The Reduced Form of Litigation Models and the Plaintiff\u27s Win Rate

In this paper I introduce what I call the reduced form approach to studying the plaintiff\u27s win rate in litigation selection models. A reduced form comprises a joint distribution of plaintiff\u27s and defendant\u27s beliefs concerning the probability that the plaintiff would win in the event a dispute were litigated; a conditional win rate function that tells us the actual probability of a plaintiff win in the event of litigation, given the parties\u27 subjective beliefs; and a litigation rule that provides the probability that a case will be litigated given the two parties\u27 beliefs. I show how models with very different-looking structure can be understood in common reduced form terms, and I then use the reduced form to prove several general results. First, a generalized version of the Priest-Klein model can be used to represent any other model\u27s reduced form, even though the Priest-Klein model uses the Landes-Posner-Gould ( LPG ) litigation rule while some other models do not. Second, Shavell\u27s famous any-win-rate result holds generally, even in models with party belief distributions that are both highly accurate and identical across plaintiffs and defendants. Third, there are only limited conditions under which the LPG litigation rule can be rejected empirically; this result undermines the case against the LPG rules\u27 admittedly non-optimizing approach to modeling litigation selection. Finally, I use the reduced form approach to clarify how selection effects complicate the use of data on the plaintiff\u27s win rate to measure changes in legal rules. The result, I suggest, is that recent work by Klerman & Lee advocating the use of such data is unduly optimistic

Can We Learn Anything About Pleading Changes from Existing Data?

In light of the gateway role that the pleading standard can play in our civil litigation system, measuring the empirical effects of pleading policy changes embodied in the Supreme Court\u27s controversial Twombly and Iqbal cases is important. In my earlier paper, Locking the Doors to Discovery, I argued that in doing so, special care is required in formulating the object of empirical study. Taking party behavior seriously, as Locking the Doors does, leads to empirical results suggesting that Twombly and Iqbal have had substantial effects among cases that face Rule 12(b)(6) motions post-Iqbal. This paper responds to potentially important critiques of my empirical implementation made by the FJC\u27s Joe Cecil and Professor David Engstrom. An additional contribution of the present paper is to elucidate some important challenges for empirical work in civil procedure. First, researchers should carefully consider which covariates belong in statistical models, while also taking care in assessing the empirical importance of controlling for covariates. Second, data collection protocols should be designed with behavioral assumptions in mind. But third, researchers should not let the perfect be the enemy of the good: even data protocols that are less than perfectly designed may be broadly useful

What We Don\u27t Know About Class Actions but Hope to Know Soon

Legislation that would alter class action practice in the federal courts has been pending in Congress. Nearly a decade’s worth of U.S. Supreme Court cases have restricted the scope and ease of use of the class action device. Class action critics argue that class litigation is a “racket” that fails to compensate plaintiffs and instead enriches plaintiffs’ lawyers at the expense of legitimate business practices. On the other hand, defenders of class actions decry the legislative and judicial forces aligned against them, warning that trends in class action law will eviscerate the practical rights held by consumers and workers. In short, there is considerable controversy over whether class actions are an economic menace or a boon to the little guys. We have two purposes in this brief Article. First, we wish to focus continuing attention on the need for more empirical information about the actual functioning of the federal class action system. Second, we wish to share our current efforts to use a one-of-a-kind collection of docket reports, originally harvested from Public Access to Court Electronic Records (PACER), to fill the empirical gap. Presentation of empirical findings resulting from this effort awaits a future article. However, this Article includes suggestions as to how the federal judiciary and Administrative Office of the United States Courts (“AO”) could improve data management and data reporting so as to make information about federal class actions more accessible to scholars and others interested in how the class action device operates in practice and what reforms, if any, would be advisable

