Volume 2008

Number 1

Symposium: Public International Law and Economics

Public International Law and Economics: Symposium Introduction

Anne van Aaken, Christoph Engel & Tom Ginsburg | 2008 U. Ill. L. Rev. 1

Introduction

Enriching Rational Choice Institutionalism for the Study of International Law

Kenneth W. Abbott | 2008 U. Ill. L. Rev. 5

Institutionalism in International Relations applies insights from economics, game theory and collective action theory, all forms of ra-tional choice, to analyze situations where international cooperation is beneficial, mechanisms of cooperation, and forms of cooperation ranging from intergovernmental organizations to decentralized policy coordination. Only recently has Institutionalism, or other forms of rational choice outside of International Relations, such as law and economics, been applied to the study of international law, a unique international institution; it still has many important contributions to make in that field. However, by restricting its scope to interactions among states and purely rationalist accounts of state behavior, Institutionalism has limited its utility in analyzing areas of law and governance in which nonstate actors play important roles, international regimes interact with domestic politics, and international actors deploy a variety of norms and policies. To address this problem, this article continues an ongoing effort to develop a richer Institutionalist theory by incorporating insights from other International Relations paradigms. The goal is to develop a positive theory of international institutions that is more congruent with, and therefore can better explain, the complex dynamic realities of international politics and the dynamic institutions of law and governance those politics produce.

Towards Behavioral International Law and Economics

Anne van Aaken | 2008 U. Ill. L. Rev. 47

No Abstract Available

Toward a Richer Institutionalism for International Law and Policy

Stefan Oeter | 2008 U. Ill. L. Rev. 61

No Abstract Available

Nonconsensual International Lawmaking

Laurence R. Helfer | 2008 U. Ill. L. Rev. 71

This article documents the rise of nonconsensual international law-making and analyzes its consequences for the treaty design, treaty partic-ipation, and treaty adherence decisions of nation states. Grounding trea-ties on upon the formal consent of states has numerous advantages for a decentralized and largely anarchic international legal system that suffers from a pervasive “compliance deficit.” But consent also has real costs, including the inability to ensure that all nations affected by transborder problems join treaties that seek to resolve those problems. This “partici-pation deficit” helps explain why some international rules bind countries without their acceptance or approval. Such rules have wide applicability. But they can also increase sovereignty costs, exacerbating the compliance deficit.

Nonconsensual international lawmaking thus appears to create an insol-uble tradeoff between increasing participation and decreasing compli-ance. This article explains that such a tradeoff is not inevitable. Draw-ing on recent examples from multilateral efforts to prevent transnational terrorism, preserve the global environment, and protect human rights, the article demonstrates that the game-theoretic structure of certain coopera-tion problems, together with their institutional and political context, cre-ate self-enforcing equilibria in which compliance is a dominant strategy. In these situations, nonconsensual lawmaking reduces both the participa-tion and the compliance deficits. In other issue areas, by contrast, prob-lem structure and context do not affect the tradeoff between the two defi-cits, and the incentive to defect remains unaltered. Analyzing the differences among these issue areas helps to identify the conditions under which nonconsensual lawmaking increases the welfare of all states.

Measuring the Shadow of the Future: An Introduction to the Game Theory of Customary International Law

George Norman & Joel Trachtman | 2008 U. Ill. L. Rev. 127

Compliance remains one of the most contested issues in interna-tional law. In this article, Professors Norman and Trachtman present a game theoretic model to identify the circumstances under which states have a rational incentive to comply with customary international law (CIL). One common explanation for compliance is the “shadow of the future,” in which a state is understood to comply out of fear that failure to do so will prevent it from using international law at some later time. A violator, the logic goes, will eventually be in a position where it wishes to invoke international law, and having failed to comply at an earlier time, will not be able credibly to invoke international law at a later time. Professors Norman and Trachtman demonstrate how game theorists measure the magnitude of the “shadow of the future,” and how this magnitude may be modified in order to increase the likelihood of compliance. The article thus shows what facts or parameters would be relevant in a rational preference-maximizing model of a state’s decision to comply.

Treaties: Strategic Considerations

Todd Sandler | 2008 U. Ill. L. Rev. 155

This paper presents a rationalist approach to treaty formation and adherence, where nations are motivated by their self-interest in a strate-gic framework that accounts for other nations’ responses. Key consid-erations include coordination games, dynamic cooperation, institutional design, and the aggregation technology of public supply. Dynamic as-pects involve multilateral cooperation under a variety of game forms. Treaty design is essential in motivating nations to fulfill obligations with-out the need for enforcement. Some properties of public goods, such as the manner in which individual contributions determine the available consumption level, have a crucial influence over nations’ incentives to adhere to treaties once ratified. The role of morality and conformity are captured in the strategic framework presented.

What Can Be Learned from the Game-Theoretic Analyses of Treaties?

Simon J. Evenett | 2008 U. Ill. L. Rev. 181

No Abstract Available

Treaty Formation and Strategic Constellations

Katharina Holzinger | 2008 U. Ill. L. Rev. 187

No Abstract Available

Commitment and Diffusion: How and Why National Constitutions Incorporate International Law

Tom Ginsburg, Svitlana Chernykh & Zachary Elkins | 2008 U. Ill. L. Rev. 201

Drafters of new constitutions face a bewildering array of choices as they seek to design stable and workable political institutions for their so-cieties. One such set of choices concerns the status of international law in the domestic legal order. In a global era, with an expanding array of customary and treaty norms purporting to regulate formerly domestic be-havior, this question takes on political salience. This paper seeks to de-scribe the phenomenon of constitutional incorporation of international law in greater detail and provide a preliminary empirical test of the com-peting explanations for it. First, the discussion focuses on the concepts of monism and dualism, which have become conventional terms used by lawyers to describe the interaction of domestic and international legal systems. Second, a theory of commitments as well as the advantages and disadvantages of international law are set forth. Third, empirical impli-cations are developed for the precommitment and diffusion theories, which are then tested. Findings show that adopting international law is a useful strategy for democracies to lock in particular policies, encourage trust in governments and state regimes, and bolster global reputations.

