Showing papers in "Yale Law Journal in 1979"

Bargaining in the Shadow of the Law: The Case of Divorce

Abstract: This article suggests an alternative way of thinking about the role of law at the time of divorce. It is concerned primarily with the impact of the legal system on negotiations and bargaining that occur outside the courtroom. We see the primary function of contemporary divorce law not as imposing order from above, but rather as providing a framework within which divorcing couples can themselves determine their postdissolution rights and responsibilities. This process by which parties to a marriage are empowered to create their own legally enforceable commitments is a form of \"private ordering.\"'

A Framework for Analyzing Predatory Pricing Policy

Abstract: Recent literature on the law and economics of antitrust has devoted increasing attention to the issue of \"predatory pricing\"-a dominant firm's use of price to restrict competition by driving out existing rivals or excluding potential ones. A number of scholars-including Areeda and Turner, Baumol, Bork, Posner, Scherer, and Williamson-have contributed to this discussion,' and each has taken a different

Secured Financing and Priorities Among Creditors

Abstract: One of the principal advantages of a secured transaction is the protection it provides against the claims of competing creditors. A creditor asserting a security interest in his debtor's property is likely to find himself in competition with a wide assortment of other claimants. For example, his security interest may be challenged by another creditor with a consensual security interest, by a creditor with a judgment or execution lien, by a creditor claiming a right to the collateral under some general statutory entitlement such as a repairman's lien, by a seller to or a buyer from the debtor, or by the debtor's trustee in bankruptcy. To a considerable extent, the value of a security interest depends upon the degree to which it insulates the secured party from the claims of the debtor's other creditors.1 Article 9 of the Uniform Commercial Code contains detailed rules for resolving conflicts between secured creditors and various third parties-rules that tell the secured party what he must do in order to prevent his security interest from being overridden by a competing claimant, or, conversely, what a competitor must do in order to circumvent an existing security interest in the debtor's property. These rules are called \"priority\" rules since it is their function to determine

The Case for Specific Performance

Abstract: The purpose of contract remedies is to place a disappointed promisee in as good a position as he would have enjoyed had his promisor performed.' Contract law has two methods of achieving this \"compensation goal\": requiring the breaching party to pay damages, either to enable the promisee to purchase a substitute performance, or to replace the net gains that the promised performance would have generated; or requiring the breaching party to render the promised performance. Although the damages remedy is always available to a disappointed promisee under current law, the remedy of specific performance is available only at the discretion of the court. Moreover, courts seldom enforce contract clauses that explicitly provide for specific performance in the event of breach. This Article argues that the remedy of specific performance should be as routinely available as the damages remedy. Part I reviews the current doctrine governing specific performance. Part II argues that the damage remedy is undercompensatory more often than is generally supposed and establishes that promisees have economic incentives not to elect specific performance unless the damage remedy is likely not to provide adequate compensation. Thus, expanding the availability of specific performance would not give promisees an incentive to exploit breaching promisors. Part III goes on to show that making specific performance generally available is unlikely to result in the efficiency losses predicted by other commentators.2 Part IV argues that expand-

Quasi-Permanence of Price Reductions: A Policy for Prevention of Predatory Pricing

Abstract: The use of the term \"predatory\" to describe conduct violative of the antitrust laws has left much to be desired. This court has noted, \"The term probably does not have a welldefined meaning in the context it was used, but it certainly bears a sinister connotation.\"' Pricing is predatory only where the firm foregoes shortterm profits in order to develop a market position such that the firm can later raise prices and recoup lost profits.

