Faculty Chapters

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  The U. S. Program of Extraordinary Rendition and Secret Detention: Past and Future

  Margaret L. Satterthwaite

  Prior edition of the 2009 edition.

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  Crossing the Punitive-Compensatory Divide

  Catherine M. Sharkey

  Received judicial and academic wisdom holds that ‘‘in our judicial system, compensatory and punitive damages, although usually awarded at the same time by the same decisionmaker, serve different purposes.’’ Compensatory damages ‘‘are intended to redress the concrete loss that the plaintiff has suffered,’’ while punitive damages are ‘‘intended to punish the defendant and deter future wrongdoing.’’ Likewise, the notion of a punitive-compensatory divide, or the alleged rigidity of these doctrinal categories of damages, drives the approach to tort policy in many realms, including the highly-charged debate surrounding tort reform—perhaps most controversially, proposals for caps on damages. At the same time, there is acknowledgement that, for example, damages for emotional distress traverse this punitive-compensatory divide. According to the Restatement (Second) of Torts, ‘‘In many cases in which compensatory damages include an amount for emotional distress, such as humiliation or indignation aroused by the defendant’s act, there is no clear line of demarcation between punishment and compensation and a verdict for a specified amount frequently includes elements of both.’’ This theme was echoed by the U.S. Supreme Court in a recent punitive damages case, when it remarked that, although ‘‘it is a major role of punitive damages’’ to condemn conduct leading to ‘‘outrage and humiliation,’’ “[c]ompensatory damages [may] . . . already contain this punitive element.” What is the import of this blurred distinction between emotional distress compensatory damages and punitive damages? Does it become especially significant, for example, when punitive damages are not an available avenue? Over two decades ago, the Wisconsin Supreme Court speculated that ‘‘if punitive damages are not allowed, juries [will] give vent to their desire to punish the wrongdoer under the guise of increasing the compensatory damages, particularly those for pain and suffering.” More recently, in examining modern statutory and judicial constraints upon punitive damages, Victor Schwartz and Leah Lorber have resurrected this theme, claiming that ‘‘plaintiffs’ lawyers . . . have poured new wine of punishment evidence, once used to obtain punitive damages, into old bottles of pain and suffering awards.’’ Tom Baker’s interviews with plaintiffs’ attorneys lend a modicum of support: ‘‘as the plaintiffs’ lawyers report, in practice there is no clear dividing line between compensatory and punitive damages. Compensatory damages can punish, just as punitive damages can compensate.’’ Academics are uncovering a parallel phenomenon at work in jury decisionmaking. As Cass Sunstein and colleagues report, ‘‘[a]lthough pain-and-suffering awards are essentially compensatory, there can be little doubt that such awards sometimes reflect jury judgments about the egregiousness of the defendant’s behavior. Hence, such judgments are likely to have a punitive component.’’ With even greater conviction, Michelle Anderson and Robert MacCoun pronounce that ‘‘[t]he dynamic relationship between the two awards might resemble a water-filled balloon; if one pushes down on one end, the other pops up.’’ The time is ripe to consider the implications of the collapsing punitive-compensatory divide. My goal in this chapter is to uncover judicial recognition of the crossover or ‘‘substitution’’ phenomenon, and to tie these developments to a considerable—and growing—body of empirical evidence that suggests the validity of such a substitution effect. Experimental mock juror studies comprise the bulk of the existing empiricism. Jonathan Klick and I have contributed to this body of evidence an econometric regression analysis using broadly representative state court jury trial data. Until recently, this crossover hypothesis, although widely presumed in certain circles, had not been tested empirically in the real world. The chapter concludes with an exploration of alternative explanations for the crossover effect that has now been demonstrated using divergent experimental and econometric techniques.

