Sie sind auf Seite 1von 19

Torts as Regulation

The goal of regulation is to allow societally beneficial activity while prohibiting or

least discouraging activities that create net harm to society.
Legal system recognizes that tort liability has the effect of deterring conduct for
which a person may be held liable to another
TWO things TORT does
Relying on the market to regulate itself
o Advantages
Ability to cater to individual preference
o Disadvantages
Consumer knowledge
Dont always have adequate information
Educating public is expensive
People dont always act rationally when they have the
Solution: Learned Hand
Effect of 3rd parties
Solution: Incentives.
o Strict liability makes manufacturers liableability to
determine minimum costs
Transaction cost
Cost of doing business
Solution: High cost of business
Inequality of Wealth
Gives you more opportunity to engage in business that reduce
transaction costs
Solution: Depends on the jury
o Merck v. Garza
In this case P needed to show causation basically he needed to find
support from studies that supported that decedent died from Vioxx.
General Causation Capable of harm to GENERAL population and
other possible eliminated
Specific Causation Substance caused particular Ps injury
Court decided to spread damages amongst the 100 exposed to Agent
orange (expected people with cancer was 1000)

Legislative Process
Bicameralism and Presentment Article 1 Sect. 7
o House Power more centralized; More efficient; Those seeking reelection always
o Senate Consensus required; individual members have more autonomy which makes
it more difficult to pass legislation; Turnover rate is moderate.

How a bill becomes a law

Bill Written
Introduced in either house
o Goes to House debated and voted on House LFoor
o Approved bill sent to Senate
Senate committee may mark up
Reported favorable to floor
Bill is debated
Filibuster OR Cloiture
Senate approve Bill
o Different Version madeby conference committee
o Unified bill debated and voted on by both house
Bill is signed/Vetoed by President/Unsigned becomes law
o 2/3 both house needed override President Veto

Theories of legislative process

Proceduralist Theories
At each stage in the legislative process a proposal can be changed/halted/
coalitions are formed and opportunities for logrolling, strategic behavior and
deliberation are presented.
Known as VETO-GATES: Road blocks in the legislative process. (Can be result of
Constitutional provisions, formally adopted by legislative body and norms and
practices that are informal)
o Constitutional prohibitions are most durable Filibuster

Statutory Interpretation

The traditional method. Identify the purpose of the statute and interpret it in a
way that best effectuates that purpose. Emphasize the importance of democratic
law making. Tries to find the goal of statute and assumes that legislature are
reasonable and rational actors. Purposivists look to statutes title, current events,
legislative history, and social values
Believes that judges must hew closely to the meaning of the clear statutory text
even when the result contradicts the statutes apparent purpose. When the
meaning is clear language trumps general purpose. Believe that statutes should be
construed in terms of each words ordinary meaning in the given context.
Textualists use dictionaries as aids to interprets statutes plain meaning.
Under intentionalist approach if court is dace with an unclear statute they look to
the likely intent of legislature based on the precise issue before the court. Look to
what was the intent of those legislators who voted for the statute. Look to
legislative history some legislative history is more important than others are.



All three approaches have benefits in interpreting a statute their way, however
each one has faults.
Pros of Textualism
The words of the statute are given more deference. Textualist believe that the
statute reflects the legislative process so if the statute is not perfect than there
is a reason it is not written perfect. Unless an absurd result would be created as
Riggs v. Palmer or US v. Kirby. Textualist believe that under texualists approach
judges would not be able to create their own interpretations. Further the
legislative process is messy and contains a lot of bargaining. The legislative history
is susceptible to manipulation and contains no coherent consensus amongst the
legislature. Textualist that giving a plain meaning to the text will force Congress
to clarify statutespenalty default rule. Canons dont always work.

Critiques of Textualism
Textualist never look to se if there is a consensus on the matter. When statutes
interpreted textually they are more likely to be overturned. Textualist overlook
that Congress does not even pay close attention to the exact words of the statute.
Also overlook the effectiveness penalty default rule because Congress is not
always aware also it would fail given the complexities and difficulties of the
legislative process. Can manipulate the text by interpreting the text in a way that
they would like.
Further the text can be vulnerable to different interpretations. Cons to canons
was illustrated in Gustafson v. Alloyd in which the majority focused on all the
terms surrounding the word communication which would be an application of
noscitur a sociss, but the dissent viewed prospectus as more of a catchall of all the
terms listed. Thus this case illustrates Llewelyn critique that every canon has an
opposite canon that would bring about a different result. Another problem is that
complex statutes are usually written by different people. Lack of guidelines and a
judge would just apply the canon that would give him the outcome he is seeking

