Thursday, March 8, 2007
Click the link at the bottom of this post to listen to this week's installment of the Thursday interview. This week's interview is with Prof. Suja Thomas of the University of Cincinnati College of Law about her two most recent articles, "The PSLRA's Seventh Amendment Problem" and "Why Summary Judgment is Unconstitutional."
Here's the abstract for "PSLRA":
This Article is the first to examine the proper role of the jury in private securities fraud litigation. In the Private Securities Litigation Reform Act, Congress required that a securities fraud complaint plead "a strong inference" of scienter. The courts have disagreed on the standard that satisfies this requirement, and likewise, the involved parties disagree. Defendant corporations argue for a stringent standard that would result in the dismissal of many claims, while plaintiff investors support a flexible standard that would allow more claims to go forward. Indeed, the Supreme Court's resolution of this issue may have an impact beyond securities litigation. If a stringent standard is adopted, special pleading may be permitted in other types of cases, including employment discrimination cases. Thus these cases may be dismissed before any discovery has been conducted. In the present context, securities law experts have not addressed the constitutional issue posed by the special pleading requirement; whether this requirement violates the Seventh Amendment right to a jury trial. The Supreme Court has held that a modern procedure must satisfy the substance of the English common law jury trial in 1791 to be constitutional under the Seventh Amendment. Accordingly, the special pleading rules developed in 21st century securities litigation must be viewed through an 18th century common law lens. This Article argues that the scienter standards developed by the courts in securities cases do not comport with substance of the common law jury trial and thus are constitutionally problematic. Contrary to the common law, the courts improperly engage in one or more steps of assessing the reasonableness of facts and corresponding inferences pled by the plaintiffs. This Article also acknowledges the possible constitutional infirmity posed by the PSLRA's "strong inference" standard itself and the heightened pleading requirements and proposes an alternative standard to dismiss a securities fraud claim that comports with the Seventh Amendment.
Here's the abstract for "Summary Judgment":
Summary judgment is cited as a significant reason for the dramatic decline in the number of jury trials in civil cases in federal court. Judges extensively use the device to clear the federal docket of cases deemed meritless. Recent scholarship even has called for the mandatory use of summary judgment prior to settlement. While other scholars question the use of summary judgment in certain types of cases (for example, civil rights cases), all scholars and judges assume away a critical question: whether summary judgment is constitutional. The conventional wisdom is that the Supreme Court settled the issue a century ago in Fidelity & Deposit Co. v. United States. But a review of that case reveals that the conventional wisdom is wrong: the constitutionality of summary judgment has never been resolved by the Supreme Court. This Essay is the first to examine the question and takes the seemingly heretical position that summary judgment is unconstitutional. The question is governed by the Seventh Amendment which provides that “[i]n Suits at common law, . . . the right of trial by jury shall be preserved, and no fact tried by jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law.” The Supreme Court has held that “common law” in the Seventh Amendment refers to the English common law in 1791. This Essay demonstrates that no procedure similar to summary judgment existed under the English common law and also reveals that summary judgment violates the core principles or “substance” of the English common law. The Essay concludes that, despite the uniform acceptance of the device, summary judgment is unconstitutional. The Essay then responds to likely objections, including that the federal courts cannot function properly without summary judgment. By describing the burden that the procedure of summary judgment imposes upon the courts, the Essay argues that summary judgment may not be necessary to the judicial system but rather, by contrast, imposes significant costs upon the system.
A big thank you to Prof. Thomas for the interview.