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  Disclosure and Civil Penalty Rules in the U. S. Legal Response to Corporate Tax Shelters

  Daniel N. Shaviro

  Historians and sociologists frequently debate American exceptionalism, or the “view that America can be understood only by appreciating its singular origins and evolution.” In some areas, ranging from the death penalty to the Bush Administration’s embrace of torture and preemptive war, American exceptionalism has been emergent in recent years rather than a historical constant. In other areas, if the U.S. initially looks different from other economically advanced countries, it may simply have traveled down a common pathway first, without actually being exceptional at all. Prominent recent scandals and debates in the U.S. regarding aggressive tax planning and breakdowns in corporate governance—the main topics at this conference—reflect, at most, the U.S. getting somewhere first. The U.S. had the Enron scandal; Europe the Parmalat scandal. In the U.S., then-Treasury Secretary Lawrence Summers said in 2000 that the “rapid growth of abusive corporate tax shelters” was “the most serious compliance issue threatening the American tax system today.” European tax authorities increasingly have similar concerns, albeit more focused on income-shifting within the European Union than on the loss-creating transactions that have drawn the greatest attention from U.S. authorities. Since the U.S. government response to corporate tax shelters has been unfolding for almost a decade by now, Europeans may naturally want to ask what lessons can be learned from the U.S. experience. Should U.S. responses be adopted more broadly? Could they be improved significantly? In evaluating the U.S. legal response to corporate tax shelters, two types of issue arise. The first concerns the legal requirements for tax-reducing transactions to be treated as tax-effective. If a company has sufficient leeway under the law to create tax losses by simply shuffling paper and creating circular cash flows, then all the audit review and penalties in the world may not suffice to make it pay tax on its income. Once the substantive rules that define permissible sheltering are in place, however, the issue shifts to one of compliance. How often do companies take reporting positions that would not be upheld if carefully scrutinized, how often are they caught, and what penalties do they face if caught? This paper seeks modestly to advance inquiry into the compliance issues by reviewing and evaluating some of the main U.S. rules that address tax shelter reporting and penalties. I will argue that the disclosure rules do not impose unreasonable burdens. Moreover, while it is unclear how much audit benefit they actually offer the Internal Revenue Service (IRS), other than in directing auditors’ attention to “listed transactions” that the IRS has publicly identified as problematic, they may more generally help the IRS in formulating responses to newly developed transactions. However, the effectiveness of the disclosure rules may be compromised by taxpayer over-disclosure, which might be designed either to avoid penalties for under-disclosure or to overwhelm the IRS with too much of a good thing. The expanded book-tax reconciliation reporting that must be furnished by corporate taxpayers on newly developed IRS Schedule M-3 likely does more to offer auditors a useful overview of the likely soft spots on a given tax return. The penalty rules‘ main flaw, I will argue, is that they focus excessively on the taxpayer’s state of mind regarding the likelihood of prevailing on audit, as a prerequisite for imposing civil penalties. Mens rea is, of course, an important element of any criminal offense that could send someone to jail. But there is little need for it in the context of a company facing the chance of, say, a 20 percent addition to the tax deficiency it will face if a given tax return position is rejected upon audit. Here, a penalty merely worsens the company’s betting odds on taking a controversial tax return position—odds which may remain unduly favorable even with the risk of a penalty. Nothing should shock the conscience about such an adjustment to “audit lottery” payoffs. If we are uneasy about exposing the company to additional downside risk when it acts in apparent good faith, the answer is to permit insurance, rather than, in effect, to provide the insurance for free by simply not charging a penalty to begin with.

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  Simplifying Assumptions: How Might the Politics of Consumption Tax Reform Affect (Impair) the End Product?

  Daniel N. Shaviro

  Proponents of consumption taxation claim that one of its major advantages is simplification. They argue that a consumption tax would be considerably less complicated technically than the present income tax and that it would lead to a drastic reduction in the resources devoted to tax planning, compliance, and administration. This chapter considers whether the idealized proposals for consumption tax reform in the United States could survive the political process. It discusses numerous ways in which the pure proposals might be modified and concludes that such highly plausible political adjustments would reduce or eliminate the gains that otherwise might be realized from fundamental tax reform. In analyzing the possible politics of consumption-based tax reform, the chapter discusses two plausible scenarios: bipartisan consumption tax reform and consumption tax reform led by the Republican Party. It also looks at the significance of the fiscal gap for consumption-based reform and important political interests that might affect the end product of consumption-based reform (for example, homeownership, charities, state and local governments, health insurance and healthcare). Finally, it considers the politics underlying the X-tax.