Precommitment Theory Applied to International Law: Between Sovereignty and Triviality

Anne Peters | 2008 U. Ill. L. Rev. 239

No Abstract Available

Is It Really All About Commitment and Diffusion?

Andreas Zimmermann | 2008 U. Ill. L. Rev. 253

No Abstract Available

Competing for Capital: The Diffusion of Bilateral Investment Treaties, 1960–2000

Zachary Elkins, Andrew T. Guzman & Beth Simmons | 2008 U. Ill. L. Rev. 265

Beginning in the early 1960s, bilateral investment treaties (BITs) have become the primary international legal mechanism for the governance of foreign direct investment. These agreements establish the terms and conditions for private investment by nationals and companies of one country in the jurisdiction of another.

In this article, Professors Elkins, Guzman, and Simmons explore the advent and spread of BITs, observing a trend, over time, of increased economic and political similarity between new BIT partners. The authors present a theory that host governments and investors view BITs as devices that raise the expected return on investments by making credible commitments to treat foreign investors fairly. The article proposes a set of hypotheses based on this competitive theory and develops an empirical strategy for testing them against alternative explanations. The resulting findings provide evidence that competition is central to the spread of BITs and that both traditional economic explanations and dyadic characteristics explain BIT signings.

After developing and testing this theory with data through 2000, a postscript analyzes additional data from 2000–2006, finding a decline in the overall rate of new signings, but an increase in BITs among lower-income countries. Based on this new data, the authors conclude that the basic competitive dynamic model remains intact.

Governments in Dilemma: A Game Theoretical Model for the Conclusion of Bilateral Investment Treaties

Christoph Engel | 2008 U. Ill. L. Rev. 305

No Abstract Available

The Case Against Reforming the WTO Enforcement Mechanism

Jide Nzelibe | 2008 U. Ill. L. Rev. 319

This essay states the public choice case against reforming the cur-rent WTO enforcement mechanism, which allows parties that prevail in an international trade dispute to retaliate against the scofflaw state by suspending equivalent trade concessions. Currently, there are two dis-tinct kinds of proposals floating around to change this mechanism to make it more incentive-compatible for all member states and user-friendly to developing nations: the first is the use of collective or third-party sanctions; the second is the imposition of monetary compensation. This essay argues that both these proposed reform schemes introduce po-tential pathologies of their own that are likely to dwarf those of the cur-rent enforcement mechanism. First, it argues that under a collective or third-party sanction scheme, the administering third-party states will have no incentive to choose a retaliation strategy that maximizes compli-ance because they will not face any export group pressures to do so. Ra-ther, such states will have an incentive to choose a retaliation strategy that maximizes the returns to their protectionist groups. In other words, collective or third-party sanctions are likely to increase the global level of protectionism without any offsetting compliance benefits. Second, it argues that the costs associated with monetary damages—including the likelihood they will lead to socially undesirable litigation levels—are likely to be higher than their putative benefits to developing countries. Finally, the essay suggests that proreform advocates tend to rely on empirical assumptions that might overstate the extent to which the current enforcement scheme actually hurts developing states’ interests.

Why Rational Choice Theory Requires a Multilevel Constitutional Approach to International Economic Law

Ernst-Ulrich Petersmann | 2008 U. Ill. L. Rev. 359

No Abstract Available

The WTO Sanctions Regime and International Constitutional Political Economy

Christian Tietje | 2008 U. Ill. L. Rev. 383

No Abstract Available

The Inefficiency of Universal Jurisdiction

Eugene Kontorovich | 2008 U. Ill. L. Rev. 389

Under standard international jurisdictional rules, nations can only prosecute conduct with which they have some connection. However, under the growing doctrine of universal jurisdiction (“UJ”), nations have the right to punish certain crimes despite having no relation to the offense. Universal jurisdiction is thus like a very liberal standing rule, one that allows anyone to litigate the legality of particular conduct, without requiring a concrete injury. Drawing on the economic analysis of standing rules, this article shows how UJ’s broad grant of jurisdictional entitlements can create inefficiencies—results that hurt net global welfare.

Sometimes owners of prosecutorial entitlements choose not to exercise them, or to trade them for some other benefit. Common examples include amnesty deals, exiles, and charge bargains. Sometimes the highest value of the right to prosecute lies in not using it. However, when the prosecutorial entitlement is given to all nations, its efficient use becomes difficult. While all nations may benefit from the waiver or trade of the entitlements, any one nation can prevent these benefits from being realized by choosing to prosecute. Because of high transaction costs, it may be impractical for nations that favor waiver to “buy out” the entitlements of those that waive prosecution, even when that would be the socially optimal outcome. Indeed, because UJ allows any one nation to frustrate amnesty and similar arrangements, it encourages opportunistic holdout. To put it differently, UJ means that a complete amnesty deal can only be reached in the unlikely case that all nations are party to it.

The inability to reach efficient waivers of prosecutorial entitlements is only a problem if prosecution is not mandatory for jus cogens offenses, if justice can be traded for peace. Much recent literature argues that UJ is mandatory, that settlement of jus cogens issues is prohibited. The final part of the article shows that the overwhelming weight of state practice, and the positions of the United Nations and international tribunals demonstrates that prosecution is not mandatory, and that efficient settlement even of universally cognizable crimes is recognized in in-ternational law.

Concluding Remarks: The Power of Rational Choice Methodology in Guiding the Analysis and the Design of Public International Law Institutions

Christian Kirchner | 2008 U. Ill. L. Rev. 419

No Abstract Available

Concluding Remarks: Public International Law and Economics

Georg Nolte | 2008 U. Ill. L. Rev. 429

No Abstract Available

Notes

Making Disclosure Regulation Work in the Nonprofit Sector

Robert A. Britton | 2008 U. Ill. L. Rev. 437

Following the Sarbanes-Oxley Act’s success using corporate disclo-sures to help regulate for-profit corporations, some state and federal lawmakers have sought to apply similar principles to nonprofit organiza-tions. Significant differences exist between the for-profit and nonprofit sectors, however, that Britton argues make Sarbanes-Oxley-type provi-sions inappropriate in the nonprofit context. Under market-based theory, for-profit disclosure permits the securities market to internalize public in-formation and more accurately value corporation securities. With no such market in the nonprofit sector, donors rather than investors, and no public valuation process, Britton argues that greater nonprofit disclo-sures will not result in increased corporate accountability or law en-forcement in the nonprofit sector. Instead, Britton suggests adopting a voluntary disclosure system in which state and federal governments, act-ing in their roles as significant donors to the nonprofit sector, withhold government grants unless potential recipients voluntarily provide en-hanced financial and management disclosures. In addition, Britton pro-poses new governmental agencies that will compile, organize, and com-pare these nonprofit disclosures. These agencies will then rate each nonprofit organization based on these disclosures, creating a false market that will enhance or harm the organizations’ abilities to attract or retain donors.