The Triangle of Law and the Role of Evidence in Class Action Litigation

In Tyson Foods v. Bouaphakeo, a donning and doffing case brought under Iowa state law incorporating the Fair Labor Standards Act\u27s overtime pay provisions, the petitioners asked the Supreme Court to reject the use of statistical evidence in Rule 23(b)(3) class certification. To its great credit, the Court refused. In its majority opinion, the Court cited both the Federal Rules of Evidence and federal common law interpreting the FLSA. In this paper, I take a moderately deep dive into the facts of the case, and the three opinions penned by Justice Kennedy (for the Court), Chief Justice Roberts (in concurrence), and Justice Thomas (in dissent) to explain why the case highlights the symbiotic relationship between Rule 23\u27s certification-relevant provisions, underlying substantive law, and the Federal Rules of Evidence. I argue that the petitioners\u27 attempts to forge a common law of statistical evidence for class certification was at war with core Federal Rules of Evidence and, consequently, with the Rules Enabling Act. Along the way, I introduce the category of counterfactually relevant evidence. I show that the statistical and other representative evidence deployed by respondents fit in this category. I then explain why arguments against the use of this evidence--whether at trial or for other purposes such as class certification--must fail. I close with a graphical depiction of how the three sources of positive law at issue in class certification--Rule 23, substantive law, and the Federal Rules of Evidence--interact with evidence used to prove that certification is warranted. The result is what I call the Triangle of Law, with each source of law occupying a vertex and the evidence at issue situated at the Triangle\u27s center. This formulation should help scholars, practitioners, and courts focus attention on the independent but interconnected roles played by evidence and the three sources of law involved in class certification questions

Locking the Doors to Discovery? Assessing the Effects of \u3ci\u3eTwombly\u3c/i\u3e and \u3ci\u3eIqbal\u3c/i\u3e on Access to Discovery

Many observers believe the Supreme Court’s Twombly and Iqbal opinions have curtailed access to civil justice. But previous empirical studies looking only at Rule 12(b)(6) grant rates have failed to capture the full effect of these cases because they have not accounted for party selection—changes in party behavior that can be expected following changes in pleading standards. In this Note, I show how party selection can be expected to undermine the empirical usefulness of simple grant-rate comparisons. I then use a conceptual model of party behavior that allows me to derive an adjusted measure of Twombly/Iqbal’s impact and show how to estimate a lower bound on this measure using data from recent studies by the Federal Judicial Center. My empirical results suggest that, depending on the nature of the suit in question, Twombly and Iqbal have negatively affected plaintiffs in at least 15% to 21% of cases that faced Rule 12(b)(6) motions in the post-Iqbal data window. Again depending on the nature of the suit, these figures represent between one-fourth and two-fifths of the cases that fail to reach discovery on at least some claims in the post-Iqbal data window

Can the Dark Arts of the Dismal Science Shed Light on the Empirical Reality of Civil Procedure?

Litigation involves human beings, who are likely to be motivated to pursue their interests as they understand them. Empirical civil procedure researchers must take this fact seriously if we are to adequately characterize the effects of policy changes. To make this point concrete, I first step outside the realm of civil procedure and illustrate the importance of accounting for human agency in empirical research. I use the canonical problem of demand estimation in economics to show how what I call the “urn approach” to empirical work fails to uncover important empirical relationships by disregarding behavioral aspects of human action. I then show how these concerns permeate a prominent empirical issue in contemporary civil procedure debates: the changes in pleading policy wrought by Bell Atlantic, Corp. v. Twombly and Ashcroft v. Iqbal. Revisiting my own earlier work, I embed the question of how changes in the pleading standard will affect case outcomes in a broad behavioral framework that takes parties’ agency seriously. In the process, I address recent critiques, both of the very idea of using behavioral frameworks to understand civil litigation policy changes, and of certain aspects of my use of real-world litigation data collected by the Federal Judicial Center. As I show, these criticisms are straightforwardly refuted on the merits. The alternative to taking seriously the behavioral context created by the civil justice system — what has occurred so far in too much of the debate over Twombly and Iqbal — is, as one critic of early 20th-century empirical research by legal scholars once put it, “a mindless amassing of statistics without reference to any guiding theory whatsoever.” To do better, we will need to take behavior seriously in studying civil litigation