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  Cooperative Efforts in Private International Law on Behalf of Children: The Hague Children's Conventions

  Linda J. Silberman

  These lectures, entitled “Cooperative Efforts in Private International Law on Behalf of Children”, focus on three child-centred Conventions produced by the Hague Conference on Private International Law: the 1980 Convention on the Civil Aspects of International Child Abduction, the 1993 Convention on Protection of Children and Co-operation in Respect of Intercountry Adoption, and the 1996 Convention on Jurisdiction, Applicable Law, Recognition, Enforcement and Co-operation in Respect of Parental Responsibility and Measures for the Protection of Children. The three modem “Children” Conventions of the Hague Conference mark something of a shift in approach by the Conference, which has, since its revitalization in the 1950s, attempted to unify the rules of private international law The work of the Conference has concentrated on the issues of choice of law and the allocation of jurisdiction covering a range of subjects, including commercial law, products liability, and civil procedure. Family law matters have also been the subject of numerous Hague conventions, including conventions on marriage, divorce, support, adoption, protection of children, and matrimonial property, although with the exception of the conventions on support, these conventions were not widely adopted and as a result were not particularly successful. The “jurisdiction” and “choice of law” model used for other Hague Conventions seemed too theoretical and abstract to address cross-border family law issues; at the same time, obtaining agreement on “substantive” provisions among countries with very different cultural and legal traditions seemed even less likely to achieve success. What, seemed to be called for was something of a new approach. The first such attempt in the family law field was the Hague Convention on the Civil Aspects of International Child Abduction of 1980. Building on several of the “modem” civil procedure conventions which instituted the mechanism of a Central Authority to undertake certain tasks to effectuate particular Convention provisions, the Abduction Convention adopted a structure of formal cooperation to assist foreign applicants in locating children who were wrongfully removed or retained. In addition, the Convention created a judicial remedy to achieve the return of a child if informal or voluntary returns could not be achieved. With the success of the Abduction Convention, the Hague Conference directed its efforts towards preparation of a convention on intercountry adoption. The prior 1965 Hague Adoption Convention was of limited utility and had very few ratifications. The primary goals of this new Convention were to establish channels of communication between “sending” and “receiving” countries, to achieve co-operation between these countries and to assure substantive safeguards in intercountry adoption. The system of co-operation established in the Abduction Convention offered a precedent for a new Adoption Convention, which introduced co-operative efforts for intercountry adoption. The 1993 Hague Convention on Protection of Children and Co-operation in Respect of Intercountry Adoption presented other unique features. First, it offered protection to children (and others) in two domestic systems—that is, in both the sending and receiving States Second, it introduced substantive requirements that were to be respected before any intercountry adoption could take place or be recognized. This latter feature gave the 1993 Adoption Convention some characteristics of a “human rights” convention. The most recent “Children’s Convention” was a revision and reworking of the 1961 Convention on the Protection of Minors finalized in 1996. The formal title of the new Convention is Convention on Jurisdiction, Applicable Law, Recognition, Enforcement and Co-operation in Respect of Parental Responsibility and Measures for the Protection of Children, but it is usually referred to as the 1996 Protection of Children Convention or, more simply, the 1996 Protection Convention. This Convention, unlike the Abduction and Adoption Conventions, is a jurisdiction and recognition of judgments convention; it establishes a set of international standards for the exercise of jurisdiction in child protection matters and requires enforcement of judgments exercised in accordance with those standards. It differs from the Abduction Convention in that the Abduction Convention merely establishes a remedy to preserve the pre-abduction status by returning a wrongfully removed child to its habitual residence. Moreover, provisions for co-operation and communication—important features of the Abduction Convention—are also part of the 1996 Protection Convention. The three “Children’s Conventions” are intended to be operational—that is, they provide specific rules and institute particular mechanisms to achieve their objectives. In that sense, these Conventions are a contrast to the United Nations Convention on the Rights of the Child which is aspirational in character and less likely to have a direct impact on day-to-day cross-border issues relating to children. However, the Hague Conventions do have an important synergy with the UN Convention in that they help to implement many of the goals of that Convention. Moreover, the Hague Conventions themselves have helped to identify a set of international norms for addressing children’s issues in transnational cases.