Pros of Purposvism
Language is ambiguous. Cannons of interpretation can be constraining and just give
the appearance of objectivity to hide judges preferences. Do a the country a
dsissrvice when we needlessly ignore persuasive evidence of Congress actual
purpose and require it to take the time to revisit the matter. May have clear
purpose but fails to adopt language thay reflects it. Statutes that viewed by
Textualists are more likely to be overridden.
Holy TrinityWhen text and purpose of Congress are in conflict; Purpose trumps
letter of law.
Critiques of Purposivism
Statutes dont always have specific purpose. The level of generality and relevancy
can differ. Statutes are vectors not rays and can have counter point. Question of
to what ends statutes dont mean to achieve a goals at all cost since that would
problematic. The legislative process is not coherent. Legislators have independent
goals and often strike deals to make that happen. They have
appease. They enact words not a purpose. Its not legitimate to enact the aims or
goals of legislature because words were chosen for a reason and it is not the
judges role to figure out intent. West Virgina v. Casey

Pros of Intentionalism
Reliable medium for members of congress. Congress delegated them for a reason a
and we should give them credence. Legislators often dont read every detail as such
legislative history act as a way to clarify the intent. Textualism replaces the
language in which congress thought.

Critiques of intentionalism
Hard to find intent No one main intent, diverse intents
Marquis de Condorcets (A,B,C,) shows that it is hard to aggregate individual
preferences into a collective choice, this was expanded into the social choice
theory (however a counter to this is that this could strengthen looking at
legislative history)
no coherent intent legislative history

Legislative History

Interest Groupsinduce legislators to create favorable legislative history to

achieve private-interest goals would not be able to persuade the entire
Congress to endorse
Constituentscould favor sponsors/big corporations. Could favor
constituents from district from district.
o Personal interests rather than public interests
Has not gone through the bicameral passage by the house/Senate/President
o Manipulationlegisiaotrs adding language to affect the courts
interpretation of the statute that would favor their cause
(Continental Can Company v. Chicago Truck Drivers.
Not considering the bargain that took place
No one main intent, diverse intents

Cannons of interpretation
Semantic Cannons

Ordinary meaning: Unless there is evidence that the wrods have acquired
specialized meaning use plain ordinary meaning
o Problems; Ordinary meaning to whom.
Presumption of statutory consistency- that words have the same meaning
throughout a statute (West v. Casey)
o Problem then you are limited. Words carry different meaning
depending on what you are trying to sayNitpicky
Presumption against surplusage- Courts use words with a specific purpose
and every word has a given meaning. (
Presumption against redundancy Interpret to avoid redundancy (Gustafson
Noscitur a sociis- Words known by association. (Context clues) Problem; Not
always accurate.
Ejusdem generis, catchall shall be construed to cover those things with
similar attributes to the particularly listed words. (Birds of a feather flock
o Problems: Extraccting from the terms the particular characteristic or
quality limits the general purpose.
o McBoyle Airplane as vehicle
Expression Unius Expression of one thing implies exclusion of another.

Cons of Canons

Cons to canons was illustrated in Gustafson v. Alloyd in which the majority

focused on all the terms surrounding the word communication which
would be an application of noscitur a sociss, but the dissent viewed
prospectus as more of a catchall of all the terms listed. Thus this case
illustrates Llewelyn critique that every canon has an opposite canon that
would bring about a different result
Another problem is that complex statutes are usually written by different
Lack of guidelines and a judge would just apply the canon that would give
him the outcome he is seeking

Substantive Cannons

A substantive canon is a judicial presumption in favor or against a particular

substantive outcome. It is possible to conceive of such canons as representing
generic approximations of congressional intent:

Constitutional Avoidance
Constitutional avoidance (Classical)
o Avoid interpretations where court would have to strike down statute
as unconstitutional
Constitutional Question (Modern)
o Avoid court having to answer constitutional question.
How plausible is the non-problematic interpretation ? fairly
How serious or difficult is the constitutional issue?
o Pros of constitutional avoidance
Deference to congressDeference to congress.
Legislature might prefer less optimal interpretation instead of
declaring statue unconstitutional. Presumption that congress
does not intend to pass unconstitutional laws.--Avoids
unnecessary striking down statutes
Encourages legislative deliberation and transparencyScalia
likes this point.
o Cons
might involve judges twisting it in ways to avoid a
unconstitutional interpretation
Courts will construe statutes in favor of a certain
substantive result unless statutes not only indicates
contrary result bit does so with greater clarity than
would ordinarily require.

