Advancing Intelligence and Global Society: International Law’s Role in Governing the Advance of Artificial Intelligence

Download a copy of this Note:

---

Lesley Nash[I] 

Introduction

Advancing technology changes the fabric of global society, from electricity to the rise of social media, yet law has always struggled to keep pace with such technological advances,[2] and this problem has accelerated with the increased pace of technological change in the twentieth and twenty-first centuries.[3] Although modern society is faced with a multitude of issues springing from new technologies, law and governance structures have lagged[4] while the technologies themselves have advanced.[5] This discrepancy between technology and law is particularly glaring in the artificial intelligence (“AI”) field. Though the solution to creating “true” artificial general intelligence is still elusive,[6] “weak” forms of the technology are altering the fabric of society, from social media[7] to the orchestration of war.[8] These technological advances remake everyday existence, yet global regulatory functions are not sufficiently robust to oversee these changes.

The fact that international law has not yet exhibited meaningful regulatory control over artificial intelligence technology does not mean that itcannot. International law offers a structure of governance over issues that are too broad for unilateral state regulation, or that implicate international interests.[9] Although international law has often been denigrated as weak,[10] it has great potential to offer solutions for global problems that are too large for states to tackle alone. This note seeks to unveil the benefits of using international law to approach the problems and potential of AI as well as suggest a possible method of doing so that can increase regulation and aid in the development and advancement of safe AI technology.

Part I will provide a succinct overview of the current state of artificial intelligence, including the various types of autonomous states of technologies. Section A will include a discussion of the definitions of relevant technologies as well as their modern uses. Section B will touch briefly on several examples of the legal and regulatory issues that have arisen from this technological paradigm. Section A of Part II will discuss the current state of international legal and regulatory structures, while Section B will consider how international law might provide regulation and oversight of this advancing technological sector. Section C of Part II will examine several national and international policies regulating artificial intelligence and what lessons can be drawn from existing structures. Section A of Part III will then draw from institutions and structures offered in Part II, Section B, as well as best practices considered in Section C. Here, I will argue that international law offers the best path forward to functional oversight, regulation, and promotion of advancing AI technologies, and will propose a framework for such an international regulatory structure. Section B of Part III will briefly answer questions related to why international law is not already in use. Finally, Part IV will conclude with a few remarks about both the potential and danger inherent in advancing AI technology and reiterate the call for international regulation and oversight.

I.  Artificial Intelligence in the Modern World

A.  Understanding Artificial Intelligence: Definitions and Current State of Technology

AI is ubiquitous in popular culture,[11] but the reality of the technology is much different than popular imaginings. AI can be divided into two general categories: “weak” or “specific” AI and “strong” or “general” AI.[12] “Weak” or “specific” AI is an application or system with a specific function, in which the AI often “outperform[s] even the most expert humans.”[13] “Strong” or “general” AI (often referred to as artificial general intelligence, or AGI), on the other hand, is more akin to the AI of pop culture, where the program or system is not merely “specifically” gifted but rather achieves “human-level” performance across a spectrum of individual challenges that would allow the AI to “think.”[14] Though AGI is not yet realized, researchers have made progress on several fronts related to general intelligence, including visual analysis, object recognition, and behavioral interactions.[15] Specific intelligences, on the other hand, are common, operating as systems that are designed to follow a “special-purpose algorithm,” which may render the program an expert search engine[16] or chess player,[17] but incapable of harnessing human ‘common sense.’

A discussion of AI necessitates one of automation. Paul Scharre notes three degrees of autonomy that are helpful when discussing AI.[18] First, semiautonomous operations are those in which “the machine performs a task and then waits for a human user to take an action before continuing;”[19] or “human in the loop” processes.[20] Second, there are supervised autonomous operations in which, once in operation, “the machine can sense, decide, and act on its own, but a human observer can . . . intervene;” or “human on the loop” processes.[21] Finally, there are fully autonomous operations, in which “systems sense, decide, and act entirely without human intervention;” or “human out of the loop” processes.[22] Programs often move among these types of processes when completing a task and they can be conceived of as a continuum: as programs grow more sophisticated, they require less human intervention and oversight to complete tasks.[23]

There is also a difference between automatic, automated, and autonomous intelligence in machines. Automatic programs are simple, highly predictable, and display no decision-making qualities.[24] Automated programs are more complex, rule-based systems that may consider a range of variables before acting.[25] Autonomous programs are sophisticated, goal-oriented, and may be considerably less predictable in their processes.[26] Like process levels, intelligence levels operate on a spectrum, with intelligence growing as a program moves down the continuum from automatic to autonomous.[27] Autonomous programs do not “think;” if their processes are opaque it is because there is not a simple connection between input and output as there is in an automatic program; rather, autonomous, “goal-oriented” systems assimilate a wide variety of input and produce an output through a process that may be unintelligible to human observers.[28]

B.  AI Interactions with the Modern World: Influence, Benefits, and Dangers

Understanding AI as more than the humanoid robot or omnipotent mastermind enables a deeper understanding of the ways in which AI technology already interacts with and influences global society, as well as of the reasons why greater regulation and oversight is beneficial. AI operates across a multitude of sectors, influencing fields from social media to the global economy and everything in between. The following examples highlight the benefits and the dangers of continually advancing, and often under- or unregulated artificial intelligence technologies.

The first example occurred on May 6, 2010, when the Dow Jones industrial average careened wildly, losing nearly ten percent of its value in just under fifteen minutes and then, within a half hour, rebounded it its prior level.[29] Following investigations into what became known as the “Flash Crash,” it became clear that the crisis, which was described by traders as “horrifying,”[30] had been set off by a single trading algorithm programmed to sell off a specific type of contract.[31] These contracts were in turn purchased by specifically programmed purchasing algorithms; the competing algorithms entered into a fast-paced trading race, in which the pace of trade triggered other algorithms to offload their contracts as well, interpreting the fast pace of trading as high liquidity.[32] Although stability was soon restored, at the peak of the crisis, “a trillion dollars had been wiped off the market” and investors around the world were shaken.[33]

The Flash Crash was not the result of a rogue algorithm or of a weak AI breaking away from programming. It was an example of a weak AI following its programming to the letter in spite of the catastrophic effects of doing so. The Flash Crash was caused by human programmers’ failure to understand the effects of their algorithm following its directive to its logical conclusion.[34] While the use of algorithmic programming granted benefits in the form of higher trade volume, the potential danger of unforeseen programming consequences clearly played out.

Another illustrative example is the infamous case of Stuxnet malware, which was created to compromise the Siemens machines controlling centrifuges in Iran’s Natanz nuclear facility.[35] Though the facility did not suffer catastrophic damage from Stuxnet, the attacks did reduce the lifetime of the centrifuges, as well as undermining confidence in the security of the Iranian facility.[36] In addition to these long-term deleterious effects of the program, Stuxnet also ushered in a new era of cyber warfare, hailed as the world’s “first military grade cyber weapon.”[37]

Stuxnet heralded a sea change in malware; the virus was not contained in the Natanz facility but spread globally, likely transferred by laptops or USB drives infected with the virus.[38] Though Stuxnet was designed to attack a specific make of Siemens controller, its presence on the internet affords hackers and programmers with access to the virus’ blueprints an opportunity to dismantle, alter, and learn from the way Stuxnet operates.[39] Concern over such cyberattacks has only increased since this first major international incident occurred.[40]

These cases point to a sector of technology and innovation that is advancing—or, perhaps, has advanced—past the point of legal and regulatory control.[41] This note offers these instances as examples of just a few of the diverse situations in which advancing AI and automation technology would benefit from a system of oversight and regulation.

II.  International Law: Promises, Failings, and Potential 

A.  Why International Law?

The rise and increased visibility of the modern international legal system developed in the post-World War II and Cold War eras.[42] International law is “the legal order … meant to structure the interaction between entities participating in and shaping international relations.”[43] Some scholars have argued that international law is not “law,” per se[44] given its lack of authority and enforcement structures,[45] but others have noted that “almost all nations observe almost all principles of international law … almost all of the time.”[46] International law can help preserve peace and security, manage interstate social and economic disputes, and protect the interests of the international community as a whole.[47]

AI is a problem—like the global arms race or climate change—that implicates all of global society.[48] Whether operating in financial markets, conflict situations, or social media and data-gathering, advancing AI crosses and will continue to cross national boundaries; as Erdélyi and Goldsmith suggest, purely national responses to this rising challenge may conflict and create more problems than they solve.[49] Furthermore, isolated national or corporate attempts to solve the emerging research and regulatory problems created by AI may be hasty, ignoring investments in safety to be first to reach a benchmark in machine intelligence.[50] Advancing AI creates an opportunity for international law to step into a gap that national law is not sufficient to fill.

The problem arises from the fact that international law is not law in the traditional sense of national law in which the sovereign creates the system of laws by which its citizens abide.[51] In the international legal systems, the states engaging in the system are themselves sovereign.[52] The pertinent questions then become: In what circumstances do states comply with international law and international obligations, and how can this general compliance be used to create an international structure of governance and oversight for advancing AI technology

B.  Under What Circumstance Do States Adhere to International Law? 

Academics and international law practitioners have long questioned why states seem to mostly follow international law. This law, which is composed not only of the formal treaties between states but also of more the general principles of customary international law,[53] has been able to function more or less effectively for centuries, despite its lack of total enforcement power over sovereign states. Though the debates behind why states recognize international law are intense and ongoing,[54] of more particular interest to this examination are the following questions: Under what circumstances do states follow international law, and how can this knowledge be applied to the creation of an international governance structure for advancing AI?

Despite arguments that states are not obligated to follow international law,[55] there are more instances of states complying with international laws than not.[56] The commonality in many of these instances may be, rather than some sense of morality or complicated philosophical principle, the less benign and more realist idea of state self-interest.[57] States, though they regularly come together to work toward some common purpose, are individual actors that must shape their own policy considerations towards international issues.[58] The goal for international law is to provide regimes that states can follow that achieve international legal goals while also providing an appealing choice to state self-interest. Such a choice to follow international law can be seen in the disarmament treaties and in international cooperation on nuclear technology that began in the 1950s, and many of these arrangements continue to have a high level of state adherence today.[59]

As previously noted, international law is most useful in circumstances in which one state alone is not capable of managing a problem, or when the interests of the international community as a whole are implicated.[60] Although adherence is not perfect, existential world crises have seen a majority of involved states come to the table and negotiate an international solution through the auspices of international law.[61] Where advancing AI technology does not neatly align with existing international norms, it is necessary to create new structures of governance;[62] which, like those governing arms proliferation, nuclear weapons, and climate change, advance an international policy goal and offer states benefits they would not be able to gain on their own. Jana von Stein notes that this type of mechanism, combining “the proverbial carrots and sticks; technical and financial assistance; [and] tying good behavior to a particular identity” can be quite effective in holding states to compliance with international law and institutions.[63] This research encourages a self-interested view of state compliance, one in which any new international law regime will need to offer states an incentive to comply with its norms.[64]

Examples from other crises clearly show that the mere existence of an existential threat to international society is not necessarily enough to compel full compliance with international law and norms.[65] It is therefore necessary to make compliance with any international regulatory scheme more attractive to states. Increasing the benefits of compliance can be done in two parallel ways. First, create a system where compliance itself is valuable for states’ reputations.[66] Where states are seen as upholding their international obligations and complying with international laws and norms, other states may be more willing to enter into future agreements, grant more generous concessions in future negotiations, or cooperate on economic and regulatory projects.[67]

Second, benefits to a state’s self-interest arise when compliance with international law grants the state some type of tangible gain. For example, although membership in the World Trade Organization (WTO) requires some concessions, member states are also able to access preferential trading with partners.[68] Creating a regulatory system that engenders state adherence around AI policy must keep three goals in mind: (1) provide a solution to a problem implicating the interests of the international community; (2) create a structure in which adherence to international norms creates a virtuous compliance cycle; and (3) incentivize states to comply with the governance structure’s policies through tangible gains given to member states.

C.  Regulatory Efforts, Recommendations, and Their Messages

Despite the lack of an overarching regulatory structure, there have been various state, multi-national, and non-governmental attempts to introduce coherence and regulatory oversight to AI research and use. NGOs, expert agencies, and even the United Nations have urged greater oversight of AI advances, while several states have also released plans for the advancement of AI technology. Multiple NGOs and other non-state actors have spoken out in favor of increasing regulation and oversight of AI research and use. Some include calls for increased regulation, while others offer paths forward or designs to emulate.[69] These are not merely specialist organizations, but rather some of the most well-known and integrated NGOs: in 2015, the United Nations Interregional Crime and Justice Research Institute (UNICRI) launched its Centre for Artificial Intelligence and Robotics, which was created to “educate and inform stakeholders . . . [and] progress discussion on robotics and artificial intelligence governance.”[70]

Law and AI experts have called for international regulation and oversight of AI technology and use. One highly relevant proposal is creation of a new international organization to encourage policy discussion and eventual regulation of AI-related matters, which, though beginning as a voluntary advising body, could gain enforcement and oversight powers.[71] One such body, the Center for the Governance of AI, is active at the international level, speaking to non-governmental research groups as well as national governments about the possible dangers and benefits of AI, as well as of policy paths forward to minimize the risks and establish a structure of development and governance for AI technology.[72]

Much has also been proposed regarding the regulation of autonomous weapons; sensible, given their immense potential harm the increasing use of semi-autonomous[73] and autonomous weapons[74] in the field. In 2012, the Campaign to Stop Killer Robots was founded.[75] This campaign, organized to stop the use of fully autonomous lethal weapons and maintain human control over the use of force, is supported by nearly 120 national, regional, and international NGOs.[76] Others have called for a more “vibrant, measured, and mature discussion of the relevant legal issues,”[77]arguing that the law of armed conflict will be shaped by the use of such autonomous weapons[78] and that a ban of such systems would ignore the military practicalities and political complexities that are already tied into states developing autonomous weapons systems.[79]

Several national and supranational actors have also made steps forward in AI regulation and oversight. In June 2018, the European Union (“EU”) named 52 experts to its High Level Expert Group on Artificial Intelligence, which aims to produce policy recommendations on social, political, economic, and ethical issues related to AI, as well as balance economic competitiveness concerns tied to transparency, data-protection, and fairness.[80] In December 2018, the group published its draft AI Ethics Guidelines, which aims to “maximize the benefits of AI while minimising its risks” by “ensuring an ‘ethical purpose’ . . . and [being] technically robust.”[81]

Over twenty-five states have announced their AI strategies or have published plans for future strategies, including the US, Russia, China, and India.[82] Many plans focus on maintaining a competitive edge in the emerging AI market, although several also consider the ethical and safety elements of advancing AI.[83] One strategy notable in its attention to safe progress is the US Department of Defense’s (DoD) attitude towards the development of autonomous weapons systems, which might be extrapolated to encompass advanced AI research.[84]

The DoD’s Directive 3000.09 (“Autonomy in Weapons Systems”) creates three classes of weapons systems that are given a “green light” for development and use.[85] For proposed systems that would use autonomy or intelligence outside of these categories, the system issues a “yellow light,” requiring review before any further development of the technology, and then a second review before field use of the system.[86] Although this policy is created specifically for autonomous and intelligent weapons systems, its stated goal of “[minimizing] the probability and consequences of failures in autonomous [systems]”[87] is one that can easily be transferred to AI, creating a system of checks and review that would allow greater investment in safety in and control over the advancement of AI.[88]

Although none of these proposals are truly international in scope, many of them offer strong elements that could be incorporated into an international regulatory regime, including the American policy discussed above,[89] or the Centre for the Governance of AI’s proposed research and development guidelines.[90] Drawing from best practices of states and NGOs would be beneficial to the proposed regulatory body, and would allow it to begin with a strong foundation.

III.  Global Governance of AI: Oversight, Regulation, and Promotion 

A.  The Regulatory Promise and Potential of International Law

International law has most relevance where national law is not sufficient to protect the interests of global society; the advancement of AI presents an opportunity for greater robustness of international regulatory structures.[91] The growth of AI technology calls for a response from international society. International law and institutions, calling upon both states’ tendencies to comply with international law when doing so is seen as virtuous[92] and upon states’ individual self-interest, may be able to create a regulatory regime that is attractive enough to compel adherence from a majority of state players.[93] Such a regime would not seek to halt research on and development of AI, but to pursue such research and development safely and intentionally.[94]

The most traditional method of international cooperation is, as recommended in multiple other publications,[95] the creation of an international treaty. This proposal offers a more incentivized approach: the creation of an international body of collaborating scientists, researchers, and experts in the field— both civilian and governmental— whose research and collaborative efforts are available only to parties to the treaty. A similar body has been used in response to a broad range of “global catastrophic risks” or “existential risks,”[96] proposing a regulatory body controlled by a group of experts to govern member states of previously created treaties.[97] This body of experts should include experts from civil society as well as government representatives, to promote transparency in regulation and oversight.[98] Leveraging the potential international pitfalls of unregulated AI, the treaty body could create a regime in which a state’s refusal to sign and ratify the new AI treaty and become part of the regulatory institution is seen as damaging to its reputation.[99] Encouraging consideration of the “global catastrophic risks” that might occur should state refuse to comply could also be a motivator.

The combination of these recommendations is the creation of a new international treaty body, overseen by the United Nations (possibly drawing from UNICRI, which already has subject-matter expertise on AI)[100] paired with an expert body or advisory panel serving the members of the new treaty. While the proposed treaty would provide general guidelines for member states on research and development of advancing AI, the expert body could provide case-by-case recommendations on new research and controversial development proposals. The body could also develop best practices and contribute to important advances through collaborative research.[101] Ideally, the panel would also represent the cutting edge of AI research and development, with ideas shared freely among the body’s members.

While states may be less immediately open to joining, many AI experts have already expressed concern about the direction and speed of research, calling for guidance and even delay of certain strands of AI research as well as for more focus on developing AI safely and ethically[102] and would likely be open to joining a body of this sort. One way to make this body more attractive is to encourage the membership and active participation of expert groups such as the American Association for AI and the Machine Intelligence Research Institute (“MIRI”)[103] and individual experts such as Max Tegmark[104] and Nick Bostrom,[105] all of whom have expressed concerns.[106] Participation by these experts in the proposed panel could further incentivize states to join, in order to gain access to their research and collaborative technological development.

States are more likely to adhere to international law when doing so promotes some international interest and offers incentives to states’ self-interest. By offering an answer to the international challenges posed by the expansion of AI across all sectors, including financial, social, and military, the proposed treaty and body of experts would protect the interests of the international community. Further, by providing access to an international, collaborative body of experts that not only provides best practices recommendations and oversights but also to shared information, pooled resources, and joint research, the recommended treaty would offer states and other organizations tangible incentives to both join and adhere to the proposed convention.

