Law Commons^™

Adapting Private Law For Climate Change Adaptation, Jim Rossi, J. B. Ruhl

Vanderbilt Law School Faculty Publications

The private law of torts, property, and contracts will and should play an important role in resolving disputes regarding how private individuals and entities respond to and manage the harms of climate change that cannot be avoided through mitigation (known in climate change policy dialogue as “adaptation”). While adaptation is commonly presented as a problem needing legislative solutions, this Article presents a novel and overdue case for private law to take climate adaptation seriously.

To date, the role of private law is a significant blind spot in scholarly discussions of climate adaptation. Litigation invoking common-law doctrines in climate adaption disputes …

Unenforceable Waivers, Edward K. Cheng, Ehud Guttel, Yuval Procaccia

Vanderbilt Law School Faculty Publications

Textbook tort law establishes that waivers of liability-—especially those involving physical harm-—are often unenforceable. This Essay demonstrates through an extensive survey of the case law that despite being unenforceable, such waivers remain in widespread use. Indeed, defendants frequently use waivers even when a court has previously declared their specific waivers to be void. So why do such waivers persist? Often the simple answer is to hoodwink would-be plaintiffs. Waivers serve as costless deterrents to tort claims: Either they dupe naïve victims into believing that their claims are barred, or if not, the defendant is no worse off than before. Such …

Sequencing In Damages, Edward K. Cheng, Ehud Guttel, Yuval Procaccia

Vanderbilt Law School Faculty Publications

Tort law contains multiple doctrines governing the assignment of liability and the calculation of damages. But in what sequence should courts apply these doctrines? Does it matter, for example, whether a court applies comparative fault before or after mitigation of damages? The answer, rather surprisingly, is that sequencing does matter, and it can substantially affect the compensation that a tort victim ultimately receives. Yet the existing case law on sequencing is ad hoc, inconsistent, and undertheorized, and the issue has been entirely overlooked by the academic literature. In this Article, we introduce and examine the question of sequencing. We offer …

The Specific Consumer Expectations Test For Product Defects, W. Kip Viscusi, Clayton J. Masterman

Vanderbilt Law School Faculty Publications

The consumer expectations test in products liability law holds firms liable for producing goods that are more dangerous than the reasonable consumer would anticipate. But judicial experience in the majority of states that have utilized the consumer expectations test demonstrates that it is ambiguous and impossible to apply predictably. The test is ill-suited for regulating complex products or markets with heterogeneous consumers; moreover, the test requires courts to expend significant resources to identify consumers' ex ante beliefs about product risks, even when consumers lacked tangible beliefs about products at the time of purchase. The other major test that courts apply …

"Sorry" Is Never Enough: How State Apology Laws Fail To Reduce Medical Malpractice Liability Risk, W. Kip Viscusi, Benjamin J. Mcmichael, R. Lawrence Van Horn

Vanderbilt Law School Faculty Publications

Based on case studies indicating that apologies from physicians to patients can promote healing, understanding, and dispute resolution, 38 states have sought to reduce litigation and medical malpractice liability by enacting apology laws. Apology laws facilitate apologies by making them inadmissible in subsequent malpractice trials.

The underlying assumption regarding the potential efficacy of these laws is that, after receiving an apology, patients will be less likely to pursue a malpractice claim and will be more likely to settle those claims that are filed. However, once a patient has been made aware that the physician has committed a medical error, the …

The Reasonable Investor Of Federal Securities Law, Amanda Rose

Vanderbilt Law School Faculty Publications

Federal securities law defines the materiality of corporate disclosures by reference to the views of a hypothetical reasonable investor. For decades the reasonable investor standard has been a flashpoint for debate with critics complaining of the uncertainty it generates and defenders warning of the under-inclusiveness of bright-line alternatives. This Article attempts to shed fresh light on the issue by considering how the reasonable investor differs from its common law antecedent, the reasonable person of tort law. The differences identified suggest that the reasonable investor standard is more costly than tort laws reasonable person standard - the uncertainty it generates is …

Assessing The Insurance Role Of Tort Liability After Calabresi, W. Kip Viscusi, Joni Hersch

