Volume 88.6 (October 2021) 1284–1594 | The University of Chicago Law Review

Articles

Asymmetric Subsidies and the Bail Crisis
John F. Duffy - Samuel H. McCoy II Professor of Law and Paul G. Mahoney Research Professor of Law, University of Virginia School of Law.
Richard M. Hynes - John Allan Love Professor of Law and Nicholas E. Chimicles Research Professor of Business Law and Regulation, University of Virginia School of Law.

When individuals are arrested or indicted for a crime, governments have legitimate interests in assuring that those individuals show up for future legal proceedings and also do not cause more social harm in the meanwhile. To serve those legitimate interests, governments may restrain the personal liberty of those presumptively innocent individuals—traditionally accomplished either by incarceration or by release subject to certain sureties and conditions. The choice, in short, is between jail and bail. Currently, governments skew that choice by subsidizing the costs of jail but not bail. The result—wholly predictable given the size and asymmetric nature of the subsidy—is that the United States maintains an inefficiently large jail population that both costs taxpayers too much and excessively limits the liberty of too many. Prior commentators and reformers have correctly identified the overuse of pretrial detention in jails as a major public policy crisis and have urged substantial reforms to current bail processes up to and including the abolition of state constitutional rights to bail (as one state has recently done). We believe that the hostility toward bail overlooks the root cause of the problem, which is the asymmetric subsidization of jail over bail. We propose a balanced subsidization system that can preserve the beneficial aspects of a traditional bail surety system while (i) reducing unnecessary and inefficient restraints on individual liberty, (ii) addressing the distributional inequities of current practices, and (iii) saving taxpayers billions of dollars per year.

Federal Corporate Law and the Business of Banking
Lev Menand - Lecturer in Law and Academic Fellow, Columbia Law School.

Morgan Ricks - Professor of Law and Enterprise Scholar, Vanderbilt University Law School.

The only profit-seeking business enterprises chartered by a federal government agency are banks. Yet there is barely any scholarship justifying this exception to state primacy in U.S. corporate law. This Article addresses that gap. It reinterprets the National Bank Act (NBA)—the organic statute governing national banks, the heavyweights of the financial sector—as a corporation law and recovers the reasons why Congress wrote this law: not to catalyze private wealth creation or to regulate an existing industry, but to solve an economic governance problem. National banks are federal instrumentalities charged with augmenting the money supply—a delegated sovereign privilege. Congress recruited private shareholders and managers to run these instrumentalities as a check on monetary overissue and to prevent politicized asset allocation by government officials—a form of premodern agency independence. Viewing the NBA as a corporation law yields surprising dividends. First, it exposes a major flaw at the heart of U.S. banking jurisprudence. In recent decades, the Supreme Court and the Office of the Comptroller of the Currency (OCC), the chartering authority for national banks, have interpreted national banks’ corporate powers expansively, allowing them to enter a vast range of new business lines. But the corporate powers provision of the NBA is not a regulatory statute to which courts should apply Chevron deference, nor is it part of the OCC’s enabling act. It is part of the corporate charters of national banks. Accordingly, the opposite, settled rule of construction applies: ambiguity is construed strictly against the corporation. Second, interpreting the NBA as a corporation law reveals that the OCC’s current campaign to unhitch national bank charters from the deposit business lacks a statutory basis and threatens an unprecedented colonization of U.S. enter-prise law by a federal government agency that is ill-suited to this mission and was never congressionally tasked with it.

Comments

In Search of Ordinary Meaning: What Can Be Learned from the Textualist Opinions of Bostock v. Clayton County?
Sam Capparelli - B.S. 2018, The George Washington University; J.D. Candidate 2022, The University of Chicago Law School.

In Bostock v. Clayton County, the Supreme Court held that Title VII protects gay and transgender individuals from employment discrimination. Writing for the majority, Justice Neil Gorsuch adhered to textualist principles and relied on the ordinary public meaning of the phrase “discriminate because of sex.” Despite the majority opinion purportedly not reaching beyond the words of the statute, three other conservatives on the Court accused Justice Gorsuch of legislating from the bench. Central to this Comment, Justice Brett Kavanaugh took exception with how Justice Gorsuch reached his ordinary meaning of the phrase. The debate between these two Justices can be characterized as a debate between semantics and pragmatics—two schools within the field of linguistics. Justice Gorsuch’s stringing together the precedent-defined meaning of the individual terms of the statute re-sembled semantics. Justice Kavanaugh’s reliance on considering the phrase as a whole and an examination of the broader societal and historical context resembled pragmatics. This Comment proposes a sliding-scale approach that indicates when to move between semantics and pragmatics. What makes the scale slide is the pool of precedent, or the variability in how courts and their precedent have defined the words of a phrase. As the pool of precedent increases, the need to support a semantics-derived meaning of the phrase with pragmatics increases. To create a proxy for the variability of precedent-defined words, this Comment creates a tiered structure based on our court system’s hierarchy of precedent. By adopting this sliding-scale approach, courts will be able to interpret statutes while supporting textualism’s goal of judicial restraint.