A treaty and expert regulatory body could also help control AI advances in the future. While this discussion has focused mainly on weak AI, autonomy, and the possibility of creating AGI in the near to middle-term future, many experts are more concerned about the advances that might follow; namely, superintelligence,[107] which is “any intellect that greatly exceeds the cognitive performance of humans in virtually all domains of interest.”[108] Creating a regulatory body in the present will ensure there are safeguards in place in the event that AI technology reaches such heights, possibly preventing the disastrous consequences that might result.[109] These technological advances have not yet arrived, but they are on the horizon,[110] and establishing an international oversight body early on could prevent more wicked challenges down the road. 

B.  If International Law Is the Answer, Why Is It Not Currently in Use?

 If the potential gains from the international regulation and cooperation on advancing AI are so immense, why hasn’t an international solution yet been accepted? There are two arguments, the first of which is principled and second of which is more pragmatic. First, international law lacks the capacity to properly regulate and oversee a field as rapidly advancing as AI.[111] Second, many powerful states are simply disinterested in international regulation and oversight of advancing AI technology.[112]

First, some scholars argue that international law cannot create binding legal requirements.[113] Without an overarching authority or enforcement mechanism, international law would lack the ability to enforce any new AI regime it attempted to impose, and thus would not be the preferred method of regulation. This argument can be answered by considering that international law, though lacking traditional enforcement power, does have other means, such as international interest, incentives to states, and reputational value to encourage compliance.[114]

Second, international regulation might not be in the best interest of all states. AI is a “dual-use” technology,[115] and though few are opposed to the advancement of peaceful uses of AI,[116] there has been opposition to advancing military uses.[117] Many states, however, have already invested heavily in AI’s military potential[118] and prefer a regime governed by national regulation. This “race dynamic,” where actors refuse to cooperate out of fear that they will not achieve a new technology first,[119] emerges in recent research on public feelings about AI: in a January 2019 poll, more American respondents answered that they believed advancing AI could do more harm than good, yet there was uncertainty as to who, if anyone, should control that advancement.[120] There is a related concern that if other states are developing unsavory advances for AI, your state should as well,[121] regardless of any regulatory structure.[122]

This second set of arguments, however, merely repeats several underlying reasons for regulating AI in the first place, and can be answered by the promise inherent in an international regulatory structure that, through a series of incentives and reputational elements,[123] can gain a level of adherence high enough to undermine bad actors. Despite its flaws, international law still offers the best opportunity for true oversight and guidance of advancing AI.

IV.  Conclusion

At the conclusion of his book Superintelligence, Nick Bostrom writes:

Before the prospect of an intelligence explosion, we humans are like small children playing with a bomb. Such is the mismatch between the power of our plaything and the immaturity of our conduct… A sensible thing to do would be to put it down gently, quickly back out of the room, and contact the nearest adult. Yet . . . some little idiot is bound to press the ignite button just to see what happens. Nor can we attain safety by running away . . . nor is there a grownup in sight.[124]

 Human society has held the nuclear bomb in its hands for well over fifty years,[125] and this new bomb is no different. Although there are dangers, we are equipped to handle them, provided regulatory oversight is imposed now rather than after the ignite button has been pressed. International governance offers an answer to the looming promises and pitfalls of advancing AI. The proposed regime could provide guidance and safety while also promoting a collaborative spirit that could see AI technology advance slightly more swiftly and much more safely.[126] An international body focused on safe development and use of AI would promote international welfare, search out solutions that work best, not first,[127] and ensure that global society benefits from the promise of AI rather than suffers from the dangers.

___________________________________________________

[I] J.D. expected 2020, University of Kentucky College of Law; M.A. 2017, University of Kentucky Patterson School of Diplomacy.

[2] See, e.g., Olmstead v. United States, 277 U.S. 438 (1928), overruled by Katz v. United States, 389 U.S. 347 (1967), and Berger v. New York, 388 U.S. 41 (1967) (holding that warrantless wiretapping by law enforcement did not violate the fourth or fifth amendment); Katz v. United States, 389 U.S. 347 (1967) (tracing the evolution of Fourth Amendment protections against “unreasonable searches and seizures” as they relate to electronic wiretaps), discussed by Nicandro Iannacci, Katz v. United States: The Fourth Amendment adopts to new technology, Nat’l. Const. Ctr. (Dec. 18, 2018), https://constitutioncenter.org/blog/katz-v-united-states-the-fourth-amendment-adapts-to-new-technology [https://perma.cc/7VKB-5H3Y].

[3] Vivek Wadhwa, Laws and Ethics Can’t Keep Pace with Technology, MIT Tech. Rev. (Apr. 15, 2014), https://www.technologyreview.com/s/526401/laws-and-ethics-cant-keep-pace-with-technology/ [https://perma.cc/K9Q5-NHRF] (“These regulatory gaps exist because laws have not kept up with advances in technology. The gaps are getting wider as technology advances…”).

[4] Id. (“We haven’t come to grips with what is ethical, let alone what the laws should in be in relation to [such] technologies . . . ”).

[5] Id. (“Today, technology is on an exponential curve… changes of a magnitude that once took centuries now happen in decades, sometimes in years.”).

[6] Margaret A. Boden, Artificial Intelligence: A Very Short Introduction 19 (2018).

[7] John Ellett, New AI-Based Tools Are Transforming Social Media Marketing, Forbes (July 27, 2017, 6:00 AM), https://www.forbes.com/sites/johnellett/2017/07/27/new-ai-based-tools-are-transforming-social-media-marketing/#162c713369a2 [https://perma.cc/43FL-97MH]. 

[8] See Paul Scharre, Army of None: Autonomous Weapons and the Future of War 45 (2018) (“At least thirty nations currently employ supervised autonomous weapons systems of various types to defend ships, vehicles, and bases from attack.”).

[9] Rüdiger Wolfram, International Law, Max Planck Encyclopedia of Pub. Int’l. L. ¶16 (last updated Nov. 2006), http://opil.ouplaw.com/view/10.1093/law:epil/9780199231690/law-9780199231690-e1424 [https://perma.cc/4ZWN-LLMA].

[10] See, e.g., John Bolton, Is There Really Law in International Affairs, 10 Transnat’l L. & Contemp. Probs. 1, 28–30 (2000). 

[11] See, e.g., Michael Hogan & Greg Whitmore, The top 20 artificial intelligence films- in pictures, The Guardian (Jan. 8, 2015, 7:29 AM), https://www.theguardian.com/culture/gallery/2015/jan/08/the-top-20-artificial-intelligence-films-in-pictures [https://perma.cc/E74F-3TH5].

[12] Kathleen Walch, Rethinking Weak vs String AI, Forbes (Oct. 4, 2019, 6:30 AM), https://www.forbes.com/sites/cognitiveworld/2019/10/04/rethinking-weak-vs-strong-ai/#7da76f676da3 [https://perma.cc/B7YL-YCHK].

[13] Boden, supra note 6, at 18.

[14] See id. at 18–19; see Nick Bostrom, Superintelligence: Paths, Dangers, Strategies 16 (2014) (discussing the role of data mining in the global financial market).

[15] Id. at 14–16.

[16] Id. at 16 (noting “the demarcation between artificial intelligence and software in general is not sharp… this brings us back to McCarthy’s dictum that when something works it is no longer called AI”).

[17] Id. at 12–14. Deep Blue, a chess-playing AI, made news in 1997 when it beat Garry Kasparov, the world chess champion. Unlike Gary Kasparov, however, Deep Blue could not carry that intelligence to other areas, a clear example of a narrow or specific AI.

[18] Scharre, supra note 8, at 28.

[19] Id. at 29.

[20] Id.

[21] Id.

[22] Id. at 30.

[23] See id. (describing how a Roomba, for example, might move among different processes during completion of its task).

[24] Id.

[25] Id. at 31.

[26] Id. at 30–31.

[27] Id. at 30.

[28] See id. at 32; James Barrat, Our Final Invention: Artificial Intelligence and the End of the Human Era 113–14 (2013). The varying levels of complexity involved in autonomous systems has advanced in recent decades, with growing bodies of research on artificial neural networks (ANNs) and genetic algorithms, among others. While this Note does not go into depth on any of these processes, a deeper understanding of the technical aspects of AI research is helpful to those interested in more fully understanding the complexities of regulation and oversight. See also Barrat at 74–75; Bostrom, supra note 14, at 10–11; Ray Kurzweil, The Age of Spiritual Machines: When Computers Exceed Human Intelligence 81 (2000).

[29] Graham Bowley, Lone $4.1 Billion Sale Led to ‘Flash Crash’ in May, N.Y. Times (Oct. 1, 2010), https://www.nytimes.com/2010/10/02/business/02flash.html [https://perma.cc/2MJN-22YD].

[30] Scharre, supra note 8, at 199.

[31] Id. at 203.

[32] Bostrom, supra note 14, at 17.

[33] Id. 

[34] Id. at 21 (“Smart professionals might give an instruction to a program based on a sensible-seeming and normally sound assumption… this can produce catastrophic results when the program continues to act on the instruction… even in the unanticipated situation where the assumption turns out to be invalid.”).

[35] Fred Kaplan, Dark Territory: The Secret History of Cyber War 203–11 (2016).

[36] Ralph Langner, Stuxnet’s Secret Twin, Foreign Policy (Nov. 19, 2013, 5:26 PM), https://foreignpolicy.com/2013/11/19/stuxnets-secret-twin/ [https://perma.cc/B5Y4-KREF]. 

[37] Barrat, supra note 28, at 256.

[38] Langner, supra note 36.

[39] Id.

[40] See, e.g., Natasha Turk, The next 9/11 will be a cyberattack, security expert warns, CNBC June 1, 2018, 7:55 AM), https://www.cnbc.com/2018/06/01/the-next-911-will-be-a-cyberattack-security-expert-warns.html [https://perma.cc/7C37-WGSK]. 

[41] See Ian Kerr and Katie Szilagyi, Asleep at the switch? How killer robots become a force multiplier of military necessity, in Robot Law, 354 (Ryan Calo, A. Froomkin, and Ian Kerr, eds., 2016) (arguing that, by failing to properly regulate, oversee, and guide the advancement of AI tech, in this case autonomous weapons, society essentially allows new technology to “determine its own use.”).

[42] Oscar Schachter, The UN Legal Order: An Overview, The United Nations and Int’l. L. 3 (Christopher Joyner, ed., 1997) available at https://www.jstor.org/stable/2204020.

[43] Wolfrum, supra note 9.

[44] Bolton, supra note 10, at 48 (“International law is not law; it is a series of political and moral arrangements that stand or fall on their own merits, and anything else is simply theology and superstition masquerading as law.”).

[45] See Jana von Stein, Compliance with International Law, Int’l Studies Ass’n and Oxford U. Press (last updated Nov. 2017) http://www.janavonstein.org/uploads/4/6/1/9/46194525/oxford-encyclopedia.pdf [https://perma.cc/L9A5-SLD5]. 

[46] Louis Henkin, How Nations Behave 47 (2d. ed. 1979). For the discussion herein, see supra Part II Section B, at 6–8.

[47] Id.

[48] See, e.g., Olivia Erdélyi and Judy Goldsmith, Regulating Artificial Intelligence: Proposal for a Global Solution, Association for the Advancement of Artificial Intelligence, 1, 2, 9 (2018), https://www.aies-conference.com/2018/contents/papers/main/AIES_2018_paper_13.pdf [https://perma.cc/N6SG-GWA8].

[49] Id. at 1-2.

[50] Bostrom, supra note 14, at 249. This possibility is particularly concerning in two instances: first, in the case of lethal autonomous weapons; and second, in the case of AGI. Bostrom writes:

Consider a hypothetical AI arms race in which several teams compete to develop superintelligence. Each team decides how much to invest in safety–knowing that resources spent on developing safety precautions are resources not spent on developing the AI… there might be a risk-race to the bottom, driving each team to take only a minimum of precautions. Id. at 247.

[51] Samantha Besson, Sovereignty, Max Planck Encyclopedia of Public International Law (Last updated April 2011), http://opil.ouplaw.com/view/10.1093/law:epil/9780199231690/law-9780199231690-e1472 [https://perma.cc/Z3VW-4NQH]. 

[52] See, e.g., Shen, infra note 54 (discussing that states often follow international law, although they are not forced to do so, and can regularly choose not to do so).

[53] Wolfrum, supra note 9.

[54] See, e.g., Harld Hongju Koh, Why Do Nations Obey International Laws?, 106 Yale L.J. 2599, 2602–03 (1997) (arguing that international laws create normative structures that are internalized and reproduced in domestic law, which helps create national understanding of sovereignty and a nation’s place in global society, forming a type of virtuous feedback cycle); see generally Jianming Shen, The Basis of International Law: Why Nations Observe, 17 Dickson Int’l L. 287 (1999) (discussing a wide range of theories of observance of international law, including naturalist theories, positivist theories, and other more modern political science theories such as power politics and peaceful coexistence.).

[55] Eric Posner, Do States Have a Moral Obligation To Obey International Law?, 55 Stan. L. Rev. 1901, 1902, 1919 (2003) (arguing that states do not, in fact, have a moral obligation to follow international law, but may have prudential reasons for doing so).

[56] von Stein, supra note 45, at 20 (noting that “various mechanisms… can help to ensure that states keep their international promises much of the time”).

[57] Id. at 1918.

[58] Juliet Kaarbo, Jeffrey S. Lantis, Ryan K. Beasley, and Michael T. Snarr, The Analysis of Foreign Policy in Comparative Perspective, Foreign Policy in Comparative Perspective: Domestic and International Influences on State Behavior, 4 (2nd. ed., Ryan K. Beasley, Juliet Kaarbo, Jeffrey S. Lantis, and Michael T. Snarr, eds. 2013).

[59] John Murphy, Force and Arms, The United Nations and International Law 122–29 (Christopher Joyner, ed., 1997).

[60] See discussion supra II. A, at 6.

[61] One particularly salient example in this case–though comparisons can be overdone–is the creation of the International Autonomic Energy Agency in the wake of the Second World War, the bombing of Nagasaki and Hiroshima, and the understanding of what nuclear technology could do, both in terms of societal benefits and potential threats. The IAEA, founded in 1957, had 171 member states as of February 5, 2019. See International Atomic Energy Agency (IAEA), https://www.iaea.org/about/governance/list-of-member-states [https://perma.cc/PM7U-5HWN] (last visited Oct. 2, 2019); CERN and the Human Genome project also present good examples of international scientific collaboration, though without the immediacy that nuclear technology and now, arguably, AI technology present. See Bostrom, supra note 14, at 253.

[62] Grant Wilson, Minimizing Global Catastrophic and Existential Risks from Emerging Technologies Through International Law, 31 Va. Envtl. L.J. 307, 349–350 (2013).

[63] See von Stein, supra note 45 (including an in-depth discussion of the elements of international normative structures that encourage compliance with international law).

[64] Id.

[65] See, e.g., Michael D. Shear, Trump Will Withdraw U.S. From Paris Climate Agreement, N.Y. Times (June 1, 2017), https://www.nytimes.com/2017/06/01/climate/trump-paris-climate-agreement.html [https://perma.cc/5G67-4M95]. 

[66] Andrew Guzman, A Compliance-Based Theory of International Law, 90 Calif. L. Rev. 1823, 1880 (2002).

[67] Id. at 1886–87.

[68] World Trade Organization, Principles of the trading system, https://www.wto.org/english/thewto_e/whatis_e/tif_e/fact2_e.htm [https://perma.cc/T2FP-WDJ7] (last visited Jan. 14, 2019).

[69] See, e.g., Boden, supra note 6, at 147–49 (discussing NGO and expert calls for increased oversight).

[70] United Nations Interregional Crime and Justice Research Institute, UNICRI Centre for Artificial Intelligence and Robots, http://www.unicri.it/in_focus/on/UNICRI_Centre_Artificial_Robotics

[https://perma.cc/6JHC-EGM3] (last visited Jan. 13, 2019).

[71] Erdélyi & Goldsmith, supra note 48, at 3.

[72] University of Oxford Future of Humanity Institute, Centre for the Governance of AI, https://www.fhi.ox.ac.uk/GovAI/ [https://perma.cc/MM8G-3V4Y] (last visited Jan. 13, 2019). Although outside the scope of this paper, FHI and the Centre for the Governance of AI have a wealth of research on desired policy outcomes of governance structures, as well as more technical information such as forecasts on future AI capabilities, malicious use, and machine learning advances, which can be accessed at https://www.fhi.ox.ac.uk/publications/ [https://perma.cc/9MEU-SCUB] (last visited Jan. 13, 2019).

[73] See Scharre, supra note 8, at 103 (“As of June 2017, sixteen countries possessed armed drones…”).

[74] See id. at 47–48 (discussing the Israeli Harpy drone, which is fully autonomous, requiring no human approval of its targets. It has been sold to China, India, and Turkey, among others).

[75] Campaign to Stop Killer Robots, About Us, https://www.stopkillerrobots.org/about/ [https://perma.cc/VUD2-YXCM] (last visited Oct. 6, 2019).

[76] Id.

[77] Michael N. Schmitt and Jeffrey S. Thurnher, “Out of the Loop”: Autonomous Weapon Systems and the Law of Armed Conflict, 4 Harv. Nat’l Sec. J. 231, 233 (2013);

[78] Id. at 233–34.

[79] Id. at 280–81.

[80] European Commission, High-Level Expert Group on Artificial Intelligence, https://ec.europa.eu/digital-single-market/en/high-level-expert-group-artificial-intelligence [https://perma.cc/EF5J-6ZMY] (last visited Jan. 13, 2019).

[81] EU High-Level Expert Group on Artificial Intelligence, Draft Ethics Guidelines for Trustworthy AI (Dec. 18, 2018), https://ec.europa.eu/digital-single-market/en/news/draft-ethics-guidelines-trustworthy-ai [https://perma.cc/822H-LR7V].

[82] Tim Dutton, An Overview of National AI Strategies (June 28, 2018), https://medium.com/politics-ai/an-overview-of-national-ai-strategies-2a70ec6edfd [https://perma.cc/YN22-GGSE]. 

[83] Id.

[84] Scharre, supra note 8, at 89.

[85] Id. These three classes are “semiautonomous weapons, such as homing munitions…defensive supervised autonomous weapons, such as the ship-based Aegis weapon system…and non-lethal, non-kinetic autonomous weapons, such as electronic warfare.”

[86] Id.

[87] Id. at 90.

[88] See Bostrom, supra note 14, at 206.

[89] Scharre, supra note 8, at 89.

[90] See Centre for the Governance of AI, supra note 72.

[91] See, e.g., Wolfram, supra note 9 (considering areas falling under the governance of international law such as the high seas, climate issues, and international economic issues).

