’s decision in Wal-Mart Stores, Inc. v. Dukes, which narrowed the interpretation of the Rule 23(a) commonality requirement. And, not to be outdone by the anti-class action animus embedded in Dukes, Vitiello singles out the Court’s class action waiver decisions in AT & T Mobility LLC v. Concepcion and American Express Co. v. Italian Colors Restaurant as further evidence of the Court’s pro-corporate bias in upholding arbitration clauses with class action waivers. Vitiello acknowledges that the Court’s class action jurisprudence has been a mixed bag, leaving open the ultimate conclusion to be drawn from this universe of cases.
Finally, Vitiello notes that procedural justice derives not only from the Court’s decisions, but from rulemaking initiatives by the Advisory Committee on Civil Rules. He focuses on the Committee’s recent excursions into amending the discovery rules, which he argues deny access to justice for plaintiffs with fewer resources. This chapter provides students with useful insight into other sources of procedural justice and offers a good springboard to discuss the philosophy of transsubstantive and neutral rulemaking.
Vitiello’s Animating Civil Procedureis an excellent companion to a first-year casebook. It is easy to read, well-written, and not overly long. Not only does it discuss the most recent leading procedure cases, but it challenges students to think about the broader implications of those cases. Although the book leaves scant room for disagreement with his conclusions, Vitiello should be commended for demonstrating the overarching importance of procedure to a system of substantive justice.
Richard Re, Beyond the
, 132 Harv. L. Rev. __
(forthcoming 2019), available at SSRN
What is the nature of precedent? How is it made and how can it eventually be unmade? If anyone knows, it is Richard Re at UCLA School of Law. Re has been doing the academy and the judiciary a service in recent years by writing several articles and a scholarly amicus brief on the foundational question of how certain opinions come to bind others. Beyond the Marks Rule is his latest offering in this rich area, and it does not disappoint.
Beyond Marks begins with what one might call the “less-than-five problem.” Generally, the Supreme Court creates binding precedent when a majority of the Justices supports a single rule of decision. Under the “majority rule,” if five Justices sign on to Rule A and four Justices sign on to Rule B, Rule A becomes the holding of the Court and binds the lower courts thereafter. But occasionally the Supreme Court does not merely split but fractures, leaving us in a world of, say, 4-1-4 (in which five Justices agree on an outcome, but only four agree on a rule explaining the outcome and one relies on alternative reasoning). What to do in such a situation? One could imagine concluding that an opinion without a majority is an opinion without precedential effect. But at the moment we are bound to conclude otherwise, thanks to Marks v. United States.
Marks tells us that “when a fragmented Court decides a case and no single rationale explaining the result enjoys the assent of five Justices,” then “‘the holding of the Court may be viewed as that position taken by those Members who concurred in the judgments on the narrowest grounds . . .’” (or, as I tell my students, if four Justices want to order vegetarian fare for dinner, and a lone Justice will only have cheese pizza, then cheese pizza it is for everyone). Though the rule may have some initial intuitive appeal, Re convincingly argues that its adoption was not well thought out then and is beyond problematic today.
The costs of the Marks rule are several. First, the rule can lead to troubling results. Consider Freeman v. United States, a recent federal sentencing case, in which the Court divided 4-1-4. The majority of lower courts to subsequently apply Marks to Freeman decided that Justice Sotomayor’s concurrence—the lone 1—should control. And yet the other Justices had squarely rejected Sotomayor’s position, calling it “erroneous” and “arbitrary.” As Re points out, “the Court’s least popular view became law.” Even where the Justices do not directly criticize what will become the controlling opinion, the fact remains that a majority of the Court chose notto endorse that opinion. In this way, Marks makes precedent out of minority views.
