THE DOMAIN OF TORTS
This Article advances a novel positive theory of the law of torts that grows out of a careful reading of the caselaw. My core insight is that the benefit from the harm-causing activity determines the form and substance of tort liability. This finding is both surprising and innovative, since the operation of the doctrines that determine individuals’ liability for accidents—negligence, causation and damage—is universally believed to be driven by harms, not benefits. The key role of benefits in the operation of our tort system has eluded the searching eye of scholars, even though it is fully consistent with the caselaw, as I repeatedly demonstrate in the Article.
Specifically, I show that our tort system operates in two parallel modes—private and public—rather than just one, as conventional accounts erroneously suggest. Furthermore, the system’s mode of operation and the rules allocating liability for accidental harm are dictated by the type of the benefit sought by the alleged tortfeasor. If the benefit sought by the tortfeasor is purely private, she will be held liable for the harm resulting from her actions whenever she exposes her victim to a nonreciprocal risk. The tort system never allows actors to inflict harm on others when the benefit they seek to derive from their activity is purely private, no matter how significant that private benefit is relative to the victim’s harm. The system consequently does not hesitate to discourage the production of private benefits even when they are economically more valuable than the victim’s safety. That is, in cases of private benefit tort law excludes cost-benefit analysis in favor of the reciprocity and equality principles. When the benefit that accompanies the harm-causing activity is public, by contrast, tort law adopts a strictly utilitarian approach and focuses exclusively on minimizing the cost of accidents and the cost of avoiding accidents as a total sum. Liability in such cases is imposed based on the famous Learned Hand formula (and similar formulations). Accordingly, if the benefit from the harm-causing activity is greater than the expected harm and precautions are too costly, no liability will be imposed. The consequent reduction in the victim’s protection is counterweighted by society’s need not to chill the production of public benefits that the victim enjoys on equal terms with all other members of her community.
This insight has far-reaching implications for tort doctrine and theory. Contemporary scholarly debates about our tort system’s goals interpret the system as promoting fairness and corrective justice or, alternatively, economic efficiency. I demonstrate, however, that this dichotomous view is fundamentally mistaken. Careful analysis of the caselaw reveals that our tort system promotes fairness and corrective justice only when it operates in the private mode, and that when the system switches to the public mode it aims at achieving economic balance between victims’ safety and the production of public benefits. My analysis also demonstrates that tort doctrine is best understood as accident law because it focuses predominantly on individuals’ mutually unwanted interactions, identified as accidents, as opposed to mutually wanted and coercive interactions regulated, respectively, by contract law and criminal law. As I explain in this Article, switches between these regulatory regimes, and between torts and regulatory laws, only occur as a result of doctrinal migrations.
The Domain of Torts, 117 Columbia Law Review 535-611 (2017) download
TOWARD A THEORY OF MEDICAL MALPRACTICE
This Article introduces a novel methodology for understanding medical malpractice law and guiding its reform. I divide the legal rules that apply in medical malpractice cases into four basic categories: “entry rules,” “exit rules,” “treatment rules,” and “setup rules.” The first two of these categories of rules intersect with the other two categories. Our medical malpractice system thus consists of treatment-related and setup-related entry and exit rules.
Based on this taxonomy, I demonstrate how our medical malpractice system responds to two major concerns about legal rules: form and institutional competence. As far as form is concerned, our system systematically prefers articulated high-resolution rules over broad standards as a basis for courts’ determinations of the adequacy of the medical treatment complained against by the plaintiff. The system resorts predominantly to broad standards as a basis for courts’ assessments of whether medical care providers adequately set up the physical and informational conditions for their patient’s treatment. Courts’ decisions in these two areas determine whether the defendant—a doctor or other provider of medical care—will enter into liability for medical malpractice. For exits from that liability, the system fashions narrowly tailored rules, which it generally (but not always) prefers over standards.