[92] See von Stein, supra note 45.

[93] See, e.g., IAEA, supra note 61, and the 170 member states of IAEA.

[94] See Bostrom, supra note 14, at 206.

[95] See, e.g., Erdélyi and Goldsmith, supra note 48; Wilson, supra note 62, at 349–50.

[96] Wilson, supra note 62, at 308–11 (discussing the risks created by nanotechnology, AI, bioengineering, and the Large Hadron Collider).

[97] Id. at 355–56.

[98] Id. at 356–57.

[99] See von Stein, supra note 45, at 7–9 (discussing the role of reputation in creating state compliance).

[100] See UNICRI, supra note 70.

[101] See Bostrom, supra note 14, at 249–50 (discussing the benefits of collaboration, including “the sharing of ideas.”).

[102] Boden, supra note 6, at 147; Ian Semple, Thousands of Leading AI Researchers Sign Pledge Against Killer Robots, The Guardian (July 18, 2018), https://www.theguardian.com/science/2018/jul/18/thousands-of-scientists-pledge-not-to-help-build-killer-ai-robots [https://perma.cc/4PPL-FKFB]. 

[103] See Boden, supra note 6, at 148–49.

[104] Max Tegmark, Future of Life Institute, https://futureoflife.org/author/max/ [https://perma.cc/3BGT-DJM4] (last visited Mar. 15, 2019).

[105] Nick Bostrom, Nick Bostrom, https://nickbostrom.com/ [https://perma.cc/Y248-ZG5F] (last visited Mar. 16. 2019).

[106] Boden, supra note 6, at 147–48 (noting that there have been multiple expert conferences discussing AI safety as well as a number of open letters condemning use of, for example, autonomous weapons in war).

[107] See, e.g., Bostrom, supra note 14, at 259–60; Barrat, supra note 26, at 152–53; Boden, supra note 6, at 131.

[108] Bostrom, supra note 14, at 22 (internal footnote omitted).

[109] See id., at 95–99.

[110] See id., supra note 14, at 22–29 for an in-depth discussion of expert opinions on when human-intelligence level AI will be achieved.

[111] See, e.g., von Stein, supra note 45, at 21 (noting that not all states follow almost all of their agreements almost all of the time, and offering a discussion of the complex nature of state compliance); see also Wolfram, supra note 9, at 5, 14 (noting there is no enforcement mechanism in international law). Although these authors do not support these arguments, they do make note of them as critiques raised against international law.

[112] George Lucas, Jr., Legal and Ethical Precepts Governing Emerging Military Technologies: Research and Use, 2013 Utah L. Rev. 1271, 1275 (2013) (noting that international “regulatory statutes would prove unacceptable to, and unenforceable against, many of the relevant parties”).

[113] Posner, supra note 55, at 1905.

[114] See Part II Section B, supra page 10–13.

[115] Barrat, supra note 28, at 155.

[116] See, e.g., Bostrom, supra note 14, at 15–16 (discussing several current peaceful uses of AI, including increasing the speed and capacity of internet searches and voice and facial recognition).

[117] See, e.g., Human Rights Watch, supra note 81, at 12 (calling for an end to the use and prevention of future development and use of increasingly automated and autonomous drones in warfare). 

[118] See Scharre, supra note 8, at 102–03 (noting the number of states possessing and using armed drones). Consider also the case of Israel, which has developed the fully autonomous Harpy drone and sold this drone to, among others, China, India, and Turkey, creating both a military and financial incentive for Israel to avoid increased regulation of autonomous weapons. See id. at 45–48.

[119] Bostrom, supra note 14, at 246–49.

[120] Karen Hao, Americans want to regulate AI but don’t trust anyone to do it, MIT Tech. Rev. (Jan. 10, 2019), https://www.technologyreview.com/s/612734/americans-want-to-regulate-ai-but-dont-trust-anyone-to-do-it/ [https://perma.cc/ZCX4-PWXZ]. 

[121] See, e.g., Scharre, supra note 8, at 117–19 (discussing the beginning of what may become an autonomous arms race).

[122] Id. at 330 (“The main rationale for building fully autonomous weapons seems to be the assumption that others might do so”).

[123] See Part III Section A, supra page 11–14.

[124] Bostrom, supra note 14, at 259.

[125] See International Atomic Energy Agency (IAEA), https://www.iaea.org/sites/default/files/16/08/

iaea_safeguards_introductory_leaflet.pdf [https://perma.cc/PLH8-NDBA] (last visited Jan. 13, 2019). 

[126] See Bostrom, supra note 14, at 306–07.

[127] Barrat, supra note 28, at 266 (“Like natural selection, we choose solutions that work first, not best.”).

Legal Realism Now?

Download a copy of this Response:

David Simon

Response Piece | 107 KY. L. J. ONLINE | Volume 107

Legal Realism Now?[1]

David A. Simon*

I.  Introduction

Legal realists have accomplished quite a bit since Holmes. Some have succeeded in swallowing whole fields of law with economic jargon. Others have eaten away at law’s mystical innards by exposing its racism, sexism, and classism. And still others have evacuated from the legal intestines the digestible bits so savory to the mouth of the 19th century jurist: the categories. What is left of law in this picture? One answer, for many realists, is not much. Law is a policy tool, don’t you know? It is designed to do things. And it is the task of scholars to show how law does things, not to identify “transcendental nonsense.”[2] Surely Felix Cohen has a point.

But, as Thomas Grey reminds us, even the most tough-minded realist had a love for categorization and systematization.[3] True, it was with an eye toward how useful the exercise, but not always. Much of Adam Mossoff’s essay, Trademark as a Property Right,[4] could easily be regarded as engaging in the nonsense legal realism left behind. This is how Ramsi Woodcock characterizes it in his response, Legal Realism: Unfinished Business.[5] Formalistic, conceptual analysis is, on this view, an analytical black hole. But this is an exaggeration, a mischaracterization. It is true, as Brian Frye notes, that Mossoff’s essay makes a “valuable contribution,”[6]even if it is not the kind of contribution of which many are fond. More than that, though, Woodcock’s response reveals a curious analytic amnesia about the nature of conceptualization and realism. And it is one that traps realists into a lexical vortex not unlike the one they so eagerly deride.

II.  Realism and Formalism

The realists replaced talk of legal metaphysics with power,[7] and later economics, race, sex, and so on.[8] I must admit that I regard this development as positive. Replacing formalistic legal internalism—the view that legal categories have inherent conceptual features, and that legal analysis proceeds by deductive logic—with a more nuanced understanding of law as an interactive, social process was an important criticism. It enabled us to better understand law’s effects and how we might change them. And yet in attempting to escape the autonomous, legal hermeneutics characteristic of formalism, some analytical techniques developed their own kind of internalism.

Consider the economic analysis of law, where formalistic internalism of a different kind carries on without a hint of irony. The more one reduces legal issues to the economic lexicon, the more it resembles the formalist metaphysics it ridicules. Does fair use solve market failures? Does intellectual property law increase efficiency? Do patents have spillover effects? Should a legal entitlement be protected by a liability rule or a property rule? Does the legal rule create a positive or negative externality? Or, best of all, does the law increase social welfare? The task of the scholar answering these questions is to categorize things in the right way, in a way that allows an economic analysis. But in these cases the economic analysis is legal analysis. And what did the formalists want to do except legal analysis? If we follow the arguments to their most basic form—and even to their regular appearances in scholarship—we wind up in the world of abstractions legal realism promised to leave behind.[9]

That’s not to say there aren’t real differences. One of formalism’s rather astounding claims was to offer a method for “deducing” “right” answers from judicial decisions or statutes. Economic analysis of law, on the other hand, one-ups formalism by providing not merely answers but also questions. Economic analysts of law want policy to determine law, and economics to determine policy. When the analyst categorizes legal rules or doctrine, she does so to understand how to achieve particular policy results—those that maximize (or promote) efficiency.[10] One ought to be able to determine whether a rule is correct by evaluating whether it achieves the desired economic result. Right answers here are of the economic, not the formalist, kind.[11] So, too, are the questions.

I don’t mean to suggest that legal realism is the conceptual equivalent to law and economics; it certainly is not. I also don’t mean that other features of legal realism fail to surpass legal formalism; they certainly do. But it’s a mistake to think that conceptual analysis as such is a waste of time because we should concern ourselves only with policy. Not only does conceptual analysis sometimes yield important insights, it’s also critical to a functioning legal system. Formalism’s toolkit—analogical reasoning, adherence to precedent, conceptual analysis, etc.—is not just obscurantist cover for personal judgments, policy, or otherwise. Its machinery also provides a means for avoiding discussions of policy when it is impractical or imprudent.

Sometimes, maybe even often for trial judges, there is no obvious policy analysis to be had. Much of the trial judge’s work involves discovery and technical procedure. Legal rules do not always and in every case present the judge with clear policy choices. To ask them to consider the policy consequences of every decision they make, to ask them to predict and control future cases and strategy, is a burden too great for even the most accomplished jurist. And, even where consideration of policy is possible, it may not be desirable. If current events tell us anything about law, it’s that formalism may be law’s redeeming virtue as well as its mystical vice. Law can’t and shouldn’t be all politics, power, race or economics, just as it shouldn’t be all internal, conceptual wheel-spinning. Isn’t this what realism taught? This is why a rather well-known exponent of judicial pragmatism—one who has swooned over economic analysis of law[12]—suggests that judges might resort to the tools of formalism to build a legal decision.[13]

And yet we have grave unease about the self-proclaimed judicial scientist, or, for that matter, the more contemporary judicial umpire. Our worries stem from insights realism has wrought. And they are real worries. But if the formalism, so dominant in judicial chambers, cannot give us “right” answers, does it reduce the judge to a black-robed huckster? Are those well-meaning men and women doing anything other than playing a kind of conceptual shell game? There is a nuanced answer.[14] In hewing to subtlety, though, we are susceptible to the failures so meticulously identified by the realists: a desire for right answers, and, more importantly, a method for deriving them.

Perhaps this is why economic analysis of law, more than some of the other realist approaches to law, has appeal. It is not merely a criticism of law’s conceptual house of cards; it offers a “scientific” method for deriving “right” answers that are determined by “facts” in the “real world.” Of course, the economist’s real world is a fictional oversimplification. And the facts she uncovers are more institutional than brute.[15] At least, though, economics professes concern for (some) consequences of legal rules. Formalism, it is true, tends to become, well, overly formalistic. In these circumstances it is easy enough to see the appeal of approaches like those favored by economists. Does this mean that law and economics—or, for that matter, consequentialism—is valuable and legal formalism is not? Hardly. Does the realism of the 20th century render “quixotic” the formalism of Mossoff’s essay? Yes, but not entirely.

Although the method of legal formalism as an objective arbiter of law is passé, the method itself is not. If we try to determine what makes something property and what makes something not-property, have we done something valuable? Have we done something important by characterizing laws into liability and property rules?[16] Should we, while we’re at it, waive off Socrates for annoying the gentry with pestering questions about nature of justice?[17] The answer depends upon why we are categorizing. Economic categories help us evaluate, within a certain conceptual system, which rules we might want to adopt and why. I doubt many people think the formalism does the same.

The skepticism about formalism is a direct result of legal realism’s critique. Formalism-as-judicial-science is dead, and so legal formalism offers no independent reason to adopt its conclusions. But, then again, neither does economics. Didn’t legal realism’s razor cut judicial science at the knees, whatever its instantiation? Economics, then, must provide independent reason why we should accept its analysis before we run full boar into the thicket of efficiency, markets, and elastic demand. A system’s emphasis on consequences is a good reason to favor it over a system that disregards consequences. We should remember, though, that non-consequentialist reasoning doesn’t disregard consequences. And neither does formalism. Legal realists, above all else, have taken pains to point this out.

Then again, consequences are important. And if we claim—as do consequentialists—that consequences are all that matters, then it’s quite important to understand what count as consequences and how and why they are measured. A particular passage from Woodcock’s response is relevant:

But what Americans care about is whether protecting brand loyalty is good or bad for consumers. Protecting brand loyalty might be good for consumers because it allows firms to reap rewards from investing in the production of better products. Or protecting brand loyalty might be bad for consumers because it magnifies the power of seductive advertising or the familiarity generated by having been first to market to create irrational brand attachments, leading to higher prices and harm to more-innovative but less-well-known competitors. Legal realism demands that the debate over trademarks be carried out in these terms, in terms of effects.[18]

Notice the conceptual backsliding. The realist should not assume, as does Woodcock, that the language of economics determines the measuring of effects. The more pragmatic among us wonder not whether modifications to trademark law will increase consumer surplus or promote social welfare (as measured by economists) but rather what effects does trademark law have on society? Does it silence critics? Does it threaten to invade every aspect of our lives, to render every experience we have to one determined by trademark holders (in particular, large corporations)? Most importantly, we want to know if the effects are the kind we want to encourage? Mossoff’s essay, it is true, does not consider such questions, but neither does Woodcock’s.

III.  Reality and Effects

An emphasis on effects shouldn’t require us in every circumstance to point out the effects of some conceptual scheme or another. Or if it does, we should also place similar demands on the kinds of effects we are interested in, and why. It is natural for Woodcock to assume that a focus on consequences requires a focus on reality. Consequences presuppose events with effects in the world of sense. For Woodcock, Mossoff’s conceptual analysis falls outside the scope of reality because it doesn’t concern events in the world of sense—which Woodcock defines as the quantifiable effects of laws upon economic measures. No wonder he has difficulty finding in Mossoff’s essay redeeming qualities. Formalism, in Woodcock’s view, is not reality based. And because formalism is fantasy, it should be discarded. It’s a curious conclusion to reach for someone who acknowledges the continuing dominance of formalism in legal practice and education.

Yes, of course, but formalism’s pervasiveness is precisely the problem, according to Woodcock. Lawyers and judges engage in analysis that amounts to verbal smoke and mirrors. Formalism’s reality is unreality. One cannot divine property rights by consulting sacred texts; one must examine the things as they function in the real world. I am sympathetic to this line of thought, but one should be careful not to run with it too far. Use in judicial opinions is use in the real world. The judge understanding the internal development of a concept is an effect in the real world. This is not an argument that judges or policy makers—or god help us, law professors—should ignore effects outside the courtroom. Only that effects inside (the head) matter, too.

Sometimes these internal effects are significant. Where, for example, formalism provides a compelling account of law’s doctrines or rules. Explanatory power is not only reason-giving, but reason-making. Realists should take note because many of realisms offshoots can’t fully explain law.[19] Realism, at least less sophisticated versions, necessarily leaves out important conceptual features by its criticism of them as window-dressing. Worse still, it regards central features of law as distractions or, as in the case of morality, hopelessly empty. In economic analysis of tort law, for example, the idea of corrective justice is nowhere to be found. Yet this concept animates the principal features of the doctrine.[20] Mossoff’s analysis is in a similar vein: it tries to account for why, internally, the laws are the way they are. Maybe it doesn’t succeed. But this is something economic analysis, and much of realist scholarship, cannot do.

Is this reality? It sure feels like it. The problem realists have with this reality is that it tends to obscure the dynamics of power, privilege, and so on. But so does economic analysis of law. What realism teaches is not that the economic method will give us the answers that we want, but that the language of economics performs the same sleight of hand as legal formalism. Ideology infects the terminology and structure of economics—and, consequently, its application to law—to such a large degree that its most basic and foundational concepts (e.g., efficiency, markets) are taken as proper starting points for analysis. The realist dares not make any such assumptions: pressing on these tender spots in the skin of economic analysis reveals the rot that lies underneath. When the skin breaks and the realist peers inside, she sees that theoretical debates about terminology and its application have about as much impact on the infection as debating whether trademarks are property in the formalist picture. The indeterminacy of economic analysis must be confronted along with the indeterminacy of formalism.

This problem is not limited to economic analysis of law. Even the more general consequentialist picture, one to which I am somewhat partial, has its own schemata, which, like so many others, can’t help but become all-encompassing. When one attempts to assemble a consequentialist version of ethics or law, she quickly begins to make accommodations to non-consequentialist reasoning.[21] To shield consequentialism from the attacks of deontology, however, consequentialism has an automatic “vacuum cleaner” that can suck-up any non-consequentialist attacks: any non-consequentialist theory can be “consequentialized.”[22] If this is true, then we are left with a theory so encompassing and far-reaching it offers no meaningful concrete guidance; indeed, since the vacuum cleaner can suck up almost any deontological theory (or value), consequentialism itself falls victim to the kind of charge realists are accustomed to making: it doesn’t capture the reality it deems so important.

IV. Conclusion

Despite its shortcomings, formal conceptual analysis, just as economic analysis or critical legal studies, does have value. It tells us about the nature of our conceptual structures, why we rely on them, and whether these assumptions should be revisited. In short, it is part of the legal realist project, even if its prescriptions may not be. More than that, though, formalism has an interesting and important reality-based feature: it doesprovide judges with an internal reason—a reason judges count as significant—to accept its conclusions, or at least consider them seriously. These reasons are not just window-dressing; they can act as real constraints.[23]

Woodcock is too quick to wave off conceptual analysis as irrelevant in the new age of empirically-driven law. At the same time that Woodcock recognizes that legal disputes are driven by the formal legal analysis, he notes that legal realism has destroyed this method of decision-making. Maybe law is outgrowing its formalist britches, but its practitioners still need to wear pants. We might laugh when one tries to determine the fundamental attributes of property in the same way philosophers now laugh at the quest to identify the essence of a table. But in the real world, the former impacts people’s lives while the latter makes no difference whatsoever.[24] Better to be measured about the whole thing than to throw out old clothes before the new ones have arrived. If Mossoff offends legal realists, then, it may be because they have caught a glimpse in the mirror. 

---

* Project Researcher, Hanken School of Economics; Visiting Assistant Professor, University of Kansas Law School; Ph.D. candidate, University of Cambridge. Thanks to Brian Frye for comments and suggestions.

[1] Title adapted from Joseph William Singer, Legal Realism Now, 76 Calif. L. Rev. 465 (1988).

[2] Felix Cohen, Transcendental Nonsense and the Functional Approach, 35 Colum. L. Rev. 809 (1935).

[3] Thomas C. Grey, Holmes and Legal Pragmatism, 41 Stan. L. Rev. 787, 822–824 (1989) (“Since the heyday of the Realists, legal thinkers have tended to assume that legal taxonomy and conceptual doctrine-building necessarily rest on Langdellian premises. Behind this assumption often lies the instinctive nominalism, or cult of the concrete, that denies all practical importance to generalization and abstraction. Yet no pragmatist[, including Holmes,] would endorse such an antipathy to generalization.”); see Singer, supra note 1, at 470-72 (noting that even realists acknowledged the usefulness of generalizations in certain circumstances).