Second, there can be a significant lack of clarity—and therefore lack of efficiency—in applying the Marks rule. At the level of the rule itself, it is not pellucidly clear how lower courts should understand “that positon taken by those Members who concurred in the judgments on the narrowest grounds.” It could mean the “logical subset” approach, which considers an opinion from a fractured Court binding only if it “necessarily approves all the results reached under another concurrence in the judgment” (as in the culinary example above). It could mean that lower courts should look to the “median opinion”—the concurring opinion that represents the views of the median Justice. Or it could mean the “all opinions” approach, which considers how a given case would be resolved under the Court’s various opinions (including dissents) and follows whatever route would have gained the support of a majority. Re reveals the flaws in each of these methods and underscores how challenging it is to apply what might at first blush seem to be a straightforward rule.
Given the varied possibilities for understanding Marks, it is not surprising that there is confusion over what precisely counts as precedent in many individual cases. Returning to Freeman, most lower courts to apply Marks to the case concluded that the Sotomayor concurrence controlled. But the D.C. and Ninth Circuits concluded that Freeman failed to create any precedent at all (aside from the result). In short, these fractured decisions impose significant interpretive costs.
Re then demonstrates those costs with a comprehensive empirical study of how the Supreme Court, the federal courts of appeals, and even state courts have applied Marks. The findings show that the rule is dysfunctional in application. With respect to the federal courts of appeals, for example, Re finds that they “only sometimes reach convergent results,” and that, often, “repeated Marks analysis generates lasting disagreement.”
Re does not stop there—he concludes with an elegant solution to the problem. Rather than try to forge precedent when the Court has fractured, Re argues that only the majority rule should rule—a decision provides a binding rule of decision only if at least five Justices support it. The Justices should continue to feel free to form compromise majorities, following the logic of Screws v. United States (which maintains that a Justice may decide to vote for a particular rule precisely so as to create a majority precedent). But they must create that majority.
And Re does not even stop there. Tying Marks to his earlier work on precedent, he considers how a “Screws rule” could come about. It could come from the Court, either by overruling Marks in favor of a majority-rule rule or by reducing the number of fractured opinions over time. Alternatively, it could come from lower courts narrowly construing Marks, thereby incentivizing a would-be lone Justice, no longer able to create a binding rule herself, to find an opinion to join. Whatever the case, with Beyond the Marks Rule, Re has made a substantial contribution to the growing field of Judicial Administration/Judicial Process. And there can be no fractured opinion here—judges and academics alike should pay close attention to Re’s invaluable scholarship.
Kristin Hickman pursues a “modest” goal in Symbolism and Separation of Powers in Agency Design: “to raise a few reservations regarding judicial refashioning of agency design via [a] severance remedy for separation of powers violations.” This understated approach commands attention to Hickman’s analysis. In this contribution to a Notre Dame symposium on “Administrative Lawmaking in the Twenty-First Century,” Hickman clearly identifies and carefully analyzes problems arising out of what might otherwise have passed as unremarkable applications of existing severability doctrine. With an eye toward big-picture legitimacy of courts and agencies, and with attention toward doctrinal and statutory detail, Hickman provides fresh reasons for judges to rethink this doctrine. And the increased attention earned by relatively restrained criticisms like Hickman’s may eventually move the law in the direction of more radical critiques that have started to receive an audience at the Supreme Court.
Hickman describes three cases or sets of cases in which the Supreme Court or the D.C. Circuit held an agency design unconstitutional based on separation of powers principles and then “fixed” the problem by “severing” a structural provision of the statutory agency design. These cases addressed the structure of the Public Company Accounting Oversight Board, the Copyright Royalty Board, and the Consumer Finance Protection Bureau.
The accounting oversight board was protected by two layers of for-cause removal restrictions. Board members were removable by SEC commissioners, but only for cause; SEC commissioners were removable by the President, but also only for cause. The Court fixed this problem by eliminating the for-cause restriction on SEC Commissioners’ ability to remove board members.
The Copyright Royalty Board’s three Copyright Royalty Judges, who were appointed subject to removal by the Librarian of Congress, were judicially determined to be principal rather than inferior officers. This status was owing, in part, to a for-cause limitation on the Librarian’s authority to remove them. Because the Librarian of Congress is not constitutionally permitted to appoint principal officers, the D.C. Circuit transformed the royalty judges into inferior officers. The court accomplished this by eliminating the statutory for-cause limitation on the Librarian’s removal authority.