Vanderbilt Law School Faculty Publications

Calabresi’s theory of tort liability (1961) as a risk distribution mechanism established insurance as an objective of tort liability. Calabresi’s risk-spreading concept of tort has provided the impetus for much of the subsequent development of tort liability doctrine, including risk-utility analysis and strict liability. Calabresi’s analysis remains a powerful basis for modern tort liability. However, high transactions costs, correlated risks, catastrophic losses, mass toxic torts, shifts in liability rules over time, noneconomic damages, and punitive damages affect the functioning of tort liability as an insurance mechanism. Despite some limitations of tort liability as insurance, tort compensation serves both a compensatory …

Assessing The Insurance Role Of Tort Liability After Calabresi, Joni Hersch, W. Kip Viscusi

Vanderbilt Law School Faculty Publications

Calabresi’s theory of tort liability (1961) as a risk distribution mechanism established insurance as an objective of tort liability. Calabresi’s risk-spreading concept of tort has provided the impetus for much of the subsequent development of tort liability doctrine, including risk-utility analysis and strict liability. Calabresi’s analysis remains a powerful basis for modern tort liability. However, high transactions costs, correlated risks, catastrophic losses, mass toxic torts, shifts in liability rules over time, noneconomic damages, and punitive damages affect the functioning of tort liability as an insurance mechanism. Despite some limitations of tort liability as insurance, tort compensation serves both a compensatory …

When 10 Trials Are Better Than 1000: An Evidentiary Perspective On Trial Sampling, Edward K. Cheng

Vanderbilt Law School Faculty Publications

In many mass tort cases, separately trying all individual claims is impractical, and thus a number of trial courts and commentators have explored the use of statistical sampling as a way of efficiently processing claims. Most discussions on the topic, however, implicitly assume that sampling is a “second best” solution: individual trials are preferred for accuracy, and sampling only justified under extraordinary circumstances. This Essay explores whether this assumption is really true. While intuitively one might think that individual trials would be more accurate at estimating liability than extrapolating from a subset of cases, the Essay offers three ways in …

Erie And The Rules Of Evidence, Edward K. Cheng

Vanderbilt Law School Faculty Publications

Jay Tidmarsh offers an intriguing new test for drawing the allimportant line between procedure and substance for purposes of Erie. The Tidmarsh test is attractively simple, yet seemingly reaches the right result in separating out truly “procedural” rules from more substantive ones. Since I am not a proceduralist, in this Response I will leave the Tidmarsh test’s explanatory power and practical workability vis-à-vis general civil procedure rules to others more qualified than I. Instead, I want to focus on the implications of the Tidmarsh test for the Federal Rules of Evidence. Like others in the evidence world, I have long …

Does Product Liability Make Us Safer?, W. Kip Viscusi

Vanderbilt Law School Faculty Publications

Product liability law is intended to create an environment that fosters safer products. However, this law often has adverse consequences. Some of the problems stem from the inherent nature of product risk decisions and the function of tort liability, while others may derive from individuals’ cognitive limitations and inability to think properly about balancing risk and cost. This paper examines both types of problems and summarizes relevant academic literature.

The Heterogeneity Of The Value Of Statistical Life: Introduction And Overview, W. Kip Viscusi

Vanderbilt Law School Faculty Publications

The refinement in worker fatality risk data used in hedonic wage studies and evidence from new stated preference studies have facilitated the exploration of the heterogeneity of the value of statistical life (VSL). Although the median VSL estimate for workers is $7-$8 million, the VSL varies considerably within the worker population. New estimates of the income elasticity of VSL are 1.0 or above, which are consistent with theoretical models linking VSL to the coefficient of relative risk aversion. The specific relationship between VSL and risk aversion is, however, more complex than previously understood. Age differences in VSL are substantial, with …

Punitive Damages By Numbers: Exxon Shipping Co. V. Baker, Joni Hersch, W. Kip Viscusi