[4] Adam Mossoff, Trademark as a Property Right, 107 Ky. L.J. 1 (2018).

[5] Ramsi A. Woodcock, Legal Realism: Unfinished Business, Ky. L.J. Online (2019).

[6] Brian L. Frye, Metaphors on Trademark: A Response to Adam Mossoff, “Trademark as a Property Right”, Ky. L.J. Online (2019).

[7] See Hanoch Dagan, Reconstructing American Legal Realism & Rethinking Private Law Theory 17-67  (Oxford Univ. Press 2013), for a general review of legal realist themes.

[8] Critical Legal Studies (James Boyle, ed., N.Y. Univ. Press 1992).

[9] See, e.g., Louis Kaplow & Steven Shavell, Fairness versus Welfare (Harv. Univ. Press 2006).

[10] The two standard versions of efficiency are Kaldor-Hicks and Pareto Efficiency.

[11] Richard A. Posner, The Problematics of Moral and Legal Theory (Harv. Univ. Press 2009). We should, though, remind ourselves that Posner and the formalists both share the dubious honor of proclaiming their preferred method a “science.”

[12] See David A. Simon, Problems in Theory: Intellectual Property (forthcoming 2019-2020) (manuscript on file with author).

[13] See Richard A. Posner, Law, Pragmatism, and Democracy (Harv. Univ. Press 2005); Richard A. Posner, The Problematics, supra note 11. Posner’s version of judicial pragmatism, and many other versions, grew out of the philosophical school of pragmatism. See Simon, supra note 12.

[14] Realism never claimed to reduce judges to charlatans. It sought to illuminate the factors other than formal legal analysis that influenced judicial decision-making. See Singer supra note 1, at 470-75. Yet this produced a puzzle: how does one engage in legal analysis without “reverting to . . . formalism . . . or reducing all claims to the raw demands of interest groups?” Id. at 468. The question is “so hard that judges and scholars often reassert central elements of formalist reasoning they had hoped to discard.” Id.

[15] John Searle, the Construction of Social Reality 27 (1995) (explaining that “brute facts” are those facts that exist independently of human institutions, and “institutional facts” are those that exist in virtue of human institutions, and also distinguishing the statement of brute facts, which requires the human institution of language, from the stated brute facts, which exist independently of language).

[16] Guido Calabresi and A. Douglas Melamed, Property Rules, Liability Rules, and Inalienability: One View of the Cathedral, 85 Harv. L. Rev.1089 (1972).

[17] Plato, The Republic (Page, Capps, & Rouse eds., 1937).

[18] Woodcock, supra note 5, at 8.

[19] Here, I am thinking mainly of economic analysis of law.

[20] See Jules Coleman, The Practice of Principle (1999). See also Jules Coleman, Risks and Wrongs (1992).

[21] Simon, supra note 12.

[22] David McNaughton & Piers Rawling, Agent-Relativity and the Doing-Happening Distinction, 63 Phil. Stud.: An Int’l J. for Phil. in the Analytic Tradition167–185 (1991). But see Campbell Brown, Consequentialize This, 121 Ethics749 (2011). See, for example, Stephanie Bair, Rational Faith: The Utility of Fairness in Copyright, 97 B.U. L. Rev. 1487 (2017), for attempts at this in IP scholarship. See Simon, supra note 12, for an explanation of why this approach doesn’t succeed.

[23] This is true even in the Court that has the most opportunity and freedom to make policy in the guise of law. See, e.g., Ryan C. Black & Ryan J. Owens, Agenda Setting in the Supreme Court: The Collision of Policy and Jurisprudence, 71 J. of Pol. 1062 (2009). As noted before, even realists didn’t really claim that judges were unconstrained – but rather they were constrained by factors other than law. In particular, they argued that formalism provided cover for the influence of these extra-legal factors.

[24] I don’t mean to suggest that philosophy makes no meaningful contribution to people’s lives, or has not influenced how people think or how, for that matter, science proceeds. But at least in this example, there is no import in a legal setting how this might make a difference.

Legal Realism: Unfinished Business

Download a copy of this Article:

Legal Realism Unfinished Business Download

Response Piece | 107 KY. L. J. ONLINE | Volume 107

Ramsi A. Woodcock*

I. Legal Reasoning as a Renaissance Habit of Mind

The great evolutionary biologist Stephen Jay Gould devoted his last book to the relationship between science and the humanities.[1] Gould argued that the Renaissance was not the forward-looking launcher of the scientific revolution that many, inspired by the careful observations of nature in the work of Leonardo Da Vinci, believe it to be, but a backward-looking enterprise.[2] The Renaissance sought to restore the learning of the ancients rather than to advance scientific knowledge through observation of the natural world.[3] Gould gives the example of the “Historia animalium” of Ulisse Aldrovandi and Konrad Gesner, the greatest natural historians of the period.[4] That book includes chapters on the elk and the fox, but also on the unicorn and the satyr, not, as Gould is quick to point out, because Aldrovandi and Gesner necessarily thought that unicorns and satyrs exist, but because the ancients had written about those creatures.[5] The Renaissance was oriented toward ancient intellectual authority, not toward the observable world.[6] As Gould puts it, “for the Renaissance, the recovery of ancient wisdom, not the discovery of novel data, became the primary task of scholarship.”[7] Gould goes on to detail how in the seventeenth century science moved on to focus on reality.[8] The law, however, had to wait another three hundred years to make this move, and in important respects is still waiting.

The Renaissance character of legal studies is one of the most jarring aspects of legal education for American students, who, unlike law students in most other parts of the world, commence their study of law after four years of undergraduate education in other fields of intellectual endeavor.[9] The practice of law to this day is often not oriented toward the observation of reality but toward the observation of legal texts, their categorization and systematization in relation to each other, rather than in relation to the world.[10] The undergraduate major in economics of course learns mathematical models that may be horribly divorced from reality and utterly incapable of answering the pressing economic questions of the day. But the key difference between this experience and that of the law student is that the economic models learned by the undergraduate economics student are supposed to reflect reality, however badly they may in fact do that.[11] Even the undergraduate major in comparative literature, who primarily studies chains of authorial influences — can hints of Heraclitus be found in Rabelais? — engages in a course of study that is oriented toward observed fact, even if texts themselves are the subjects of observation. Either there is Heraclitus in Rabelais or there is not.

By contrast, new law students quickly find that what matters in the law is “legal argument,” the drawing of analogies to past cases, rather than argument based on observed fact, on the relationship between particular case outcomes and the world.[12] Getting the case right does not mean identifying the effects of a set of possible rulings on the nation and deciding whether those effects are desirable according to some metric, whether that metric be justice, the carrying out of the expectations of the legislature, or something else.[13] Getting the case right means finding the outcome that best fits past cases, preferably those decided by courts or judges with the greatest prestige.[14] The law in the first instance appears to the new law student not as a system to be back-tested against the world but to be back-tested against itself.[15] In order to solve cases, the law student dives into the law library, which collects reports of past court decisions, not into the university’s main library, which collects works devoted to describing the real world. Just so, the Renaissance naturalist dove into ancient manuscripts to describe the natural world, not into the nearest lake.No wonder American law students experience their first year of legal studies as exceptionally difficult and find their undergraduate performance little guide to their performance on first-year law exams. These students have spent their entire intellectual lives in the Enlightenment, excelling by showing their teachers that they have a better grasp on reality than their classmates.[16] But in law school that skill matters not at all. For some, the result is a crisis of motivation, because they have grown up associating the pursuit of reality with self-worth. For others, it is a moral crisis, as they find legal reasoning leading them to support case outcomes that they believe will be bad for the world. They are taught, however, that accepting that law and justice are two different things is key to joining the profession.[17] For still other students, the crisis is one of skills. They may have been very good at arguing from reality in their prior intellectual lives; all at once, they must learn the very different skill of arguing from authority.

The Renaissance character of legal reasoning gives new law students, and the lawyers they go on to become, unique insight into the intellectual battles of the past, albeit insight they could do without. Gould wrote of the Renaissance that “[w]e often get befuddled when we try to comprehend the central belief of the system that the Scientific Revolution hoped to replace, because [argument from authority] strikes us as so strange and archaic[.]”[18] But to the seasoned lawyer, Aldrovandi and Gesner’s approach to natural history is perfectly familiar: there is no better way to win a case than to show that a very important court said something supportive, and the greater the number of courts, and the further back in time that support can be shown to stretch, the stronger the authority still. It does not matter if the result is bad for America or the world, or something that actual legislators, not the abstract “intent of the legislature” to which courts refer in doing legal reasoning, could not possibly have wanted.[19] The fact that other cases support the outcome is enough. The sixteenth century is alive and well in the law. 

II. Legal Realism as Policymaking

For at least a hundred years now, the legal realist movement has contested the Renaissance approach to the law by insisting that legal argumentation always be reality-based.[20] The question in deciding any case, insist the legal realists, is always what those who framed the law — that is, legislators — would actually want to have happen in the particular case, or, in matters of common law, what the best result would be after taking consequences into account.[21] That is, realists want courts to do what everyone else in government already does: make policy. The term “policy” evokes armies of PhDs in subjects like sociology, environmental science, government, and, above all, economics, working for think tanks, administrative agencies, or the science departments of universities, gathering data and making recommendations about what the President or Congress should do. What the term “policy” does not invoke is the court or the law school. Policy is modern governance, in contrast to the Renaissance governance that is still the staple of the law.[22]

The fact that policy is generally associated with institutions other than the courts and law schools reflects how society has dealt with the failure of legal practice to adapt to science: by pushing the legal world aside. It is no coincidence that the rise of the legal realist movement a hundred years ago coincided with the dawn of the administrative state.[23] The legal realist movement and the movement to outflank the law with policy institutions was one and the same.[24] Legal realists wanted judges to get real, and seeing that they would not, sought to take governance outside of the realm of the courts and place it in the hands of administrative agencies staffed with people educated into reality-based intellectual disciplines, people with PhDs, not JDs.[25] The legal realists have created a policy world outside of the law that has vastly more influence today over how the country is run than do courts and their method of legal reasoning. Today federal legislation is pervasive and state statutes have greatly circumscribed the ambit of the common law, from the Uniform Commercial Code, which extracted vast swaths of commercial law from the common law power of the courts, to the more recent tort reform push to reduce the law of punitive damages to statute.[26] Indeed, the federal courts today defer to the vast majority of administrative agency decisions explicitly on the ground that the judiciary lacks the expertise to review them.[27] But this was not always so.

Nineteenth century America was ruled by courts; legislation was uncommon, narrow, and subject to searching judicial review.[28] Nowhere is the change wrought by legal realism on judicial power starker than in the mostly-forgotten history of judicial review of price regulation by administrative agencies.[29] The Supreme Court grudgingly conceded power to Congress to create price-regulating administrative agencies in Munn v. Illinois in 1877, but for more than 50 years starting in 1890 the Court insisted on supervising the prices those regulators set.[30] In case after case, the Court sought to use legal reasoning to determine whether the price of electricity, tap water, or whatever other product was before the court, met a standard of fairness that the Court found in the Due Process Clause of the U.S. Constitution.[31] After decades of withering criticism from the legal realists, however, the Court finally quit the field in 1944, conceding that price setting by precedent should give way to reality-based price setting carried out by experts — economists — trained in understanding markets.[32] Every similar retreat of the courts from constitutional review of regulatory activity over the past century has been a victory for legal realism, for the policymaker over the lawyer.[33]

But unless the administrative state succeeds at doing away with the judiciary entirely, the triumph of legal realism will be complete only if it transforms the way judges do law. In this, legal realism has had mixed success. The realists did take legal scholarship more or less by storm, convincing elite law professors that they should never push for a change in the law, or a particular resolution of a pending case, without deploying policy arguments in support.[34] Renaissance-style scholarly pursuits, such as the writing of immense treatises collating all of the cases relating to a particular branch of the law, have ceased to occupy law professors at the best schools.[35] “Law and . . . ” scholarly subfields have proliferated, as law scholars have sought to import various reality-oriented intellectual disciplines, from literature to sociology, into the law.[36]

Perhaps the most important of the “law and . . .” subfields has been law and economics, which appeared in two distinct phases.[37] The first was a project of the original group of legal realists, most notably Robert Hale, that sought to push the courts aside rather than reform them.[38] The great triumph of this first law and economics movement was convincing the Supreme Court to get out of the rate regulation business by showing how badly adapted legal reasoning was to deciding what a fair price might be.[39] The second movement, which started in the 1950s, was oriented to the internal reform task of replacing legal reasoning with reality-based economic reasoning.[40] This second iteration should probably be credited with doing more to compel law scholars to focus on results than any other single effort to open the law up to the reality-based intellectual world.[41] But its success has been limited by the shortcomings of economics as a social science. Despite its orientation toward reality, economics ignores large categories of human behavior that ought to be relevant to a scientific approach to law, because economics assumes that all economic actors are rational and have static preferences.[42] Nonetheless, every time a law professor, influenced by economics, argues that the parties to a case will contract around controlling precedent, or that a rule will distort economic incentives, the professor accepts that consequences matter, even if the professor makes no effort to undertake a careful study of those consequences.[43] Law and economics has in this way been a victory for realism.

It would be a big mistake to infer from the realist success in the realm of legal scholarship a similar triumph in legal practice. The primary currency of argumentation in the world of legal practice remains the analogy from past cases, with more legal realist approaches appearing only occasionally, and then only in the most elite courts in the most important cases.[44] Precedent continues to matter, not because it helps courts determine what the best outcome for America might be, or because the consequences of a lack of consistency in case handling would be bad for the nation — both acceptable realist approaches to precedent — but because precedent came before, just as the unicorn mattered for the Renaissance naturalist, because it came before.[45] 

III. Mossoff on Trademark

A. His Argument

It is against this backdrop of the continuing contestation of realism in the law that Mossoff’s argument that trademark is a property right must be evaluated.[46] Mossoff argues that courts and commentators have tended to deny trademark the status of property because they have failed to analogize trademarks to easements, which permit owners of real property limited access to neighbors’ land.[47] According to Mossoff, trademarks, like easements, are linked to ownership of something else.[48] For trademarks, it is ownership of the business associated with the mark in the minds of consumers.[49] For easements, it is ownership of the real property to which the easement provides access.[50] According to Mossoff, because courts rely on the contingency of easements on a property right to accord easements themselves the status of property, courts should rely on the contingency of trademarks on property in a business to accord trademarks the status of property as well.[51] 

B. The Missing Consequences

Mossoff’s paper will serve to remind realists of just how bad legal scholarship was before it embraced reality. For the paper argues a legal question over nearly forty long pages with nary a word about legal consequences, let alone what those legal consequences might mean for Americans out in the real world.[52] Treating trademarks as property based on their connection to ownership of the underlying business could suggest to courts that trademarks protect the value of consumer loyalty to that underlying business rather than serving, as the courts believe them to today, to prevent consumer confusion of brands.[53] The concept of genericide, which eliminates trademark protection when a mark like “escalator” comes to be associated by consumers with an entire product category rather than a particular brand, could disappear, for example, because genericide undoubtedly reduces the value of a firm’s mark.[54] The likely result would be greater market power for firms with successful brands, for good or ill.[55]

Mossoff wants to win this debate without any discussion of the policy consequences, of whether ironclad protection of reputation is in fact good or bad for markets. But what Americans care about is whether protecting brand loyalty is good or bad for consumers. Protecting brand loyalty might be good for consumers because it allows firms to reap rewards from investing in the production of better products. Or protecting brand loyalty might be bad for consumers because it magnifies the power of seductive advertising or the familiarity generated by having been first to market to create irrational brand attachments, leading to higher prices and harm to more-innovative but less-well-known competitors.[56] Legal realism demands that the debate over trademarks be carried out in these terms, in terms of effects. Mossoff would resolve the entire question based on an analogy to the law governing whether a farmer can use a neighbor’s field to get to the road. Because a court once said the farmer could get to the road, Mossoff would say that a trademark can never be set aside so long as it remains valuable to its owner.[57] Just so, the Renaissance scientist looked to Hesiod rather than the hills for information about the natural world. 

C. Indeterminacy

The failure of legal reasoning to take account of consequences, of which Mossoff’s paper is an example, is damning enough. But the realist critique of legal reasoning always goes further, to show that legal reasoning not only fails to take the real world into account, but cannot even provide courts with clear guidance about how to resolve cases.[58] Legal reasoning, argue the realists, is more like rhetoric than mathematics.[59] For the realist, legal reasoning lacks the determinacy of mathematics because, looked at from the right angle, anything can be analogized to anything else. Trademarks are like easements in that they are both contingent on ownership of something else, but they are also like turtles in that they both start with the letter “T.” The only way to really win an argument through legal reasoning is therefore to assume your conclusion.[60] Mossoff cannot argue that trademark is property because trademark rights happen to have a structure (existence contingent on ownership of a piece of property) that resembles the structure of some other rights that the law treats as genuine property rights. If the law does not actually say that trademark is property — and it cannot because Mossoff’s purpose is to fill that silence with his legal reasoning — then the fact that trademarks merely resemble rights that have been designated as property rights tells nothing about whether trademark rights should be treated as genuine property rights.[61] The resemblance just poses the question whether there should be a rule saying that everything that resembles a property right is a property right. If the argument is that yes, there should be such a rule, then an argument must be made for why that rule should be adopted, returning the argument more or less to where it started, which was to find a way to argue from existing law to the need for recognition of a new rule of law that resolves the question whether trademark should be treated as property.

To his credit, Mossoff’s target is an equally specious example of legal reasoning: the argument that trademark cannot be property because it does not resemble other property rights.[62] That textbook take on the relationship between trademark and property holds that trademark rights are not property because their limitation to use in conjunction with the underlying business makes them unlike basic property rights, which, on this telling, do not have any limits on use.[63] But just as resemblance cannot be used to make a property right, non-resemblance cannot be used to deny a property right. Neither resolves the question without assuming its conclusion. The fire of legal reasoning cannot be fought with the fire of more legal reasoning. The true realist approach would be to ask whether making trademarks count as property would be good for America and to proceed to treat trademarks as property if the answer is yes.

Of course, the realists’ beloved policy analysis is just as flexible, and determinate, as legal reasoning.[64] Considering the consequences of laws never actually definitively resolves the question what the correct law should be.[65] That requires the addition of a rule of decision, a value system such as human rights, or maximization of social welfare in the economic sense.[66] The position of the realists, however, is that legal reasoning is no more exact, no more determinate, than policy analysis.[67] As between two approaches that are equally open to interpretation, the realists would choose the one that is informed by reality. After a bout of legal reasoning, the lawyer ends up without an airtight argument for any particular result, plus no sense of what any particular result would mean for the country.[68] At least with legal realism, the lawyer obtains a sense of the consequences, and that in turn gives the lawyer a feeling for which outcome might be best. 