As far as institutional competence is concerned, the system authorizes the medical profession to devise rules identifying medical errors that make a patient’s treatment defective and actionable as malpractice (treatment-related entry rules). The system allows courts and the legislature, on one side, and the medical profession, on the other side, to design discrete components of the standards making doctors and other care providers responsible for setting up poor physical or informational conditions for treating patients (setup-related entry rules). Finally, the system gives courts a virtually exclusive power to formulate rules that allow a negligent care provider to escape liability for malpractice (treatment- and setup-related exit rules). Courts used this power to narrow malpractitioners’ exits from liability in torts: negligent doctors and other defaulting care providers normally cannot disassociate themselves from the aggrieved patient’s damage.
This interplay of rules and rulemaking powers pervasively affects our medical malpractice system: it narrows care providers’ liability for treatment-related malpractice; it expands care providers’ liability for setup-related malpractice; and it narrows negligent care providers’ ability to avoid the duty to compensate the aggrieved patient. The Article demonstrates that this system is both fair and efficient and criticizes tort reforms that reduce liability for malpractice.
Toward a Theory of Medical Malpractice, 97 Iowa Law Review 1201-1257 (2012) download
THE DISTORTIONARY EFFECT OF EVIDENCE ON PRIMARY BEHAVIOR
In this Essay, we analyze how evidentiary concerns dominate actors’ behavior. Our findings offer an important refinement to the conventional wisdom in law and economics literature, which assumes that legal rules can always be fashioned to achieve socially optimal outcomes. We show that evidentiary motivations will often lead actors to engage in socially suboptimal behavior when doing so is likely to increase their likelihood of prevailing in court. Because adjudicators must base decisions on observable and verifiable information—or, in short, evidence—rational actors will always strive to generate evidence that can later be presented in court and increase their chances of winning the case regardless of the cost they impose on third parties and society at large. Accordingly, doctors and medical institutions will often refer patients to undertake unnecessary and even harmful examinations just to create a record that they went beyond the call of duty in treating them. Owners of land and intellectual property may let harmful activities continue much longer than necessary just to gather stronger evidence concerning the harm they suffer. And even the police will often choose to allow offenders to carry out crimes in order to improve the chance of a conviction. The effect we identify is pervasive. It can be found in virtually all areas of the law. Furthermore, there is no easy way to eliminate or correct it. It should be noted, however, that the evidentiary phenomenon we discuss also has a positive side effect: it reduces adjudication costs for judges and juries and improves the accuracy of court processes. In some cases, this improvement will exceed the social cost stemming from actors’ suboptimal behavior. In other contexts, however, the social cost will far outweigh the benefit.
The Distortionary Effect of Evidence on Primary Behavior, 124 Harvard Law Review 518-548 (2010) (with Gideon Parchomovsky) download
THE EVIDENTIAL DAMAGE DOCTRINE, OR LIABILITY FOR UNCERTAINTY
When a tort plaintiff cannot adequately prove her case, the case is lost. The evidential damage doctrine aims to make a broad exception to this conventional wisdom.
Under this doctrine, the defendant is responsible for evidential damage when his wrongful actions impair the plaintiff's ability to prove the facts underlying her direct-damage lawsuit. By "direct damage" I mean any damage actionable in torts.
The evidential damage doctrine is applicable in a great variety of tort actions that are factually uncertain. To give a few paradigmatic examples: under the evidential damage doctrine, any action in which the defendant's negligence is established, but causation is indeterminate, is decided against the defendant; more specific examples include medical malpractice cases featuring both the doctor's negligence and the patient's preexisting condition; toxic exposure; environmental torts; tobacco cases; informed consent cases with hypothetical causation; and, finally, market-share and enterprise liability cases, with both indeterminate victims and indeterminate wrongdoers. The remedies are: (1) shifting the persuasion burden to the defendant; and (2) direct compensation for the evidential damage -- depending on the law's chosen goal (deterrence or corrective justice).
This (and several other) insights are developed in Tort Liability under Uncertainty (Oxford University Press, 2001) (with Ariel Porat)
LIABILITY FOR LOST CHANCES: WHAT COMPENSATION IS DUE?
DISTINGUISHING BETWEEN THE (EX ANTE) RISK OF INJURY AND THE (EX POST) PROBABILITY OF CAUSATION
The following example is paradigmatic:
The claimant required urgent surgery, which -- if performed properly and on time -- would have given her a 75% chance of recovery. The doctors negligently delayed the surgery. The delayed surgery was performed impeccably, but it promised the claimant only a 25% chance of recovery. Ultimately, the claimant did not recover.
