Symposium: Emerging Issues in Class Action Law: Backdoor Federalization
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Description
TTwo primary arguments are advanced for the contemporary functional importance of federalist constraints on centralized political power. The first is captured in Justice Brandeis’ famous invocation of the states as the laboratories of democracy in which ‘a single courageous State’ may blaze new paths by trying ‘novel social and economic experiments.’ The second ties the smaller, decentralized scale of sub-national units to a more robust democratic accountability by which ‘government is brought closer to the people, and democratic ideals are more fully realized.’ Each of these arguments fits well with concerns over the centralization of power inherited from the history of the twentieth century. Federalism, understood in its contemporary role as a vindication of state authority relative to the federal government, stands, as claimed by Judge Easterbrook, as an antidote to the ‘central planner,’ the figure of mythic economic inefficiencies and staunch antidemocratic propensities to totalitarianism. While perhaps these claims saddle the dual sovereignty of federalism with more historic weight than it might bear, the focus on economic heterogeneity and democratic accountability is certainly critical. This chapter is largely about circumstances in which these two arguments for federalism fail. While Justice Brandeis’ aphorism about the states as laboratories of democracy is oft repeated, the tail end of his claim tends to get lost. Brandeis sought to leave open the prospect that ‘a single courageous State may, if its citizens choose, serve as a laboratory; and try novel social and economic experiments without risk to the rest of the country.’ The question that concerns us is what happens when claims of state sovereignty do pose risks to the rest of the country, when the experiments of democracy within one state’s borders have spillover effects that adversely affect citizens of other states. In such circumstances, not only may the benefits of heterogeneity and interstate competition fail, but also the citizens of other states are deprived of the political means of compelling democratic accountability on economic actors shielded by other states’ claims of sovereignty. The novelty of our approach is to think of the battles over federalism as running across two dimensions. The more familiar is the question of which law controls, state or federal. But a second dimension is the battle over which forum should control, state or federal, and which is to be the catalyst for new legal norms. With a two-by-two matrix corresponding to these substantive and procedural dimensions, we aim to underscore aspects of ‘horizontal federalism’—namely, policing relations between the states—that have tended to be obscured by the looming shadow of ‘vertical federalism’—namely, the balance of power and division of labor between federal and state sources of authority. By approaching the topic indirectly, focusing primarily on what Richard Fallon terms the ‘subconstitutional’ domain of preemption and forum selection, we hope to give a broader rendition of the legal response to market pressures toward predictability and uniformity than would emerge from a narrow focus on formal constitutional doctrine. Our main argument is that the U.S. Supreme Court has, in preemption and forum-allocation cases, attempted to capture the considerable benefits that flow from national regulatory uniformity and to protect an increasingly unified national (and international) commercial market from the imposition of externalities by unfriendly state legislation. We highlight the role that such functional principles can play in illuminating the contemporary Court’s interpretive method across substantive and procedural areas of the law relating to commercial matters. Rather than standing as an ally of state autonomy against the encroachments of the federal behemoth—the exaggerated but commonplace reading of the Court’s highly publicized federalism rulings on the scope of the Eleventh Amendment—the Court appears to be a willing partner of Congress in providing federal oversight to state interference with the national market. We can project the Court’s work in preemption cases across a spectrum of congressional efforts to exert a federal interest. At one pole are statutes such as the Employee Retirement Income Security Act of 1974 (ERISA) or the Copyright Act, in which field preemption of the substantive law is accompanied by exclusive federal-court jurisdiction. In such cases, the only issue is the boundaries of the field. At the other extreme are Dormant Commerce Clause cases, in which the Court has to define the federal interest in the absence of congressional action. In between are the difficult cases in which the Court assesses Congress’ interest in protecting the rational operation of the national market by coordinating state regulation. Products liability cases occupy this middle ground in the federalization process because of the characteristically incomplete manner in which Congress legislates in this area. Typically, Congress acts, in limited product realms, to define standards of liability but leaves to state law the need to provide remedies—an incomplete regulatory regime fraught with the capacity for federal-state conflict.
Source Publication
Employment Class and Collective Actions: Proceedings of the New York University 56th Annual Conference on Labor
Source Editors/Authors
David Sherwyn
Publication Date
2009
Recommended Citation
Issacharoff, Samuel and Sharkey, Catherine M., "Symposium: Emerging Issues in Class Action Law: Backdoor Federalization" (2009). Faculty Chapters. 944.
https://gretchen.law.nyu.edu/fac-chapt/944