D. Confusion about Realism

Mossoff mistakenly associates the textbook case against trademark as property — the specious argument that because trademark does not resemble other property rights it cannot itself be a property right — with legal realism.[69] He sees the realists in the textbook case because he mistakenly believes that the realists define property as a plenary right of control — absolute dominion — over the owned thing, a position Mossoff associates with the phrase “right to exclude.”[70] If a right must have that plenary character in order to be a property right, then it follows immediately that the limited right to use marks that is conferred by trademark law is not a property right.[71]

But the view of property Mossoff attributes to the realists could not be more different from the realists’ actual view, because the view he attributes to the realists is the very same view that the realists attacked, and demolished, a hundred years ago.[72] Nineteenth century courts used the view of property as conferring absolute dominion over a thing to resist realist attempts to shift governance to administrative agencies.[73] The courts argued that all administrative action deprives owners of their property, in violation of the due process protection for property contained in the U.S. Constitution.[74] The view of property as absolute dominion allowed the courts to argue that when a rate regulator fixed a price for a good, for example, the owner’s property rights were violated because those rights extended to all uses of the good, including the choice of the price to charge for the good’s sale.[75] The realists fought back with the now-familiar argument that property rights are whatever the courts want them to be.[76] The courts could just as easily define property not to include a right to set the price as to define it to include a right to set the price.[77] The concept of property did not require that the courts view rate regulation as a deprivation of property. In the view of the realists, the courts were free to choose the definition of property with the best consequences for America, and in the realists’ view that was the definition that would facilitate administrative action.

The realists’ attacks on the view of property as absolute dominion is also the origin of the famous realist view of property as a bundle of rights.[78] The point of the bundle metaphor was that a regulator could break property down into pieces, take out the pieces that were preventing the regulator from operating, and then bundle the remaining pieces back together, without the bundle ceasing to add up to property.[79] A true realist would never argue that the contingency of trademark rights on ownership of the underlying business means that trademarks cannot be property because, for the realist, the contingency of the trademark right just means that the bundle of rights that is a trademark lacks a few of the sticks that make up absolute dominion over the owned thing. But, for the realist, that alone is no more reason to deny trademark the property moniker than it is to grant trademark the property moniker. 

IV. Conclusion

Mossoff can be forgiven for confusing the textbook case against trademark as property for realism because today many scholars take for granted that realism dominates scholarship.[80] It would seem to follow that the textbook view must be a realist view. The fact that the textbook view is instead of the Renaissance variety is a measure of the extent to which the legal realist project remains unfinished in the law, and scholars on both sides of the trademark debate who should know better continue to engage in legal reasoning. Despite the immense practical importance of intellectual property law, and the rich body of reality-based economic and social scientific scholarship devoted to intellectual property issues, the legal study of intellectual property law today remains perhaps more mired in the Renaissance, in Felix Cohen’s “heaven of legal concepts,” than any other area of legal scholarship.[81] The debate over whether trademark is property provides but a glimpse of the problem. But that is a story for another day. 

---

[1] See Stephen Jay Gould, The Hedgehog, the Fox, and the Magister’s Pox: Mending the Gap between Science and the Humanities 1–8 (2003).

[2] Id. at 36.

[3] Id.

[4] Id. at 37.

[5] See id. at 37–38.

[6] See id.

[7] Id. at 36.

[8] See id. at 39–47.

[9] See Daniel R. Coquillette, Lawyers and Fundamental Moral Responsibility 1 (1995).

[10] The percentage of the text of court opinions that is quoted from other court opinions is a rough measure of the extent of this orientation. To choose an example at random, eleven percent of a recent Supreme Court opinion quotes directly from other legal opinions. See District of Columbia v. Wesby, 138 S. Ct. 577 (2018).

[11] See Eugene Silberberg, The Structure of Economics: A Mathematical Analysis 1–2 (2d ed. 1990).

[12] See Robert J. Fogelin & Walter Sinnott-Armstrong, Understanding Arguments: An Introduction to Informal Logic 423–25 (6th ed. 2001).

[13] See Barbara Fried, The Progressive Assault on Laissez Faire: Robert Hale and the First Law and Economics Movement 14 (1998).

[14] Fogelin & Sinnott-Armstrong, supra note 12, at 423–25.

[15] See Felix S. Cohen, Transcendental Nonsense and the Functional Approach, 35 Colum. L. Rev. 809, 821 (1935) (describing legal reasoning as dealing in “theorems in an independent system” rather than statements about the world); Guido Calabresi, The Future of Law and Economics: Essays in Reform and Recollection 8 (2016).

[16] See Coquillette, supra note 9, at 1 (acknowledging the conflict between legal education and liberal arts backgrounds).

[17] See Fogelin & Sinnott-Armstrong, supra note 12, at 459.

[18] Gould, supra note 1, at 36.

[19] Cf. Henson v. Santander Consumer USA Inc., 137 S. Ct. 1718, 1725 (2017) (“[W]hile it is of course our job to apply faithfully the law Congress has written, it is never our job to rewrite a constitutionally valid statutory text under the banner of speculation about what Congress might have done had it faced a question that, on everyone’s account, it never faced. . . . Indeed, it is quite mistaken to assume . . . that ‘whatever’ might appear to further the statute’s primary objective must be the law.”) (internal brackets and quote marks omitted).

[20] See Peter Cane & Joanne Conaghan, Legal Realism, in The New Oxford Companion to Law (2008).

[21] See Joseph William Singer, Legal Realism Now, 76 Calif. L. Rev. 465, 467–68, 474 (1988); Fried, supra note 13, at 14. A reality-based approach to statutory interpretation seeks to answer the question what the legislature would want the court to do in the case at hand. Answering that question requires careful study of the consequences of any particular interpretation, and study of the legislature to determine how the legislature would feel – a word used here advisedly – about the outcome. What legislators happened to say during debates over passage of the law is only one datum among many that are relevant to a realistic statutory interpretation.Statutory interpretation today, however, does something quite different: it simply treats records of legislative debates as authoritative texts. See Stephen Breyer, On the Uses of Legislative History in Interpreting Statutes, 65 S. Cal. L. Rev. 845, 848–50 (1992). The detachment of this current approach from reality is evident in the fact that no court appears ever to have mentioned the offices of legislative counsel of the House and Senate of the U.S. Congress, which employ dozens of lawyers who draft the actual texts of the bills proposed by federal legislators. See Office of the Legislative Counsel, Welcome to the Office of the Legislative Counsel of the U.S. House of Representatives, https://legcounsel.house.gov/ (last visited Sept. 9, 2018). It seems reasonable to suppose that those who actually wrote the language of the laws on the books might be able to explain the intent behind key words. The fact that no court has ever seen fit to ask these bill drafters what their words were meant to convey reflects the Renaissance orientation of statutory interpretation toward texts rather than reality.

[22] Harold Berman observes that the scientific revolution brought a focus on cases and evidentiary standards to the law that reflected an interest in the empirical. See Harold Joseph Berman, Law and Revolution, II the Impact of the Protestant Reformations on the Western Legal Tradition 301 (2006). A focus on cases creates only the semblance of empiricism, however, so long as that focus is mediated by analogical reasoning from precedent.

[23] See Fried, supra note 13, at 14.

[24] See id.; Morton J. Horwitz, The Transformation of American Law, 1870-1960, at 169 (1992); Duncan Kennedy, Two Globalizations of Law & Legal Thought: 1850-1968, 36 Suffolk U. L. Rev. 631, 636 (2003).

[25] See Fried, supra note 13, at 14. A hundred years ago, the realists would in fact have been replacing LLBs, rather than JDs. The bachelor of law was the main degree awarded by law schools at the time. See J. Gordon Hylton, Why the Law Degree Is Called a J.D. and Not an LL.B., Marquette University Law School Faculty Blog, Jan. 11, 2012, https://law.marquette.edu/facultyblog/2012/01/11/why-the-law-degree-is-called-a-j-d-and-not-an-ll-b/.

[26] See Shael Herman, The Fate and the Future of Codification in America, 40 Am. J. Legal Hist. 407, 427–32 (1996); Douglas Laycock, Modern American Remedies: Cases and Materials 159–60 (4th ed. 2010).

[27] See Christopher J. Walker, Attacking Auer and Chevron Deference: A Literature Review, 16 Geo. J.L. & Pub. Pol’y 103, 105–6, 110–11 (2018).

[28] See Horwitz, supra note 24, at 220–22; Theda Skocpol & Kenneth Finegold, State Capacity and Economic Intervention in the Early New Deal, 97 Pol. Sci. Q. 255, 261 (1982).

[29] See generally Fried, supra note 13, at 160–93 (recounting this history).

[30] See Chicago, M. & St. PR Co. v. Minnesota, 134 U.S. 418, 458 (1890); Munn v. Illinois, 94 U.S. 113, 124–26 (1876); Fried, supra note 13, at 165–69, 176, 186–89; Robert L. Rabin, Federal Regulation in Historical Perspective, 38 Stan. L. Rev. 1189, 1208-09 (1986) (discussing Munn).

[31] See U.S. Const. amend. 5; Fried, supra note 13, at 175–89.

[32] See id.; Power Comm’n v. Hope Gas Co., 320 U.S. 591, 601–02 (1944).

[33] A high-water mark was reached in the 1970s, on the eve of deregulation, and since then the scope of the administrative state has contracted to a modest degree. See Richard A. Posner, The Problematics of Moral and Legal Theory 232–33 (1999);  Horwitz, supra note 24, at 230–68 (describing the reaction against regulation that started at the end of the New Deal).

[34] See Singer, supra note 21, at 503–04.

[35] See A.W.B. Simpson, The Rise and Fall of the Legal Treatise: Legal Principles and the Forms of Legal Literature, 48 U. Chi. L. Rev. 632, 677–79 (1981).

[36] See Singer, supra note 21, at 504; Charles W. Collier, The Use and Abuse of Humanistic Theory in Law: Reexamining the Assumptions of Interdisciplinary Legal Scholarship, 41 Duke L.J. 191, 201–06 (1991); Calabresi, supra note 15, at 9.

[37] See Calabresi, supra note 15, at 15–16.

[38] See Fried, supra note 13, at 14.

[39] See id. at 186–93.

[40] See Calabresi, supra note 15, at 11–16.

[41] See id. at 15–16.

[42] See Elizabeth Mensch & Alan Freeman, Efficiency and Image: Advertising as an Antitrust Issue, 1990 Duke L.J. 321, 352–53 (discussing the limits of the assumption of static preferences in the advertising context).

[43] See Singer, supra note 21, at 503–04.

[44] For a rare example of a realist court opinion, see Roe v. Wade, 410 U.S. 113, 141–62 (1972). For an example of a contemporary opinion in the legal reasoning mold, see supra note 10.

[45] Much has been made of the spread of factor tests that require judges to balance “conflicting considerations” after 1945. See Kennedy, supra note 24, at 675–76; Duncan Kennedy, A Critique of Adjudication: Fin de Siècle 147–52 (1997). Judges certainly must consider consequences in order to apply these tests properly, but the persistence of the practice of analogizing from precedents usually prevents judges from properly applying the tests. Instead of considering consequences in weighing factors, judges analogize to past applications of the factors. For example, in one recent case, the Supreme Court applied the factor test for probable cause by mimicking the outcomes of past cases having similar facts, rather than by undertaking an independent evaluation of each factor, even though the Court acknowledged that probable cause is “a fluid concept that is not readily, or even usefully, reduced to a neat set of legal rules.” See District of Columbia v. Wesby, 138 S. Ct. 577, 586–88 (2018) (internal citations omitted). All else equal, a truly realist approach would give zero weight to the fact that similar cases were decided in a particular way. The popularity of factor tests does not represent the triumph of realism in adjudication.

[46] See Adam Mossoff, Trademark as a Property Right, 107 Ky. L.J. 1, 3–5 (2018).

[47] See id. at 4–5. For the definition of easements, see Jesse Dukeminier et al., Property 767 (7th ed. 2010).

[48] See Mossoff, supra note 46, at 4.

[49] In fact, Mossoff claims that the link is to the reputation of the business, which he calls goodwill. See id. at 11–18. Trademark has traditionally been tied not to goodwill in particular, however, but to the business, or more specifically to the assets that generate the product that is associated with the mark in the minds of consumers. See Robert P. Merges et al., Intellectual Property in the New Technological Age 909–10, 963–64 (6th ed. 2012) (discussing inter alia unsupervised licensing). This response essay will proceed as if Mossoff had made the more accurate claim of a link to the business, rather than to goodwill.

[50] Actually the tie exists only for “appurtenant” easements, whereas easements “in gross” are not tied to ownership of other land. See Dukeminier et al., supra note 47, at 767.

[51] Mossoff, supra note 46, at 4.

[52] See id. at 10–11.

[53] See Merges et al., supra note 49, at 765.

[54] See id. at 795–98.

[55] Frederic M. Scherer, First Mover Advantages and Optimal Patent Protection, 40 J. Tech. Transfer 559, 570–76 (2015) (discussing the consequences of brand loyalty in the first-mover advantage context).

[56] See Merges et al., supra note 49, at 766–68.

[57] See Mossoff, supra note 46, at 24.

[58] See Fogelin & Sinnott-Armstrong, supra note 12, at 427; Fried, supra note 13, at 14; Singer, supra note 21, at 468–69.

[59] In emphasizing the indeterminacy of the law, the critical legal studies movement carried the banner of this second aspect of legal realism in the last half of the 20th century, but the movement seemed to find little value in the orientation toward consequences and reality demanded by the first aspect of legal realism. See Kennedy, supra note 45, at 339–44. Critical legal scholars tended to assume that the indeterminacy of policy analysis made realism’s focus on consequences no more valuable than legal reasoning’s focus on analogy and precedent, no less a mystification, despite realism’s orientation toward reality. See id. at 147–52.

[60] See Cohen, supra note 15, at 814, 820.

[61] See Mossoff, supra note 46, at 9–11.

[62] See id. at 7, 20–21.

[63] See Merges et al., supra note 49, at 765.

[64] See id. at 147–52.

[65] See id.

[66] See Singer, supra note 21, at 474.

[67] See id. at 473.

[68] See Cohen, supra note 15, at 821.

[69] See Mossoff, supra note 46, at 7, 20–21.

[70] See id. at 20–21.

[71] See id.

[72] See Singer, supra note 21, at 490–94; Cohen, supra note 15, at 820. What seems to have confused Mossoff in the “right to exclude” rhetoric of the realists is the realists’ position that all rights, of property or otherwise, interfere with the rights of others. See Fried, supra note 13, at 53–56. Nineteenth century courts tried to maintain that property rights are a purely private affair, distinct from government exercise of coercive power. See id. For these courts, property involved a relationship between a person and the owned thing, and nothing more. See id. at 50–51. The realists countered that property rights involve relations between people, because it is inherent in the notion of a right over something that someone else’s right over that thing must be limited in some way. See id. at 53–56. Owning land implies a right to keep others off the land, at least at some times for some reasons. See id. It follows that state guarantees of property rights amount to the use of coercive government power against some people (the non-owners) in favor of the owners. See id. Property is therefore just as much a matter of government regulation as are the administrative agencies favored by the realists, and the courts therefore cannot cast their resistance to the regulatory state as a struggle between private property and government. See id. Private property is government too.Because their antagonists considered property to be absolute dominion, realists argued that property amounts to a right to exclude everyone without limitation. But that does not mean that realists think that the right to exclude granted by property must always be total. Realists are just as happy viewing limited rights, such as trademark rights, as rights to exclude. Their position is that all rights are rights to exclude to a greater or lesser extent.

[73] See Fried, supra note 13, at 176.

[74] See id.

[75] See id.

[76] See Cohen, supra note 15, at 820.

[77] See id.

[78] See Fried, supra note 13, at 51–52.

[79] See id. at 53.

[80] See Singer, supra note 21, at 467.

[81] For an excellent example of the economic analysis of intellectual property, see Vincenzo Denicolò, Do Patents Over-Compensate Innovators?, 22 Econ. Pol’y 680, 681–99 (2007); Scherer, supra note 55, at 560–76. For a discussion of realist approaches in a leading casebook, see Merges et al., supra note 49, at 10–16. For the “heaven of legal concepts,” see Cohen, supra note 15, at 809.

Metaphors on Trademark: A Response to Adam Mossoff, “Trademark as a Property Right”

Download a copy of this Article:

Metaphors on Trademark: A Response to Adam Mossoff, “Trademark as a Property Right” Download

Response Piece | 107 KY. L. J. ONLINE | Volume 107

Brian L. Frye[1]

“Metaphors in law are to be narrowly watched, for starting as devices to liberate thought, they end often by enslaving it.”[2] – Benjamin N. Cardozo

I. Introduction

There are two kinds of “intellectual property” scholars: those who use scare quotes and those who don’t.[3] Some scholars believe that intellectual property is just another kind of property, which the law should treat the same as any other kind of property.[4] But others believe that “intellectual property” has little or nothing in common with physical property and see the term “property” as little more than a misleading metaphor.[5] The disagreement between these two schools of thought is probably strongest when it comes to trademarks, which lack many of the “property–like” features of patents and copyrights, most notably alienability.

Adam Mossoff is decidedly in the property camp.[6] In his provocative but rather quixotic essay, “Trademark as a Property Right,” he claims that trademark simply “is” a property right. He observes that trademark can be conceptualized as a form of property right and notes that when 19th century courts initially created trademark doctrine, they often relied on analogies to physical property.[7] Mossoff shows that many features of historical and contemporary trademark doctrine can be analogized to use–rights in physical property, especially easements appurtenant and riparian rights.[8] Accordingly, he argues that trademarks should be defined as a form of use–rights, and receive similar treatment.[9]

I agree with Mossoff’s descriptive claim that trademarks can be and have been analogized to certain forms of physical property rights. His doctrinal and historical arguments are compelling. But the fact that courts have analogized trademarks to use–rights in the past does not obligate them to continue using the analogy.[10] And the fact that trademarks can be analogized to use–rights does not imply that courts must rely on that analogy.  It depends on your theory of trademarks.

People can and do reasonably disagree about whether and why trademarks are justified. Consequentialist theories hold that trademarks are a means to an end, and deontological theories hold that trademarks are an end in themselves.[11]Mossoff’s normative claims are decidedly deontological— specifically Lockean. He argues that business owners are entitled to own trademarks associated with the commercial goodwill they labored to create.[12] But consequentialist theories don’t ask whether people are entitled to own trademarks. They ask whether good things happen when people are allowed to assert trademark rights.

Accordingly, whether you find Mossoff’s normative claims appealing will depend on your own normative premises. He is unlikely to convince consequentialists, unless he convinces them to change their premises.