The claimant cannot prove causation and attempts to recover compensation under the lost-chances doctrine. Under this doctrine, courts uniformly award the claimant 50% of her total damage.
This approach is wrong: the claimant should recover 2/3 of her damage, not just 50%.
See, for example, Mays v. United States, 608 F. Supp. 1476 (D.C. Colo. 1985) (upon finding that medical malpractice reduced the patient's chances of recovery from 40% to 15%, the court reasoned that the damage was 25% of the patient's total loss); Herskovits v. Group Health Cooperative of Puget Sound 664 P.2d 474 (Wash. 1983) (holding a 14% reduction, from 39% to 25%, in the decedent's chance for survival as sufficient evidence to allow the case to go to the jury); Alberts v. Schultz, 975 P.2d 1279, 1287 (N.M. 1999) (holding that if medical malpractice reduced the patient's chance of survival from 50% to 20%, that patient's compensation would be 30% of the value of his or her life); Jorgenson v. Vener, 616 N.W.2d 366, 372 (S.D. 2000) (if instead of completely eliminating the chance of recovery, the physician's negligence merely reduced the chance of recovery from 40% to 20%, then the value of the lost chance would be 20% of the value of a complete recovery).
For reasons provided below, the claimant should have recovered 29% of the damage in Mays; 19% of the damage in Herskovits; 37.5% of the damage in the Alberts example; and 25% of the damage in the Jorgenson example.
Take a person who sustains injury after being wrongfully exposed to a risk of sustaining that injury. Before the wrongdoing, this victim's probability of sustaining the injury equaled 1-p, which is parallel to her probability of remaining uninjured (p). After the wrongdoing, the victim's probability of sustaining the injury became 1-q, which is parallel to her probability of escaping the injury (q). Because the victim actually sustained the injury, her case falls into the 1-q category. This statistical category comprises two jointly exhaustive and mutually exclusive scenarios that reflect the victim's initial position. In the first scenario, the victim sustains the injury irrespective of the wrongdoing. Under this scenario, the victim was doomed to sustain the injury, so that the wrongdoing made no impact on her well-being. As already indicated, the probability of that scenario equals 1-p. In the second scenario, it is the wrongdoing that causes the victim's injury. Under this scenario, the victim would have remained uninjured had she not been exposed to the wrongdoing. The probability of this scenario equals (1-q)-(1-p), that is, p-q. This ex ante probability represents the reduction in the victim's chances of remaining uninjured, as effected by the wrongdoing.
Now consider the ex post probability of the scenario that the wrongdoing was the actual cause of the victim's injury. This probability is represented by the fraction of scenarios featuring a victim who could not sustain her injury without being subjected to a wrongdoing in the more general cluster of cases that feature an injured victim, a wrongdoing, and the exhaustive variety of causal factors that could inflict the same injury on the victim. The above fraction of scenarios equals p-q. The cluster of cases covering all possible scenarios equals 1-q. The ex post probability of the scenario in which the wrongdoing actually inflicts the victim's injury therefore equals (p-q)/(1-q).
As already mentioned, the victim's (ex ante) risk of sustaining injury as a result of the wrongdoing equals p-q. Consequently, in cases in which the victim actually sustains injury, the (ex post) probability of causation -- that is, the probability of the allegation that factually attributes the injury to the defendant's wrongdoing -- would generally be higher than the (ex ante) risk of injury. This would be so because, on numerous occasions, a wrongdoing increases the victim's probability of becoming injured without transforming this prospect into empirical reality. In any such case, since the wrongdoing still leaves the victim with chances of escaping the injury, 0<qp-q)/(1-q)>p-q. The two probabilities would be equal only when q=0, that is, when the wrongdoing totally eliminates the victim's chances of escaping the injury. In q=0 cases, the risk of injury and the probability of causation would concur and would equal p.
The courts' approach is detrimental to society.
Using the same notation, let p and q denote, respectively, the victim's chances of remaining uninjured before and after the wrongdoing. Allow D to denote the average amount of damage that the wrongdoing inflicts in the long run of cases, and let T denote the total number of cases in which the risky activity takes place. The ideal compensation that the legal system should exact from the wrongdoer would thus equal (p-q)DT.
