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Exploring Economic and Democratic Theories of Civil Litigation: Differences Between Individual and Organizational Litigants in the Disposition of Federal Civil Cases


Gillian K. Hadfield


USC Law School and Department of Economics


Stanford Law Review, 2005

Abstract:     
Recent efforts to assess whether or not the trial is vanishing from the civil justice system, have thus far not drawn distinctions between cases in which the market efficiency function of the legal system is in play and those in which democratic and political functions are in play. As Marc Galanter famously set out thirty years ago in his seminal work on why the haves come out ahead and as current studies of the legal profession confirm, however, we should expect that there are significant differences in how corporations, organizations, governments and private individuals fare in our legal system: these different entities bring different resources to bear and they face different repeat versus one-shot incentives. Normatively, the issues at stake in our understanding of what is happening to civil cases and the efforts to craft alternatives to traditional civil litigation require that we differentiate between litigants, between legal functions, and between the different goals of our legal system. It may be that the disappearance of public civil trials to resolve commercial contract disputes is of no consequence; indeed it may be an efficient response to the increasing cost of the public system. The same cannot be said of the disappearance - if it is a real phenomenon - of public adjudication of civil rights or the claims of individuals about the misconduct of public or corporate actors. Private and confidential dispute resolution may be perfectly appropriate and something to be promoted in the resolution of family disputes, whereas it may be inappropriate in the resolution of patent disputes in which two corporations may bargain over the division of monopoly rents or in the resolution of disputes between the state and citizens about how electoral districts are determined. If judicial resources are strained by caseloads, which litigants are flooding in - corporate or individual? And if rationing is required, if an attempt to reduce the number of cases to which judges and courts devote their efforts is required, which cases should be diverted into private dispute resolution and which should be retained for public adjudication?

In this paper I present preliminary data on the differences between individual and organizational litigants in the disposition of federal civil cases. This paper follows on an earlier paper in which I developed a methodology for increasing the value of the database created by the Administrative Office of the US Courts. Here I endeavor to show the differences between individual and organizational litigants in the rate at which cases are abandoned, defaulted, adjudicated without a trial, adjudicated with a trial, or settled. The results show substantial differences in cases based, primarily, on plaintiff rather than defendant type. I find individual plaintiff cases are substantially more likely to be determined by an adjudication - especially a non-trial adjudication - than are organizational plaintiff cases. I also find evidence that organizational plaintiffs - against either individual or organizational defendants - are substantially more likely to settle their cases rather than to have them decided either by trial or non-trial adjudication.

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Date posted: March 25, 2005  

Suggested Citation

Hadfield, Gillian K., Exploring Economic and Democratic Theories of Civil Litigation: Differences Between Individual and Organizational Litigants in the Disposition of Federal Civil Cases. Stanford Law Review, 2005. Available at SSRN: http://ssrn.com/abstract=690384

Contact Information

Gillian K. Hadfield (Contact Author)
USC Law School and Department of Economics ( email )
699 Exposition Boulevard
Los Angeles, CA 90089
United States
213-821-6793 (Phone)
213-740-5502 (Fax)

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