It’s All About (Re)location: Interpreting the Federal Sentencing Enhancement for Relocating a Fraudulent Scheme
Stephen Ferro - B.A. 2019, University of Chicago; J.D. Candidate 2022, University of Chicago Law School.

Section 2B1.1(b)(10) of the U.S. Sentencing Guidelines Manual increases the recommended sentencing ranges for defendants who make fraudulent schemes harder to uncover. In particular, subsection (A) of this Guideline—the relocation enhancement—increases a defendant’s recommended sentence if she “relocated, or participated in relocating, a fraudulent scheme to another jurisdiction to evade law enforcement or regulatory officials.” This provision raises the question: Where is a fraudulent scheme located? The question might have a straightforward answer in cases that involve few defendants and few fraudulent acts. But federal circuit courts have split over how to apply this enhancement to schemes that span multiple jurisdictions at once, exacerbating a preexisting disagreement about the level of intent required by the relocation enhancement. This Comment argues that courts can resolve these problems by limiting the applicability of the relocation enhancement. Specifically, courts should apply the relocation enhancement only to cases where the defendant committed an act of deception in one jurisdiction, grew suspicious of a specific law enforcement investigation into her actions, fled the jurisdiction because of that investigation, and then committed the same deceptive act in a new jurisdiction. This reading draws support from interpretive canons, Sentencing Commission guidance, and existing literature on the deterrent effect of sentencing enhancements. This reading also encourages courts to make greater use of another provision in § 2B1.1(b)(10)—the sophisticated-means enhancement—to address the problems posed by multijurisdictional fraud schemes.

The Scope of Evidentiary Review in Constitutional Challenges to Agency Action
Conley K. Hurst - B.A. 2017, Washington and Lee University; M.St. 2018, University of Oxford; J.D. Candidate 2022, The University of Chicago Law School.

When reviewing agency action, the Administrative Procedure Act (APA) instructs courts to “review the whole record or those parts of it cited by a party.” The Supreme Court has interpreted this brief statement as a restriction on the evidentiary scope of judicial review under the APA. Courts may consider only the administrative record compiled by the agency, which includes all materials before the decisionmaker at the time he or she made the decision. The Supreme Court has recognized one exception: plaintiffs may supplement the administrative record if they make a strong showing of bad faith or improper behavior on the part of the agency. Courts consistently apply the record rule to arbitrary and capricious claims. It is less clear whether the rule applies to constitutional claims. This issue crept into two recent, high-profile Supreme Court cases—Department of Commerce v. New York and Regents of the University of California v. Department of Homeland Security—but the Court has yet to definitively resolve the issue. In the meantime, lower courts have developed three alternative approaches. This Comment argues that the record rule, though one with a robust bad faith exception, should apply to all constitutional challenges to agency action. It analyzes the APA’s text, legislative history, pre- and post-APA precedent, and policy considerations to argue for a record rule approach.

The Legal Causes of Labor Market Power in the U.S. Agriculture Sector
Candice Yandam Riviere - J.D. Candidate, The University of Chicago Law School; Ph.D. Candidate in economics, Pantheon-Sorbonne University.

Recent developments in law and economics have shown that labor market power is a pervasive antitrust issue contributing to earnings inequality and slowed economic growth. In the agriculture sector, workers—especially H-2A temporary agricultural workers—have consistently suffered from low, stagnating wages and poor working conditions. This Comment evaluates the extent of labor market power in the agriculture sector and how antitrust law and immigration-policy norms exacerbate labor monopsony. I show that the pervasiveness of labor monopsony is due, in part, to a conflict between antitrust law and immigration regulation. Specifically, I examine an immigration statute that allows temporary guest workers to work in the agriculture sector. Immigration regulation and its enforcement allow employers to engage in anticompetitive practices that entrench farmers’ labor market power. While Section 1 of the Sherman Act protects workers from any agreement to restrain wages, the H-2A statutory standard allows conduct that can lead to wage suppression, thus bolstering farmers’ and ranchers’ labor-market power. Additionally, antitrust enforcement is weakened by courts’ interpretation of the immigration statute as immune from antitrust law. To resolve these issues, I first offer a guide for judges to interpret immigration and antitrust laws together. Second, I provide some suggestions for legislators to amend the provisions of the immigration statute.