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Articles 1 - 4 of 4
Full-Text Articles in Law
Silencing Litigation Through Bankruptcy, Pamela Foohey, Christopher K. Odinet
Silencing Litigation Through Bankruptcy, Pamela Foohey, Christopher K. Odinet
Faculty Scholarship
Bankruptcy is being used as a tool for silencing survivors and their families. When faced with claims from multiple plaintiffs related to the same wrongful conduct that can financially or operationally crush the defendant over the long term—a phenomenon we identify as onslaught litigation—defendants harness bankruptcy’s reorganization process to draw together those who allege harm and pressure them into a swift, universal settlement. In doing so, they use the bankruptcy system to deprive survivors of their voice and the public of the truth. This Article identifies this phenomenon and argues that it is time to rein in this destructive use …
Mutual Optimism And Risk Preferences In Litigation, Keith N. Hylton
Mutual Optimism And Risk Preferences In Litigation, Keith N. Hylton
Faculty Scholarship
Why do some legal disputes fail to settle? From a bird’s eye view, the literature offers two categories of reasons. One consists of arguments based on informational disparities. The other consists of psychological arguments. This paper explores the psychological theory. It presents a model of litigation driven by risk preferences and examines the model’s implications for trials and settlements. The model suggests a foundation in Prospect Theory for the Mutual Optimism model of litigation. The model’s implications for plaintiff win rates, settlement patterns, and informational asymmetry with respect to the degree of risk aversion are examined.
Information Costs And The Civil Justice System, Keith N. Hylton
Information Costs And The Civil Justice System, Keith N. Hylton
Faculty Scholarship
Litigation is costly because information is not free. Given that information is costly and perfect information prohibitively costly, courts will occasionally err. Finally, the fact that information is costly implies an unavoidable degree of informational asymmetry between disputants. This paper presents a model of the civil justice system that incorporates these features and probes its implications for compliance with the law, efficiency of law, accuracy in adjudication, trial outcome statistics, and the evolution of legal standards. The model’s claims are applied to and tested against the relevant empirical and legal literature. (JEL: D74, K10, K13, K41)
Event-Driven Suits And The Rethinking Of Securities Litigation, Merritt B. Fox, Joshua Mitts
Event-Driven Suits And The Rethinking Of Securities Litigation, Merritt B. Fox, Joshua Mitts
Faculty Scholarship
Event-driven securities suits-ones that arise after an issuer has experienced some kind of disaster-have become increasingly prevalent in recent years. These suits are based on the fraud-on-the-market doctrine, a doctrine that ultimately gives rise to the bulk of the damages paid out in settlements and judgments pursuant to private litigation under the U.S. securities laws. The theory behind fraud-on-the-market cases is that when an issuer's share price has been inflated by a Rule-10b-5-violating misstatement, investors who purchased shares at the inflated price have suffered a compensable injury if they still hold the shares after the inflation is gone. Although these …