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Abstract:
Scientists and mathematicians in recent years have become intensely interested in the structure of networks. Networks turn out to be crucial to understanding everything from physics and biology, to economics and sociology. This article proposes that the science of networks has important contributions to make to the study of law as well. The network of American case law closely resembles the Web in structure and can be studied using techniques that are now being used to describe many other networks, some found in nature, and others created by human action. Studying the legal network can shed light on how the legal system evolves, and many other questions.

I present in this article the preliminary results of a significant citation study of nearly four million American legal precedents, which was undertaken at my request by the LexisNexis corporation using the Shepard's citation service. This study demonstrates that the American case law network has the overall structure that network theory predicts it would. It is a highly skewed, scale-free, or similar network. The remarkably great degree of skew is significant. Precendential authority is concentrated in a small number of cases. The vast majority of cases are rarely or never cited. In that it consists largely of dead cases, the Web of Law closely resembles scientific paper citation networks, which consist mostly of dead papers.

This article has three parts. First, I introduce some basic concepts of network science, including such important ideas as nodes, links, random graphs, evolving networks, scale-free networks, small worlds, the rich get richer dynamic, node fitness, and clusters. In Part II, I show that both over all and by particular jurisdiction, the Web of Law is a scale-free or similarly highly skewed network. In Part III, I describe some insights that appear from this application and suggest areas for future research.

The Web of Law has a structure very similar to that of other real networks, such as the Web and the network of scientific papers. Indeed, preliminary analysis suggests the citation network of U.S. Supreme Court cases is nearly identical to the network of high-energy physics papers, and is well described by a two-power-law model. The Web of Law is organized with hub cases that have many citations and the vast majority of cases, which have very few. The distribution of citation frequency appears to be well described by a two power-law distribution, very similar to scientific paper citation networks.

Many promising hypotheses can be generated by considering the law as a scale-free network. State and federal systems can be examined empirically to measure how well integrated each is with itself, and with each other, and how this is changing over time. Legal authorities can be measured to determine whether their authority is emerging or declining. Institutional bodies, such as courts, can be examined in the same way. Clusters of cases, which will reveal the semantic topology of law, can be mapped to determine whether traditional legal categories are accurate or require reform. These methods can be used to develop computer programs to improve the efficiency of searching electronic legal databases. Network theory hints at complex, but analyzable, interactions between the legal doctrines of precedent, and the systems of common law and multiple sovereignties. Because law grows and because it has doctrines of authority, it creates a network of a certain shape, which spontaneously organizes itself.

Legal databases, which are huge, precisely documented, and readily accessible, present a perfect opportunity for the application of network science. This research would produce new knowledge of general jurisprudence that has simply been impossible until now, when we have the necessary advances in network science, the fast computers, and the existence of a complete record of the legal network in electronic form, waiting to be explored.

scale-free, network, citations, topology, precedent, authority

Abstract:
This paper argues that a hypothetical contract analysis of fiduciary duty requires a corporate law norm that the total value of financial claims against the firm be maximized. This conclusion follows from using rational investors complying with the CAPM mandate as the parties making the hypothetical contract under which resources are committed to the firm. The analysis shows some inadequacies in the "shareholder value maximization" norm that is assumed in most corporate law literature. The norm of maximizing firm value fits best with an abstract conception of fiduciary duty in which the duty is owed to the corporation, rather than to shareholders or any other particular class of security holders. Adopting this conception dissolves many of the fiduciary duty puzzles posed by derivative securities, such as those stressed by Hu.

Abstract:
This paper argues that a hypothetical contract analysis of fiduciary duty requires a corporate law norm that the total value of financial claims against the firm be maximized. This conclusion follows from using rational investors complying with the CAPM mandate as the parties making the hypothetical contract under which resources are committed to the firm. The analysis shows some inadequacies in the "shareholder value maximization" norm that is assumed in most corporate law literature. The norm of maximizing firm value fits best with an abstract conception of fiduciary duty in which the duty is owed to the corporation, rather than to shareholders or any other particular class of security holders. Adopting this conception dissolves many of the fiduciary duty puzzles posed by derivative securities, such as those stressed by Hu.

