Sergio Campos, ‘The Class Action as Trust’

The class action is controversial because the class attorney can litigate or settle the claims of the class members without their consent. Many scholars have turned to corporate law to address the potentially disloyal behavior of the class attorney. These scholars have used analogies to corporate law to support (1) the use of opt out rights and (2) restrictions on class conflicts to constrain class attorneys, and the law has generally mirrored both requirements. In practice, however, both of these requirements have undermined the efficacy of the class action and prevented the class action from being used in many appropriate settings.

This article argues that a more useful model for the class action is the trust. Unlike the shareholders of a corporation, the beneficiaries of the trust typically cannot exercise control over the trustee. Moreover, unlike the corporation, trust law facilitates the creation of trusts with conflicts among the beneficiaries. These features of the trust mirror the most controversial features of the class action.

The article shows that both of these features are necessary to address problems of scale found in both contexts. Unlike in the corporate context, both the trust and class action contexts lack a well-developed market for managerial control which would allow beneficiaries/class members with conflicting interests to cede control to a third party with better aligned interests. In the absence of such a market, retaining control among the divided beneficiaries/class members prevents them from investing in the res/claims at the right scale.

Accordingly, trust law shows that class action requirements such as opt out rights and class cohesion are misguided. The article concludes by applying the trust model of the class action to such class action issues as the ascertainability of class members, settlement pressure on the defendants, and cy pres awards.

Campos, Sergio J, The Class Action as Trust (February 4, 2016).

Fellowships at Harvard Law School

“From our colleagues at Harvard Law School come these two job postings – please share with anyone potentially interested: Qualcomm Postdoctoral Fellowship in Private Law and Intellectual Property. Located at Harvard Law School, the Qualcomm Fellowship is a two-year, residential postdoctoral program specifically designed to identify, cultivate, and promote promising scholars early in their careers with a primary interest in intellectual property and its connection to one or more of property, contracts, torts, commercial law, unjust enrichment, restitution, equity, and remedies. …” (more)

[Myanna Dellinger, ContractsProf Blog, 5 February]

‘Law and Economics for the Read-Write Generation: A Review of Guido Calabresi’s The Future of Law and Economics

“One of the great pleasures of this little book is that it does not attempt to be exhaustive. Reading it feels like being whisked through a behind-the-scenes tour of a chocolate boutique, with the chocolatier himself merely gesturing modestly at the lines of perfected squares behind the counters, and then enthusiastically pressing new creations upon you: would you try this one, where I have treated basil as if it were raspberry? How about a bite of altruism, which I treat just like any other taste or preference? Many flavors are familiar, others exotic; and some of the oddest combinations seem obvious when combined by the hand of a master …” (more)

[Arden Rowell, Concurring Opinions, 5 February]

‘Means and Ends in Law and Economics’

“Is law and economics about means, ends, or both? This question, which lies at the heart of Guido Calabresi’s intriguing new book, turns out to have no easy answer. Law and economics is by turns imperialistic and indifferent, a dominating know-it-all and a deferential technician. Often law and economics seems like a means-focused enterprise: Give us a social goal, its practitioners offer, and we will find the best way there – the efficient way. This accords with the lay definition of efficiency …” (more)

[Lee Fennell and Richard McAdams, Concurring Opinions, 5 February]

‘A New Journal on Roman Law and the Roman Law Tradition’

Interpretatio Prudentium – Roman Law and Roman Law Tradition in Review is a scientific Journal on Roman Law and Roman Law Tradition, edited by the Legal Theory and History Research Center of the University of Lisbon (THD-ULisboa) in the course of the activities undertaken by the line of research ‘Roman Law Tradition in Action: the Lusophone experiences’. Interpretatio Prudentium has the purpose of disclosing results of scientific research that may contribute to a more accurate knowledge of the roman juridical experience but also of the different paths undertaken by the Roman Law Tradition …” (more)

[Dan Ernst, Legal History Blog, 5 February]

Giovanni Sartor, ‘The right to be forgotten: balancing interests in the flux of time’

The passage of time may reverse the balance of interests involved in the processing of personal data. This provides a rationale for the so-called ‘right to be forgotten’ – namely, data subjects’ right to exclude or limit the further processing of their personal information. This right has been endorsed in a number of judicial decisions in various EU Member States and has been affirmed in the recent Google-Spain decision by the European Court of Justice. To analyse the rationale of the right to be forgotten, I consider the evolving balance between legally relevant advantages and disadvantages resulting from the processing of personal data. For modelling this evolving balance, I propose a method based on the identification of trends over time and on their graphical representation. On the basis of this analysis, I consider how remedies and sanctions meant to implement the right to be forgotten may affect expectation and motivations of content and host providers, and consequently influence their behaviour. I argue that in the EU legal framework data subjects should be granted the right to request from competent authorities an injunction to have their personal data removed or their distribution limited when unrestricted online distribution is no longer justified by the balance of the interests at stake. However, sanctions against online distribution may induce premature forgetting. In particular, they may have a chilling effect on the distribution of information for journalistic purposes, negatively affecting freedom of expression and information.

Giovanni Sartor, The right to be forgotten: balancing interests in the flux of time. International Journal of Law and Information Technology (Spring 2016) 24(1):72-98, doi: 10.1093/ijlit/eav017.

Joanna Shepherd, ‘An Empirical Survey of No-Injury Class Actions’

This report empirically examines the allocation of settlements and awards in no-injury class actions among plaintiffs, attorneys, and cy pres funds. The results are based on my study of 432 no-injury class action settlements and trial awards from 2005-2015. The study finds that, on average, 60% of the total monetary award paid by the defendants was allocated to the plaintiffs’ class and 37.9% was allocated to attorneys’ fees. However, because many settlements disperse the unclaimed portion of the settlement fund to a cy pres fund, the funds available to class members at the time of settlement may significantly overstate the actual amount class members ultimately receive. Although 60% of the total monetary award may be available to class members, in reality, they typically receive less than 9% of the total. In comparison, class counsel receives an average of 37.9% of available funds, over 4 times the funds typically distributed to the class. A result in which plaintiffs recover less than 10% of the award, with the rest going to lawyers or unrelated groups, clearly does not achieve the compensatory goals of class actions. Instead, the costs of no-injury class actions are passed on to consumers in the form of higher prices, lower product quality, and reduced innovation.

Shepherd, Joanna, An Empirical Survey of No-Injury Class Actions (February 1, 2016).

‘(R)evolution in Law & Economics’

“It is a real pleasure to read Guido Calabresi’s The Future of Law and Economics almost 20 years after taking his torts class. Calabresi always struck me as a warm and inspiring presence at Yale. He’s attained eminence as a scholar, teacher, and public servant. There is much to learn from and celebrate in his work. I’ll start with his latest book’s major contributions, and then go on to raise some questions about just what future(s) might be in store for law and economics …” (more)

[Frank Pasquale, Concurring Opinions, 4 February]

‘Markets, Morals and Guido Calabresi’s The Future of Law and Economics

“Guido Calabresi is a dear friend and mentor, and like everyone else who knows his justly famous work, I was delighted to hear that he has a new book. One central theme of the book is his critique of conventional economists – for not doing what they say they do. They say they treat all preferences alike, but then they ignore some widespread popular preferences because, well, because these preferences just don’t fit well into a conventional economic focus on markets. According to Guido, people widely prefer not to use markets for some kinds of matters, for reasons of humaneness, justice, and generosity …” (more)

[Carol Rose, Concurring Opinions, 4 February]