The Liberal Order

Sue the Dog

There's a story about a man who died in Colorado and left his entire multi-million dollar estate to God. Shortly thereafter, and before a court in Colorado could figure out what to do with the money, a man in California was apparently struck by lightning. He sues God and when told by the judge that his suit could not proceed because he couldn't locate God and anyway God had no assets, he pointed to the money left for God in Colorado.

It seems that Leona Helmsley's dog, who is now $12 million richer due to his inheritance from the Queen of Mean (how appropriate now), is being sued by a former housekeep who claims to have been bitten by the dastardly dog.

Helmsley's actions following her death, and having toured the Biltmore Estate in Asheville, NC, have moved me one step closer in agreement to James Buchanan's argument for a 100% inheritance tax.

Consumer Protection Laws

My family and I experienced some pretty serious price gouging this past weekend. While shopping for clothes we really gouged the hell out of some stores. Why just a few weeks ago these stores were able to buy many dollars with only a few shirts, but this weekend they had to give us far more shirts for the same amount of money. I almost felt bad charging them so many shirts for my dollars, and was even concerned that the government would step in and charge my wife and me with gouging.

Skip Oliva offers an excellent analysis of this conundrum.

It’s difficult to reconcile the American concept of “equal justice under law” with the Federal Trade Commission’s motto, “Protecting America’s Consumers.” The implication is that there is one set of laws for consumers and another set—affording lesser protection—for producers and sellers. This conflict presents itself in all “consumer protection” laws, and it stems from an awkward premise: That in any given economic exchange, the party trading cash holds the legal and moral high ground over the party trading a good or service.

Put another way, try to fashion a consumer protection or antitrust law in a purely barter economy. If A trades two pounds of flour to B in exchange for a bushel of apples, which party is the “consumer” entitled to government protection? It’s easy to apply common law principles regarding fraud to such a transaction, but virtually impossible to employ contemporary consumer protection standards, which require a presumption that one trader is good and the other is bad.

Antitrust regulators obsess over short-term prices. They deem a price “anticompetitive” when they think it should have been lower. The seller is liable for trading a good at anticompetitive prices. But why isn’t the buyer equally liable? If the government sets the competitive price of a good at x and a seller trades that good at x+1, both the buyer and seller undermine the competitive price level.

The rejoinder to this is that the buyer is “forced” to pay the anticompetitive price because the seller controls the supply of an item desired by the buyer. But the reverse is also true. The buyer controls a supply of an item desired by the seller—cash. The seller lacks the ability to obtain cash from anyone except those cash-holders willing to trade for the seller’s item.

Overzealous Prosecution

Let's say that A steals a car and is consequently being pursued by the police. A few miles away from the chase B and C exit a mall, get into separate cars, and, both being distracted by accounts of the chase while listening to a news channel proceed to crash into each other, killing all occupants of both cars. Is A responsible for the deaths of B and C and the occupants of their cars?

What if the shopping mall was along the route of the pursuit such that B and C became distracted by watching the chase in front of them and consequently crash into each other? Is A responsible for their deaths?

What if B and C were closely following the chase in their respective cars (perhaps they're thrill seekers) and, distracted by the events, they crash into each other, killing the occupants of both cars. Again, is A responsible?

Lastly, what if instead B and C were news reporters closely following the chase and, being distracted, crash into one another, killing all occupants in both vehicles? Is A now responsible? Put B and C in helicopters: Is A now responsible for their deaths? If so, at what point in the scenarios listed above did A become responsible for the deaths of B and C who chose to pursue the chase and whose negligent behavior led to their own deaths? (There were no fewer than four helicopters following this chase.)

Rick Gotchie, a Phoenix air-conditioning contractor working at a nearby building, was watching the helicopters circling the scene and noticed they were getting closer to each other, The Associated Press reported.

Why were they getting closer and closer to each other? Does it pay to be the one closest to the scene? Is this the fault of the idiot car thief?

What transpired was a tragic event, but the car thief is not culpable in their deaths, any more than he would be for the death of a man who suffers a heart attack while watching the story unfold on television.

This is why this is yet another overreaching by prosecutors.

Phoenix Police Chief Jack Harris has said the suspect will likely also face criminal charges for the deaths of the four people on board the two helicopters.

Story here. Here's the video of the tragic crash.

Addendum: Edited for clarity and to add the link above.

Oops! Did a car dealership make a very costly mistake?

In Cobaugh v. Klick-Lewis, Inc., a man is awarded a Chevy Beretta Cobalt for golfing a hole-in-one. Cobaugh went golfing with friends on a Monday. There was a charity golf tournament at the course the weekend before and Klick-Lewis Buick Chevy Pontiac offered the car to any tournament participant who hit a hole-in-one on the ninth hole.

Forgetting to remove the car and the attending sign, Cobaugh proceeded to hit a hole-in-one on the ninth hole, albeit on Monday after the tournament was over, and then demanded the free car from Klick-Lewis. The dealership refused to honor its offer, arguing that it was valid only during the tournament. Cobaugh sued and won.

Writing for the majority the judge noted that the sign was an offer to reward anyone who accepted by performing the challenge. Consideration for the dealership was that it received publicity from the sign.

Comes now a Honda dealership in Roswell, New Mexico that is facing a similar problem. Unfortunately for any potential plaintiffs, they'll have a difficult time collecting the $30,000,000.

