Volume 2, Issue 1

The theory that the prospect of liability for damages deters risky behavior has been developed in countless articles and books. The literature is far sparser, however, on how deterrence is operationalized. And prior work slights an equally important effect of damage actions, to incentivize claims management in addition to harm-reduction responses that are cost- rather than liability-minimizing. This article works in the intersection of these two understudied areas, focusing on claims management steps taken by frequently sued organizations, and opening a window into the black box of deterrence to see how those steps may end up serving harm-reduction purposes as well. To summarize, I observe that damage actions regulate risky enterprise by inducing organizations to develop claims management capabilities—that is, the capacity to process any resulting disputes. I then argue that these claims management practices and personnel are sometimes used, secondarily but importantly, to improve safety, reduce risk, and increase compliance with external legal requirements. Organizations' internal claims management operations can, though they need not, facilitate care-taking in four important ways: (a) promoting the gathering and analysis of claims information; (b) requiring the hiring of specialized personnel with a mission to reduce claim payouts; (c) encouraging bureaucratized procedures that may be harm-reducing, and (d) increasing the salience of claims to various actors within the organization. I discuss the theory underlying these four points, drawing on organizational economics and sociology, as well as on psychology and behavioral law and economics. Then I discuss these four channels of influence in particular factual settings which serve as case studies, looking at a single large retailer, and then more generally at hospitals and hospital doctors, and jails and prisons. Because organizational theory tells us that this kind of transformation or repurposing is quite ordinary, the preliminary evidence I canvass suggests that claims management should be included in any study of how damage action deterrence is operationalized within large risk-creating organizations.This article thus makes two chief scholarly contributions. It proposes and theorizes concrete operational paths by which damage actions may elicit organizational compliance with external norms. And it describes in-house claims management, a heretofore underobserved arena in which law influences organizational activity. In the conclusion, I propose that who performs claims management functions may matter, as well, and suggest that in future research, claims management should be considered along with liability and loss prevention as the trio of liability-related operational areas in which firms must implement a "make-or-buy" decision.

This article offers a new assessment of the stages in the development of fault and strict liability and their justifications in American history. Building from the evidence that a wide majority of state courts adopted Fletcher v. Rylands and strict liability for unnatural or hazardous activities in the late nineteenth century, a watershed moment turns to the surprising reversals in tort ideology in the wake of flooding disasters.An established view of American tort law is that the fault rule supposedly prevailed over strict liability in the nineteenth century, with some arguing that it was based on instrumental arguments to subsidize industry, while others claim that its basis was in the moral condemnation of wrongdoing as a principle of corrective justice. Courts supposedly did not embrace strict liability until the mid-twentieth century, driven by efficiency arguments. This article challenges the established view by setting forth three periods.In the first period from 1810 to 1860, instrumental and moral arguments were rare or non-existent, and instead, courts relied on simple assertions or minimalist citations to precedent in establishing a general negligence rule. In the second period (the 1870s and 1880s), American courts defended the general negligence rule with economic arguments not as a primary justification, but as a defense against the English challenge in Rylands. In the third period around the turn of the century, state judges, partly reacting in horror to the disastrous Johnstown Flood of 1889 and other unnatural modern threats, turned to strict liability with moralistic corrective justice arguments, not instrumental arguments. The cases from this last period illustrate a number of moral arguments in favor of strict liability: choice and duties; fairness (those who profit from an activity should pay those they hurt); a social contract argument of reciprocity; and a rights argument in favor of the natural user over the unnatural innovator. Instead of enterprise liability emerging from post-Great Depression/New Deal politics, from twentieth-century academics, or from engineers overlooking the factory floor, it gained significant ground in the late nineteenth century from the murky depths of a flooded Pennsylvania valley. This historical study of the dramatic twists and turns on Rylands suggests that tort doctrine and tort theory are contingent upon events and context.

The new prominence of constitutional tort claims like Valerie Plame's and Jose Padilla's calls for a re-examination of the form, a basic, but often overlooked, kind of lawsuit. This essay divides constitutional tort claims into three different types, each with different purposes and different kinds of plaintiffs, and each with different implications for the regulation of government policy. It also makes the case for the continuing, if uneasy, relevance of the form, despite its often belabored, but certainly justified, reputation for hostility towards plaintiffs.Constitutional torts do not always fail in every way, or in the same ways. To be sure, there are the pro se and quasi-pro se cases that always lose. But there are also the excessive use of force cases that sometimes do not lose. And, increasingly, there are the policy-related strike suits against senior federal officials where liability, in the end, is not the point. After trifurcating the constitutional tort, the paper seeks to explain why it remains interesting, and draws some larger conclusions about the evolution of the Bivens suit, which increasingly looks like a new, albeit problematic, locus of the old impulse towards institutional reform litigation, and an increasingly-resorted-to alternative to lawsuits under the Administrative Procedure Act.