May 28, 2009
Sotomayor on Business Cases
Business law academics, pouring over, Judge Sotomayor's cases business law, authored as a district court judge and as the writing judge for a Second Circuit panel of three judge, can find no discern able "leanings" or "theories" that would either favor or disfavor those who run businesses in the United States.
I have commented that I was surprised on her high rate of reversal by the Supreme Court, most of which are in business related cases. She has lost 3 of 5 appeals from the circuit court and lost her only appeal on a business related decision of a district court opinion. Most agree that she will lose the Ricci case as well, which is pending, putting her at 5 of 7 reversals in cases taken by the Supreme Court. This is high for an individual judge (even though the supreme court does reverse in 70 percent of all cases), parparticularly for a circuit judge not in the Ninth Circuit (which suffers, by far, the highest reversal rate) and particularly for a circuit judge in the Second Circuit (which does not not get reversed as much as other circuits). Moreover, one of her opinions that the Supreme Court affirmed was done so on alternative grounds with a backhand comment on her reasoning -- I would put it in the reversed category (that makes it 6 of 7). Only one of the reversals was close (a 5-4 decision) and one was unanimous (8-0), a particularly tough reversal (the number of 8-0 reversals from the Court that are not from the Ninth Circuit is small, indeed).
In any event, the reversal rate will not affect her confirmation, which will go smoothly. More of interest is her new role on the court in business cases. Her is my take: The Supreme Court, after the retirement of Justice Powell and until the appointment of Justice Roberts, was woefully short on business expertise. The number of business cases accepted declined significantly and those who wrote the cases that were accepted did so with a remarkable lack of enthusiasm and, more critically, with a fundamental misunderstanding the effect of many of the opinions on market incentives and market planning produced by the opinions themselves. This tin ear to the effect of an opinion on future business practice and structure was due to training, or the lackof it, in business culture and market structures. When judges lack market based training and experience and lawyers argue that opinions will affect markets in negative ways, most judge turn literal and conservative and stay close to the rules (let agencies or legislatures establish the market based incentives). A few judges do not care for arguments that imply necessarily that a judge has limited economic expertise and, to help the little guy (or some other guy), just let it rip and damn the consequences (it looks good at the retirement dinner). Does Judge Sotomayor show market training or market sensitivity (for history or economics) in her many decisions? No [Not a surprise: During her education she focused on federalism and civil rights questions (often relating to Puerto Rico); her pratice was as a governement criminal lawyer and, later, as an intellectual property enforcer; her talks and classes given as a judge are not related to business matters]. Will she be literal or let it rip? So far, she has be literal in business cases (although sometime literally wrong), but put a Justice's robe on someone and things can change.
May 28, 2009 | Permalink
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Let me understand: When business cases come before the Supreme Court, you want the Court to show empathy toward businesses rather than merely applying the law as it is written?
And by the way, the Judge's last name is spelled "Sotomayor."
Posted by: Stuart Levine | May 28, 2009 9:49:10 PM
I agree this post.
Posted by: Raif | May 31, 2009 9:28:32 AM