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  Foreword

  Bryan A. Stevenson

  Published in 1764, On Crimes and Punishments by Cesare Beccaria (1738-1794) courted both success and controversy in Europe and North America. Enlightenment luminaries and enlightened monarchs alike lauded the text and looked to it for ideas that might help guide the various reform projects of the day. The equality of every citizen before the law, the right to a fair trial, the abolition of the death penalty, the elimination of the use of torture in criminal interrogations—these are but a few of the vital arguments articulated by Beccaria. This volume offers a new English translation of On Crimes and Punishment alongside writings by a number of Beccaria's contemporaries. Of particular interest is Voltaire's commentary on the text, which is included in its entirety. The supplementary materials testify not only to the power and significance of Beccaria's ideas, but to the controversial reception of his book. At the same time that philosophes proclaimed that it contained principles of enduring importance to any society grappling with matters of political and criminal justice, allies of the ancien régime roundly denounced it, fearing that the book's attack on feudal privileges and its call to separate law from religion (and thus crime from sin) would undermine their longstanding privileges and powers. Long appreciated as a foundational text in criminology, Beccaria's arguments have become central in debates over capital punishment. This new edition presents Beccaria's On Crimes and Punishments as an important and influential work of Enlightenment political theory.

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  Surveillance of Emergent Associations—Freedom of Association in a Network Society

  Katherine J. Strandburg

  Recent events have combined to bring the prospect of using communications traffic data to ferret out suspect groups and investigate their membership and structure to the forefront of debate. While such “relational surveillance” has been around for years, efforts are being made to update traffic analysis to incorporate insights from “social network analysis”—a means of analyzing relational structures developed by sociologists. Interest in employing social network analysis for law enforcement purposes was given a huge boost after September 11, 2001, when attention focused on tracking terrorist networks. Traffic data, when stored, aggregated, and analyzed using sophisticated computer algorithms, contains far more “information” than is commonly appreciated. Increasing computational capabilities make it possible to apply computerized analysis to larger and larger sets of traffic data and raise the possibility of employing data-mining techniques to uncover “suspicious” patterns of association. Increasing use of the Internet and other digital communications means that traffic data is increasingly recorded by communication intermediaries. The availability of this data facilitates relational surveillance. The Internet, wireless communication, and locational technology have also transformed the ways in which civic and political associations operate. More and more political and civic “work” is performed, not by traditional face-to-face associations with well-defined members, policies, and goals, but by decentralized, often transient, networks of individuals associating primarily electronically and with policies and goals defined synergistically with the formation of the emergent association itself. Relational surveillance, particularly in the form of a search for “suspicious” patterns of association, has great potential to chill this increasingly important type of associational activity. Historically, both Fourth Amendment and statutory protections from government surveillance have been strongest for communication content, offering significantly decreased protection for traffic data, which reveals who is talking to whom. Freedom of association doctrine has the potential to provide strong protection against overreaching relational surveillance, but so far has focused on protecting the rights of traditional associations. This chapter considers how relational surveillance must be regulated to preserve the growing role of emergent associations in politics and civil society. It concludes that First Amendment freedom of association provides the strongest basis for such regulation and extends the First Amendment analysis into the age of electronic communications by extracting principles from Fourth Amendment doctrine about how surveillance regulation must respond to technological change.

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  Do Judges Reason Morally?

  Jeremy Waldron

  Legal philosophers have devoted a lot of attention to the following questions: Do judges engage in moral reasoning? Should they engage in moral reasoning? Are they good at moral reasoning? Are they better at moral reasoning than other official decision-makers? Is the quality of their moral reasoning a reason for assigning final decisions about issues of rights to the judiciary rather than to legislatures? The last couple of questions are particularly important for constitutional jurisprudence. In the debate about judicial review of legislation, it is often suggested that because courts are better at moral reasoning than legislatures are, we should entrust them with final authority over the essentially moral issues of individual and minority rights. Now, this is a quite specific claim about institutional competence, and I suspect it is often put forward on a flimsy basis. We catch a glimpse of what goes on in legislatures, and it sounds like a cacophony. (We ignore Machiavelli's warning not to “consider the noises and the cries that . . . arise in such tumults more than the good effects that they engender.”) We read a few Supreme Court opinions and they appear to be careful analytic treatments of important issues of rights. Certainly they seem to be talking about the issues in the measured tones and with the articulate arguments that we would expect to use when we discuss them in our seminars and workshops.

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  Hart and the Principles of Legality

  Jeremy Waldron

  This chapter contends that Hart in some portions of his work relies upon an understanding of the fundamental principles of legality as moral principles, even though Hart elsewhere insists that the principles of legality are morally neutral. It redefends the position of Lon Fuller in the debates between Hart and Fuller that took place several decades ago.