On Freedom of Expression

Abstract: Mill's essay On Liberty begins with an introduction that ends in an apology. As he approaches his famous chapter, Of the Liberty of Thought and Discussion, he writes: "Those to whom nothing which I am about to say will be new ... may .... I hope, excuse me, if on a subject which for now three centuries has been so often discussed, I venture on one discussion more."' One hundred and twenty years later, I too apologize for venturing on "one discussion more," and for calling that discussion On Freedom of Expression. I use the title strictly out of respect: I do not know how to think about this subject without Mill. My explanation for one discussion more is simply that I continue to have difficulty with two fundamental, interrelated questions that any theory or hypothesis about liberty of expression must resolve. First, why should expression have greater immunity from government regulation than most other forms of human conduct; second, what are the limits of this immunity? The answers to these questions-if indeed there are satisfactory answers-would be a long first step, though only a first step, toward a theory of free expression. For a theory would have to come explicitly to grips with such additional questions as: if expression is to have more immunity from regulation than other forms of conduct, how does one, for this purpose, identify expression?2 And, to what extent may or

And Who Is My Neighbor

Abstract: I remember .... about 1646 (or 1647) that Mr. John Maynard (now Sir John, and serjeant) came into Middle Temple hall, from Westminster-hall, weary with business, and hungry, when we had newly dined. He sate-downe by Mr. Bennet Hoskyns (the only son of Serjeant Hoskyns, the Poet) since Baronet, and some others; who having made an end of their Commons, fell unto various Discourse, and what was the meaning of the Text (Rom. v. 7.) "For a just man one would dare to die; but for a good man one would willingly die." They askt Mr. Maynard what was the difference between a just man and a good man. He was beginning to eate, and cryed:-Hoh, you have eaten your dinners, and now have leisure to discourse; I have not. He had eate but a Bitt or two when he reply'd:-I'le tell you the difference presently: serjeant Rolle is a just man, and Mathew Hale is a good man; and so fell to make an end of his dinner. And there could not be a better interpretation of this Text. For serjeant Rolle was just, but by nature penurious; and his wife made him worse: Mathew Hale was not only just, but wonderfully Charitable and open handed, and did not sound a trumpet neither, as the Hypocrites doe.'

Disputing Without the Force of Law

Abstract: ' F T T H u n i R. Volume 88 Number 5 April 1979 e s q Disputing ithoiit tho Force of Law by Latini A «i/c/- SS VAU: L.J. S S W : i Hi.pt int Cupj-riL'lit 'f. I'IT'I liy J he Y.ilr Law liniiii.il Co., Inc.

Law and the Crystal Ball: Predicting Behavior with Statistical Inference and Individualized Judgment

Abstract: Important benefits and burdens are distributed in American society on the basis of predictions about individual behavior. Release from prison, places in schools, jobs, and retail credit are among the benefits distributed to those applicants who are found most likely to succeed. The effort to predict an applicant's behavior can be made in a variety of ways: by professional experts or ordinary laymen, by use of individualized judgment or formulas that assign fixed weights to predetermined characteristics of the applicant. No matter what method is used, it typically generates controversy. This controversy is expressed in policy debates over the fairness or wisdom of choosing a particular method for selecting applicants. It also appears in litigation challenging a selection system on the ground that it violates some constitutional or statutory requirement. When the decisionmaker is a government agency, such as the parole authority or a public school, then the choice of a selection system is plainly a matter of public concern. As a political matter it involves the allocation of public resources, and as a legal matter it is subject to the requirements of fairness contained in the due process and equal protection clauses of the United States Constitution. But even when the decisionmaker is a private institution, such as a private employer or lender, its practices are often subject to public scrutiny and legal control. Many private decisionmakers are prohibited by law from discrimination on the basis of race, sex, and various other attributes. Enforcement of that prohibition requires the decisionmaker to respond to claims of illegal discrimination, by explaining his selection system, and thereby exposing it to public scrutiny. That exposure in turn generates a demand for new legal restraints on methods of selection. In order to decide whether new legal restraints should be imposed, or even simply to choose a fair and effective selection system, it is