Winning at All Costs: Using Law & Economics to Determine the Proper Role of Government in Regulating Performance-Enhancing Drugs in Professional Sports

Joshua H. Whitman | 2008 U. Ill. L. Rev. 459

The prevalence of performance-enhancing drugs (PEDs) in sports is widely recognized. Employing the analytic tools of law and economics, this note addresses the question of whether federal government action to regulate PED use in sports represents an appropriate remedy for these problems. The author begins by providing a brief history of the emer-gence of PEDs in professional sports and presenting a brief overview of fundamental law and economics tools, including concepts derived from efficiency and welfare economics, the Coase Theorem, and behavioral law and economics. Applying these tools to the question presented, the author first suggests that the potentially prohibitive transaction costs in-curred during the collective bargaining process and high enforcement costs of the bargained agreements represent two potential justifications for government regulation of PEDs in professional sports. The analysis next identifies and takes account of the externalities that attend decisions by professional athletes to use PEDs. The author weighs the argument that society’s implicit approval of PEDs represents a positive externality that potentially overshadows two negative externalities imposed by PED use in sports—negative effects on the nation’s youth and decreased public confidence in the integrity of sports—and concludes that PED use in sports has contributed to an endemic ethical crisis rather than an in-crease in social welfare. Finally, the author examines cognitive biases, particularly the “winner’s bias,” to conclude that athletes’ natural ina-bilities to accurately measure the costs incurred by their decisions to use PEDs prevent them from properly considering the externalities their deci-sions impose on the rest of society. Weighing each of these factors in an efficiency analysis, the author recommends active government regulation of PEDs in sports as the socially optimal method of addressing the use of PEDs in American professional sports.

Number 2

Articles

Unintelligent Design in Contract

Peter A. Alces | 2008 U. Ill. L. Rev. 505

Scholars have expended considerable energy in the effort to “discover” a normative theory of Contract. This Article surveys that effort and concludes that something fundamental about Contract has been missed and has frustrated the search from the outset. Succinctly, Contract doctrine resists the neat formulation theory requires.

Theorists’ perspectives on Contract may be generalized as attempts to impute either deontology or consequentialism to the Contract law. Focusing largely on deontological constructions of Contract, this Article demonstrates the inconsistencies among the extant heuristics—promise, reliance, and transfer—and more importantly, the failure of any of those constructions to provide a coherent explanation of Contract doctrine. This failure reveals a more fundamental failure of Contract theory generally: Because doctrine is a matter of historical accident rather than “divine” inspiration, efforts to explain doctrine as an outgrowth of some coherent and fundamental purpose are necessarily unavailing, and ultimately obfuscatory.

Contract defies reduction into certain normative terms because Contract doctrine is an amalgam of normative inclinations. Neither pure deontology nor pure consequentialism is the source of all Contract; both rather serve as poles at the ends of a Contract continuum. This Article concludes that the search for the grail—the theory of Contract—heretofore has been misdirected. Our effort to understand Contract in normative terms should begin anew, from the premises offered here.

Law and Proximity

Adam J. Hirsch & Gregory Mitchell | 2008 U. Ill. L. Rev. 557

Perceptions of proximity matter to people. When they come close to getting something they want, or when they nearly avoid something that harms them, or nearly are harmed by something, people tend to react more strongly than when they miss getting the thing they want by a lot, or when a harm that befalls them was unavoidable, or when a potential harm never came close to occurring. This article explores these psycho-logical phenomena and their implications for legal policy and process. The article begins by reviewing the existing literature on the psychology of proximity and proceeds to consider its implications for the law of torts and criminal law (i.e., harms), and for the regulation of lotteries and gambling law (i.e., goods). The article then turns to situations where le-gal process can itself raise perceptions of proximity—viz., near misses of legality. The article argues that lawmakers could mitigate the frustra-tions of near misses by structuring law, and issuing legal judgments, in a manner that avoids or obscures them. In particular, the article explores the implications of the psychology of proximity for the rules-standards debate and assesses the virtues of substantial compliance doctrines, a form of legal structure that has received insufficient attention in the course of the rules-standards debate. The article concludes that lawmak-ers should take the psychology of proximity into consideration when they make policy choices, but in so doing lawmakers need to bear in mind the potential functionality of that psychology. Near miss experiences can be painful but simultaneously educational, stirring behavioral adjustments in those who endure them.

Reclaiming Egalitariansim in the Political Theory of Campaign Finance Reform

Frank Pasquale | 2008 U. Ill. L. Rev. 599

Recent advocacy for campaign finance reform has been based on an ideal of the democratic process which is unrealistic and unhelpful. Scholars should instead return to its egalitarian roots. This article exam-ines how deliberative democratic theory became the main justification for campaign finance reform. It exposes the shortcomings of this “delibera-tivist detour” and instead models campaign spending as an effort to commodify issue-salience. Given this dominant function of money in politics, a more effective paradigm for reform is “equalizing influence.” Advocates of campaign regulation should return to the original principles of reformers; not an idealized vision of the democratic process, but prag-matic concerns about moneyed interests acquiring too much influence over the nation’s politics.

