The Common Law as a Bottom-Up System

Over at Cato’s blog, I follow up on my Monday post on the Google Book Search deal. If you’ll forgive me for quoting myself, my bottom-line point is that the class action mechanism is the wrong way to deal with the many issues addressed in the settlement:

The judicial process works well precisely because it typically makes decisions on a case-by-case basis, fitting the circumstances of each case to an evolving body of precedent. This incremental approach tends to produce a body of law that adapts well to changing circumstances while giving all affected parties the opportunity to have their interests represented. Because different cases are heard by different judges, the mistakes of any one judge won’t unduly influence the direction of the law’s evolution. The class mechanism tends to undermine these beneficial properties of our legal system. Rather than many cases being decided by many judges over a period of years, a class action lawsuit asks a single judge to render justice for thousands of plaintiffs whose individual interests can’t possibly all be represented by the attorneys presenting arguments to the judge. Especially when the proposed class is as large and heterogeneous as the plaintiffs in the Google Book Search case, the class action mechanism demands that the judge to balance the competing interests of thousands of different parties, many of whom have divergent interests. No single person could possibly weigh all the competing arguments in a systematic fashion.

A few years ago I wrote a paper for Cato opposing the DMCA’s anti-circumvention provisions. One of my key arguments was that the courts had done a good job of adapting copyright’s fair use doctrine to rapid technological change, and that Congress’s track record was much less laudable. In a series of important cases, the courts upheld the legality of the VCR, reverse-engineering for interoperability, the MP3 player, and image thumbnails for search engines, while simultaneously (and correctly, in my view) ruling against peer-to-peer services that were simply profiting from the infringing activities of their users. Congress’s track record hasn’t been too hot, as the pair of atrocious bills enacted in 1998 attests.

gavelThe difference, I think, is that the courts create law using the incrementalist, precedent-based process we call the common law. Obviously, courts have to rule consistent with existing statute when applicable, but when the relevant statute is vague or silent, then judges have to fill in the gaps with their own judgments. Like any bottom-up system, judge-made law evolves incrementally. Judges are expected to stick as much as possible to applying existing caselaw to the facts in front of them. If the facts are different from those addressed in earlier cases, then the judge extends the principles of earlier rulings to the new cases. This ensures that caselaw remains firmly grounded in reality, because a change in doctrine typically only occurs in response to a change in the “facts on the ground.”

Like any bottom-up system, the common law process also makes use of competition. When social or technological changes force judges to confront questions that have not been previously considered by the courts, judges may not always see eye to eye on the best way to accommodate the law to the new circumstances. In these circumstances, the first few judges to rule in an area may push the law in different directions. Subsequent judges then exercise a kind of peer-review, choosing the past precedents they feel best fit the facts in front of them. Over the course of many cases, individual cases tend to coalesce into a nuanced and cohesive body of law.

This process of judicial competition and peer review is especially important to the Supreme Court, which can’t possibly review every decision by a lower court. One of the things the high court looks for is “circuit splits”—cases where two different appeals courts have developed conflicting bodies of case law. These are good cases for the Supreme Court to take both because it’s important that the law be consistent across the country, and because it saves the Supreme Court work: it can pick and choose between the competing approaches, rather than having to fashion a new doctrine from scratch. I’ve argued that one of the problems with patent law is that Congress foolishly consolidated jurisdiction over patent appeals into a single appeals court. Without competition among circuits, it has been more difficult for the Supreme Court to oversee the Federal Circuit’s work.

The problem with the class action mechanism is that it eschews this kind of incremental, decentralized decision-making in favor of a kind of judicial central planning. Rather than trying to resolve a dispute between a single plaintiff (or at least a manageable number of them), and a single defendant, the judge is now being asked to make decisions about plaintiffs whose interests may be totally unknown to the judge. This undermines a key virtue of the judiciary: its ability to gradually adapt the law to changing circumstances. And it introduces a single point of failure: if the judge screws up, it’s going to be much more difficult to undo the damage.

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