Mossoff’s essay also makes an epistemological claim, arguing that we should analogize trademarks to use–rights because it will help us better understand how trademarks can and should work.[13] Is he right? Maybe. At the very least, his analogy has some purchase on trademark history and doctrine. Surely, both deontological and consequentialist theories can benefit from a more robust understanding of the historical development of trademark law. But it is unclear how “tradition” could provide any consequentialist justification for trademark doctrines that produce undesirable results. 

II. Mossoff’s “Property Theory” of Trademarks

As he must, Mossoff recognizes that the prevailing theory of trademarks is utilitarian.[14] The overwhelming majority of courts and scholars assume that a trademark is “a regulatory entitlement whose function is to increase social welfare by reducing consumer search costs.”[15] In theory, modern trademark law “amounts to little more than industrial policy.”[16] However, the paradigmatic problem with trademark doctrine is its failure to regulate competition efficiently.[17]

Mossoff objects to the utilitarian theory of trademarks. He argues that trademarks can and should be “defined as a property right.”[18] Or rather, he argues that courts and scholars should adopt a Lockean theory of trademarks and conceptualize trademarks as a kind of “property” right analogous to physical property rights.

Mossoff begins by explicitly rejecting utilitarianism and proclaiming his fealty to the “Lockean property theory.”[19] He then observes that the historiography of trademark law is dominated by the utilitarian perspective.[20] While contemporary trademark scholars generally recognize that 19th century courts often adopted a “goodwill–as–property” theory of trademark, they describe a gradual transition to an “unfair competition” theory of trademark.[21] Mossoff disagrees, arguing that trademarks can and should be described in Lockean terms.[22]

While Mossoff disclaims any intention to provide an “intellectual history” of trademark law, he traces the origin of trademark law to the emergence of the concept of commercial goodwill in the early 19th century.[23] He argues that 19th century courts and scholars defined goodwill as the “reputational value” of a commercial enterprise and saw trademarks as a way of using that goodwill.[24] In other words, they saw the exclusive right to use a trademark as a function of the exclusive right to own the goodwill associated with a commercial enterprise.[25] This is consistent with Lockean property theory, which defines property as “the right to exclusive use of the fruits of one’s productive labors.”[26] Goodwill is property because it consists of an exclusive right to the reputational value of a commercial enterprise. But what about trademarks?

According to Mossoff, trademarks are also property, albeit a different kind of property. He argues that trademarks are a form of “use–right” or “usufruct” inherent in commercial goodwill.[27] In property law, a use–right is a property right “necessarily derived from or attached to an accompanying property right.”[28] If goodwill is a property right, and trademarks inhere in goodwill, then trademarks are analogous to a use–right in goodwill.

Mossoff explains his use–right theory of trademarks by analogy to paradigmatic use–rights like riparian rights and easements appurtenant.[29] An easement appurtenant is “a use–right derived from and attached to a dominant estate that permits use of another servient estate.”[30] For example, a right to cross someone else’s land in order to reach your own land is an easement appurtenant. Mossoff argues that a trademark is a property right “appurtenant” to commercial goodwill because it consists in an exclusive right to use a mark, but only in relation to the commercial goodwill it signifies.[31]

Mossoff shows that courts have routinely referred to trademarks as “property” rights “appurtenant” to goodwill.[32] He shows that it is possible to analogize particular features of trademark doctrine to the property doctrine of easements appurtenant. For example, the owner of an easement appurtenant cannot convey it separately from the estate to which it is attached, because doing so would transform it into an “easement in gross.”[33] Likewise, a trademark owner cannot convey it separately from the goodwill to which it is attached, because doing so would transform it into a “trademark in gross.”[34] Moreover, like all use–rights, a trademark exists and is enforceable only insofar as it is actually used in commerce.[35]

As Mossoff observes, this parallelism is obviously not a coincidence. Courts describe trademarks in terms of use–rights because they derived trademark doctrine in substantial part from the doctrine of use–rights.[36] Accordingly, he argues that courts and scholars should continue to analogize trademarks to use–rights. By implication, he argues that they should adopt a theory of trademarks modeled on the Lockean property theory rather than a utilitarian theory. 

III. Trademark “Ownership” & Its Discontents

I found this essay intriguing, but also puzzling. Mossoff convincingly shows that trademarks can be analogized to use–rights in physical property. He provides a compelling argument that the viability of that analogy is not an accident, but a function of the historical development of trademark doctrine. In other words, trademarks resemble use–rights because courts modeled them on use–rights.

But he wants to do more. He wants to show that trademark “is” a property right. Rather, he wants to show that trademarks should be defined as a kind of “property” and afforded the same kinds of exclusive rights as physical property.[37]

He does not achieve that goal. And I do not see how he possibly could, given the nature of his claims.

Mossoff argues that the utilitarian account of trademarks as regulatory entitlements that promote consumer welfare is wrong, because trademarks look like use–rights, and trademark doctrine sprung from the brow of property doctrine.[38] But that misses the point. The project of utilitarianism is not to describe the law as it is, but as it should be. Utilitarians can cheerfully concede all of Mossoff’s points, because they do not care about legal doctrine for its own sake— they care about its results. In other words, Mossoff cannot effectively challenge the utilitarian theory of trademarks because he is not speaking its language.[39]

Mossoff explicitly endorses the Lockean theory of property, which provides that people are entitled to exclusive ownership of the fruits of their labor.[40] If one accepts the Lockean theory of property, it follows that people are entitled to own anything analogous to Lockean property, including trademarks associated with the goodwill in their business.

But utilitarians are consequentialists, who reject Mossoff’s Lockean premise. According to utilitarians, property is purely instrumental, and the purpose of trademarks is only to increase net social welfare. While Mossoff’s arguments will surely speak to those who accept the Lockean theory of property, it is not clear whether they have anything to offer utilitarians, at least with respect to his normative claims.

Indeed, as Mossoff recognizes, other trademark scholars have identified the historical use of commercial goodwill as a justification for conceptualizing trademarks as a form of property.[41] Those scholars argued that the use of “property” metaphors gradually diminished as utilitarian premises began to dominate trademark theory. Mossoff makes a convincing case that trademarks were not actually conceptualized as property in goodwill but “use–rights appurtenant to” goodwill.[42] From a utilitarian standpoint, who cares? It just doesn’t matter what kind of property metaphor you use if the metaphors lead to bad results. 

IV. Trademark as Metaphor

Mossoff also makes a valuable contribution by showing that trademarks can be and have been analogized to use–rights in physical property. Whether or not you think trademarks should resemble use–rights, it may be a helpful way of describing trademark doctrine and how it has evolved over time.

Legal reasoning loves analogies. Indeed, analogical reasoning is arguably the paradigmatic form of common law legal reasoning.[43] The very concept of “precedent” requires analogical reasoning. If a case supplies a rule, analogical reasoning enables a court to apply the rule.[44]

And yet, analogical reasoning has both strengths and weaknesses.[45] It can clarify by enabling people to express ideas more efficiently and effectively. Nothing is more rhetorically powerful than a compelling analogy. But it can also obscure by encouraging people to ignore the practical consequences of adopting a policy. A powerful analogy can normalize an objectively undesirable outcome. Analogies are valuable when they facilitate the expression of an unfamiliar concept in familiar terms. They are dangerous when they enable the use of familiar terms to justify bad decisions.[46]

As I have previously explained, intellectual property metaphors are often unhelpful.[47] Accordingly, the question is whether Mossoff’s analogy to use–rights clarifies or obscures our understanding of trademarks.[48] I am convinced that his analogy helps to clarify our understanding of the historical development of trademark doctrine and why it has adopted certain principles, including the rejection of “trademarks in gross.” But I am not convinced that it helps to clarify our understanding of what trademarks should look like today.

Mossoff’s analogy probably helps explain why most people think trademarks are justified. He is hardly alone in accepting Lockean property theory. While utilitarianism dominates the academy, Lockeanism surely dominates the electorate. And Mossoff provides a convincing explanation of why people who accept Lockeanism tend to think trademarks are normatively justified. He makes explicit a previously unarticulated analogical relationship and helps explain why trademark law took its present form.

But is that form justified? If you accept Mossoff’s Lockean theory of property, then you should ask whether contemporary trademark doctrine is justified as a way of protecting a legitimate right to the fruits of labor. Whether trademarks resemble use–rights in physical property seems entirely irrelevant. Surely, under Lockean property theory, the justification for a property right depends on its intrinsic, metaphysical qualities, not merely its similarity to some other property right. Maybe trademarks are justified on Lockean terms, but can a mere analogy actually prove it?

By contrast, if you accept a utilitarian theory of property, then Mossoff’s entire normative premise is irrelevant. As a practical and political matter, utilitarians should pay attention to why Lockeans think trademarks are justified. But they have no reason to accept those justifications. For utilitarians, Mossoff’s analogy simply provides a helpful way of explaining how trademark law went wrong. If the purpose of trademark doctrine is to enshrine inefficient and unjustified property metaphors where they do not belong, then utilitarians should happily discard it in favor of more efficient doctrines. 

5. Conclusion

 In sum, Mossoff’s essay makes a valuable contribution to scholarship on Lockean theories of intellectual property. Specifically, his use–right analogy provides a helpful way for Lockean theorists to explain how trademarks fit into a Lockean framework. But Mossoff’s analogy does not and cannot show that trademarks must be conceptualized in Lockean terms. For utilitarians who believe that trademarks are merely a means to the end of promoting consumer welfare, Mossoff’s analogy is of formal and historical interest, but no more.   

---

[1] Spears–Gilbert Associate Professor of Law, University of Kentucky School of Law. J.D., New York University School of Law, 2005; M.F.A., San Francisco Art Institute, 1997; B.A, University of California, Berkeley, 1995. Thanks to Ramsi Woodcock and David A. Simon for helpful comments.

[2] Berkey v. Third Ave. Ry. Co., 155 N.E. 58, 61 (1926).

[3] However, as Ed Timberlake has observed, “Though the number of types of ‘intellectual property’ scholars may be few, innumerable are the unrelated subjects thrown into this conceptual junk drawer.” Ed Timberlake (@TimberlakeLaw), Twitter (Sept. 7, 2018, 11:14AM).

[4] See, e.g., Adam Mossoff, Intellectual Property and Property Rights ix (Adam Mossoff, ed. 2013).

[5] Id. at ix.

[6] See Mossoff, supra note 4.

[7] Adam Mossoff, Trademark as a Property Right, 107 Ky. L.J. XX, 3 (2018).

[8] Id. at 4.

[9] For a thoughtful review of Mossoff’s essay, see Camilla Alexandra Hrdy, Adam Mossoff: Trademarks As Property, Written Description (Sept. 5, 2017, 9:52 PM), https://writtendescription.blogspot.  com/2017/09/adam-mossoff-trademarks-as-property.html.

[10] See Mossoff, supra note 7, at 4–5 (highlighting how earlier courts recognized that trademark is a “property right”).

[11] See Intellectual Property, Stanford Encyclopedia of Philosophy, October 10, 2018, at https://plato.stanford.edu/entries/intellectual-property/ (discussing theories of copyright).

[12] See Mossoff, supra note 7, at 4.

[13] Id. at 3.

[14] Id. at 2–3.

[15] Id. While Mossoff consistently refers to this as a “legal realist” theory of trademarks, it is more properly characterized as a “utilitarian” theory of trademarks, or more specifically, a “welfare economic consequentialist” theory of trademarks. Legal realism is a descriptive theory about how law actually works, and does not imply any particular normative theory. Of course, utilitarianism and other consequentialist normative theories are common among legal realists.

[16] Mark P. McKenna, The Normative Foundations of Trademark Law, 82 Notre Dame L. Rev. 1839, 1843 (2007).

[17] See, e.g., Mark A. Lemley, The Modern Lanham Act and the Death of Common Sense, 108 Yale L.J. 1687, 1688 (1999).

[18] See Mossoff, supra note 7, at 3.

[19] Id. at 6.

[20] See id. at 6–7.

[21] Id. at 7–8.

[22] Id. at 10–11.

[23] Id. at 11–12.

[24] Id. at 14–15.

[25] Id. at 15–16.

[26] Id. at 17.

[27] Id. at 20–21. A “usufruct” is a “legal right of using and enjoying the fruits or profits of something belonging to another.” Merriam Webster, Usufruct, https://www.merriam-webster.com/dictionary/ usufruct (last visited Oct. 20, 2018).

[28] Id. at 21.

[29] Id. at 21.

[30] Id. at 22 (citing the Restatement (Third) of Property: Servitudes § 1.2(1) (Am. Law Inst. 2000)).

[31] Id. at 23–25.

[32] Id. at 24–25.

[33] Id. at 29–30.

[34] Id. at 29–32.

[35] Id. at 33.

[36] Id. at 37.

[37] See Camilla Alexandra Hrdy, Adam Mossoff: Trademarks As Property, Written Description (Sept. 5, 2017, 9:52 PM), https://writtendescription.blogspot.com/2017/09/adam-mossoff-trademarks-as-property.html (“In other words, Mossoff's main contribution here is not actually the goodwill–to–trademark linkage. Rather, it is his extensive use of the historic case law and detailed application of Locke's labor theory to justify a trademark as property.”).

[38] See Mossoff supra note 7, at 32.

[39] See, e.g., Lemley, supra note 17.

[40] John Locke, Second Treatise of Government § 27 (C. B. Macpherson ed., Hackett Pub. Co., Inc. 1980) (1690).

[41] Mossoff, supra note 12, at 7–9 (discussing Robert G. Bone, Hunting Goodwill: A History of the Concept of Dilution in Trademark Law, 86 B.U. L. Rev. 547, 569­–72 (2006); Mark P. McKenna, The Normative Foundations of Trademark Law, 82 Notre Dame L. Rev. 1839 (2007)).

[42] Mossoff, supra note 17, at 23–27.

[43] See generally, Lloyd Weinreb, Legal Reason: The Use of Analogy in Legal Argument (2005); Cass R. Sunstein, On Analogical Reasoning, 106 Harv. L. Rev. 741 (1993).

[44] See generally, David A. Simon, A Philosophy for Moral Rights?: The Self, Society, & the Author-Work Relation, Chapter 4: Failed Analogies to Explain the Relation Between Author and Work (unpublished dissertation) at 6.

[45] Id. at 7–10.

[46] Id.

[47] Brian L. Frye, IP as Metaphor, 18 Chap. L. Rev. 735 (2015).

[48] See generally, Simon, supra note 44 (asking whether various analogies clarify or obscure the nature of the author–work relationship).

Throwing the Challenge Flag on the NFL’s Collective Bargaining Agreement

Download a copy of this Note:

Throwing the Challenge Flag on the NFLs Collective Bargaining Agreement Download

Student Note | 107 KY. L. J. ONLINE | Volume 107

Throwing the Challenge Flag on the NFL’s Collective Bargaining Agreement

Joseph T. McClure[1]

I. Introduction

The National Football League (“the NFL” or “the League”), founded in 1920 and comprising 32 teams, is the most watched and most profitable professional sports organization in the United States.[2] Each team is allowed to roster 53 players for a league total of 1,696 players.[3] In the 2016 season, the League suspended 66 players, or approximately 4 percent of all players for various violations of NFL rules.[4] From 2002 to 2009, the League suspended just 55 players total.[5] The 2016 season is not merely an anomaly; the League has suspended 297 players since 2011, the year the NFL and the NFL Players’ Association (“NFLPA”) negotiated the current Collective Bargaining Agreement (“CBA”).[6] This astonishing rise in the number of suspended players necessitates a closer look at the power the League exerts over its employees in the context of disciplinary action.

Collective bargaining agreements are negotiated commercial contracts between sophisticated parties, typically between a labor organization and an employer.[7] In the employment context, the contract governs the parties’ relationship, establishing terms and conditions of employment as well as policies and procedures for resolving disputes.[8] Collective bargaining agreements are typically governed under the National Labor Relations Act (“NLRA”).[9] Many collective bargaining agreements contain arbitration clauses to avoid litigation and reduce the costs of resolving disputes between the parties.[10] Arbitration clauses are typically governed by the Federal Arbitration Act.[11]

Other professional sports organizations often operate under similar collective bargaining agreements.[12] However, procedures for dispute resolution are drastically different in other professional sports organizations. For example, the National Basketball Association (the “NBA”) and the NBA Players’ Association (“NBAPA”) have agreed to appoint a “Grievance Arbitrator” to resolve all disputes.[13] This Grievance Arbitrator is completely independent, and appointed at the consummation of the collective bargaining agreement to serve a term that runs concurrently to the duration of the agreement.[14] The Grievance Arbitrator may be removed by notice of discharge filed by either the NBA or NBAPA, and the parties must then agree to the appointment of a replacement arbitrator.[15] If the parties are unable to agree on a replacement arbitrator, the parties must jointly request the International Institute for Conflict Prevention and Resolution (“CPR”) “or other organization(s) as the parties may agree upon” to submit to the parties eleven (11) attorneys who have no actual or apparent conflicts within the past five (5) years.[16] The parties may choose from these eleven names, or else delete five (5) of the names, and return the remaining six (6) names to the CPR Institute.[17] From the remaining six names, the CPR Institute will choose a new Grievance Arbitrator.[18] Unlike the NFL, the NBA Collective Bargaining Agreement provides clear procedures for dispute resolution, including explicit evidentiary procedures.[19] These procedures clearly provide for a discovery process, the exchange of all relevant evidence and witness lists, and require the parties to agree on a statement of the issues prior to commencement of the arbitration proceeding.[20]

Under each collective bargaining agreement negotiated by the NFL and NFLPA since 1968, the Commissioner of the NFL has retained not only the exclusive power to impose disciplinary action, but also the power to act as the arbiter for any appeal of that action.[21] As previously noted, this arrangement is extraordinary. The NFL Collective Bargaining Agreement does not provide the parties any procedural remedies to remove an arbitrator for bias or select a new arbitrator subject to agreement of both parties.[22] Additionally, the procedures defined by the NFL’s Collective Bargaining Agreement are vague, and the process for admitting and utilizing evidence is largely undefined. The combination of broad power afforded to the Commissioner, and the vague standard of dispute resolution procedures have allowed the NFL to take advantage of dispute resolution procedures to the detriment of their players. This Note seeks to examine the power of the NFL Commissioner under Article 46 of the current CBA against the backdrop of the parties’ negotiations. In addition, this Note seeks to examine recent high–profile challenges to exercises of the Commissioner’s Article 46 power in the court system, scrutinizing Article 46’s adherence to the Federal Arbitration Act (“FAA”). This Note argues that the precedent set in Brady II was incorrect, has led to at least one other incorrect decision, and empowers the NFL to continue to skirt the requirements of fundamental fairness imposed by the Federal Arbitration Act.