Corporations and the Market for Law

Larry E. Ribstein & Erin Ann O\’Hara | 2008 U. Ill. L. Rev. 661

The state competition for corporate law has long been studied as a distinct phenomenon. Under the traditional view, corporations are sub-ject to a unique choice-of-law rule, the “internal affairs doctrine” (IAD). This rule is explained as a historical accident, or by the special logistics of the corporate contract. The resulting market for corporate law appears to have special characteristics, particularly including the dominance of the single state of Delaware. This article challenges the traditional view. It shows that the corporate law market is best understood as a special application of the general market for law. Parties to many types of contractual relationships are able to choose the law they wish to govern their relationship, and states compete to provide the law that the parties most desire. Any differences between the corporate and general law markets are matters of degree rather than kind and are explained by applying the general forces underlying the law market to particular sets of circumstances. Theories of corporate competition that ignore the broader law market context are incomplete, and the competition for corporate law carries lessons for the law market generally. Moreover, the connection between the corporate and other law markets has implications for the constitutional status of the IAD, the scope of the IAD, and for the relationship between state and federal law.

Notes

Whacking the Political Money “Mole” Without Whacking Speech: Accounting for Congressional Self-Dealing in Campaign Finance Reform After Wisconsin Right to Life

Robert P. Beard | 2008 U. Ill. L. Rev. 731

This note examines the current campaign financing scheme’s effec-tiveness in fighting campaign corruption and the significant restrictions these laws place on political speech. The author begins by chronicling the myriad of campaign finance scandals that plagued United States elections throughout the past century, as well as the hodgepodge of legislative reactions to these scandals that led many commentators to characterize campaign finance reform as a game of “Whack-a-Mole.” Beyond the legislation itself, the Supreme Court’s current framework for evaluating campaign finance restrictions is also problematic and tends to perpetuate incumbency and corruption while stifling political criticism. To combat these problems, the author proposes a heightened legal standard for evaluating campaign speech restrictions that requires members of Congress to justify any self-dealing legislation under the inherent fairness standard used in corporate law. Borrowing from the framework of corporate-finance disclosure laws, the author further recommends a shift from today’s ineffective, nebulous campaign finance model to a less restrictive scheme focused on disclosure and fueled by grassroots participation. By promoting transparency and accountability for campaign contributions, parties in interest will be forced out of the shadows, preventing campaign corruption and enabling voters to make informed decisions on Election Day.

Watered Down: Are Insurance Companies Getting Hosed in the Wind vs. Water Controversy?

Brendan R. Vaughan | 2008 U. Ill. L. Rev. 777

In the aftermath of Hurricane Katrina, many Gulf Coast residents whose homes were damaged or destroyed turned to their insurance com-panies to provide compensation for their loss, only to find that their homeowners’ policy explicitly excluded losses due to flooding. Such policies often cover damage caused by wind and rain, but not from water; for many of the homes affected by Katrina, the damage was caused by a combination of wind and flooding. The author examines the so-called wind vs. water debate by focusing on two recent decisions from the Southern District of Mississippi in which insureds and insurance companies litigated the fact-intensive question of whether wind or water caused the damage to the insureds’ home. The author identifies three approaches to concurrent causation—the efficient proximate cause approach, the liberal approach, and the conservative approach—identifying the positive and negative aspects of each. Ultimately, the author concludes that the conservative approach should govern and the policies should be enforced as written. Otherwise, the author asserts that insurance companies will be forced to either raise premiums or to discontinue offering insurance in the Gulf Coast region.

Compositions are Being Sold for a Song: Proposed Legislation and New Licensing Opportunities Demonstrate the Unfairness of Compulsory Licensing to Owners of Musical Compositions

Jeffrey A. Wakolbinger | 2008 U. Ill. L. Rev. 803

Today’s music business hardly resembles the industry in existence at the beginning of the twentieth century, yet musical composers remain bound by compulsory licensing laws enacted as part of the Copyright Act of 1909. Compulsory licensing permits an individual or company to rec-ord and sell any song without the composer’s permission. The user need only meet a few simple requirements and pay the composer a statutorily determined royalty rate. Although infrequently invoked, this statutory li-censing rate for compulsory licenses removes any bargaining leverage from the composers and effectively caps the rate composers can negotiate in the free market for reproductions of their songs. As new technology has expanded the available means for mechanical reproduction of musi-cal works, the use of the compulsory license has become increasingly troubling to certain constituents in the music industry. In response, Con-gress recently considered the Section 115 Reform Act, which would establish a blanket licensing system for new digital music delivery technologies. Wakolbinger examines the perceived advantages and disadvantages of the proposed legislation before suggesting an alternative: the total elimination of the compulsory licensing system. He argues that eliminating compulsory licensing would correct the fundamental unfairness of the prior system and permit the music business and intellectual property laws more flexibility to adapt to future advances in music reproduction technologies.

Number 3

Articles

Prediction Markets and the First Amendment

Miriam A. Cherry & Robert L. Rogers | 2008 U. Ill. L. Rev. 833

The continuing development of prediction markets is important be-cause of their success in foretelling the future in politics, economics, and science. In this article, we identify the expressive elements inherent in prediction markets and explore how legislation such as the Unlawful In-ternet Gambling Enforcement Act of 2006 might harm such predictive speech. This article is the first to explore First Amendment protections for prediction markets in such depth, and in so doing, we distinguish pre-diction markets from other regulated areas such as gambling, commodi-ties, and securities trading. The article’s examination of prediction mar-kets also illustrates the limitations of current commercial speech doctrine. We conclude by discussing how the executive, legislative, and judicial branches might resolve the First Amendment challenges of regulating prediction markets, and we propose a new legal test, modeled on existing free speech jurisprudence, which may assist courts in adjudicating any constitutional challenges.

Classified Information Leaks and Free Speech

Heidi Kitrosser | 2008 U. Ill. L. Rev. 881

This article provides a timely response to the recent trend toward “cracking down” on classified information leaks and the absence of sig-nificant scholarship, theory, and doctrine on classified information leaks. The article begins by explaining the President’s vast secret-keeping ca-pacity and the capacity’s manifestation in the classification system. This capacity is particularly manifest in the problems, at least partly intrinsic, of broad executive branch classification discretion and overclassification. The author then describes the major constitutional arguments for defer-ence to political branch decisions to criminalize classified information leaks and publication of the same: such leaks are not speech but conduct; such leaks—even if speech—fall within the political branches’ wide rang-ing power to protect national security; and the judiciary lacks the exper-tise to second-guess such political branch decision making. The author refutes these arguments by explaining that a common thread underlying them is the notion of vast deference to political branch—particularly ex-ecutive branch—determinations regarding what information disclosures constitute national security threats. The author contends that this no-tion’s fatal flaw is that the Constitution’s speech- and transparency-related checks and balances not only do not vanish upon the wielding of a classification stamp, but are of special constitutional importance in this context given the vast secret-keeping capacities of the executive branch. Finally, the author considers the doctrinal implications of the preceding analysis and proposes judicial standards to test the First Amendment va-lidity of prosecutions for classified information leaks.