In reality, however, only injured victims can successfully sue the wrongdoer.
Therefore, the number of cases in which the wrongdoer would have to pay compensation would equal (1-q)T. The wrongdoer's compensation duty would thus be below the optimal. Using the probability of causation as an award-multiplier would eliminate this shortfall. As already established, the probability of causation equals (p-q)/(1-q). The total amount of the wrongdoer's compensation duty would consequently be [(p-q)/(1-q)]DT(1-q), that is: (p-q)DT.
This compensation duty equals the losses inflicted by the wrongdoer. It would therefore optimally deter prospective wrongdoers (and would also promote corrective justice).
Indeterminate Causation and Apportionment of Damages, 23 Oxford Journal of Legal Studies 667 (2003) (with Ariel Porat) download
TORTS AND INNOVATION
This Essay exposes and analyzes a hitherto overlooked cost of the current design of tort law: its adverse effect on innovation. Tort liability for negligence, defective products, and medical malpractice is determined by reference to custom. We demonstrate that courts’ reliance on custom and conventional technologies as the benchmark of liability chills innovation and distorts its path. Specifically, the recourse to custom taxes innovators and subsidizes replicators of conventional technologies. We explore the causes and consequences of this phenomenon and propose two possible ways to modify tort law in order to make it more welcoming of innovation.
Torts and Innovation, 107 Michigan Law Review 285-315 (2008) (with Gideon Parchomovsky) download
This Essay addresses an anomaly in trespass law. Trespass law is generally understood as the paradigmatic example of property-rule protection: an owner can obtain an injunction against the trespasser and have him removed from her land. The property-rule protection enjoyed by the owner protects her right to exclude others and to set the price for the use of her property. However, the property-rule protection only exists ex ante: it avails only against imminent or ongoing trespasses. Ex post, after a trespass ends, the owner can only recover compensation measured by the market value of the unauthorized use, i.e., the going rent. This liability-rule compensation dilutes the ex ante property-rule protection of ownership. Effectively, it grants trespassers a call option on others’ property, creating a mismatch between rights and remedies.
To remedy this mismatch, we introduce the concept of “propertized compensation”—a damage measure that sets compensation equal to the owner’s pre-trespass asking price. We contend that propertized compensation should become the primary remedial option in trespass cases. The use of this measure will reinstate the owner’s position as a price maker, entitling her to recover the amount that she would have agreed to accept ex ante in a voluntary exchange. We further argue that owners who cannot produce evidence regarding their pre-trespass asking price (as well as owners who prefer not to seek propertized compensation) should be entitled to seek disgorgement of the trespasser’s profits. Finally, we claim, contra the extant regime, that market-value compensation should only be used in the exceptional cases of trespass by necessity, media trespass, and good faith encroachments. In all other cases, it should only be awarded if the owners specifically ask for it.
Reconceptualizing Trespass, 103 Northwestern University Law Review 1823-1863 (2009) (with Gideon Parchomovsky) download
LIABILITY FOR FUTURE HARM
This Article considers the possibility of imposing liability in torts for a wrongfully created risk of future harm. We examine the American and English court decisions pertaining to this issue and consider whether a probability-based compensation for the victim’s expected—albeit not yet materialized—harm is just and efficient. We demonstrate how the virtues of a legal regime that allows a tort victim to recover compensation for her expected harm overshadow its vices. We conclude that a person’s risk of sustaining harm in the future should be actionable whenever the risk is substantial. We further conclude that it should be left to the victim to decide whether to recover for his or her expected harm, or else wait and see if the risk materializes and recover only if it does. We observe that allowing victims to make this choice might create a collective action problem. Because expedited compensation for a victim’s expected harm erodes the wrongdoer’s ability to compensate future claimants, victims would opt for an early recovery for expected harm even when their substantive remedial preferences are different. We demonstrate, however, that this problem can be resolved.
Liability for Future Harm (with Ariel Porat), in Richard S. Goldberg, ed., Perspectives on Causation 221-239 (Hart Publishing, 2011) download