 II.  The NFL’s Current Collective Bargaining Agreement

Negotiations for the current CBA began in 2010, spurned largely by Commissioner Goodell’s threat to “lock out” the players if no agreement was reached by March 1, 2011.[23] The most prominent issues included player health and safety protections such as limits on “two–a–days” and offseason practices, as well as full–contact practices in both the pre–season and post season.[24] The NFLPA also focused on securing medical benefits for the players, including the creation of neuro–cognitive benefits for players with concussions and other similar football–related injuries.[25] Finally, the NFLPA negotiated for revenue sharing for the players.[26] This current CBA is effective through the 2020 NFL season.[27] Notably, negotiations did not focus on player discipline or the procedures and protections afforded to players accused of misconduct on or off the field. Statistics mentioned in the introduction illuminate the importance of player disciplinary procedures and the powers afforded to the NFL that were not considered in negotiations. [28] The 400% increase in player suspensions following the 2011 negotiations is astonishing, and it’s clearly not an event the parties contemplated in their negotiations.[29]

III. Adherence to the Federal Arbitration Act

The Federal Arbitration Act (“FAA”) was enacted by Congress to enable judicial oversight of private dispute resolution, or arbitration. Arbitrators are not bound by the formal rules of evidence and may draw on their own personal knowledge when making their awards.[30] However, Congress did not intend for arbitration to be the Wild West of dispute adjudication and resolution.[31] Section 10 provides grounds for vacating arbitration awards, including “where the arbitrators were guilty of misconduct in . . . refusing to hear evidence pertinent and material to the controversy. . . . .”[32] Courts have also recognized grounds for vacatur where the process of the arbitration denies a party “fundamental fairness.”[33] The case law that surrounds these two pillars of Section 10 is erratic, especially in regard to fundamental fairness. Evidentiary findings of the arbitration are generally not subject to review, but when the findings (or denial of process to make findings) lead to fundamental unfairness, Courts have a role in ensuring equity.[34] In other words, when the arbitrator fails to make findings of material and pertinent information, the error itself amounts to misconduct providing grounds for vacatur of the award on the grounds of fundamental fairness.[35] This is true whether the omission of material and pertinent evidence is intentional, a product of poor judgment, or by mistake; all omissions of material and pertinent evidence amount to error and open the award to judicial review.[36] The following cases illustrate cognitive dissonance in how Section 10 of the FAA operates to protect parties against fundamental unfairness in private dispute resolutions.

IV. Tom Brady

On January 18, 2015, the New England Patriots led by quarterback Tom Brady defeated the Indianapolis Colts in the American Football Conference Championship game and advanced to the Super Bowl.[37] Shortly thereafter, the NFL began an investigation into the Patriots’ use of underinflated footballs during the first half of the football game.[38] The investigation was conducted by co–lead investigators Jeff Pash and Theodore Wells (“Pash/Wells Investigation”).[39] Pash was serving as the NFL Executive Vice President as well as NFL General Counsel.[40] Wells was an attorney at the firm of Paul, Weiss, Rifkind, Wharton, & Garrison (“Paul Weiss Law Firm” or “Paul Weiss”).[41] At the conclusion of the investigation, Pash and Wells issued a report (“Wells Report”) in which they determined that “more probabl[y] than not,” Brady was “generally aware” of activities of two Patriot equipment staff members who “more probab[ly] than not” deliberately released air from the balls prior to the beginning of the AFC Championship Game.[42] Exercising the disciplinary powers of the CBA, the Commissioner handed Tom Brady a four-game suspension without pay.[43] The Commissioner also disciplined the Patriots organization by fining the team $1 million and garnishing two picks in the upcoming NFL draft.[44]

On May 14, 2015, Tom Brady appealed[45] the decision pursuant to the CBA arbitral process.[46] Pursuant to CBA Art. 46 § 2(a), Commissioner Goodell designated himself as arbitrator to hear Brady’s appeal.[47] Brady immediately made a motion seeking Goodell’s recusal, arguing among other things that the Commissioner “cannot lawfully arbitrate a matter implicating the competence and credibility of NFL staff,” and noting that in other high profile arbitrations that Goodell had publicly commented on, Goodell had recused himself (Rice[48] and Bounty–Gate[49]).[50] Brady’s motion was denied by Goodell, citing the Commissioner’s Article 46 powers to act as arbitrator at his discretion.[51] Brady made a motion to compel “all documents created, obtained, or reviewed by NFL investigators” in connection with the investigation.[52] This motion, too, was denied by Goodell, who cited to Art. 46 and asserted that it provides for “tightly circumscribed discovery and does not contemplate the production of any other documents in an Article 46 proceeding.”[53] Brady also made a motion seeking to compel testimony from NFL Executive Vice President and co–lead investigator Jeff Pash.[54] Goodell also denied this motion, arguing that as the given absence of defined scope in Article 46, it is within the Commissioner’s discretion to determine the scope of the presentations.[55] In support of this denial, Goodell stated “Pash, the NFL’s General Counsel, does not have any first–hand knowledge of the events at issue here.”[56]

On July 28, 2015, following the arbitral hearing, Goodell published a final decision finding Brady “knew about, approved of, [and] consented to” a scheme to deflate footballs prior to the AFC Championship Game.[57] (As the District Court noted, this finding “goes far beyond the ‘general awareness’ finding in the Wells Report or the disciplinary notice sent to Brady).[58]

Before the beginning of the 2015 NFL season, the Southern District of New York ordered the NFL to vacate Tom Brady’s suspension on the grounds of fundamental unfairness.[59] The Court found Goodell’s denial of Brady’s motions to compel production of documents and compel testimony of Pash violated [the Federal Arbitration Act] on the grounds of fundamental unfairness.[60] In light of its finding on these grounds, the Court did not reach a determination on Brady’s claims of evident partiality under § 10(a)(2).[61] The Court noted that its role in review of an arbitral process is limited but acknowledged the FAA allows vacatur of a decision where the arbitrator refused to hear evidence material and pertinent to the controversy, or where there is evident partiality.[62] A Court is not required to confirm an award obtained without fairness and due process.[63] The Court’s role is to review the arbitrator’s award to ensure he is effectuating the intent of the parties manifested in the collective bargaining agreement without “dispens[ing] his own brand of industrial justice.”[64]

The District Court was correct in finding the arbitrator’s denial of Pash’s testimony and the refusal to compel production of relevant documents constituted a fundamentally unfair hearing process. The Commissioner proctored no convincing reason for these denials, citing only his discretion as arbitrator under Article 46 of the CBA.[65] This exercise of discretion is insufficient in and of itself. Pash was the co–lead investigator and had access to all documents created and obtained during the course of the Pash/Wells Investigation.[66] Additionally, this information was also available to Wells. Significantly, Wells enjoyed the dual role as “independent investigator” and partner at Paul Weiss law firm, and the firm retained by the NFL for representation during the arbitration process.[67]

Given this dual role, it is inconceivable to presume the attorneys of the Paul Weiss law firm could have simultaneously fulfilled their duty to zealously represent their client in preparing for the hearing while conducting an “independent investigation.”[68] In previous arbitral proceedings involving the CBA at issue here, independent arbitrators had compelled testimony of NFL investigators despite the contention from the NFL that testimony would be cumulative or duplicative.[69] Here, without any contention as to the ways in which such testimony would be cumulative or duplicative, the District Court correctly found the Commissioner’s denial of Brady’s motion to compel testimony presented fundamental unfairness.[70]

The District Court also correctly found this denial was prejudicial to Brady and foreclosed the possibility of exploring the purported “independence” of the investigation.[71] As to the investigative files themselves, Goodell’s denial of Brady’s motion to compel production also rests on discretion alone, without any convincing substantive reason.[72] For example, Goodell asserted that “the Paul Weiss interview notes played no role in the disciplinary decisions; the Wells report was the basis for those decisions.”[73]

This statement is only barely true. While the decision was ultimately constructed from the Wells Report, the Wells Report was obviously constructed from the underlying investigative documents.[74] These investigative documents were available to the NFL throughout the arbitration, given that the Paul Weiss law firm acted as counsel retained by the NFL for both the investigation and representation purposes throughout the arbitral process.[75]

Additionally, the Commissioner attempts to argue it both ways, asserting that Article 46 sufficiently defines the discovery process, but also that its absence of clarity allows the Commissioner to exercise his discretion to make up the discovery rules out of thin air.[76] The District Court correctly recognized that absent provisions precluding the production of these documents, the arbitrator has the affirmative duty to ensure relevant documents are made available to the other party.[77] Failure to do so is a violation of fundamental fairness and thus grounds for vacating the award under §10(a)(3).[78]

Following this decision by the District Court, the League appealed, seeking vacatur of the District Court decision and reinstatement of Brady’s suspension.[79] The Circuit Court granted this appeal over a dissent, reversing and remanding the case to the District Court with instructions to confirm the arbitrator’s award.[80] This Note argues the Circuit Court’s decision  in “Brady II” is wrong and has set defective precedent in favor of the NFL in similar situations, empowering the League to exercise extraordinary unchecked power over its players in disciplinary proceedings. This Note further contends that the essence of the reasoning on which the Circuit Court relies for its decision is contrary to the requirement of the FAA to mandate fundamental fairness as an unwaivable and unmodifiable element of all arbitration agreements, regardless of the discretion granted to the arbitrator. Furthermore, the Circuit Court failed to adequately consider the implications of the conflict of interest presented by allowing one party to the dispute to act as the proverbial “judge, jury, and executioner” without regard to overarching fundamental fairness mandated by the FAA.

The Circuit Court rightly acknowledges that arbitrators appointed by a collective bargaining agreement must be allowed to effectuate the intent of the parties to resolve disputes outside the judicial system.[81] The Circuit Court astutely points out that collective bargaining agreements are the product of negotiations which reflect the priorities of the parties, and arbitrators are chosen because of their trusted judgment to “interpret and apply the agreement in accordance with . . . the various needs and desires of the parties.”[82] As discussed previously in this Note, player discipline was not a priority of either the NFL or the NFLPA at the time of the 2011 negotiations.[83] Prior to 2011, League discipline of players was rare, often inconsequential, and performed outside of the public eye.[84] The Circuit Court treats Article 46 of the CBA as if it were meticulously negotiated by the parties, resulting in a determination that the NFL should be permitted to act with plenary dictatorial power to bring accusations of misconduct, use League resources to conduct opaque investigations, and issue decrees of guilt or innocence without providing the accused with access to documents from the investigation, all in the name of providing the League with “discretion.”[85] This decision is bewildering in its result, but more troublingly, it is unsupported by sound logic and has resulted in perpetual harm.

The Circuit Court held that the Commissioner’s decision to exclude the testimony of Pash did not raise questions of fundamental fairness, and denial of the production of documents is not a grounds for vacatur of the award because the CBA did not require the exchange of such notes.[86] In these holdings, the Circuit Court ignores the obvious conflicts of interest presented by the Commissioner’s refusal to recuse himself and the retainer of the Paul Weiss law firm as both investigator and representative counsel.

The Circuit Court reasons that arbitrators do not need to comply with strict evidentiary rules and retain discretion to admit or exclude evidence.[87] This is certainly true, but the testimony of a lead investigator is undeniably pertinent and material to the controversy, and thus exclusion is grounds for vacation of an award.[88] While the arbitrator does not have to follow the Federal Rules of Evidence, common sense notions of fundamental fairness suggest the need to include testimony from a lead investigator. Instead, the Circuit Court suggests that pursuant to the parties’ bargain, the CBA would theoretically allow the Commissioner to impose punishment, then uphold his own decision on appeal without any investigation or hearing any evidence because this is what the parties must have intended by giving the Commissioner broad authority to regulate procedural matters.[89] The arbitrator’s discretion is bound by the intent of the parties in the collective bargaining agreement, and it cannot be argued in good faith that the NFLPA would have intentionally awarded the Commissioner with this sort of dictatorial disciplinary power.

As to the Commissioner’s denial of Brady’s motion to compel production of investigative documents, the Circuit Court reasons that because the CBA does not provide procedural rules for discovery, the discretion of the Commissioner is absolutely controlling.[90] This is incorrect. In the absence of procedures, the Commissioner is bound by fundamental fairness in exercising discretion and must effectuate the intent of the parties.[91] The Circuit Court reasons that the parties intentionally excluded discovery procedures because elsewhere in the CBA, a proceeding allows for “reasonable and expedited discovery . . . .”[92] This argument is flawed. The difference in language between Art. 15 § 3 – 

. . . Arbitrator shall grant reasonable and expedited discovery upon the application of any party where, and to the extent, he determines it is reasonable to do so. Such discovery may include the production of documents and the taking of depositions. 

(emphasis added), and Art. 46 (“the parties shall exchange copies of any exhibits upon which they intend to rely”) is merely semantics.[93] Both provisions contemplate that opposing parties should be allowed to request documents from their adversary. Both provisions also allow collection and presentation of material and pertinent documents from third parties. For the Commissioner to deny Brady’s request presents fundamental unfairness, but the Circuit Court props up this ridiculous assertion by concluding that the Commissioner was simply applying the CBA as written.[94] (How can a provision purported to be intentionally excluded also be interpreted as written? The author remains puzzled.)

 V. Ezekiel Elliott

In July 2016, Dallas Cowboys running back Ezekiel Elliot was investigated by Ohio law enforcement concerning allegations of domestic violence.[95] More than a year later, in August of 2017, the Columbus City Attorney’s Office issued a statement that it would not press charges against Elliott because of “conflicting and inconsistent information.”[96] However, the NFL initiated its own investigation, tapping Kia Roberts and Lisa Friel to lead the investigation and prepare a report (“Elliott Report”).[97] After reviewing the Elliott Report, the Commissioner imposed on Elliott a six–game suspension pursuant to the League’s Personal Conduct Policy.[98] Elliott and the NFLPA appealed.[99] During the appeal, the NFLPA compelled testimony from Roberts.[100] This testimony highlighted Roberts’ conclusions that Elliott’s accuser was not credible and had provided inconsistent statements, yet Roberts had been excluded from a meeting with Goodell, Friel, and outside advisors when the decision to suspend Elliott was finalized.[101] The NFLPA sought to compel testimony to determine whether key evidence and critical facts had been concealed from decision–makers, but the arbitrator denied this request.[102]

On September 1, 2017 (the day following the arbitrator’s announcement that a decision was forthcoming), the NFLPA and Elliott sued the NFL seeking vacatur of the impending decision and a temporary restraining order (or preliminary injunction).[103] The action was commenced in the Eastern District of Texas.[104] On September 5, 2017, the arbitrator issued his decision confirming the Commissioner’s six–game suspension, and the NFL filed suit in the Southern District of New York seeking confirmation of the award.[105] The motivation behind these dueling lawsuits is Brady II, as the NFL sought to take advantage of a particular favorable decision, and the NFLPA sought to avoid it. With the advantage of knowing exactly when the decision would be issued, the NFL would always be able to obtain their preferred venue.

In ruling on the NFLPA’s motion for a temporary restraining order (and preliminary injunction) which would stay the suspension, the Texas District Court noted the “unique and egregious facts, necessitating court intervention.”[106] The District Court based its concern on the FAA, citing to fundamental unfairness as a reason for intervening into otherwise bargained–for arbitration.[107] In an opinion eerily similar to that of the court in Brady I, the District Court raised concerns that the arbitration process had denied the admission of key witness testimony and documents, and such denial amounted to serious misconduct by the arbitrator.[108] Namely, the District Court expressed concern that certain conclusions of Roberts were excluded from the Elliott Report (namely that Elliott’s accuser’s allegations were not credible), despite Roberts sharing these conclusions with Friel.[109] In fact, Friel colluded with counsel for the NFL and jointly made the decision to exclude Roberts’ conclusions from the report and from further discussions with the Commissioner regarding discipline.[110] Moreover, these conclusions were suppressed until the arbitration hearing itself, and the District Court found that if the NFL had succeeded in its overall goal, Roberts’ conclusions would still be concealed from Elliott and the NFLPA.[111]

Given this suppression, the District Court concluded the arbitrator’s denial to compel testimony from Goodell regarding his knowledge of Roberts’ conclusions presented gross error and resulted in a fundamentally unfair hearing.[112] The District Court noted the decisions of Brady I and Brady II, stating, “the circumstances of this case are unmatched by any case this Court has seen.”[113] Seemingly, the Court noted the NFL’s willingness to stretch the boundaries of fundamental fairness in its arbitration process even further than the Second Circuit was willing to overlook.[114] The Court noted that fundamental unfairness infected Elliott’s appeal from the beginning, and “[a]t every turn, Elliott and the NFLPA were denied the evidence or witnesses needed to meet their burden.”[115] On September 8, 2017, the District Court granted the motion for temporary restraining order and preliminary injunction enjoining the arbitrator’s decision, thus effectively lifting the suspension pending a final ruling on the merits.[116]

The NFL appealed to the Fifth Circuit, arguing that because the NFLPA’s petition was filed before a final arbitration decision had been issued, the District Court lacked subject matter jurisdiction and the lawsuit was premature.[117] Over a dissent, the Circuit Court agreed with the NFL, vacating and remanding with instructions to dismiss the case for lack of subject matter jurisdiction.[118] The dissent acknowledged that the integrity of the arbitration process had been impugned by the NFL’s suppression of information during the arbitration process.[119] However, with this dismissal, litigation could only continue in the Southern District of New York, bound by the misguided precedent of Brady II.