Victorian Tort Liability for Workplace Injuries

Michael Ashley Stein | 2008 U. Ill. L. Rev. 933

The first decision of an injured worker suing his master for a work-place accident was reported in 1837, the year of Queen Victoria’s ascen-sion. The second Workman’s Compensation Act, a comprehensive social insurance scheme, was passed in 1900, a few months before her death. The Article provides an initial account of the development of employers’ liability to their servants for work-related injuries during the Victorian era. It demonstrates that English judges, and especially the Barons of the Exchequer, interpreted the law to resist employers’ liability. The means these judges used included creating the defence of common em-ployment, widely applying the doctrines of assumption of the risk and contributory negligence, quashing nearly every innovative attempt to cre-ate law favourable to labourers, and avoiding House of Lords precedent that supported a limited form of liability. The Article argues that the dominant influence of political economy as an intellectual schema pro-vides the most complete account of why Victorian judges acted in this manner. It also demonstrates that the three leading rationales for the parallel development of American tort law (judicial restraint, the invisi-ble hand hypothesis, and the subsidy theory) fall short as explanations. By setting forth the first comprehensive treatment of the evolution of English employer/employee liability, the Article provides a comparative perspective into the debate over the development of American tort law, and challenges its reinterpretation. The considerable weaknesses of the traditional historical explanations for the development of tort law when applied to the English context suggest that they may not be as strong for the American context. The Article demonstrates that historical inquiries are important for understanding novel applications of traditional legal doctrines to rapidly changing technological circumstances. Many of the same dilemmas faced by English judges in the aftermath of the Industrial Revolution are being reprised for contemporary American jurists. Un-derstanding how a previous generation of judges approached similar ju-risprudential quandaries, as well as what motivated their decisions, lends insight to modern-day struggles with these dilemmas.

“And was Jerusalem builded here, among these dark Satanic Mills?”

Book Review Essay

The Accidental Promise: Remaking the Law of Misrepresented Intent

Aditi Bagchi | 2008 U. Ill. L. Rev. 985

Insincere Promises advances an economic theory of the law of mis-represented intent. Ian Ayres and Gregory Klass argue that penalizing promisors who misrepresent the objective probability of their performance helps to induce efficient reliance on promises by promisees. The authors develop a reformed version of the doctrine aimed at inducing optimal reliance with minimal transaction cost.

In this Book Review Essay, the author shows that Ayres and Klass have all but abandoned the role of intent in the common law of misrepresented intent. Ayers and Klass are concerned only with making available to promisees accurate information about the probability of performance by promisors. She suggests that whatever the merits of their approach, it is inconsonant with the everyday practice of promising, which attaches great significance to subjective intent. Contrasting the common law of promissory fraud with securities regulation of expressions of corporate intent, she argues that the “errors” which Ayres and Klass identify in the case law reflect the origins of the common law doctrine in the moral practice of promising. The relevance of subjective intent to that practice explains why even Ayres and Klass would make subjective intent essential to the crime of false promise, and also explains why they couch their the-ory of the tort of promissory fraud in intentional terms. The author con-cludes that, though the proposed reforms are consistent with economic theories of contract law, if given effect they would result in a radical overhaul of existing doctrine.

Insincere Promises: The Law of Misrepresented Intent, by Ian Ayres and Gregory Klass. Yale University Press, 2005.

Notes

Protecting Privacy in a Shared Castle: The Implications of Georgia v. Randoplh for the Third-Party Consent Doctrine

Monique N. Bhargava | 2008 U. Ill. L. Rev. 1009

Judicial treatment of third-party consent searches has been espe-cially convoluted. In Georgia v. Randolph the United States Supreme Court rejected the rule that consent to the warrantless search of jointly occupied property by a cotenant or common resident renders the search valid against another present cotenant or common resident who refuses to consent. In the wake of this decision, lower courts have struggled to reconcile the Court’s revision of third-party consent doctrine with estab-lished principles of Fourth Amendment jurisprudence. The Court’s anal-ysis in Randolph turned upon the Court’s view of widely shared social expectations. The Court’s view, however, contravenes traditional proper-ty law concepts that protect the right of cotenants to include, as well as exclude, third parties. The author’s analysis of Randolph’s effect upon the role of third-party consent in search procedures begins with an exam-ination of how the Court’s “social expectations” analysis comports with Fourth Amendment jurisprudence. Next, the author explains lower courts’ struggle with the question of whether Randolph’s holding applies to consent to enter or consent to search. Finally, the author anticipates potential consequences of Randolph for households with more than two cotenants and for domestic violence cases. To resolve the tension created by Randolph between the third-party consent doctrine and established Fourth Amendment principles, the author recommends that the Court abandon its “social expectations” analysis with respect to third-party consent searches in favor of the “totality of the circumstances” approach outlined in Justice Breyer’s concurrence. In addition, to protect residents without undermining their privacy interests in personal effects, the author suggests that courts apply Randolph only in connection with police requests for consent to search.

The Firearm Owners\’ Protection Act and the Restoration of Felons\’ Rights to Possess Firearms: Congressional Intent Versus Notice

Daniel Brenner | 2008 U. Ill. L. Rev. 1045

Many federal and state statutes affect individuals’ right to “keep and bear arms” as guaranteed by the Second Amendment of the United States Constitution. In particular, the Firearm Owners Protection Act (“FOPA”) prohibits felons from possessing, receiving, shipping, or transporting firearms or ammunition in interstate or foreign commerce. FOPA does not apply, however, to individuals who have received par-dons or a restoration of their civil rights. It also exempts felons whose convictions have been expunged or set aside. These exceptions apply as long as such pardon, expungement, or restoration of civil rights fails to expressly provide that the individual may not ship, possess, or receive firearms or ammunition.