Vanderbilt Law School Faculty Publications

The U.S. Supreme Court decision in Exxon Shipping Co. v. Baker is a landmark that establishes an upper bound ratio of punitive damages to compensatory damages of 1:1 for maritime cases, with potential implications for other types of cases as well. This article critiques the Court’s reliance on the median ratio of punitive to compensatory damages in samples of verdicts to set an upper bound for punitive damages awards. Our critique of the approach draws on the properties of statistical distributions and a new analysis of cases with punitive damages awards. The Court’s conclusion that a 1:1 ratio establishes a …

What Are We Comparing In Comparative Negligence?, Paul H. Edelman

Vanderbilt Law School Faculty Publications

In tort cases, comparative negligence now is the dominant method for determining damages. Under that method, the jury apportions fault among the parties and assesses damages in proportion to the relative fault assessment. Comparative negligence contrasts with contributory negligence, where any fault attributed to the plaintiff bars recovery. Although comparative negligence routinely governs in tort cases, its most basic feature remains uncertain: how to apportion fault. In this Article, I demonstrate that at least two different methods exist, and that these methods lead to radically different outcomes. I create a framework, building on a traditional model from law and economics, …

The Allocation Problem In Multiple-Claimant Representations, Paul H. Edelman, Richard A. Nagareda, Charles Silver

Vanderbilt Law School Faculty Publications

Multiple-claimant representations-classa ctions and other group lawsuits-pose two principal-agent problems: Shirking (failure to maximize the aggregate recovery) and misallocation (distribution of the aggregate recovery other than according to the relative value of claims). Clients have dealt with these problems separately, using contingent percentage fees to motivate lawyers to maximize the aggregate recovery and monitoring devices (disclosure requirements, client control rights, and third-party review) to encourage appropriate allocations. The scholarly literature has proceeded on the premise that monitoring devices are needed to police misallocations, because the fee calculus cannot do the entire job. This paper shows that this premise is mistaken …

Does Frye Or Daubert Matter? A Study Of Scientific Admissibility Standards, Edward K. Cheng, Albert Yoon

Vanderbilt Law School Faculty Publications

Nearly every treatment of scientific evidence begins with a faithful comparison between the Frye and Daubert standards. Since 1993, jurists and legal scholars have spiritedly debated which standard is preferable and whether particular states should adopt one standard or the other. These efforts beg the question: Does a state's choice of scientific admissibility standard matter? A growing number of scholars suspect that the answer is no. Under this theory, the import of the Supreme Court's Daubert decision was not in its doctrinal standard, but rather in the general consciousness it raised about the problems of unreliable scientific evidence. This Article …

Changing Scientific Evidence, Edward K. Cheng

Vanderbilt Law School Faculty Publications

A number of high-profile toxic tort cases, such as silicone breast implants, have followed a familiar and disturbing path: Early studies suggest a link between a suspected substance and a particular illness. Based on these initial studies, lawsuits are brought and juries award large judgments to various plaintiffs. Then later, more comprehensive studies find no evidence of a causal link. How should the legal system cope with this problem in which new scientific evidence calls into question previous findings of liability? These erroneous judgments seriously harm social welfare and legitimacy. Beneficial products are needlessly discontinued or are made more expensive, …

Damages To Deter Police Shootings, W. Kip Viscusi, S. Jeffrey

Vanderbilt Law School Faculty Publications

Many fatal shootings by police are not warranted. These shootings impose losses on the victims and their families and reflect the failure of existing administrative and legal restraints to deter these unwarranted shootings. This Article proposes a revamping of existing incentives to both provide more adequate compensation to the victims' families and to establish levels of deterrence that are sufficient to curtail unjust fatalities. There are legal criteria for what level of force is "reasonable," but determining reasonableness in practice may be difficult. Practical guidance such as the "21-foot rule" for the threat to warrant a shooting is often problematic. …

Jurors, Judges, And The Mistreatment Of Risk By The Courts, W. Kip Viscusi

Vanderbilt Law School Faculty Publications

A sample of almost 500 jury-eligible citizens considered a series of experimental situations involving accidents. The juror sample did not properly apply negligence rules, as their errors were particularly great for low-probability, large-loss cases. They also penalized corporations for undertaking corporate risk analyses that seek to trade off cost versus risk reduction benefits. Jurors' damages assessments were also more prone to error than were responses by a sample of state judges. Judges were less prone to erroneous risk beliefs and less subject to the zero-risk mentality.