problem is when to invoke it

one argument is that it does not foster judicial restraint , but
expands the degree to which courts may draw on constitutional
considerations to limit the scope or application of congressional

o Example;
NRLB v. Catholic Bishop
(Catholic school employers part of a unionno
affirmative expressionConstitutional avoidance acts a
clear expression
Dissent: Ejudesm cannon. (Covers everyone not explicitly
excluded-congress could have done that.)
Clear Statement Rule
This canon requires a clear statement before a court will construe a federal
statute as interfering with fundamental aspects of state sovereignty. The clear
statement rule is designed to protect state governments from federal
i Federalism (Protecting state sovereignty and autonomy)
need to honor the wishes of the states
1 Protecting states from undue federal interference
with core state activities or functions (Gregory v.
Ashcroft: ADA laws in relation to federal judge age limit
in MO)
a If Congress intends to alter the usual
constitutional balance between states and the
federal government, it must make its intention
to do so unmistakably clear in the language of
the statute. (Gregory)
b No metric for deciding what clear means
disagree over what most people would regard as
c Reasons for maintaining Federalism:
i Responsiveness by the state to the diverse
needs of citizens
ii Participation is easier at the smaller state
iii State governments are more able and willing
to innovate
iv Strong states can prevent Federal Power
2 When in conflict, however, the Federal laws take priority
over the state laws this can be done expressly or

Rule of Lenity
(Bass, McBoyle, discussed in Moskal/Smith)
Clear statement rule, but thought to be more legitimate Constitution didnt
require clarity, but it is required to protect due process
o Wants people to have fair notice of what crimes are
o Legislatures should define criminal policy (semi-nondelegation
o More of a moral obligation than giving real notice to criminals
Issue of how ambiguous a statute must be? If the Justices are arguing,
should it be invoked?
Similar canons for tax liability and provision of government benefits
IF there is a dispute side with the defendant.

Apply Textualism



Plain meaning structure.

Canons of Interpretation that might be used under a textualist approach
(only if relevant to problemuse cannons when there are two or more
Find purpose
Use legislative history (if applicable)

Regulatory Process
APA (Administrative Procedure Act) enacted in 1946 laying out the basic
structure and procedures and subjects agencies to legal and political controls (kind
of like a Constitution).
Formal Rulemaking
tends to be trial type procedures. It is governed by an elaborate set of procedures
laid out in sections 556 and 557 of the APA. It is an adversarial hearing with
administrative law judge, special process for internal appeals, formal findings of
fact and conclusions of law. It is pretty close to a litigation proceeding. An
exception is that in rulemaking an agency can adopt procedures to how they will
allow evidence (might allow written arguments but not oral testimony). Formal
takes forever (9 years to change content of peanut butter).
Informal Rulemaking
aka notice and comment rulemaking governed by section 553 of the APA. There are
three steps:
Agency publishes notice of proposed rulemaking (NPRM) in federal registrar:
o Time/Place/Nature of public proceeding.
o Reference to legal authority.
o Terms or substance of proposed legislation.
Agency provides public with opportunity to comment
Agency publishes an explanation of the rule in a concise general statement
of basis and purpose. 553
Exceptions 553
o Policy statements and interpretative rules not subject Good Cause &
Procedural Rules


1st step is determine if agency action is question of a rule or adjudication,
Rulemaking (Rule): an agency statement of general or particular
applicability and future effect designed to implement, interpret, or
prescribe law or policy or describing the organization, procedure, or
practice requirements of an agency.
EX. similar to what legislators do, making new law, new policy
EX. Ratemaking need Formal Agreement: future rates(electricity), how much
company can charge and how much the customer has to pay
Adjudication (Order): deals with particular parties, resolves disputes, and
things in the past, (typically applying existing law or policy to facts)
o Issue final decisions (injunctions, pay fine): affirmative, negative,
injunctive, fines any authoritative agency action other than a rule

Did the agency provide adequate notice?

Was there opportunity for Meaningful comment?
Did interest parties have a meaningful opportunity to Interested parties must
have sufficiently clear idea of the rule the agency is considering
Courts have argued that the notice requirement must be read in conjunction
with the requirement that provide an opportunity for comment, plus a sense
that the purpose of the notice is thwarted if it is insufficiently specific
about what the agency is considering. Section 553 c says that the
opportunity to participate in the rule making through submission of written,
data, views, or arguments (even outside parties must have meaningful
opportunity to comment, which means evidentiary basis for proposal,
including any scientific studies or data relied on.)
Did agency provide data in which it relied on in order to promulagte?
o Failure disclose scientific data relied upon would suppress meaningful
comment and is akin to rejecting comment altogether.
o the court may invalidate any agency action that is arbitrary,
capricious, an abuse of discretion, or otherwise not in accordance with
the law. The court should strike down as arbitrary and capricious any

agency action that fails to consider all relevant factors. If studies are
not disclosed, parties will
o US v. Nova Scotia Food Products Corp.
held that a failure to disclose to interested persons the data
relied upon in making the decision was erroneous. The burden is
on the agency to articulate why the rule should apply to a large
and diverse class (fish)-no reason to conceal the data