Privacy, Publicity, and the Portrayal of Real People by the Media

Abstract: In the course of their various productions, the news and entertainment media' frequently portray real people without authorization. The public policy embodied in the First Amendment 2 protects, and may even encourage, such portrayals; they are regarded as \"an essential incident of life in a society which places primary value on freedom of speech and press.\" 3 But unauthorized publicity can cause those portrayed substantial harm; it may disrupt their lives,4 hurt their feelings, 5 or decrease their ability to profit from their names, likenesses or other attributes.6 As a result, there is a countervailing public policy that such harm should not be permitted. The portrayal of real people by the media thus brings two important public policies into conflict. Courts have responded to this conflict by attempting to define a series of rights enabling individuals to enjoin or to recover damages for unauthorized portrayals. 7 To the traditional cause of action for

Defenses, Presumptions, and Burden of Proof in the Criminal Law

Abstract: * This article is an elaboration of views first stated in Low & Jeffries, DICTA: Constitutionalizing the Criminal Law? Va. L. Weekly, Mar. 25, 1977, at 1. The authors would like to thank Thomas F. Bergin, Richard J. Bonnie, Ronald A. Cass, Thomas H. Jackson, Jerry L. Mashaw, Harvey S. Perlman, Stephen A. Saltzburg, and Peter Westen for their criticisms and comments. Thanks are also due to Jonathan Koch, Barbara Schilberg, and Douglas Sullivan for research assistance and to Andrew Brumby for preparation of the appendix. Most especially, the authors acknowledge their continuing intellectual indebtedness to Peter W. Low. Without his guidance and encouragement, this piece would not have been done. t Assistant Professor of Law, the University of Virginia. $ J.D. 1977, the University of Virginia School of Law.

The Recurring Question of the “Limited” Constitutional Convention

Abstract: Article V of the United States Constitution requires Congress to call "a Convention for proposing Amendments" upon application of two-thirds of the states.' Amendments proposed by such a convention, if subsequently ratified by three-fourths of the states, become part of the Constitution. Thus far in the history of the republic, no such convention has been called. In the last few years, however, thirty states2 have submitted applications to Congress calling for a convention restricted to consideration of an amendment requiring a balanced federal budget. Only four more applications are necessary to reach the total of twothirds specified by Article V; Congress is said to have been brought "to the brink of calling a constitutional convention."3 For a century following the Constitutional Convention in 1787, the only applications submitted by state legislatures under Article V contemplated conventions that would be free to determine their own agendas.4 Only in this century have legislatures begun to submit ap-

The Graying of Civil Rights Law: The Age Discrimination Act of 1975

Abstract: Nondiscrimination laws have come to play a central role in the design of public policy in the modem welfare state. Such laws place those who administer them in the difficult business of allocating scarce resources, regulating conflicting interests, and attempting to shape complex institutional behavior. The egalitarian vision that inspires such laws and the rhetorical and political energy that generate their enactment, however, are not easily accommodated to the underlying moral and decisional complexities of the regulatory task. These complexities inevitably disturb the tranquil surface of the law where formal simplicity and moral clarity dwell. This Article examines the Age Discrimination Act of 19751 (ADA), and explores the conflict between the criteria of social choice that decisionmakers wish to employ, and the moral and legal constraints that nondiscrimination laws seek to impose upon such criteria. The Article consists of four parts. Part I describes the ADA and contrasts it with earlier nondiscrimination laws, especially the prohibition on race discrimination in Title VI of the Civil Rights Act of 1964. A critical analysis of the putative analogy between race discrimination and age discrimination reveals the distinctive characteristics of age and the principal considerations that ought to govern the use of age as a criterion of classification. I argue that the ADA's attempt to fuse two distinct types of group protection statutes has yielded a hybrid form that constitutes a problematic policy instrument. Part II traces the evolution of the ADA: the legal and political contexts out of which it emerged; its legislative history; the Civil Rights Commission study on age discrimination mandated by the ADA; and

Labor Arbitration and Dispute Resolution.