Although commentators do not significantly dispute FOPA’s broad re-striction on felons’ Second Amendment right to “keep and bear arms,” FOPA’s other provisions have given rise to a federal circuit court split regarding whether a pardon, expungement, or restoration reinstates the entirety of a former felon’s civil rights when an applicable state law pro-vides that felons may not possess firearms or ammunition. The author begins by outlining the background of the Second Amendment, FOPA’s statutory precursors, and FOPA’s basic framework for restoring a former felon’s firearm privileges. Next, the author uses these concepts to ana-lyze two inconsistencies in circuit courts’ application of FOPA: (1) the effect of a state’s reinstatement of a former felon’s civil rights by certificate or other document when the state otherwise forbids the felon from possessing firearms (the “active restoration” split), and (2) the implications of a state’s provision for automatic reinstatement of a former felon’s civil rights when the state also prohibits felons from possessing firearms (the “passive restoration” split). The author then scrutinizes whether and at what point courts should invoke the rule of lenity used in statutory construction to resolve these issues. After concluding that a singular emphasis on either due process notice concerns or legislative intent would prove an inadequate mechanism for protecting state autonomy and felons’ due process rights, the author recommends that states be required to proactively inform felons of their rights before releasing them into society. Specifically, the author suggests that states conduct informational meetings in which law enforcement officials inform probationers of gun possession laws and how prosecutors charge felons who possess firearms. This solution would fulfill the dual objectives of providing felons with notice of their rights and permitting states to determine whether a felon is fit to possess firearms.

Supreme Court Upholds a Mandate of Death when the Jury is in Equipoise: Challenged Under the Apprendi Interpretation of the Sixth Amendment

Benjamin T. Kurtz | 2008 U. Ill. L. Rev. 1071

This note challenges the constitutionality of the capital sentencing scheme used by Kansas courts. The author begins by examining the his-tory of and policies underlying the trial-by-jury guarantee of the Sixth Amendment to the U.S. Constitution. Because a criminal defendant’s Sixth Amendment rights extend into the sentencing phase of a trial, the jury plays a critical role as the ultimate arbiter of both fact and judgment. The Kansas sentencing scheme mandates a sentence of death when the jury determines that the reasons for and against executing the defendant are in equipoise. As a result, the Kansas scheme diminishes the role of the jury and deprives a criminal defendant of the fundamental right to a trial by his or her peers. To remedy these problems, the author proposes three potential avenues for restoring constitutionality to the Kansas capital sentencing scheme. Specifically, the author recommends that the Kansas legislature reverse the current weighing equation that militates in favor of death, require an additional jury finding that death is the appropriate sentence, or eliminate the weighing equation altogether. In its current form, the sentencing provisions raise serious constitutional concerns. However, Kansas can restore criminal defendants’ full Sixth Amendment rights, as well as the critical role the jury plays in capital cases, by adopting any of the author’s three proposals.

Breaking Asbestos Litigation\’s Chokehold on the American Judiciary

Christopher J. O\’Malley | 2008 U. Ill. L. Rev. 1101

Asbestos, flame-retardant and insulating fibrous minerals once used and still found in many buildings, is known to cause cancer, asbestosis, and other serious illnesses. The large number of claims against asbestos manufacturers has produced a unique period of litigation in the United States courts system, characterized by hundreds of thousands of individu-al claimants and insolvent or near-insolvent defendants. According to some, asbestos litigation is an impending disaster and crisis situation due to the vast judicial resources consumed by it as well as the uncertainty underlying diagnoses of asbestos-related diseases. Even though exposure to asbestos dramatically decreased many years ago, it is estimated that between 500,000 and 2.4 million more asbestos-related claims may be filed in the future. After a brief survey of the history of asbestos litiga-tion, the author explores the status of the litigation in U.S. courts today and analyzes a range of diverse proposals that strive to improve the effi-ciency and fairness of future proceedings. The author recommends im-plementing an administrative scheme modeled after the Black Lung Benefits Act and drawing upon the FAIR Act of 2005 as the fairest way to compensate claimants with asbestos-related diseases while ensuring timely processing of claims and stability for asbestos manufacturers facing bankruptcy.

Number 4

Articles

Decoding and Recoding Natural Monopoly, Deregulation, and Intellectual Property

Shubha Ghosh | 2008 U. Ill. L. Rev. 1125

Intellectual property scholarship has recently demonstrated a shift from the metaphor of property to that of natural monopoly. In this Arti-cle, the author responds to the metaphor of natural monopoly with a three-part argument. First, the author identifies the use of natural mo-nopoly rhetoric in intellectual property. Second, the author decodes the uses of natural monopoly rhetoric using economic theory. Third, the au-thor recodes natural monopoly language in intellectual property debates by reference to criticisms of natural monopoly in the debate over deregu-lation of traditional natural monopolies, such as public utilities and air-lines. The recoding of intellectual property through the terms of deregu-lation helps identify three often overlooked, but compelling, interests in intellectual property reform: (1) the role of the consumer, (2) the role of competition, and (3) the role of administrative agencies. The identifica-tion of these three interests highlights ways in which intellectual property can be deregulated and transformed into a new regulatory regime that is responsive to interests other than the private property interests of the in-tellectual property owner. The Article concludes by applying this revital-ized conception of intellectual property to the policy debates over exper-imental use, fair use, and administrative reform in patents and copyright.

Rebooting Originalism

Stephen M. Griffin | 2008 U. Ill. L. Rev. 1185

A number of constitutional scholars have been trying to “reboot” originalism by addressing previous criticisms of the theory—for example, shifting focus from original intent to original public meaning—and an-nouncing the result to be a “new originalism,” despite a failure to ad-dress many serious objections to the “old” originalism. In this article, the author provides a critique of the new originalism and an examination of the existing alternative theories of constitutional interpretation. Ra-ther than “nonoriginalism,” these alternatives are traditional or conven-tional constitutional interpretation, which features a variety of forms, modes, or methods.