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  Hobbes on Public Worship

  Jeremy Waldron

  We usually assume that the difference between Thomas Hobbes and John Locke on the issue of religious toleration is explained by Hobbes’s greater concern about the danger to civil peace posed by religious disagreement. Both thinkers agree that there is no point trying to use civil laws to govern personal faith or belief. “Faith,” writes Hobbes, “hath no relation to, nor dependence at all upon, Compulsion, or Commandment.” It is not under voluntary control and therefore not something that an individual can alter in response to any “promise of rewards or menaces of torture”. But they disagree on the relation between religious views and political disturbance. Though Locke accepts that measures must be taken against any view that teaches that civil law is not to be obeyed, he does not think very many religions will have this consequence: “. . . no Sect can easily arrive to such a degree of madness, as that it should think fit to teach, for Doctrines of Religion, such things as manifestly undermine the Foundations of Society . . . because their own Interest, Peace, Reputation, every Thing, will be thereby endangered. Hobbes, by contrast, sees the connection between religious belief and subversion as endemic. Since religion is partly about eternal sanctions, it poses a standing danger to the use and effectiveness of civil sanctions to maintain order and peace in society. People quite rightly believe that God’s command is to be preferred to the command of anyone else including their sovereign, and so it is of the utmost concern to the sovereign what his subjects believe God’s commands to be. True, the sovereign cannot control those beliefs directly. But he can control them indirectly by controlling their sources and in particular by controlling what people are taught to believe by those who hold themselves out as experts on God. Locke is notoriously equivocal about the possibility and utility of this sort of indirect thought-control. Mostly he seems to believe that it is unnecessary and that the main source of political disturbance is not a proliferation of uncontrolled views about what God commands but competition for the privilege of establishment and the resentment of those believers whose faith and practice are not accorded full toleration. We may surmise that, had he known of Locke’s view, Hobbes would have thought it naïve and dangerous. A sovereign cannot neglect the supervision of the opinions that are taught in his realm, for “in the well governing of Opinions, consisteth the well governing of men’s Actions, in order to their Peace, and Concord.” Hobbes thinks it pretty clear that the civil power needs to control the appointment of spiritual pastors, and supervise and license their activities, and this amounts in effect to establishing a national church.

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  The Dignity of Groups

  Jeremy Waldron

  Citizens of South Africa do not need me to tell them how important the idea of dignity is in our modem conceptions of human rights. Human dignity is the first of the values on which the South African Constitution is founded and, along with equality and freedom, it is the basis of South Africa's Bill of Rights. Dignity is asserted as the foundation, too, of much of international human rights law. The United Nations Charter tells us that the enterprise of setting up the UN is predicated on 'faith ... in the dignity and worth of the human person,' and 'the inherent dignity of the human person' is also said to be the basis from which the contents of the International Covenant on Civil and Political Rights are derived. The implication is that if you want to understand human rights, you had better begin by understanding human dignity. The meaning of dignity is key to the meaning of rights.

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  The Constitution of Europe: Resquiescat in Pacem

  Joseph H. H. Weiler

  This edition brings together the texts that correspond to the interventions of the speakers who dealt with the different themes foreseen in the program of the International Conference on “Europe and the Challenges of the 21st Century”. We would like to thank everyone for their availability to prepare the written version of their respective interventions, or to review extracts from the recordings of the Conference sessions. The organizers express their appreciation for the excellent collaboration of Masters Sónia Donário, Olívio Mota Amador and Nuno Cunha Rodrigues, and express their gratitude for the collaborations of the sponsoring entities mentioned on another page of this book, without which the International Conference would not have had the scope achieved, with the participation of some of the world's greatest experts on integration. It was, without a doubt, a unique event in the context of initiatives of this nature.