Abstract: There is a widespread perception that our judicial system needs changing. It is expensive, unnecessarily technical, intrusive on private relations, and it gives unfair advantage to the wealthy and powerful. Labor arbitration, by contrast, is frequently pointed to as the paradigm of private justice. It is understandable that labor arbitration is widely admired. When it functions properly it achieves in an impressive fashion the goals by which any system of dispute resolution should be measured. These are: (1) Finality. Once decided, are cases likely to be retried or appealed? (2) Obedience. Are the decisions put into effect or are they rendered meaningless by subsequent refusals to carry them out? (3) Guidance. Do the decisions provide necessary guidance to the parties involved in the dispute? Can they subsequently structure behavior in a reasonable fashion and avoid future litigation? (4) Efficiency. Are the majority of disputes settled without a formal hearing? When cases are tried, are the procedures adequate, flexible, and suited to the particular issue? Are the benefits achieved from the system economical compared to the costs? (5) Availability. Is the dispute-resolution machinery routinely available without undue expense to people whose behavior is governed by the system, and are they provided with adequate representation? (6) Neutrality. Do the decisionmakers avoid favoritism and bias for one side or another? (7) Conflict Reduction. Does the entire process, including the adjudication, lead to more amicable relations and contribute to mutual respect among the potential disputants? (8) Fairness. Will the disputes be resolved in a way that appropriately recognizes the interests of the various parties likely to come before the system?

Efficiency and Competition in the Electric-Power Industry

Abstract: Historians may remember the 1970s as the decade in which lawmakers first recognized the limits of regulation as an instrument for the promotion of social and economic policies. In a major address on March 25, 1979, President Carter declared that his administration would strive \"to reduce, to rationalize and to streamline the regulatory burden throughout American life.\"'. Efforts toward that end in the 95th Congress prompted the partial deregulation of airlines2 and natural gas producers.3 This year, the President has exercised his unilateral authority to deregulate domestic crude oil prices, 4 and Congress is considering proposals to reduce or eliminate federal regulation of railroads,\" the trucking industry,0 and certain segments of the telecommunications industry. 7 If deregulation is an idea whose time has come, Congress should not overlook the electric-power industry. The Federal Energy Regulatory Commission (FERC)8 and its state counterparts together administer a comprehensive regulatory scheme that includes control over market entry, rate schedules, location of facilities, and standards of service. This pervasive market intervention may be justified, in part, by the

Presidential Power and Administrative Rulemaking

Abstract: The expanding scope of federal regulatory activities may require the development of innovative management and review techniques. In this decade alone, the government has undertaken major regulatory initiatives in such fields as environmental protection, occupational safety and health, and consumer product safety. These efforts exemplify a tendency of modem regulation to delve increasingly into highly complex and often controversial matters that affect broad segments of industry and the public.1 The increasing sprawl of the federal agencies has challenged the effectiveness of the checks and balances designed by the Constitution. Understandably, criticism of the government's performance has not been lacking. Indeed, a general movement for "regulatory reform" has surfaced, advancing a number of diverse and, in part, longstanding criticisms. 2 Both Congress and the federal courts have initiated measures to control the regulatory bureaucracy.3 Several recent Presidents have taken tentative steps to join in this enterprise,4 and in doing so, they have raised a question that is

Multicriteria Choice Processes: An Application of Public Choice Theory to Bakke, the FCC, and the Courts

Abstract: the FCC's refusal to define precisely its choice process prevents any theoretical check on possible agenda influences. In practice, it is difficult to gauge the plausibility of either an inadvertent or deliberate violation of axiom VII. In most cases, there are relatively few ap158. See pp. 739-40 suPra. 159. See pp. 742-43 supra (courts will overturn any FCC attempt to use single criterion choice process); pp. 743-44 supra (violation of axiom VIII would be more serious than other illegal administrative acts; axiom VIII is probably so deep within core of law that agency would not violate it). 160. At least one recent case indicates that courts will detect and overturn FCC decisions that are too implausible or depart too much from past precedents. See Central Fla. Enterprises, Inc. v. FCC, 4 MEDIA L. REP. (BNA) 1502, 1516 (D.C. Cir. Sept. 25, 1978), amended, No. 76-1742 (D.C. Cir. Jan. 12, 1979) (renewal hearing) (FCC order "is unsupported by the record and the prior law on which it purported to rely"). 161. An effort to "tell a story" in each case that directed attention away from the use of a single criterion choice process would involve assessment in opinions of criteria that were not given weight in the actual decision. Such an effort would almost certainly have to be conscious. 162. It is likely that if any significant distortion were involved, courts would detect it and vacate the FCC action. See Central Fla. Enterprises, Inc. v. FCC, 4 MEDIA L. REP. (BNA) 1502, 1510 (D.C. Cir. Sept. 25, 1978), amended, No. 76-1742 (D.C. Cir. Jan. 12, 1979) (renewal hearing) (1965 policy statement "imposed an orderliness on the inquiry which made it obvious when applicants were not in fact on an equal footing").