Concise General Statement of Basis and Purpose:

questions of cogent materiality
o Rule: statement show the court what major policy issues were and why
the agency reacted to them as it did
o Agencies risk reversal under judicial review for arbitrariness if they
fail to respond adequate to any non-frivolous, non-repetitive complaint
Resulted in lengthy and detailed statements (not
o Ct may adopt an interim rule, but they should answer the important
o E-Comments are representative of interests affected

Was the final rule in line with the previous rule?

Is the final rule a Logical Outgrowth?
o TWO PART TEST: Is the proposed rule in CHARACTER WITH THE
o Agency only required to give description of rule NOT required to
state actual proposed rule If the agency conducts new study and
there are no fundamental changes to the agencys initial proposal then
DOES NOT have to provide opportunity to comment.
Can parties anticipate that the change was possible thus should
have reasonably filed their comments on the subject
o If agency final rule deviates substantially from the from the NOPR.
o Ex: Chocolate Manufacturing Assoc. v. Block
o The agency needs to tell the public what the background is of the rule
they are proposing and the changes they wish to make. Often times
they will provide a list of specific topics in which things they are
considering changing and of things that are off limits (chocolate milk
case). Only the things up for debate can be altered via this rule

making process. That is to say, you cannot say X is not up for debate
then alter it. If enough new information comes up about a particular
area, then you may need to have a second round. This is not an infinite
regress, but only happens when the new rule fails the logical
outgrowth test.
as long as the final rule is within the general subject
identified by the NOPR notice is ok. Burden to comment
is imposed on those whose interest might conceivably be
Was the agency required to RENOTICE or Provide Supplemental notice?
Agency not prohibited from adding new supporting documents.
Would otherwise Drag out the process if every time there
would be new comment period and provide notice. EX: Chocolate
Manufacturing Ass. V. BLock
PRO: Up to commenters to find information would drag
out process if agency has to continually renotice every
time there are new comments. Makes agencies reluctant
to make changesMake changes that are vague and more
general in order preserve flexibility
CON: Cannot promulgate rule based on information
agency has sole knowledge basis. if purpose is to have
notice and comment work effectively comment should be
focused. Not fair to interest parties to comb through
scientific literature to figure out what the agency relied
on. Reliable and ubiquitous- where exactly is it publicly
available and how much research is necessary to actually
find the info. Agency has be certain information can be
Publicly available could mean different things.
Agency doesnt have expertise and is relying on someone
elses study. Too much information to focus. Putting onus
on commentator interms of finding information can
become expensive. ( one entity vs. multiple parties)


o Should have known that it was a possibility agency
could adopt some other policy. Was it within the
scope of adopted rule
Theory- societal consensus

Rule making vs Adjudication

Formal adjudication ( 556-57, 554)
o Most adjudication = formal (very much like trial) trial like
adversarial hearings
o Witnesses and cross examinations
Informal adjudication (Not specified in the APA)
o Not entirely governed by any procedural law; some generic APA
provisions apply; also subject to statutes/agency
Chenery- established that an agency may announce a new policy decision in an
adjudicative order rather than through rule-making.
Sec in Chenery basically creates a rule in the adjudicatory process. Court says that
Chenery is allowed to do this because there needs to be some flexibility.
Policy by adjudication Pros and Cons:
Cons: Notice, interference with reliance, rule of law
Pros: Avoiding taking advantage of loopholes, availability of information (new
data after rule made); avoid delay (rule-making takes a long time), maybe a
dire need to act quickly
NLRB v. Bell Aerospace:
Established that an agency can change long standing policy by adjudication
but the use of adjudication is subject to review of abuse of discretion
Said that an agency could overturn a precedent in an adjudication. That an
agency an create new policies in an adjudication as long as it is not an abuse
of discretion or a violation of the Act.


Bell Aerospace balancing test: The petitioner who is challenging the agency must
Reasonableness of reliance (was there a long standing policy)
The substantiality of the reliance (if you would be left the same than there
is no difference)
Under the D.C. Circuit it is just fairness and equity so long standing policy
are more likely upheld. (Bell Aerospace is the LAW NOW)

Apply facts to case.
Was there adequate notice?
Was the agency supply the data they used?


