Forced Arbitration in the Fortune 500

As the Federal Arbitration Act (FAA) nears its centennial, its most controversial byproduct—forced arbitration—has entered uncharted territory. For years, companies exploited their power over fine print to produce ambitious dispute resolution regimes. This trend reached its apex in the 2010s, when the Supreme Court held that arbitration is incompatible with class actions and gave its blessing to delegation provisions, which allow the arbitrator to decide whether a case must be arbitrated. But around 2020, the dynamic changed. Plaintiffs’ lawyers discovered a tactic called “mass arbitration” that gains settlement leverage by bombarding defendants with scores of individual claims. In addition, Congress passed the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act, which excludes claims of sexual wrongdoing from the FAA, and is weighing other anti-arbitration measures. But one fact that shines through the debate over these developments is how little we know about the prevalence and content of forced arbitration clauses. To be sure, some scholars have published helpful surveys of arbitration agreements. Yet this work tends to be out of date, based on tiny sample sizes, restricted to certain industries, and focused on consumer transactions to the exclusion of employment arrangements. This Article improves our grasp of forced arbitration through an empirical study of the arbitration provisions of the largest corporations in America (the Fortune 500). This original, hand-collected dataset of 582 forced clauses yields three main insights. First, big businesses actively engage in procedural rulemaking. Indeed, nearly eighty percent of Fortune 500 enterprises mandate arbitration for at least some of their customers or workers (or both). Second, private tribunals are probably less hospitable to plaintiffs than the judiciary. Seventy-seven percent of forced arbitration clauses expressly prohibit class actions, seventy-eight percent contain delegation clauses, and about half feature a term that may be substantively unconscionable. Third, and most surprisingly, the drafting quality varies tremendously. Some private procedural codes reflect the meticulous care of a watchmaker, but others are marred by shocking mistakes. The Article then explains how its findings shed light on proposals to weaken the FAA, mass arbitration, and judicial review of forced arbitration clauses under the unconscionability doctrine

Investor Justice

There is a systemic flaw in the investor protection landscape. Unrepresented investors face off against well-resourced repeat- player firms that almost always have lawyers. While consumers face similar challenges in civil courts, in forced securities arbitration, the decisionmaker may not have a law degree, is prohibited from conducting any outside legal research, and has no monetary incentive to read materials the parties submit. These realities amplify already-existing informational and resource asymmetries between Main Street investors and stockbrokers and undermine the market-legitimizing function of securities arbitration. Despite being designed to permit investors to recoup losses without the aid of an attorney, the mandatory securities arbitration system has evolved into a process that investors cannot navigate on their own. This Article explores the unintended consequences of procedural changes designed to improve and professionalize the mandatory securities arbitration forum. In addition to shedding light on structural norms that disproportionately impact average investors, this Article proposes interventions to ameliorate those burdens. In so doing, it contributes to ongoing discourse concerning investor protection, procedural justice in forced arbitration, and access to justice for regular people

Toward a Dynamic View of Corporate Purpose

Scholars debating the corporation’s role in society generally advance the view that there is only one desirable orientation for corporations and their management. Specifically, proponents of a stakeholder governance model contend that focusing management on a broad set of corporate constituents maximizes overall welfare, while advocates of a shareholder-centric directive counter that prioritizing shareholders creates social welfare by rendering the firm most profitable. This Article offers another view: It suggests that the welfare-maximizing purpose for corporations could change depending on external economic conditions, which both of these positions assume away. Specifically, shareholder primacy is likely to promote welfare in a first-best world, where the government regulates corporate externalities, ensures competitive markets, and responds to inequality. Once these assumptions are relaxed, however, the case for stakeholder governance improves. The Article supports this theoretical insight with a detailed analysis of two historical periods in which the dominant view of corporate purpose in society changed dramatically. Specifically, it describes two corporate purpose “moments” of flux in the United States—one that occurred after the great stock market crash of 1929, and another following a period of economic stagflation in the 1970s—in which the pendulum swung from one governance model to the other, impacting scholarship, business practice, and law. These historical snapshots reveal that departures from a shareholder-oriented model have been preceded by extreme external economic conditions, consistent with the theoretical insight offered here. This analysis also sheds light on the present moment, in which inequality, corporate concentration, and environmental degradation have generated heated debates about the corporation’s role in society once again

Closing in on the Patent Troll: State Legislatures’ Role in Combatting Trolling Behavior

In the United States, entities known as patent trolls purchase patents solely for the purpose of threatening and bringing litigation and present a significant threat to innovation and economic progress. The question is: Who will rise to the occasion and stop them? In the face of federal inaction, state legislatures have stepped in, enacting laws to combat bad faith assertions of patent infringement. This Note examines the efficacy and constitutionality of state anti-patent troll statutes, analyzing how they operate within the broader framework of federal patent law. State legislatures have taken various approaches to address patent trolling. Some statutes have survived legal scrutiny, empowering successful challenges against patent trolls. Others face obstacles under the Federal Circuit’s stringent bad faith preemption doctrine, which imposes a high bar for proving bad faith claims of patent infringement. Despite these challenges, recent litigation demonstrates that well-crafted state statutes can survive preemption challenges and meaningfully deter patent trolls. This Note argues that states should continue to refine and experiment with anti-patent troll legislation, leveraging the benefits of jurisdictional diversity and iterative legal reform to disrupt trolling tactics. For these reasons, state-level efforts offer a promising path to protecting innovators from predatory litigation, ultimately reinforcing the patent system’s core purpose—to incentivize and reward genuine innovation