Since this was a unilateral mistake and there is little reason to believe that the 30,000 recipients saw this as an unreal offer, it's likely to be ruled a valid contract if it ever makes it to court.

Causation in Tort Law

Standard tort law requires the plaintiff to prove a defendant or defendants acted negligently, were the proximate cause of the injury, and that there actually was injury. Failing to do all three is grounds for dismissal.

So, for example, I go speeding by your house at three times the speed limit (negligence), which causes you to exit your front door to yell at me and proceed to stumble down your steps, breaking many bones and causing internal injuries (damages). The question is: Did I cause your injury. A legitimate court would answer no.
If I drove directly into your house, and the force of my car, either directly or from flying debris, caused these same damages to you, then yes, I caused your injury. But the fact that you chose to exit your door to yell at me does not constitute causation of your damages by me.

Similarly, let's say that after a class I delay a student's departure from my classroom to discuss his performance at a recent baseball game. After ten minutes he leaves my classroom and, while walking to his next class, is struck by lightning, which causes serious injury to him. My action (delaying him) did not cause his injuries. Consider the counter factual: What if my delaying the student caused him to miss the thunderstorm that killed two of his classmates who left right after class. Does this student owe me for saving his life?

Although this is a criminal case rather than a tort, the same reasoning should apply.

KSDK - If it hadn't been for Massigh Stallman, Missouri Highway Patrol Trooper Ralph Tatoian would still be alive, and Stallman is responsible for his death, a jury has ruled.

In April of 2005, Trooper Tatoian was driving on Interstate 44 to the scene were police were looking for Stallman, a wooded area in Gasconade County. As he drove with his lights and siren on, he came over a hill near Pacific, and slammed into a tractor trailer. Trooper Tatoian was killed.

What if instead of having been killed in an accident while racing to the scene of the manhunt, Trooper Tatoian avoided being part of a fatal shootout where he would have been had he not received the call to proceed to the manhunt. Would Stallman have received a lighter sentence for saving the trooper's life?

Sweet Justice

A Connecticut secretary who suffers from the "winter blues" is suing her ex-employers for $33 million, claiming they wouldn't give her a well-lit desk with a window view.

Caryl Dontfraid says she has seasonal affective disorder, which causes depression during the fall and winter and can be alleviated by exposure to bright light.

"She wanted to work closer to a window with good light," her attorney, Robert Campos-Marquetti told the Daily News. "This is a request that could have been easily accommodated."

And what evil employer would perpetrate such injustice on its employees?

Dontfraid was cited as an "exemplary employee" for Binder & Binder, a Park Avenue law firm specializing in disability claims.

Story here.
Link via Fark.

KeithUrban.com

This seems heavy handed on the part of Keith Urban (the singer Urban, not the artist). But for law and econ students, this conflict offers a great study of a potential Coasean solution.

The Keith Urban you have likely heard of – the country music star also married to superstar actress Nicole Kidman – last week filed a federal lawsuit against a New Jersey man named Keith D. Urban over the use of the Internet domain name www.keithurban.com.

The Adverse Effects of Corporate Bullying

As some commentators have pointed out, I got burned on the MPAA post below. I missed the obvious clues indicating that the site was a fake news site. But the larger point I wanted to make--and that this parody was obviously making--was that corporate bullying may not be a good business practice.

Here's another example (a legitimate one, too) of this happening.

Lawyers for the plush children's icon [Barney the Purple Dinosaur) have agreed to pay $5,000 to settle a federal lawsuit filed against them in August by the Electronic Frontier Foundation, which was defending an anti-Barney Web site called the "Source of All Evil."

The settlement, announced on Tuesday, caps a five-year campaign by the New York firm of Gibney, Anthony and Flaherty to rid the Internet of unflattering images of its plump saurian client.

Parody is a protected form of free speech.

The $5,000 payment is weak, but expect to see more Barney targets in the future.

MPAA Moves to License Home Theaters

The Motion Picture Association of America (MPAA) wants to control how DVDs are viewed in private homes.

"Just because you buy a DVD to watch at home doesn't give you the right to invite friends over to watch it too. That's a violation of copyright and denies us the revenue that would be generated from DVD sales to your friends," said Glickman. "Ideally we expect each viewer to have their own copy of the DVD, but we realize that isn't always feasible. The registration fee is a fair compromise.

And what exactly is a home theater? And what must you do if your home falls into that category?

The MPAA defines a home theater as any home with a television larger than 29" with stereo sound and at least two comfortable chairs, couch, or futon. Anyone with a home theater would need to pay a $50 registration fee with the MPAA or face fines up to $500,000 per movie shown.

Link via Fark.

What constitutes a religion?

This is where your classic town-gown dispute gets weird. The $2.4 million house that J. Brian O'Neill Sr. bought for his son is allowed only six unrelated residents under zoning laws. But if it's a residence for a "religious community," the number jumps to 15.

The solution? The Apostles of O'Neill. That's the name the young men used Oct. 2 when they filed paperwork to incorporate as a nonprofit religious organization. In an e-mail statement, the group says that it has donated to charities and that its mission is "to be active and positive members of our community."

Story here.

And what are their religious beliefs?

On one side of the battle: nine best buds at Georgetown University who hung a skull-and-crossbones flag outside their home and a porn star poster inside. On the other: their neighbors, who accuse the students of running a scam to keep their partying friends together.