Judicial Oversight
Section 706(A)(2) sets out a baseline standard for overturning agency action but
provides little guidance on how the courts should determine the nature of the
challenged agency action. Prior to the passage of the APA, the courts were very
deferential to agency action. The courts would require the challenging the party to
carry the burden of proof to show that the agencys action was arbitrary
P. 719
Judicial Review under APA is broken down into Procedural Review:
Procedural requirements that the courts will review
Court determines whether the agencies acted consistently with statutes
Acted consistently with the constitution
Decision in formal proceedings must be supported by substantial evidence in
the record
Agency decisions must not be arbitrary and capricious
If the agency acted with the procedural requirements and the court would
decide if decision was crazy Because special interest had some sort of
influence in the agencies.
Judge Leventhal created the hard look test
the court must look at the agencies reasons carefully and decide if the
agencies made their decisions on reasoned decisions.

Does it deal with the agencies interpretation of statute?

Chevron Applies
Decides because the text and history are silent on the administrative
agencys interpretation, than the court should defer to the agencys
Pros of deferring to the agency:
o They should refer to the agency because they are the experts they
know the implications, the costs, and they know the ramifications, the
agency is good at that stuff.
o People in the agencies are more accountable, whereas judges are
there for a while. The agency is more accountable to value decisions
President and Congress can have oversight of agencies. Whereas the


courts dont really have someone over them. The courts are less
o Another argument is that you have 12 circuit courts all of which can
make a decision on these cases so there would be less uniformity.

Step One, is the silent or ambiguous? (Tobacoo case)

Has congress directly spoken to the precise question at issue?
o Ct gives no deference to the agency's interpretation when it
decides under step one
To determine clarity, ct should use traditional tools of statutory
interpretation: dictionary definitions, canons(use context)
o Textualism, dictionary definitions, canons, context, ordinary term and
not terms of art.
o Purposivist, purpose of statute, will usually find statute is ambiguous,
and have to proceed to step 2
o Intentionalist, use legislative history to find out what the legislators
knew the statute to mean
How Clear does the Statute have to be? (Sweet Home Case)
o Canons contradict, dictionary v common language, under this view the
agency should win every case

Step Two, if statute is not clear, meaning its ambiguous, or if the statute is silent,
the ct must defer to agencies interpretation. Was agencies interpretation was
reasonable or permissible
Some courts just defer to agency (Rust v. Sullivan the abortion case, where
court just defered to the agency without analyzing the reasoning the agency
used and if the agency had considered all relevant factors)
o or some courts use the hard look and ask for reasoning, and
reasoned decision making. State Farm is a good example where the
court did not let the agency slide and
Determine if RM was arbitrary and capricious
o State Farm (Arbitrary and Capricious Case)- Court decides that the
agency failed to provide an adequate basis and explanation for
rescinding the passive restraint requirement
Court says arbitrary and capricious if:
Failed to consider plausible alternative

o comments (comments are sufficient in saying that

is something hat we should think about or even
o those alternatives that are sufficiently
Relevant Factors- We look to the relevant factors in
which what the statute says about the relevant statutes
in how to act.
Factual Predicates of the Action
o There must be some relation to the facts to the
record basically tie the finding to the record
under the arbitrary and capricious review.
o the agency must tie its findings or factual
predictions to data in the record
Clear Error of Judgment (policy)
o Court not substitute its judgment with that of the
agency( agency are the experts)
o The agency is less vulnerable to political issues like
the court
o Courts rarely do this however
o some courts do say something when something is
just so absurd and that they think agency is just
considering something for a constituent such as a
major tax break, or doing something for a
supporter of the President, etc
Dont need step 2 because of arbitrary and capricious is a catchall
phrase. - depends on what is REASONABLE
Rarely do cts overturn step 2
o EXCEPT: Utilities companies - Statute says local utilities "have to
lease things that are necessary."
o Statute was ambiguous on what "necessary" meant, but ct said
legislation meant something that was less than "everything is
necessary," which the Agency said everything was necessary. Ct ruled
that the Agency's definition was unreasonable.
o POLICY: Justifications:
Agency expertise
Agency can evaluate trade-offs better


Congress intended for Agencies to interpret statutes, agency

has the authority to fill gaps with force of law.
Political accountability
National Coordination (in interpretation of federal law
Counter argument
Counter or Marbury, bc it is not allowing the ct adopt its
own interpretation of the law. BUT-->
o Delegation: this gap in the law is seen as an
expressed delegation from legislators to the
Agency to fill.