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  The Questionable Axiom of Butner v. United States

  Barry E. Adler

  The Supreme Court opinion of Butner v. United States established this now famous bankruptcy law principle: “Property interests are created and defined by state law.” Having thus stated the principle, the Court explained: “Uniform treatment of property interests by both state and federal courts within a State serves to reduce uncertainty, to discourage forum shopping, and to prevent a party from receiving ‘a windfall merely by reason of the happenstance of bankruptcy.’ ” The principle is straightforward, and seemingly compelling. It was described by one noted author as an “uncontested axiom” at least among bankruptcy scholars who focus on the consequences of bankruptcy law within the larger legal system and a market economy. Appearances can be deceiving, however. The purpose of this essay is to question the Butner principle from the broad consequential perspective that has fostered its endorsement. Part I describes the Butner case and its holding. Part II explores purported justifications for the Butner principle. Part III challenges the wisdom of the Butner principle as applied to the priority of nonconsensual claims. Concluding remarks are then offered.

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  Legal Perspectives

  José E. Alvarez

  This article provides a summary of the author's writing and teaching at several well-known law schools. The article addresses how the international organizations with a global reach have changed the mechanisms and reasoning behind the making, implementation, and enforcement of international law. It also notes the disappearance of a rather religious faith in law and multilateral approaches that had become characteristic of the legal culture among those who helped design the world organization in the 1940s.

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  Culture, Subculture, Multiculturalism: Educational Options

  Kwame Anthony Appiah

  It is a truism that in the United States of America “we live in a multicultural society.” But the obviousness and apparent clarity of this truism, like the apparent clarity and obviousness of most such truisms, dissolves upon inspection. To begin with what is, perhaps, the least patent difficulty, what people normally have in mind when they pronounce this slogan, is that the United States is a multicultural nation. This is by no means obviously the same thought, since that we in America constitute a nation is, so to speak, a juridical and constitutional fact, while our being a society requires, I should have thought, both more and less than this. The people of Martinique, after all, are French nationals: but there is surely such a thing as Martinican society as distinct from French society—the society of the “hexagon”—and it is not obvious that Martinicans generally are participants in the latter. Similarly, many Native Americans, who live on reservations, while clearly American nationals, might be thought to live in a separate society from the rest of us; and we might also argue, less uncontroversially, that soldiers on bases, the inhabitants of Bel Air, or of South Central L.A., or of San Francisco's Chinatown, live in societies separate from those of the people whose lives go on around them.

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  Does Truth Matter to Identity?

  Kwame Anthony Appiah

  This collection of new essays explores the relation between race and ethnicity and its social and political implications. Although much work has been done on the philosophy of race in the past century in the United States, the concept of ethnicity has only recently awoken the interest of American philosophers, and the relations between race and ethnicity remain largely unexamined. The discussion is divided into two parts dealing, on the one hand, with the nature and the relation between race and ethnicity and, on the other, with the social consequences of the complex relations between them. Part I explores in particular the debated topic of racial and ethnic identities: Does it make sense to speak of racial and ethnic identities, and especially of black and Latino identities? And if it does make sense, how should these identities be conceptualized, and how are they related to gender? Part II examines how race and ethnicity have influenced the lot of some social groups in significant ways: How do racially defined institutions deal with racial assimilation? How do different conceptions of race and ethnicity influence public policy and various forms of racism? How can exploited racial and ethnic groups be effectively recognized? And what is the role of affect in social justice as dispensed by the courts?

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  Immigrants and Refugees: Individualism and the Moral Status of Strangers

  Kwame Anthony Appiah

  For over 50 years, Sir Michael Dummett has been a major philosophical voice in a wide range of fields, including epistemology, ontology, and the philosophy of language. This comprehensive volume treats all of these subjects and more in detail. It contains Dummett’s intellectual autobiography, 27 previously unpublished critical and descriptive essays by famous scholars, a reply to each essay by Dummett, and a complete bibliography of his published works.

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  What’s Wrong With Slavery?

  Kwame Anthony Appiah

  If "slavery" is defined broadly to include bonded child labor and forced prostitution, there are upward of 25 million slaves in the world today. Individuals and groups are freeing some slaves by buying them from their enslavers. But slave redemption is as controversial today as it was in pre-Civil War America. In Buying Freedom, Kwame Anthony Appiah and Martin Bunzl bring together economists, anthropologists, historians, and philosophers for the first comprehensive examination of the practical and ethical implications of slave redemption. While recognizing the obvious virtue of the desire to buy the freedom of slaves, the contributors ask difficult and troubling questions: Does redeeming slaves actually increase the demand for—and so the number of—slaves? And what about cases where it is far from clear that redemption will improve the material condition, or increase the real freedom, of a slave?

