The Supreme Court and Private Law: The Vanishing Importance for Securities and Antitrust

Abstract:     
This article looks at the Supreme Court's output in two areas of private law, securities and antitrust. The data reveals remarkably similar patterns in the two focus areas. An expansive period of cases favoring plaintiffs' rights through 1972 abruptly gave way to a stark pro-defendant period after Justices Powell and Rehnquist joined the Court on the same day. Yet the pattern did not continue through the entire twenty-five year period during which Republican presidents made ten consecutive appointments to the Court. Instead, since the mid 1980s, the Court's decisions in each area have been about evenly split and the number of cases has dropped dramatically.

After presenting the empirical findings, the article explores what theories might explain both of the shifts. An attitudinal model focused on the preferences of individual justices could explain the first shift, but a richer theory is necessary for the entire period. An alternative explanation focuses on an entrepreneurial justice, in these two areas it was Lewis Powell. The article also presents regressions analysis and a discussion of the differing economic schools of Justices Powell and Rehnquist that help explain the results.

Number of Pages in PDF File: 78

Keywords: Securities, Antitrust, Supreme Court

JEL Classification: K21, K22, K23, K41

Accepted Paper Series