Abstract:
In this article, I suggest some new explanations for the ancient rule of equal sharing in partnership law. The equal sharing rule is rooted in the structure of basic bargaining problems. Studying the structure of basic bargaining problems reveals that the equal sharing rule is efficient, in the straightforward sense that the selection of this rule by a legal system will minimize transactions costs under certain weak and plausible assumptions. To make this case requires a brief excursion into the game theory of the division of resources. Using game theory and some simple statistical logic, we can see how an equal sharing default rule might emerge spontaneously even in a world like our own, in which potential partners have different magnitudes of bargaining power, risk aversion, and other traits that influence how bargainers determine shares. This model constitutes the first part of this Article.

The second part of the article explores another possible path to the equal sharing rule in partnership law. Game theorists typically assume that individuals are simply trying to maximize their payoffs in any given game. The difficulties encountered in finding unique equilibrium solutions to bargaining problems with players such as these, however, has led some game theorists to develop evolutionary game theory. The work of evolutionary game theorists suggests another possible path to the equal sharing rule. Individuals might prefer egalitarian arrangements in their simple business associations. This might be so because they have a psychological disposition, programmed by biology or instilled by culture, or both, to do so. The equal sharing rule would be efficient because prospective partners disposed toward egalitarian arrangements would bargain around an inegalitarian default rule more often than they would around an equal sharing rule. This claim is strictly analogous to the familiar observation that risk averse individuals would more often bargain around a rule designed for risk neutral persons, than they would around a rule that took the non-controversial prevalence of risk aversion into account.

Evolutionary game theory provides a stronger theoretical foundation, and evolutionary biology, anthropology, and psychology, more suggestive empirical evidence, for new ways to look at business law problems, than one might initially suppose. I explore some of these themes in the third part of the article. Evolutionary anthropologists, psychologists and others have studied human sharing practices, and while the science on this topic is in its infancy, there is much genuinely interesting work that suggests humans may have an evolved predisposition to prefer egalitarian arrangements in certain settings. It is plausible to speculate that these evolved psychological dispositions underlie the ancient rule of equal sharing in partnership law, and inform other important aspects of business law as well.

Abstract:
This study examines determinants of cohesion in the Supreme Court's reliance on precedent in the network of U.S. Supreme Court precedents. We use a database of all Supreme Court Citations and test several measures of annualized Court action as independent variables in a regression on several measures of network cohesion. We find that the magnitude of ideological decisionmaking is consistently associated with a reduction in network cohesion, suggesting that there is indeed a conflict between legal application of precedent and ideological decisions. This effect was roughly the same, though, regardless of whether the Court was conservative or liberal. We also find significant independent effects for Chief Justice eras, with the Burger Court associated with greater cohesion and the Rehnquist Court associated with lessened cohesion.

precedent, network analysis

Abstract:
This paper analyzes the effect of the Rehnquist Court on Supreme Court precedent, using a network of all Court citations to other Supreme Court cases. Network analysis enables a study of the Court's use of precedent that may not be readily visible. We find that the Rehnquist Court has made a dramatic alteration in the network of precedent and, in the process, set the stage for a potentially revolutionary change in the makeup of the law.

Abstract:
The line-item veto and the signing statement have received much attention in recent years as a means of controlling federal spending. The reasoning is that if the president has this power he could reject individual lines of spending in large appropriations bills, just as Jefferson Davis was permitted to do under the constitution of the Confederacy. But the campaign to create a line-item veto for the president, either by statute or by constitutional amendment, has been about as successful as the Confederacy itself. Repeatedly since the Civil War, American presidents have asked for this power; it has never been granted. The last attempt was made by President Bush in 1990.

The line-item-veto debate is exhausted. A more profitable line of inquiry is to examine other less sweeping, but more constitutionally sound, means of achieving the results of a line-item veto. Three - the subject veto, constitutional excision, and the presidential-shield veto - offer more promise than the line-item veto for a president seeking greater participation in the making of our laws.

In a largely unnoticed but certainly consequential move, President Bush has repeatedly claimed power of constitutional excision. His bold action will no doubt precipitate a test case, an opportunity for us to rethink the Framers' intended scope of the veto power.