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  The Rise and Fall of the Political Question Doctrine

  Rachel E. Barkow

  At least in areas outside foreign affairs, the political question doctrine appears to be on the verge of dying, if it is not already dead. My aim in this chapter is to offer an account of the doctrine's decline and to explain why this development should concern, not comfort, us. Part I begins this task by tracing the constitutional roots of the political question doctrine and its relationship to a theory of interpretive deference. Part II continues by documenting the beginning of the doctrine's demise and the correlation of that demise with the ascendancy of a theory of judicial review that is one of judicial hegemony. Part III then argues that the diminishment of the doctrine—and, in particular, its classical strain—is troublesome precisely because it fosters this vision of judicial supremacy.

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  The Politics of European Federalism

  Jenna Bednar, John A. Ferejohn, and Geoffrey Garrett

  The European Union (EU) is manifestly different from other international "regimes." Even if it never becomes a genuine federation, the EU is a much more powerful economic, juridical, and political entity than the myriad intergovernmental institutions that dot the international landscape. Indeed, over the course of its short history, the governing institutions of the EU have successfully claimed wider and wider jurisdictions despite the resistance of numerous actors in member states. This paper considers the development of the EU within an explicit model of federalism. We take a different perspective on the familiar terrain of institutional research on the EU—the interactions among the Commission, the Council of Ministers, the European Court of Justice (ECJ) and the European Parliament. We ask how these "horizontal" facets o f European integration have affected what we call "vertical" federalism—that is, relations between the member states and "Brussels." More specifically, we consider the impact of the changes in these institutionalized interactions at the Brussels level signaled by the 1986 Single European Act (SEA) and the Treaty on European Union signed at Maastricht in December 1991 (the Maastricht treaty) on the support for further integration among European governments and citizens.

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  Rambling Through Economic Theory: Topco's Closer Look,

  Peter C. Carstensen and Harry First

  On the morning of November 16, 1971, Howard Shapiro stepped into the well of the United States Supreme Court to argue Case No. 70-82, United States v. Topco Associates, Inc. Shapiro, dressed in the formal morning coat traditionally worn for Supreme Court arguments by lawyers for the Department of Justice, was the first to argue that day. The government had lost its case at trial below-in those days government civil antitrust cases were appealed directly from the trial court to the Supreme Court—and Shapiro, representing the appellant, had the task of convincing the Court to ignore the factual findings made by District Court Judge Hubert Will and focus on the government's legal approach. Shapiro appeared confident as he began. His argument was straight-forward. Topco was the vehicle for its owners-twenty-three supermarket chains and two wholesalers-to buy grocery products cooperatively and to sell many of them at retail under brands owned by Topco. Its cooperative buying was not a problem for the government. The problem was that Topco restricted the territories within which its member-supermarket chains could sell Topco-branded goods, which the government felt gave each member the effective right to exclude all other Topco members from its territory. In the government's view, this restriction amounted to a horizontal territorial allocation scheme, long held illegal per se under section 1 of the Sherman Act. But Shapiro was not as confident of his position as he appeared. Although the Antitrust Division had characterized this case from the start as a “simple” case of horizontal competitors allocating territories, Shapiro actually was dubious about the government's position. Topco's main defense was that the territorial restrictions were necessary to enable the Topco members to provide their customers with a “private-label brand” and thereby compete better with the “Big Three” chains of the day, A&P, Safeway, and Kroger. Shapiro, as Chief of the Antitrust Division's Appellate Section, had to defend the Division's per se approach, but he thought there was some merit to the argument that the better approach would be to balance the pro- and anticompetitive effects of the restrictions-less competition in Topco-branded goods (or even among Topco members) but more competition among supermarkets, just the sort of balancing approach in which the district court judge had engaged. Shapiro began by laying out the government's legal position- territorial restraints were condemned as long ago as Addyston Pipe, decided in 1898, and as recently as Sealy and Schwinn, decided by the Court on per se grounds only four years earlier. He also advanced the traditional arguments favoring per se rules. Although “once in a while” there might be a case where a horizontal territorial restraint was not extremely harmful, the per se rule should still be applied because of the benefits of predictability. “Right now any antitrust lawyer in the country can tell a supermarket chain: You may not divide up territories with your competitors. The law is absolutely clear on that.” But with the district court's approach, Shapiro argued, the parties won't know the answer until after a “full-scale” trial with an “extremely difficult” rule of reason examination. Referring to the district court's rule of reason effort, Shapiro noted that “you'll find nothing in the record showing what A&P's position is in these fifty-five [local] markets. It's almost impossible to do that kind of vast market analysis.” The heart of Shapiro's argument, though, was not really on the legal principles. Appellate courts, deprived of live witness testimony and dependent on a printed record, are often more concerned that they understand the facts of a dispute. So Shapiro made two important factual points, based on the record but not made explicit in Judge Will's findings of fact. The points were made in response to questions from the Court about whether Topco would dissolve absent territorial exclusivity. Judge Will had found that it would, but Shapiro disagreed: “Now if they were freed from agreements not to compete, it's quite possible that they could still achieve some of the benefits of individual labeling, for example, by using a joint organization to achieve brands for each of them.” In other words, Topco didn't need territorial exclusivity among its members to provide each of its members with their own “private brand.” Shapiro also pointed to an example in the record of where two Topco members with a territorial conflict had been forced to compete against each other, with both chains carrying Topco-branded products. The testimony, Shapiro noted, was that these chains competed “all over the place” and that the revenues of the more successful competitor went up. How to explain this result? Shapiro quoted the witness's testimony: “Well, sometimes you get so mad and work so hard that you run past yourself.” Surely, Shapiro added, “this is what we think the Sherman Act is about and this is what the per se prohibition against market division is intended to achieve.”