The Consumer Finance Protection Bureau, according to a split D.C. Circuit panel, was unlawfully headed by a single director removable only for cause, rather than by a multimember commission made up of commissioners removable only for cause. The panel fixed this problem by eliminating the for-cause limitation on the President’s ability to remove the Bureau’s director. The need for severance was ultimately obviated, though, when the D.C. Circuit took the panel decision en banc and reversed on the constitutional merits. That en banc decision removed the need to determine whether the panel’s severance move was correct.
Hickman raises three reservations about the appropriateness of severance in these three cases. First, the remedy was not as restrained as it seems when compared with the alternative of leaving the statute operative as is but without a functioning agency for the time it takes Congress to fix it, and when taking into account the tradeoffs reflected in the now-invalidated agency design. Second, litigants will have less incentive to challenge agency design when the end result makes little practical difference to the outcome of their particular cases. Third, severance of for-cause removal restrictions renders agency actors less politically independent and thereby undercuts their perceived legitimacy.
These criticisms are not of equal weight—the first and third are more powerful than the second. Hickman acknowledges that a reduction in litigation incentives may not be that significant given the presence of other available actors to press structural separation of powers arguments in challenging agency actions. She properly sees a form of “cause lawyering” at work in the accounting oversight board case, for example.
Adding to Hickman’s points about mixed litigation incentives, one might also observe that severance in the three cases reduced the practical costs of the underlying constitutional holding by leaving the agency’s day-to-day operations untouched. And the Supreme Court may have been more responsive to the substantive constitutional arguments presented by separation-of-powers “cause lawyers” precisely because of the availability of a non-disruptive fix. While this observation limits the force of the litigation-incentives argument, it provides greater cause to be concerned about judicial interference with the agency-design choices that Hickman discusses in connection with her other two reservations.
A few weeks after the November 2017 symposium at which Hickman presented her paper, the Supreme Court heard oral arguments in Murphy v. NCAA. The case had nothing to do with agency design, but the resulting opinions had much to do with severability doctrine. After declaring a federal statute partially unconstitutional, the Court used severability doctrine to render it totally unenforceable.
Justice Thomas took the occasion to write a powerful concurrence, one that deserves the serious and sustained attention it will receive over time. Thomas details many ways in which the Court’s “modern severability precedents are in tension with longstanding limits on the judicial power.” The judicial power is the power to render judgments in cases, and what we now call “judicial review” is “a byproduct of that process.” As a consequence, “when early American courts determined that a statute was unconstitutional, they would simply decline to enforce it in the case before them.” Later deviations from this practice should be curbed.
If Thomas is correct, there is more reason to reject the statutory severance Hickman calls into question. The three cases Hickman discusses exemplify what happens when the metaphor of “severability” gets away from the judges and they mistakenly think that severance is a thing that they can do. But just as Hamilton was right in Federalist No. 78 that the judiciary lacks the power of the sword, Justice Thomas is right that the judiciary lacks the power of the Exacto knife.
And this brings our consideration full circle to Hickman’s explanation of how things might have worked better if the judiciary had simply followed the traditional path of setting aside the challenged agency action in these cases. The most powerful part of Hickman’s analysis is her insistence on the obvious but overlooked fact that “declaring an administrative agency’s structure to be unconstitutional and the agency’s actions to be inoperative” is not the same as “invalidating a statute altogether.” Statutory prohibitions and requirements would remain in force even if there is no enforcement agency at work. And Congress could then revive the agency by making any necessary changes. If severance were not available, the litigants who successfully challenged the agency design would have been better off, and the agencies would not have been judicially reconstituted in ways that risk undermining their perceived legitimacy and that ignore legislative debates and choices.