Following his discussion of alternatives to originalism, the author argues that an overlooked and serious concern with originalism is its lack of his-toricism, its dependence on historical evidence without acknowledging the historical context of that evidence. Understanding American constitutionalism requires an appreciation of changing contexts, something originalism has difficulty acknowledging.

In response to this failing, the author offers an alternative termed “devel-opmental theory.” Although developmental theory is not a method of constitutional interpretation, it does have implications for how those methods, especially historical interpretation, are carried out. Unlike originalism, developmental theory is capable of explaining and justifying the persistence in the federal courts of alternative legitimate forms of constitutional interpretation and the reality and legitimacy of informal constitutional change.

Bootleggers, Baptists & Televangelists: Regulating Tobacco by Litigation

Bruce Yandle, Joseph A. Rotondi, Andrew P. Morriss & Andrew Dorchak | 2008 U. Ill. L. Rev. 1225

The “bootleggers and Baptists” public choice theory of regulation explains how durable regulatory bargains can arise from the tacit col-laboration of a public-interest-minded interest group (the “Baptists”) with an economic interest group (the “bootleggers”). Using the history of tobacco regulation, this article extends the bootleggers and Baptists theory of regulation to incorporate the role of policy entrepreneurs like the state attorneys general and private trial lawyers who joined forces to regulate tobacco by litigation. We denominate these actors “televange-lists” and demonstrate that they play a pernicious role in regulation.

The article begins by showing how tobacco regulation through the 1980s fit the traditional bootleggers and Baptists public choice model. It then explores the circumstances that made it possible for the emergence of the televangelists as a regulatory partner that the bootleggers would prefer. The article then criticizes televangelist-bootlegger bargains as likely to result in substantial wealth transfers from large, unorganized groups to the coalition partners. It also shows how televangelist-bootlegger coali-tions are more pernicious than bootlegger-Baptist coalitions. Finally, it concludes with suggestions for how to make televangelist-bootlegger coa-litions less durable.

Notes

Walking and Talking Like a Kerp: Implications of BAPCPA Section 503(C) for Effective Leadership at Troubled Companies

Emily Watson Harring | 2008 U. Ill. L. Rev. 1285

a

The Future of the Corroboration Requirement in Patent Law: Why a Clear, Strict Standard Benefits All

Mike R. Turner | 2008 U. Ill. L. Rev. 1319

a

Number 5

Articles

Unexplainable on Grounds of Race: Doubts About Yick Wo

Gabriel J. Chin | 2008 U. Ill. L. Rev. 1359

Yick Wo v. Hopkins is simultaneously celebrated as a classic equal protection case, establishing the rule against discriminatory prosecution, and lamented as the first and last case in which the Supreme Court inval-idated a prosecution as racially motivated. This essay explores why Yick Wo proved to be a dead end. It proposes that the traditional view of Yick Wo is mistaken: Yick Wo was about neither race discrimination nor prosecution. Yick Wo turned on the Court’s treatment of the conduct at issue, operating a laundry, as a constitutionally protected property right. Therefore, a forgotten but large body of cases from the Jim Crow era holds that Yick Wo is a Catch-22: Yick Wo applies when some other provision of law invalidates the statute but is categorically inapplicable to prosecutions for conduct the state has the power to criminalize. In addition, because the property interest at stake was constitutionally protected, Yick Wo’s race was irrelevant to the decision; a white person or corporation deprived of property would have had precisely the same claim. In fact, Yick Wo’s race was a barrier to, rather than a basis for, relief: he could raise a property claim only because he had a treaty right to operate a laundry on the basis of equality with others. When the treaty was inapplicable, the Supreme Court upheld race-based economic discrimination against Chinese and other Asians. Yick Wo is famous because it apparently foreshadows the antiracist jurisprudence of the post-Brown era. Read in the context of the jurisprudence of its own time, however, Yick Wo is completely consistent with Plessy v. Ferguson and stands primarily for the mundane point that a valid treaty trumps inconsistent state law.

Comments

Revisiting Yick Wo v. Hopkins

David E. Bernstein | 2008 U. Ill. L. Rev. 1393

No Abstract Available

Yick Wo and the Constitutional Regulation of Criminal Law

Darryl K. Brown | 2008 U. Ill. L. Rev. 1405

No Abstract Available

On Precedent and Progeny: A Response to Professor Gabriel J. Chin\’s “Doubts about Yick Wo”

Lenese C. Herbert | 2008 U. Ill. L. Rev. 1415

No Abstract Available

Yick Wo Re-Revisited: Nonblack Nonwhites and Fourteenth Amendment History

Thomas W. Joo | 2008 U. Ill. L. Rev. 1427

No Abstract Available

Unexplainable on Grounds of Race – a Reply to Comments

Gabriel J. Chin | 2008 U. Ill. L. Rev. 1441

No Abstract Available

Warming Up to User-Generated Content

Edward Lee | 2008 U. Ill. L. Rev. 1459

Conventional views of copyright law almost always operate from the “top down.” Copyrights are understood as static and fixed by the Copyright Act. Under this view, copyright holders are at the center of the copyright universe and exercise considerable control over their exclusive rights, with the expectation that others seek prior permission for all uses of copyrighted works outside of a fair use. Though pervasive, this conventional view of copyright is wrong. The Copyright Act is riddled with gray areas and gaps, many of which persist over time, because so few copyright cases are ever filed and the majority of those filed are not resolved through judgment. In these gray areas, a “top-down” approach simply does not work. Instead, informal copyright practices effectively serve as important gap fillers in our copyright system, operating from the bottom up.

The tremendous growth of user-generated content on the Web provides a compelling example of this widespread phenomenon. The informal prac-tices associated with user-generated content make manifest three signifi-cant features of our copyright system that have escaped the attention of legal scholars: (i) our copyright system could not function without infor-mal copyright practices; (ii) collectively, users wield far more power in influencing the shape of copyright law than is commonly perceived; and (iii) uncertainty in formal copyright law can lead to the phenomenon of “warming,” in which—unlike chilling—users are emboldened to make unauthorized uses of copyrighted works based on seeing what appears to be an increasingly accepted practice. Although the warming phenome-non has been completely ignored in prior copyright scholarship, warming serves as a powerful counterforce to the chilling of speech, even when copyright law is uncertain.