To Save Democracy from Juristocracy: J.B. Thayer and Congressional Power After the Civil War

As many Americans once again worry that their democracy is hostage to judicial power, this Article is an archival reconstruction of how famed Harvard law professor James Bradley Thayer set out on a mission to stave off the syndrome before it stuck—though he failed in the end. The Article shows how Thayer (1831–1902) arrived at his epoch-making theory of judicial deference to safeguard Congress’s power after the democratic revolutions of the Civil War and Reconstruction. Indeed, he hoped to see America transformed in the direction of British legislative supremacy, in which Parliament—and not the courts—reigned supreme.Scandalized by growing ventures to weaponize the federal judiciary so as to preempt the newly federalized American democracy, Thayer bet on something new in global history: mass democracy on a national scale, understood as an experiment in collective learning. The Article thereby provides a new periodization and transatlantic contextualization of the struggles over judicial fiat routinely associated with the Supreme Court’s defense of laissez-faire in the early twentieth century. And yet, as this Article emphasizes, Thayer failed in the long run. His democratizing fix, judicial self-restraint under the “clear error standard”—which this Article shows had the same English roots as his democratic and parliamentary theory—has tragically misled reform. It embroiled Americans in a never ending debate on judicial “restraint,” even as Thayer proposed a doctrinal prescription encouraging judges to limit their power themselves. He therefore postponed an institutional remedy for an institutional syndrome. For this reason, his mission, in spite of its partial implementation after his death, now has to be rescued in its own right. Judicial self-restraint has not prevented the continuation and even the intensification of the very juristocratic syndrome Thayer rightly found so troubling. If Americans still remain with him at the dawn of our commitment to democracy, they will have to save it from judges in a new way all their own

The Power of Subnational Actors in Enforcement of the Convention on Long-Range Transboundary Air Pollution

The Geneva Convention on Long-Range Transboundary Air Pollution (CLRTAP) was adopted in 1979 and continues to serve as the preeminent international framework for transboundary air pollution. The international community has used a range of multilateral and bilateral cooperative arrangements to address international movement of harmful pollutants. Each has had to contend with the issue of ensuring compliance among party States. CLRTAP faces challenges in addressing transboundary pollution in non-Western countries despite clear evidence that air pollution is harmful to human health and technological developments that enable more accurate tracking of pollutants. In the absence of a model assigning liability for transboundary air pollution to States, the involvement of subnational actors in the enforcement of CLRTAP is crucial. Subnational actors—regions, states (as opposed to nation-states), provinces, cities, and nongovernmental entities—have been a leading influence in environmental protection and climate change action. Literature addressing the use of subnational actors has been broadly applied to climate change issues. The related field of transboundary air pollution could benefit from a similar examination of the importance of subnational actors in enforcement mechanisms. This note seeks to understand the role of subnational actors within the implementation of the 1979 Geneva Convention on Long Range Transboundary Air Pollution and suggests a cooperative approach wherein the significance of subnational actors is recognized and they are utilized to encourage compliance with CLRTAP and the globalization of its goals. Part I briefly outlines the history of CLRTAP and the effect of subsequent updates to the framework. Part II addresses the problem of ensuring enforcement with international legal treaties without the participation of subnational actors and analyzes deficiencies within the current CLRTAP liability framework, particularly the lack of compliance and implementation within Eastern Europe, the Caucasus, and Central Asia (EECCA countries). This analysis draws on existing models of compliance for participation of States in international legal frameworks. Part II also advocates for the expansion of the role of subnational actors in the implementation of transboundary pollution agreements through increased public access to information as well as engagement between international, national, and sub-national actors. This paper concludes that robust participation of subnational actors in CLRTAP is crucial for encouraging implementation of and compliance with the convention in EECCA countries

Tonry’s Blueprint for the Comparative Study of Sentencing Law and Policy

This essay explores Michael Tonry’s treatment of sentencing law and policy within the U.S. as an inherently comparative project. The essay draws from Tonry’s “early period” in comparative sentencing from the late 1970s to the middle 1990s, when his writing was largely U.S.-centric, focued on quickly changing conditions in dozens of states and the federal system. Tonry classified the several models of “sentencing reform” that were being tried across the country, drew contrasts in the legal architectures of the new systems, collected data and evaluation research for as many states as possible, and treated the reform-active states as “laboratories” whose experiments could be evaluated for the benefit of other jurisdictions. The essay examines the importance of this body of work and illustrates the impact it has had on research and policy communities over several decades. In addition, the essay suggests that “Tonry’s blueprint” holds great value for future researchers in comparative criminal justice policy