In his famous, unfinished article The Forms and Limits of Adjudication, Lon Fuller posited that certain types of claims—he called them “polycentric” disputes— were incapable of resolution through adjudication. In these disputes the number of interested parties is so large and the potential ramifications of the dispute so vast that it is impossible for each person affected by the decision to participate in the decision-making process through proofs and reasoned arguments—participation which, Fuller argued, was the sine qua non of adjudication. According to Fuller, the binary nature of a second decision-making mechanism—voting—also made elections a poor means for resolving mass disputes, with their multifaceted nuances. Therefore, the only legitimate mechanisms to resolve polycentric disputes were negotiation or managerial direction. One type of dispute that Fuller held out as an exemplar of polycentrism was a labor dispute over wages in a centralized economy: the way in which different levels of increase in wages would have ripple effects across the economy made it unimaginable that a judge or a voter could determine the question of a proper wage.
Of course, Fuller’s claim is contestable, both theoretically and factually. In particular, the rise of complex litigation, which emerged as a significant legal phenomenon after Fuller drafted his article in 1957, has tested the assumption that large-scale disputes cannot be resolved through proofs and reasoned arguments. But the course of complex litigation over the past sixty years has also given Fuller’s thesis some support. Consider, for example, the aggregation techniques that courts in complex disputes have employed: class actions that limit participation rights in return for the promise of adequate representation and MDL proceedings whose bellwether trials are designed to channel most cases into settlement and whose settlement structures take their inspiration from administrative agencies and insurance companies. In each of these, the right of each affected individual to participate through proofs and arguments falls by the wayside. Likewise, some of the “best practices” for resolving aggregate litigation—for instance, providing separate representation for each interest group to prevent conflicts of interest within groups and using statistical sampling to ensure that issues of liability and damages are determined accurately on a macro scale—highlight the difficulty of guaranteeing the individual participation and the individualized assessment of claims that lie at the heart of Fuller’s adjudicatory paradigm.
Fuller’s paradigm casts a long shadow over complex litigation. In recent years courts have seemed especially reluctant to stray too far from the traditional understanding of adjudication that Fuller describes. Courts have declined to head down adventurous doctrinal paths that would facilitate the aggregation of large numbers of cases: think, for instance, of the many cases narrowly construing Federal Rule 23, Wal-Mart’s rejection of the use of trial by statistics, and the increasing judicial resistance to cy pres relief. Whatever the merits of these decisions (and some of them seem to me more defensible than others), convincing a present-day court to use its adjudicatory powers to resolve “polycentric” claims in a single, comprehensive lawsuit is an uphill climb. Yet even if courts are reluctant to adjudicate mass disputes, the disputes themselves continue to proliferate. Predictably, substitute mechanisms have stepped into the breach.
Adam Zimmerman has explored many non-judicial dispute-resolution mechanisms. His latest article turns to another one: presidential settlements, which are deals brokered by the White House that extinguish the legal rights of claimants in favor of an executive-branch compensation system, without judicial involvement or imprimatur. The BP oil spill settlement is perhaps the largest and most recent example. As Zimmerman recognizes, however, presidents have been hammering out similar deals since the earliest days of the Republic. In the past four decades alone, President Carter negotiated, and President Reagan implemented, the Algiers Accords, providing a compensation mechanism for claims arising from the Iranian Revolution; President Clinton engineered a settlement between Holocaust victims and banks that had confiscated Jewish bank accounts; and President George W. Bush brokered a deal between the government of Libya and the victims of the Lockerbie bombing. Over the years presidents have also intervened to resolve labor disputes—a role that calls to mind Fuller’s argument that such disputes are classically polycentric and therefore beyond the legitimate reach of adjudication.
As Zimmerman points out, the president’s role as “settler-in-chief” poses certain practical problems that plague all processes for resolving mass injuries. The first is the lack of representation at the bargaining table for victims or others affected by the dispute; while the president stands in for the victims in the negotiations, the White House’s own political and international agendas make the president a less than faithful agent of the victims. Second and relatedly, presidents may ignore conflicts of interest among claimants. For example, presidential settlements of labor disputes often sacrifice the interests of those entitled to compensation for past harms in favor of those who preferred a better prospective remedy. Similarly, the varying strength of Holocaust survivors’ legal entitlements to the recovery of funds was largely ignored. A third difficulty is assessing the entitlements of individual claimants with accuracy. In the Lockerbie settlement, for instance, each plaintiff received the identical lump-sum award, despite variations in individual injury and damage. Simply put, without effective judicial review of these settlements, the quality of the President’s decision-making and the fairness of the settlement itself remain open to criticism.
