Dec 28, 2010

Posted in Uncategorized

Judge Wood: “there seems little doubt that economic freedom is high on the list of cherished rights.”


Judge Wood issued a lengthy dissent from a three-judge Seventh Circuit panel’s refusal to recognize the University of Wisconsin’s waivers of sovereign immunity by litigation conduct in Board of Regents of the University of Wisconsin v. Phoenix International Software, Inc. While the facts of the case are rather complicated, Judge Wood devoted her final paragraph to waxing poetics about capitalism, private ownership, and economic freedom.

Capitalism and private ownership have served the United States well. Even though there is no clause in the Constitution explicitly committing this country to such an economic system (although the Takings Clause of the Fifth Amendment may come close), the antitrust laws have been called quasi-constitutional, and there seems little doubt that economic freedom is high on the list of cherished rights. See, e.g., United States v. Topco Associates, Inc., 405 U.S. 596, 610 (1972) (“Antitrust laws . . . are the Magna Carta of free enterprise.”); Northern Pac. R.R. Co. v. United States, 356 U.S. 1, 4 (1958) (“The Sherman Act was designed to be a comprehensive charter of economic liberty[.]”). At a minimum, this public policy should provide a rule of construction for courts considering questions of state sovereign immunity. At a stronger level, these considerations may yet persuade the Supreme Court to take up the question whether the scope of the sovereign immunity enjoyed by the states should be limited in the same way that sovereign immunity is limited for foreign nations, such that an exception to immunity would exist for commercial acts.

Damn. I still feel bad about her snub for SCOTUS. Let’s see if Justice Kagan can match this.

H/T How Appealing

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  • http://Website steve rappoport

    You could, if you wanted to, also write a post about this paragraph:

    “From the time of the Declaration of Independence until the Constitution of 1787 took effect, the states were fully sovereign in the international sense of the term: they were States, just as modern-day France, Japan, or India are States today. This fact is reflected in Articles II and III of the Articles of Confederation. Article II affirms that “[e]ach State retains its sovereignty, freedom and independence, and every power, jurisdiction and right, which is not by this confederation expressly delegated to the United States, in Congress assembled.” Articles of Confederation of 1781, art. II. Article III reinforces the point by specifying, “The said States hereby severally enter into a firm league of friendship with each other,” for purposes including common defense and general welfare. Id. art. III (emphasis added). It was against this backdrop that the 1787 Constitution was written. Although that Constitution greatly strengthened the powers of the central, or “federal,” government, it did not change the fundamental principle under which the states remain sovereign entities to the extent that the Constitution does not override their sovereignty. Indeed, that is precisely the point of the Tenth Amendment, which says, “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.” U.S. Const. amend. X. This assurance, no less than the remainder of the Bill of Rights, was regarded as essential during the ratification debates.”

    It is not clear that she is right, given the language of the Constitution itself and given what we know about the nature of the sovereign’s immunity. But it is interesting, nonetheless, I think.

    • Josh Blackman

      I’d quibble with the first sentence. My research for original citizenship suggests that they weren’t quite as sovereign as India or France, but rather delegated certain powers to the Continental Congress. I will write further about the power of the Continental Congress, and its implications on state sovereign immunity, when I finish my million and one other projects.