Innocentrism

Daniel S. Medwed | 2008 U. Ill. L. Rev. 1549

The following Essay by Professor Daniel S. Medwed provides a re-sponse to skeptics and antagonists of the emerging centrality of inno-cence-based arguments in criminal law. Professor Medwed contends that the growing focus on innocence, which he terms “innocentrism,” is a positive occurrence and one that ultimately can complement, rather than replace, the emphasis on substantive and procedural rights that for good reason rest at the core of American criminal law. The Essay begins by discussing an array of criticisms that scholars and practitioners have launched against the innocence movement. Professor Medwed then ar-gues that although these criticisms have some validity, they fall short in justifying the rejection of actual innocence as a major focal point of the criminal justice discourse in the twenty-first century. The author ulti-mately concludes that innocentrism should have a significant place in this discourse, and it can do so in concert with other time-tested criminal law values.

The Economic Bias in Tort Law

Ronen Perry | 2008 U. Ill. L. Rev. 1573

Economic loss is moving to the forefront of tort discourse on both sides of the Atlantic. A Council draft of the Restatement (Third) of Torts: Economic Torts and Related Wrongs is being appraised and discussed by prominent American tort scholars, and European academics are seeking common ground regarding liability for economic loss in the European Union. The time may well be ripe to focus on an unexplored, perhaps unnoticed, mystery in the common-law of torts: the consequential–relational economic loss dichotomy. Consequential economic loss is economic loss that stems from physical injury to the plaintiff’s own person or property. Relational economic loss is purely economic loss that stems from physical injury to the person or property of a third party, or to an ownerless resource. The difference between the two may often seem normatively immaterial, but it has far-reaching implications in tort law. This Article endeavors to unveil the political—redistributive—underpinning of this perplexing legal distinction.

Part I shows that while all common-law jurisdictions have allowed re-covery for consequential losses without much hesitation for centuries, most of them have been reluctant to impose liability for relational losses. Part II identifies the various reasons given by courts and scholars for the consistent unwillingness to impose liability for relational losses. It shows that these reasons are equally applicable to consequential losses, inap-plicable to most cases of relational loss, or fundamentally flawed. The inevitable conclusion is that the law should treat consequential and rela-tional losses similarly, at least as a general rule. The positive and nor-mative analyses thus seem incongruent.

Part III theorizes that the best account for the consequential–relational economic loss distinction is an embedded political inclination of com-mon-law judges. The traditional distinction has been used, perhaps un-consciously, to empower the powerful. Following a general overview of his hypothesis, notwithstanding its intrinsic appeal, Professor Ronen Per-ry substantiates it further on three levels. First, he places it in a wider theoretical context, assuming that an interpretive account of a particular doctrine must, at least to some extent, fit with an interpretive theory of the relevant branch of law. Put differently, Perry “zooms out” to show that Robins Dry Rock & Repair Co. v. Flint is an unremarkable tile in a larger mosaic. Second, he “zooms in” to show that the intricacies of the law concerning relational economic loss, not only the general rule of no-recovery, roughly conform to his hypothesis. Third, he tests his hypothe-sis from a comparative perspective. If Perry’s contention holds, and the consequential–relational loss dichotomy is politically contingent, differ-ent legal regimes may be expected in other political environments. He demonstrates that this is in fact the case.

David C. Baum Memorial Lecture

Living Together: The Roots of Respect

Martha Nussbaum | 2008 U. Ill. L. Rev. 1623

In this lecture, Professor Martha Nussbaum discusses the life and writings of Roger Williams, founder of Rhode Island. The harsh realities of life in seventeenth-century New England gave rise to two very different methods of dealing with the transient and unstable nature of colonial ex-istence. Some sought to keep the “howling world” at bay by instituting strict religious orthodoxy. Williams, however, urged mercy and reasona-bleness as an alternative to this imposed response to uncertainty. Wil-liams argued that individuals with different religious ideas and philoso-phies can, and must, learn to coexist, and maintained that law, while relevant to keeping civil peace, has no authority in the jurisdiction of the soul, which should be governed by persuasion, not force. Williams pro-posed that, while souls may differ on what the truth is, it is the quest for that truth, the struggle to find the answers to the soul’s questions, that is what is most precious about the human conscience, no matter the individ-ual’s ultimate belief.

Note

Surviving Rodriguez: The Viability of Federal Eqaul Protection Claims by Underfunded Charter Schools

Greg Rubio | 2008 U. Ill. L. Rev. 1643

Since their introduction in the early 1990s, charter schools, which provide a hybrid educational form that combines public funding with many of the educational policy freedoms that attend private schools, have experienced growing popularity across the country. As their numbers continue to increase, funding for charter schools has become more of a concern. Statistics indicate that charter school funding, which derives from federal, state, and local sources, has not kept pace with the funding accorded traditional public school systems. This disparity has led some charter school constituents to consider equal protection challenges against these allegedly discriminatory funding regimes. The Supreme Court’s 1973 decision in San Antonio Independent School District v. Rodriguez, however, has led many to conclude that the doors to the federal courthouse remain closed to equal protection litigants protesting inequities in school funding. The author begins by presenting background information on federal equal protection jurisprudence, the charter school concept, and the purported discrepancies in charter school funding. After discussing the continued viability of education as a fun-damental right, he then considers the Court’s Rodriguez decision in light of its subsequent rulings in Papasan v. Allain and Plyler v. Doe. Following an examination of charter school characteristics relevant to charter school equal protection challenges, the author contends that Papasan and, to a lesser extent, Plyler, present alternative avenues that would allow charter school plaintiffs to circumvent the Rodriguez barriers. He concludes that, ironically, charter school plaintiffs have the strongest chance to raise a successful federal equal protection claim by confronting the government’s lowest hurdle: rational basis review. Under what he terms the “Papasan exception,” Rubio contends that Rodriguez explicitly made itself inapplicable to a state’s decision to divide resources unequally among its school districts and that, therefore, federal equal protection challenges remain available to charter school litigants who have inexplicably been denied access to entire categories of state funds.