Veto, Line-item veto, Presidential Powers

Abstract:
In 1987, an intriguing legal memorandum arrived over the transom at the White House. Sent by New York City securities lawyer Stephen Glazier, it argued that President Reagan did not need a statute or constitutional amendment to exercise a line-item veto because the Constitution inherently confers such power on the President. Far from embracing this novel theory, lawyers in the Reagan and Bush Administrations attacked it, and in 1992, President Bush publicly renounced it. In previous writings we have examined in detail the legal arguments for and against the existence of an "inherent" line-item veto in the Constitution. In Part I of this Essay, we recount the chronology of the debate over the line-item veto from its beginnings in 1987, to its conclusion in 1992. In Part II, we briefly summarize our prior legal analysis because it is critical to assessing the credibility of the frequent claim, implicitly embraced by the Bush Administration, that the theory of the inherent line-item veto is constitutionally baseless. Similarly, we briefly explain why there might exist a broader presidential power to unbundled, and separately veto, non-germane parts of an omnibus piece of legislation. If, as we have previously argued, the legal theory of the inherent line-item veto cannot be dismissed out of hand, then why, we ask in Part III, did two Republican administrations, ostensibly committed to controlling federal spending, denounce the theory so vigorously?

Abstract:
At Sen. Edward Kennedy's request, constitutional scholars Laurence Tribe of Harvard and Philip Kurland of the University of Chicago considered the following question: In the absence of a constitutional amendment, does the President have the authority to use a line-item' veto to kill portions of a bill passed by Congress, while signing the remainder of the legislation into law? The Senator inserted into the Congressional Record their response to his query, in which Tribe and Kurland concluded that any attempt to exercise such a 'line-item veto' would clearly be unconstitutional.

On this conclusion, Sen. Kennedy emphasized, two highly respected authorities--who have broadly differing views on many matters of constitutional interpretation--agree unequivocally. Only conservative extremists', the Senator said, would continue to advocate that President Bush test the constitutionality of a line-item veto. Predictably, the newspaper headline the following day announced: Line-Item Veto Unconstitutional, Legal Scholars Say.

Despite its pedigree, the Tribe-Kurland response to Sen. Kennedy's question contains little real analysis of the Constitution or its history. Although it is quite possible that the President does not have the inherent power under the Constitution to wield a line-item veto, the issue is far more subtle and ambiguous than Tribe and Kurland admit. In particular, Tribe and Kurland do not define what they mean by an item veto or what constitutes a bill' for purposes of presentment to the President. Nonetheless, their ultimate conclusion is not one with which political conservatives necessarily would disagree. Indeed, two noted conservative lawyers who served in the Department of Justice under President Reagan--Bruce Fein and William Bradford Reynolds-- have asserted that there is no defensible argument that an item veto exists implicitly in the Constitution. This appears to be the same conclusion that Assistant Attorney General Charles Cooper reached and gave to President Reagan in an Office of Legal Counsel memorandum not yet publicly available.

This skepticism notwithstanding, it is hardly insulting the Constitution, as Sen. Kennedy asserted, to probe the question of whether the President has an as yet unexercised veto power. Although a number of lower federal courts have stated in dicta that the President has no item veto, the Supreme Court obviously has never addressed the question. It is not surprising, therefore, that reasonable minds differ on this constitutional question--as they do on abortion, the War Powers Resolution, affirmative action, the death penalty, and many other constitutional issues. Indeed, as we discuss below, on November 3, 1989, President Bush asserted a kind of item veto and, on November 20, 1989, Rep. Tom Campbell and five other members of Congress introduced a resolution urging the President to execute a line-item veto expressly for the purpose of testing its constitutionality. Sen. Robert Dole, the Senate Minority Leader, had already publicly urged the President to do so in January 1989. A prominent constitutional scholar, Ronald Rotunda, has also raised this suggestion. And President Bush himself has stated to the press that he would like to create a test case on the item veto.

President Bush, Sen. Dole, Rep. Campbell, and constitutional scholars other than Professors Tribe and Kurland are not indulging in conservative extremism or constitutional churlishness. What steps the Constitution permits the President to take to protect perhaps his most important formal power--the veto--from the measures that Congress has taken to weaken it is one of the most pressing questions anyone who cares about the separation of powers must face. Whether the item veto is constitutional or not, it challenges our understanding of the separation of powers and of the significance of the original meaning of the Constitution in defining the roles of Congress and the President in the lawmaking process.

In Part I of this Article, we discuss the ambiguity that surrounds the veto power because of the words that the framers used, and failed to use, in drafting the Constitution. In Part II, we show that the item veto can take at least four different forms. These forms differ in the degree to which one can plausibly argue that the President already possesses them. Part III identifies and analyzes several intriguing constitutional puzzles posed by the item veto. Part IV approaches the item veto from a different direction by asking what the word bill means for purposes of the veto power.