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  Contract as Statute

  Stephen J. Choi and G. Mitu Gulati

  The focus of much of the literature on standard-form contracts has been the problem of power and informational asymmetries among the contracting parties. One party dictates the terms—for example, a big consumer-goods producer may draft a standard-form contract that forms a mandatory part of all consumer purchases—and the other party is a passive recipient of the terms. Boilerplate contracts, however, are found in many markets where the relationship between the parties is not characterized by power imbalances. Instead, we find sophisticated parties on both sides and a multitude of parties employing contracts with slight variations on the same set of boilerplate terms. For example, large portions of the markets for bonds and derivatives are dominated by boilerplate of this type. Our goal is to suggest that the interpretation of boilerplate contracts among sophisticated parties is a topic in need of attention.

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  An Economic Model of Legal Discovery

  Robert D. Cooter and Daniel L. Rubinfeld

  Over the last three decades, the use of mathematical methods and logic and the innovative application of game theoretic, economic and statistical methods have reshaped the way scholars of legal evidence and procedure think about core features of the current legal system and the construction of an ideal justice system. In this comprehensive collection, Professor Sanchirico has brought together the major breakthroughs in this exciting confluence of scholarly methods and concerns. Volume I corresponds in essence to the legal field of procedure. It includes papers which focus mainly on events which surround and are influenced by trial, rather than on trial itself: such events include the decision to sue, the settlement of disputes out of court and ‘primary activity’ behaviour, such as contractual performance, product design or precaution in hazardous activities. Volume II corresponds more to the field of evidence. It delves into the workings of the trial process itself and investigates the interaction between the actual mechanics of trial on the one hand and filing, settlement, and primary activity behaviour on the other.

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  The Role of Nonprofits in the Production of Boilerplate

  Kevin E. Davis

  Drafting contracts—by which I really mean the documents that embody contracts—requires investments of time, experience, and ingenuity. Those investments may yield significant returns because the quality of contractual terms can be an important determinant of the gains that parties realize from trade. This in turn suggests that from an economic perspective, it is important to understand how contractual terms and, in particular, widely used “boilerplate” terms are produced. Recent academic literature on this topic has focused on production of boilerplate by either for-profit actors—whether for their own use or for use by their clients—or the state. The dominant theme is that for-profit actors typically have suboptimal incentives to invest in production of contractual terms because they often cannot capture all of the benefits that flow from those investments. As for the state, the main concern is that it lacks the competence to formulate contracts that are suited to the diverse needs of private commercial actors.

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  What Can the Rule of Law Variable Tell Us About Rule of Law Reforms?

  Kevin E. Davis

  A plan for wide-ranging judicial reform in India is articulated. Topics include judicial governance, the law and economic growth, alternate dispute resolution, human resource development, the crucial role of IT, the future of legal education, and civil society initiatives for legal reform.