Williamson on Predatory Pricing II

Abstract: This commentary addresses issues raised by Professors Areeda and Turner in Williamson on Predatory Pricing, which was published in the June 1978 issue of this Journal. 1 Areeda and Turner took exception with my earlier treatment of predatory pricing,2 in which I emphasized its strategic aspects.a They defended their previous treatment, 4 in which strategic aspects are ignored or suppressed. Although modeling strategic problems in nonstrategic terms can be illuminating, in that it sometimes helps to place strategic features in perspective, I contend that public policy with respect to strategic behavior ought to be informed by strategic analysis. Areeda and Turner evidently hold otherwise. Inasmuch as this commentary mainly deals with differences between myself and Areeda and Turner, I should like to emphasize at the outset that we agree on the following: (1) predatory pricing is not an empty concern; (2) a major hazard in allowing private predatory pricing actions to be brought is that they will be used for protectionist purposes; and (3) a principal means of safeguarding against protectionist abuses of the law is to devise predatory pricing rules that have good economic efficiency properties. But although protectionist abuses of predatory pricing actions by new entrants can be serious, strategic abuses by established firms also require attention. Indeed, a complete efficiency analysis is not possible until potential abuses of this latter kind are taken into account. Section I examines strategic versus nonstrategic approaches to predatory pricing. Section II deals with mistaken welfare arguments on which Areeda and Turner continue to rely. Potentially misleading statements in their comment are considered in section III. Section IV addresses purported operationality problems that they attribute to my output restraining rule and also discusses previously unremarked operationality difficulties endemic

Predatory Pricing: A Rejoinder

Abstract: A further point-by-point reply to Professor Williamson would unduly tax the readers of the Journal. The principal differences between us are adequately set forth in the several articles,1 and we leave the dispute where it sits. It does seem worthwhile, however, to comment on two points. The first concerns Williamson's general characterization of our approach. Although we appreciate his kind words about our original contribution, we do not understand the repeated criticisms that we ignore a would-be predator's strategic motivations and that we rest solely on static economic analysis. Such characterizations do not fairly express our views about the formulation of wise and administrable

Dispute Resolution: A Foreword

Abstract: The essays in this issue of the Law Journal have been written and presented as work in \"dispute resolution.\" Consider the occasions for using this term in legal scholarship. Almost all commentary on law can plausibly be said to relate to disputes in one way or another. Yet, the term \"dispute resolution\" is most often used to refer to social scientific work that typically assumes a functional perspective cutting across formal and institutional lines. One writes in the area of \"dispute resolution\" as soon as one decides that no single institution, rule, technique, or role is the subject of the work, but rather the \"dispute\" or \"disputing\" that might confront many different institutions or components of them. Indeed, the term has sometimes been quite explicitly chosen to avoid having to decide whether phenomena do or do not occur within some formal institution or system of institutions.1 Because dispute-resolution work focuses on the social processes and events with which institutions cope rather than on the institutions themselves, the approach is naturally suited to situations in which an institutional structure cannot be taken for granted. Cross-cultural studies, ethnographic work, and reformist endeavors all provide such occasions. Any existing institution-a court, an administrative agency, the judiciary, the jury-is necessarily only one way to resolve or process the \"dispute.\" Dispute-resolution work begins with the premise that there are many techniques and institutions for performing a single social function.2 And it is the function that is the unit of analysis.