In his Murphy concurrence, Thomas emphasized the way in which modern severability doctrine “requires courts to weigh in on statutory provisions that no party has standing to challenge, bringing courts dangerously close to issuing advisory opinions.” The scenario in which this worry has appeared most acutely is when a holding of inseverability threatens the enforceability of parts of a statute not otherwise properly before the court. But the cases that Hickman discusses reveal a different version of an advisory opinion problem. The courts purported to remove a sentence or two from the agencies’ governing statutes—which they can only do metaphorically—while leaving “the actions of the challenged agency, and the structures and actions of identically or similarly designed agencies, largely or entirely untouched.”
Although Hickman does not question the fundamental legitimacy of modern severability doctrine, her analysis of its application in a few cases shows the power of raising reservations “regarding judicial refashioning of agency design.” If the Supreme Court and the D.C. Circuit were to follow Hickman’s advice and contemplate their application of modern severability doctrine more thoroughly, they might find their conclusions more unsettling than Hickman’s lawyerly disclaimer of any “grand proposals” suggests.
Irina Manta, Tinder Lies
, ___ Wake Forest L. Rev.
___ (forthcoming 2019), available at SSRN
In a world dominated by online dating, my own marriage seems quite quaint. We were introduced to each other! In person! By another human being! Sometimes I think that people give me a faintly odd look – a look that just 15-20 years ago was reserved for the bold (and seemingly “shameless”) people who dared to look for a partner online. When I left the dating world, it consisted primarily of websites. But as Irina Manta points out in her intriguing and provocative new article, Tinder Lies, online dating has become even easier and more ubiquitous with the surge in popularity of dating apps such as Tinder and Bumble. Manta confronts a problem that is as old courtship itself, that of sexual fraud, or “lies 1) that were put in profiles on online dating apps/sites, 2) whose content would materially influence the decision of a reasonable person whether to have sexual intercourse with the profile owner, and 3) remained uncorrected before sexual intercourse took place.” Like many problems, the issue of truth and disclosure in dating and sexual interactions has become more magnified and widespread when the primary platform for romantic and sexual introduction involves a great deal of anonymity, self-description, and the uncomfortable knowledge that one is, essentially, in a marketplace.
Tinder Lies is a terrific read. Manta takes on a question of increasing significance in the lives of many Americans who use online dating services and apps: What, if anything, should be done about users who lie about themselves in their profiles, where these lies lead other users to make decisions of significant personal import that they would not have otherwise made–to have sex with the person in the deceptive profile or to invest a significant amount of time and emotional resources in a relationship with a fraudster? While some lies might strike us as relatively harmless and easily debunked upon a face-to-face meeting, such the height or weight of the user, other lies are far more consequential, such as the person’s marital status,.
With these questions in mind, Manta offers an engaging primer on the history and current doctrinal landscape of legal responses to sexual fraud. She uses trademark law as a useful analogue to the problems of sexual fraud in online dating and offers a framework for a state law response to sexual fraud in which behavior that amounts to false advertising subjects that person to civil liability. She concludes by suggesting that this legislative framework could be operationalized by offering claimants access to expedited proceedings in small claims court. As a civil procedure scholar, it is this last piece that I find most intriguing (and which is, presumably, of most interest to JOTWELL Courts Law readers).
At the outset, I applaud Manta for incorporating a procedural aspect into what is otherwise a mostly substantive discussion about the merits and drawbacks of permitting or designing causes of action for sexual fraud at all. Procedure is often an afterthought in substantive policy or legislative proposals. For our part, proceduralists are sometimes less attentive to the substantive components of our ideas than we should be. Manta recognizes serious barriers to enforcement of claims for sexual fraud and realizes that some are as much procedural as they are substantive. Many plaintiffs would not have the financial (or, frankly, emotional) resources to file a lawsuit in a court of general jurisdiction where the filing costs might dwarf any recovery, where litigation is slow and expensive, and where proving actual damages might be a significant barrier to a meaningful recovery.
To counter these procedural problems, as well as to crystalize a coherent cause of action, Manta proposes a model state statute that essentially sets statutory damages for sexual fraud at a level below that state’s jurisdictional limit for small claims court. It is easy to see the appeal of such a proposal. Small claims court enables claimants to file lawsuits without the expense or need of retaining counsel, paying hefty filing fees, and engaging with the other costly processes associated with litigating in a court of general jurisdiction.