The Southern District of New York first issued an opinion on October 17, 2017, maintaining the status quo and preserving the temporary restraining order to stay Elliott’s suspension.[120] The short opinion issued by Judge Crotty (a “Part I” substitute judge) granted the TRO and deferred consideration of the preliminary injunction to Judge Failla (who was on vacation at the time). In this short opinion, Judge Crotty noted Elliott and the NFLPA were “deprived of opportunities to explore pertinent and material evidence,” and refused to accept the NFL’s argument that because of Brady II, the NFLPA is foreclosed from making a fundamental fairness argument to attack the arbitrator’s award.[121]

Judge Failla held a hearing and issued an opinion on October 30, 2017.[122] The decision found the arbitration proceedings in accordance with the CBA and fundamental fairness, and denied the NFLPA’s motion for a preliminary injunction.[123] The opinion relied heavily on the Brady II decision, similarly finding that despite withholding key evidence and witnesses, the arbitration process was fundamentally fair.[124] Specifically, the Court declined to find that the suppression of Roberts’ exculpatory conclusions amounted to clear error resulting in fundamental unfairness.[125] Furthermore, the Court affirmed the fairness of the arbitrator’s decision not to compel testimony of Goodell as to whether he had been made aware of Roberts’ conclusions.[126] In reliance on these decisions, the Court explicitly points to the Brady II precedent, finding that in Brady II, the NFLPA’s request for interview notes was comparable to this case.[127] On emergency appeal to the Second Circuit, the NFLPA’s petition was summarily denied, the case was effectively dead, and Ezekiel Elliott was effectively suspended based on sketchy evidence and suppressed testimony.[128]

 VI. NFL Commissioner as Judge, Jury, and Executioner

As highlighted in the cases of Tom Brady and Ezekiel Elliott, the Second Circuit has produced a precedent that incorrectly and inequitably interprets the “fundamental fairness” requirement of the FAA and its application to NFL Collective Bargaining Agreement. The decision in Brady II is rooted in the idea that the NFLPA and the NFL negotiated disciplinary appeal procedures at arm’s length and could fully appreciate the impact the negotiations would have on the League and its players over the next decade. This was simply false, as the empirical data shows, and without a crystal ball, disciplinary action appellate procedure was simply not a priority for the NFLPA or the NFL. In the absence of intent to contract for a grant of unilateral power to the NFL Commissioner to act as prosecutor, judge, jury, and executioner, Courts should lean more heavily on ideas of fundamental fairness. Courts should be exceptionally skeptical in light of the arbitration procedures (or lack thereof) that effectively grant the NFL, a party in the supposed neutral arbitration, the power to control the information provided to the player–appellees and ultimately, the evidence available to be presented during the arbitration hearing.

One court has made this logical leap, holding a standard provision in NFL contracts designating the Commissioner (or his assignee) as arbitrator is unconscionable and thus, unenforceable.[129] In a case in front of the Missouri Supreme Court, a former employee of the St. Louis Rams successfully established that allowing the Commissioner of the NFL to arbitrate disputes of NFL policy constituted an unconscionable contract term.[130] The Court agreed that because the Commissioner is an employee of the League, acting as sole arbitrator is unconscionable where the Commissioner is given “unfettered discretion to establish the rules for arbitration,” rendering the provision unenforceable.[131] While the author acknowledges there is a difference in a dispute between team management and employees, and a dispute between players and the league, the principles and underlying conflicts are not dissimilar. This part of the decision from the Missouri Supreme Court is not difficult to accept or justify: parties to the dispute cannot also act as impartial arbitrators! When the arbitrator is not impartial, the integrity and neutrality of the proceedings have been impugned, and a presumption of “fundamental unfairness” is created. This comports with common sense. Viewed without cynicism, in the event of disciplinary appeals, Article 46 of the CBA requires an interested party to promulgate procedural rules without contractual framework and unrestrained from precedent. Additionally, Article 46 requires the Commissioner to put aside his interests and make a decision as the sole arbitrator, presiding over the issue of whether to overturn his own previous decision. The full extent of issues was not addressed by the Court in Brady I, as the case was decided on other grounds. But the Second Circuit’s decision to overturn the District Court and uphold the arbitration award without addressing the root of the fundamental unfairness poisoned the well for future NFL players–turned–litigants who have received kangaroo–court justice through the NFL’s arbitration procedures.

VII. What’s Next?

            The NFL’s collective bargaining agreement has been widely decried in national sports media. The NFLPA has called the process “a sham and a lie” and called for the NFL Management Council to step in and reevaluate the process moving forward.[132] However, the bottom line is that both the NFL and the NFLPA are stuck in this agreement until 2020 barring extraordinary circumstances. Given this unfortunate reality, it is worth examining other successful collective bargaining agreements and proposing a suggested structure for the next negotiated agreement between the NFL and NFLPA. In closing, this Note seeks to propose revising Article 46 of the NFL CBA in the following ways.

As part of the terms for the 2020 Collective Bargaining Agreement, the NFL and the NFLPA should stipulate to the appointment of a single arbitrator for all off–field player conduct disciplinary appeals to serve a term equal to the duration of the Collective Bargaining Agreement. The Commissioner of the league currently has the power to impose discipline for off–field conduct detrimental to the League, and that power should remain vested with the Commissioner. All appeals of his disciplinary decisions should be heard by a single arbitrator in the interests of uniform decision–making and consistency of dispute resolution. Without cause, the parties should have the option to remove the arbitrator by simple notice and replace the arbitrator from a list of eleven (11) candidates stipulated by the parties at the consummation of the collective bargaining agreement. Should the parties not agree as to the selection of the replacement arbitrator, the parties should be allowed to strike eight (8) names from the stipulated list and allow a pre–determined designated representative select from the remaining three (3) names. While the parties would retain the option to remove the arbitrator at–will, the power to remove should be limited only to future appeals. The parties would not have the power to remove the arbitrator from any appeals processes that had already been initiated by filing notice of such appeal.Finally, instead of adopting their own half–measure procedures for arbitration, the parties should stipulate that proceedings must follow an established framework for arbitration. The parties should adopt the procedures from the American Arbitration Association. Established procedures will further enhance the credibility of the proceedings in the eyes of the fans, players, and the League stakeholders. Furthermore, adoption of established procedures decreases the risk of misconduct or injustice in the arbitration proceedings.

VIII. Conclusion

The purpose of collective bargaining agreements is to ensure a balance of power between labor organizations and employers. In the context of professional sports, collective bargaining agreements ensure the players are adequately represented and are given the opportunity to preserve a balance of power with their governing organizations.

The CBA between the National Football League and the NFLPA is flawed because it doesn’t accurately capture either of the parties’ intent to create disciplinary procedures. This flaw results from a lack of information or motivation to negotiate such terms, given the relatively few player suspensions imposed prior to 2011. However, the Second Circuit’s decision in Brady II has given the Commissioner of the NFL broad dictatorial powers to perform a range of investigative and adjudicative roles within the player disciplinary process. This decision was incorrect and misinterprets the role of the “fundamental fairness” requirement of the FAA. This decision created broad and binding precedent and is used as a weapon by the NFL to avoid consequences for unfair adjudicatory processes. If allowed to proceed in another Circuit court, players may be able to impose a check on this power. However, given the mismatch of information availability, the NFL will always have the first–mover advantage in choice of venue. Finding no fundamental unfairness in a process which conceals material and pertinent information from the accused and allows the arbitrator to effectively act as judge, jury, and executioner requires a suspension of common sense. The Second Circuit should revisit the decision in Brady II and either qualify or overturn this decision in the interests of fundamental fairness.

In the process of negotiating the 2020 Collective Bargaining Agreement, the NFL and NFLPA should revisit Article 46 and implement several changes to increase the validity and credibility of appeals proceedings. The parties should stipulate to an unconflicted arbitrator who serves a defined term and may be removed at–will at the request of either party. Furthermore, the parties should adopt recognized framework for all arbitration proceedings. The aforementioned steps would serve to increase the credibility of the appeals process in the eyes of the fans, players, and League stakeholders and lead to fewer disputes requiring resolution in the courts.  

---

[1] J.D. Candidate May 2019.

[2] Statista, National Football League (NFL) – Statistics and Facts, https://www.statista.com/topics/ 963/national–football–league/ (last visited Jan. 2, 2019); Jim Norman, Football Still Americans’ Favorite Sport to Watch, Gallup (Jan. 4, 2018)https://news.gallup.com/poll/224864/football–americans–favorite–sport–watch.aspx.

[3] NFL Collective Bargaining Agreement 145 (2011).

[4] NFL Fines & Suspensions, Spotrac, https://www.spotrac.com/nfl/fines-suspensions/2016/ (last visited Jan. 2, 2019).

[5] NFL Fines & Suspensions, Spotrac, http://www.spotrac.com/nfl/fines–suspensions/ (last visited Jan 2, 2019) (follow hyperlink; change your “viewing” year to the specific year you desire to view and change your select type to suspensions).

[6] Id.

[7] Cornell Law School, Collective Bargaining, https://www.law.cornell.edu/wex/collective_ bargaining (last visited Jan. 2, 2019).

[8] Id.

[9] See 29 U.S.C.S. § 151 (2018).

[10] Lynne MacDonald, What Are the Benefits of Employment Arbitration?, Chron, https://smallbusiness.  chron.com/benefits-employment-arbitration-14693.html (last visited Jan. 2, 2019).

[11] See 9 U.S.C.S. § 1, 3 (2018).

[12] Compare NBA – NBPA Collective Bargaining Agreement (2017), and MLB Collective Bargaining Agreement (2012).

[13] See, NBA Collective Bargaining Agreement 399 (2017).

[14] Id.

[15] Id. at 399–400.

[16] Id.

[17] Id.

[18] Id.

[19] See id. at 397–98.

[20] Id.

[21] Mike Florio, Commissioner’s power under Article 46 has been present since the first CBA, NBC Sports (May 17, 2015, 7:18PM), https://profootballtalk.nbcsports.com/2015/05/17/commissioners-power-under-article-46-has-been-present-since-the-first-cba/.

[22] NFL Collective Bargaining Agreement 113–15; 117–18 (2011).

[23] NFL locks out players, who file suit, ESPN (Mar. 12, 2011), http://www.espn.com/nfl/ news/story?id=6205936 [hereinafter “NFL Lockout”].

[24] Nate Davis, NFL, players announce new 10–year labor agreement, USA Today (July 25, 2011), http://content.usatoday.com/communities/thehuddle/post/2011/07/reports-nfl-players-agree-to-new-collective-bargaining-agreement/1#.XC0IZyOZPBI.

[25] Id.; Former Players Receive New Neuro–Cognitive Disability Benefit, NFLPA (Dec. 7, 2012), https://www.nflpa.com/news/all–news/former–players–receive–new–neuro–cognitive–benefit.

[26] Gregg Rosenthal, The CBA in a nutshell, Pro Football Talk (July 25, 2011, 2:03 PM), https://profootballtalk.nbcsports.com/2011/07/25/the–cba–in–a–nutshell/.

[27] NFL Players Association, Collective Bargaining Agreement 1 (2011).

[28] See supra footnotes 1–6 and accompanying text.

[29] See supra footnotes 4–6 and accompanying text.

[30] Bernhardt v. Polygraphic Co. of America, 350 US 198, 203 (1956).

[31] 9 U.S.C. § 10 (2012).

[32] Id.

[33] Tempo Shain Corp. v. Bertek, Inc., 120 F.3d 16, 20 (2d Cir. 1997).

[34] See Areca, Inc. v. Oppenheimer & Co., Inc., 960 F. Supp. 52, 54–55 (S.D.N.Y. 1997).

[35] See Shamah v. Schweiger, 21 F. Supp. 2d 208, 214 (E.D.N.Y. 1998).

[36] See generally, Bell Aerospace Co. Div. of Textron v. Local 516, 500 F.2d 921, 923 (1974) (examining the mishandling of evidence not through the lens of intent but through the ultimate impact on the arbitration); Hoteles Condado Beach v. Union de Tronquistas Local 901, 763 F.2d 34, 39–40­ (1st Cir. 1985) (examining the weight given to evidence based upon the prejudice shown to the parties, not through motive); Teamsters, Local Union 657 v. Stanley Structures, Inc., 735 F.2d 903, 906 (5th Cir. 1984) (commenting that courts are restricted when looking at arbitration proceedings to examine whether that proceeding was fundamentally unfair); Transit Cas. Co. v. Trenwick Reinsurance Co., 659 F. Supp. 1346, 1354–1355 (S.D.N.Y. 1987) (determining whether the arbitrator either was guilty of misconduct or had manifest disregard for the law).

[37] Colts vs. Patriots – Game Summary, January 18, 2015, ESPN, http://www.espn.com/nfl/game?  gameId=400749520 (last visited Jan. 2, 2019).

[38] NFL investigation of balls in AFC title game led by Pash, Wells, NFL (Jan. 23, 2015, 1:56 PM), http://www.nfl.com/news/story/0ap3000000462476/article/nfl-investigation-of-balls-in-afc-title-game-led-by-pash-wells (hereinafter “NFL investigation of balls”).

[39] Id.

[41]NFL investigation of balls supra note 38; Ben Protess, Report’s Author Is Former Football Player Known Best as Trial Lawyer, NY Times (May 6, 2015), https://www.nytimes.com/2015/05/07/ sports/football/ted-wells-reports-author-is-former-football-player-known-best-as-trial-lawyer.html.

[42] Paul, Weiss, Rifkind, Wharton & Garrison LLP, Investigative Report Concerning Footballs Used During The Afc Championship Game On January 18, 2015 (2015), https://www.documentcloud.org/documents/2073728-ted-wells-report-deflategate.html.

[43] Troy Vincent’s Letter to Tom Brady, ESPN (May 12, 2015),  http://www.espn.com/nfl/story/_/id/ 12873455/troy–vincent–letter–tom–brady.

[44] NFL releases statement on Patriots’ violations, NFL (May 11, 2015, 8:48 PM), http://www.nfl.com/news/story/0ap3000000492190/article/nfl-releases-statement-on-patriots-violations.

[45] NFL Mgmt. Council v. NFL Players Ass’n (Brady I), 125 F.Supp.3d 449 at 457 (S.D.N.Y. 2015).

[46] The arbitral process is only vaguely defined in the NFL’s CBA. See NFL Collective Bargaining Agreement, supra note 22 at 187. Essentially, the Commissioner issues a punishment, then the player may appeal by writing to the Commissioner. After receiving the writing, the Commissioner has the discretion to designate himself as the arbitrator, or alternatively, appoint a hearing officer.

[47] Id. at 204–05.

[48] Ray Rice was suspended for an incident involving domestic violence in 2014. Video of the assault garnered widespread national media attention. See Ray Rice Suspended 2 Games, ESPN (July 24, 2014), http://www.espn.com/nfl/story/_/id/11257692/ray-rice-baltimore-ravens-suspended-2-games.

[49] In 2012 the NFL concluded an investigation into the New Orleans Saints, finding the Saints’ organization had designed a system of financial incentives for hard hits and inflicting injuries on opposing players. See Saints Bounty Scandal, ESPN: NFL Topics, http://www.espn.com/nfl/topics/_/page/new-orleans-saints-bounty-scandal (last updated Feb. 26, 2013).

[50]Brady I, 125 F.Supp.3d 449, 458 (S.D.N.Y. 2015).

[51] Id. at 457–58.

[52] Id. at 458.

[53] Id. at 459.

[54] Id. at 458.

[55] Id. at 459–60.

[56] Id. at 460.

[57] Id. at 460–61.

[58] Id. at 461.

[59] Id. at 474.

[60] Id. at 462–63.

[61] Id. at 473–74.

[62] Id. at 462.

[63] Id.

[64] See Alexander v. Gardner-Denver Co., 415 U.S. 36, 52 (1974); Steelworkers v. Enterprise Car, 363 U.S. 593, 596–97 (1960); 187 Concourse Assocs. v. Fishman, 399 F.3d 524, 527 (2d Cir. 2005).

[65] Brady I, 125 F.Supp.3d at 459–60.

[66] Id. at 470.

[67] Id. at 472–73.

[68] Id.

[69] Id. at 471–72.

[70] Id.

[71] Id. at 472.

[72] See id.

[73] Id.

[74] Id. at 473.

[75] Id. at 472.

[76] Compare Brady I, 125 F.Supp.3d at 459 (Goodell cites Art. 46 in asserting “the collective bargaining agreement provides for tightly circumscribed discovery” to support denial of motion to compel production of documents), with Brady I, 125 F.Supp.3d at 459–60 (admitting that Article 46 does not provide guidance for basic discovery such as witness testimony thus the arbitrator retains discretion to admit or deny motions sua sponte).

[77] Id. at 473.

[78] Id. at 472–73.

[79] NFL Mgmt. Council v. NFL Players Ass’n (Brady II), 820 F.3d 527, 531–32 (2nd Cir. 2016).

[80] Id. at 548–49.

[81] Id. at 536.

[82] Id.

[83] See supra footnotes 1–29 and accompanying text.

[84] See supra footnotes 23–29 and accompanying text.

[85] Brady II, 820 F.3d 527 at 539.

[86] Id. at 545–46.

[87] See id. at 546–47.

[88]  See 9 U.S.C. § 10(a)(3) (2012).

[89] Brady II, 820 F.3d at 546, 548.

[90] Id. at 546–47.

[91] Alexander v. Gardner-Denver Co., 415 U.S. 36, 53 (1974); 187 Concourse Assocs. v. Fishman, 399 F.3d 524, 527 (2d Cir. 2005); see also United Steelworkers of Am. v. Enterprise Wheel & Car Corp., 363 U.S. 593, 597 (1960).

[92] Brady II, 820 F.3d at 546.

[93] NFL Collective Bargaining Agreement, supra note 22 at 113, 205.

[94] Brady II, 820 F.3d at 546–47.

[95] NFL Players Ass'n v. NFL (Zeke I), 270 F. Supp. 3d 939, 944 (E.D. Tex. Sep. 8, 2017).

[96] Id.

[97] Id.

[98] Id.

[99] Id.

[100] Id. at 945.

[101] Id.

[102] Id.

[103] Id.

[104] Id. at 939.

[105] Zeke I, 270 F. Supp. 3d at 945; NFL Mgmt. Council v. NFL Players Ass’n (Zeke IV), No. 17-cv-06761-KPF, 2017 U.S. Dist. LEXIS 171995 at *2 (S.D.N.Y Oct. 17, 2017).

[106] Zeke I, 270 F. Supp. 3d at 951.

[107] Id.

[108] Id.

[109] Id. at 951–54.

[110] Id. at 951–53.

[111] Id. at 952–53.

[112] Id. at 953.

[113] Id. at 953.

[114] See id. at 953–54.

[115] Id. at 954.

[116] Id. at 955.

[117] NFL Players Ass’n v. NFL (Zeke III), 874 F.3d 222, 231 (5th Cir. 2017).

[118] Id. at 229.

[119] Id. at 234.

[120] Zeke IV, 2017 U.S. Dist. LEXIS 171995, at *6.

[121] Id. at *5–6.

[122] NFL Mgmt. Council v. NFL Players Ass’n (Zeke V), 2017 U.S. Dist. LEXIS 179714, at *1 (S.D.N.Y. Oct. 30, 2017).

[123] Id. at *3.

[124] Id. at *22–25.

[125] Id.

[126] Id. at *24.

[127] Id. at *20.

[128] Around the NFL Staff, Ezekiel Elliott Suspension Back; Court Denies Injunction, NFL (Nov. 9, 2017, 3:41 PM), http://www.nfl.com/news/story/0ap3000000874433/article/ezekiel-elliott-suspension-back-court-denies-injunction.

[129] State ex rel. Hewitt v. Kerr, 461 S.W.3d 798, 803 (Mo. 2015).

[130] Id. at 803.

[131] Id.

[132] NFLPA Statement on NFL Disciplinary Process, NFLPA https://www.nflpa.com/news/ezekiel-elliott-disciplinary-process, (last visited Jan 2, 2019).