Commenting On Geier V. American Honda Motor Co., Edward K. Cheng

Vanderbilt Law School Faculty Publications

Preemption is probably the most frequently used constitutional doctrine in practice. It is the doctrine by which Congress supersedes state law and establishes uniform federal regulatory schemes to ensure the smooth functioning of the national economy. The Supreme Court, in an effort to cabin this immense congressional power, has traditionally applied a "presumption against preemption" - a rule of statutory interpretation under which federal law does not preempt state police powers absent clear congressional intent. The presumption has recently fallen into some disfavor, however, and the Court has ignored it in some prominent preemption cases. It remains viable, but its …

A Postmortem On The Cigarette Settlement, W. Kip Viscusi

Vanderbilt Law School Faculty Publications

The settlement of the Attorney Generals' suits against the cigarette industry for $206 billion was a landmark outcome. By any standard, the financial stakes were enormous, dwarfing eventhe largest tort liability judgments and punitive damages awards. Moreover, what was especially noteworthy was that the party paying for the costs was the cigarette industry, which to date had been almost unscathed after decades of litigation involving the hazards of smoking... Even more surprising than the enormous amount of the settlement is that any portion is being paid at all to the states. Past research at the national level indicates that cigarettes …

Pain And Suffering: Damages In Search Of A Sounder Rationale, W. Kip Viscusi

Vanderbilt Law School Faculty Publications

This paper will address pain and suffering generally and will not distinguish these different potential components of pain and suffering damages. Section 1 presents the theoretical foundations for damages awards, including both the deterrence and compensation objectives. Section 2 explores some practical rationales for pain and suffering damages, such as the omission of legal fees as a component of damages. Section 3 examines the extent to which pain and suffering awards vary systematically with the extent and nature of the injury as opposed to simply being random acts of capricious juries. Since much of the interest in pain and suffering …

Individual Rationality, Hazard Warnings, And The Foundations Of Tort Law, W. Kip Viscusi

Vanderbilt Law School Faculty Publications

If all people were fully rational and cognizant of all the risks they faced, then they would always select an efficient level of safety in all their activities and other choices. Thus people would trade off the potential benefits of the risky behavior against the costs, including the risks to life and limb, and select the activity and product mix that best promoted their welfare. In such a world, there would not only be no need for hazard warnings, but there also would be no need for liability of any kind. Purchasers of hazardous products, for example, would always value …

Cigarette Warnings: The Perils Of The Cipollone Decision, W. Kip Viscusi

Vanderbilt Law School Faculty Publications

In Cipollone v Liggett Group, Inc., a splintered Court concluded that cigarette smokers who are injured through their consumption of tobacco may bring some state law tort claims against the manufacturers of the cigarettes. Other claims, however, are preempted by federal legislation requiring cigarette packages and advertising to bear warning labels, the specific wording of which is dictated by statute. After a detailed examina- tion of the economics of hazard warning systems, Professor Viscusi argues that the most important economic issues in the Cipollone case were cor- rectly resolved in Justice Stevens'plurality opinion, which contained little overt economic reasoning. The …

Product Liability, Research And Development, And Innovation, W. Kip Viscusi, Michael J. Moore

Vanderbilt Law School Faculty Publications

Product liability ideally should promote efficient levels of product safety, but misdirected liability efforts may depress beneficial innovations. This paper examines these competing effects of liability costs on product R & D intensity and new product introductions by manufacturing firms. At low to moderate levels of expected liability costs, there is a positive effect of liability costs on product innovation. At very high levels of liability costs, the effect is negative. At the sample mean, liability costs increase R & D intensity by 15 percent. The greater linkage of these effects to product R & D rather than process R …

Auctioning Class Action And Derivative Lawsuits: A Critical Analysis, Randall Thomas, Robert G. Hansen

Vanderbilt Law School Faculty Publications

Numerous legal academics and practitioners have criticized the handling by plaintiffs' attorneys of large-scale class action and derivative lawsuits. These critiques point out attorneys' abuse of the legal system, ranging from purported collusion among plaintiffs and defendants.