Although these are noble aspirations, the reality of small claims courts may be at odds with Manta’s stated goals. The hallmarks of small claims courts (besides their low jurisdictional limits for amount in controversy) are relaxed procedural and evidentiary rules and a norm of proceeding pro se. Given the nature of a claim of sexual fraud, there may be problems with encouraging plaintiffs to file suits in a system that does not treat evidence and witnesses with the same rigor as courts of general jurisdiction. As Manta acknowledges, claims of sexual fraud involve a good deal of “he said, she said” controversy. Whether the plaintiff would have engaged in a sexual relationship but for the lie told by the defendant may be difficult to prove in a procedurally abbreviated format. Even the facts that Manta considers straightforward might be “easy” to prove, but nonetheless expensive. Take, for example, the question of whether the defendant lied about his or her marital status. The plaintiff would need to produce some sort of record of what the defendant said on his or her profile. This information is easy to change, and save for the plaintiffs who are savvy enough to take screen shots (which should really be subject to evidentiary authentication), that information is in the hands of the dating app rather than the plaintiff. This information is not impossible to obtain. But getting records from a third party is expensive and requires procedural savvy – precisely the sort of process that Manta wants to spare complainants in these cases. Even the question of marital status requires some work. A recalcitrant defendant can essentially force a plaintiff to unearth a marriage certificate or corroborating witness in discovery to prove marital status at the time in question. These questions differ from “typical” small claims cases, such a garden variety suit between a home owner and a contractor, where the parties are largely in possession and control of a few key documents or other easily captured pieces of evidence.
In other words, the defendant in these suits can easily put the plaintiff to her proof. And any law or system that would abbreviate such rights of the defendant and allow the plaintiff to prevail more-or-less on her own assertions should give everyone serious pause. Sorry as I feel for people who have made heartbreaking choices based on false information, the judicial system is especially solicitous of protecting the rights of defendants on claims involving either sexual conduct or fraud. A claim of sexual fraud carried serious moral weight, even if Manta’s statutory penalty is low. And I am uncomfortable with applying a system of relaxed evidentiary rules and abbreviated procedures to these claims. One source of this discomfort is that such a statute could hurt women more than men. Manta believes that dating app sexual fraud is perpetrated more by men than by women. But given a recent study showing that in online dating men’s desirability peaks at age 50 whereas women’s desirability peaks at age 18, women are under significant (and understandable) pressure to misrepresent their age. This lie could be the source of many, many claims. And to funnel these cases into a system where people have a limited ability to defend their reputations, or to do so at what is ultimately a much higher cost than typical small claims court promises, is dicey territory.
Finally, even if one were to set aside reservations about having these sorts of claims proceed in low-jurisdictional-limit courts, there are reasons to tamper enthusiasm about the efficacy of small claims courts. These courts offer abbreviated procedure; they do not always offer meaningfully abbreviated timelines. While cases in small claims court are resolved faster than those in courts of general jurisdiction, it can still take 6-12 months of waiting and hours in line at the courthouse for a 5-10 minute hearing before a judge. Moreover, small claims court judgments are notoriously difficult to enforce. One study found that only 55% of small claims court judgments resulted in any payment to the plaintiff at all, and that when judgments were collected, they amounted to about 31% of what the plaintiffs were actually awarded.
Having stated those words of caution, I still think that Manta makes a significant contribution. Few scholars are as specific about exploring the connection between cause of action, remedy, and a meaningful forum for enforcing that remedy. I wish that Manta had engaged further with the difficulties of small claims courts. Although this might be perceived as a damper on enthusiasm for her idea, it is actually an opportunity to reinvigorate scholarly dialogue about litigation and dispute resolution in alternative public forums. Procedural and substantive scholarship could benefit with such engagement. Manta’s proposal is an excellent starting point for this kind of scholarly dialogue.