These settlements also raise constitutional concerns. As highlighted by the murkiness of the Supreme Court’s opinion in Dames & Moore v. Regan, which upheld the Iranian claims tribunal, the precise boundaries on the president’s Article II power to extinguish claims is uncertain. When the president acts without congressional approval, as is often true with presidential settlements, the legitimacy of the President’s action in compromising private claims depends entirely on the breadth of this power. Whatever the precise scope of that power at a given instant, there is also a fear of the slow but inexorable accretion of power to the president (at the expense of both Congress and the judicial branch); under Justice Jackson’s framework in the Steel Seizure Case, congressional acquiescence to one presidential settlement may implicitly expand the president’s powers in the next. For instance, the BP oil-spill settlement, in which claims were largely based on past harms and did not touch in a substantial way on international relations, seems a step beyond prior settlements that resolved domestic labor disputes or claims arising from the actions of sovereign nations. Presidential settlements raise other separation-of-powers questions. For example, if the power to compromise private claims is indeed one that the president enjoys under Article II, it becomes uncertain whether that power is subject to any limitation except for other constitutional provisions, such as due process. And it is uncertain whether Congress has the ability to regulate or constrain the president’s actions in negotiating these settlements.
With respect to these practical problems, Zimmerman argues that the president should import into the settlement process some of the best practices of complex litigation: ensuring that groups with distinct interests have a voice in shaping the settlement, avoiding conflicts of interest in the bargaining process, and enhancing the accuracy of individual awards through methods such as sampling, bellwether trials, and statistical aggregation. Zimmerman also urges that the president subject the settlement to a process of judicial review, or at least independent review in an Article I court, to ensure its fairness. The problem, however, is how to ensure that a president will adopt measures that constrain presidential discretion and flexibility in brokering a deal. The article suggests—perhaps somewhat optimistically, absent recent examples of presidents having done so—that the president might welcome the importation of these mass-action principles into the process as a means of enhancing the legitimacy of the settlement. The article is more cautious about whether Congress has the power to impose these limits on an unwilling president, although its reading of cases like Youngstown and Dames & Moore is cautiously optimistic that Congress can play such a role in at least some presidential settlements.
Zimmerman’s provocative treatment of these issues brings me back to Fuller’s critique. If voting, adjudication, negotiation, and managerial direction are the principal dispute-resolution mechanisms, presidential settlements are a hybrid of the final two (some managerial direction, some negotiation) with a dash of voting thrown into the mix (given the president’s status as a political actor).1 Zimmerman’s proposal adds to the recipe a pinch of adjudication: participatory rights for those affected, some individualized assessments of the merits of claims, and a neutral observer’s check on the fairness of the outcome. The value of Fuller’s model is to identify possible tools for dispute resolution; the value of Zimmerman’s work is to show that the real world is more complex than models—in other words, every approach to the resolution of mass disputes must rely on a mix of the tools associated with each model if it is to succeed. For Fuller, legitimacy in decision-making derives from the decision-maker’s adherence to the essential form of a decision-making model; for Zimmerman, legitimacy in decision-making is enhanced by blending elements from different models. If a blended approach is right, it becomes important to determine which blend of principles works best for each type of mass dispute and then to establish structures that channel each type of dispute into its best dispute-resolution form.
At the bottom of Zimmerman’s description of presidential settlements is a cautionary tale. For example, could a president, without input from asbestos victims, broker a settlement of all present and future asbestos claims that bars victims from bringing suit and relegates them to a flat payment of $50,000? And if the Article II power exists, is that the best way to conclusively resolve the legal aspect of the asbestos crisis? The first question (one of constitutional power) is related to, but distinct from, the second (one of best practices). Until we figure out what the best practices are and how we can implement them, we invite the president to push the boundaries of Article II power in unprincipled and counterproductive ways.
- The dash is quite small, for it is unlikely that many voters would vote for or against a presidential candidate solely because of the candidate’s position on a presidential settlement. [↩]