1. Agenda for 7th Class Handouts Slides
Readings – King v. Burwell (ObamaCare)
Name plates
Review of Last Class
Theories of Statutory Interpretation
Sexual Harassment
Adverse selection

2. Assignment for Next Class
Review any questions from today’s assignment that we don’t discuss in class
Read King v. Buwell handout
Questions to think about / Short papers
Everyone should be prepared to discuss all the questions on the last two pages of the Sexual Harassment handout
Mandatory writing
Group 5. Q4 & Q8
Group 6. Q3 & Q7
Group 7. Q2 & Q6
Group 8. Q1 & Q5
Optional writing -- All questions that are not mandatory
1st Longer Writing Assignment
Due tomorrow, January 31 at 5PM
Questions?

3. Review of Last Class Weber
Both majority and dissent use legislative history
But careful reading of quotes they rely upon suggest that legislative history was much more ambiguous
No one really thought much about voluntary affirmative action
Dworkin
In hard cases, traditional legal methods (textualism and intentionalism) don’t provide answer, so judge must decide case based on “political morality”
Controversial
Some think traditional legal methods (almost?) always provide an answer
Some think it is illegitimate for judges to decide based on their views of political morality
Dworkin would respond. How else decide?
Is it better for judges to pretend that traditional legal materials provide an answer?
Class list for preferences and sign in
Digital voice recorder
Nameplates and marker
Handouts of PowerPoint slides
IP chart

4. Methods of Statutory Interpretation I
Textualism – Courts should look only at text of statute
Should not look at legislative history or purpose
Intentionalism – Courts should try to figure out what the legislature intended
Should look at legislative history, where informative
Purposivism – Courts should try to figure out the purpose of the statute and then interpret ambiguous parts of the statute to further that purposes
Purpose may be inferred from text, legislative history, or other sources
What problem was statute trying to address?
Purposivism is sometimes a variant of intentionalism and textualism
Purposivism is distinct if judges infer purpose from sources other than text or legislative history
Purpose may be public good, even if statute is actually just interest group deal 4 4

5. Methods of Statutory Interpretation II
Pragmatic interpretation -- Judges should take into account real-world consequences
In practice, use all methods
Good lawyers and judges try to show how all methods point to same conclusion
But sometimes methods point to contradictory conclusions 5 5

6. Methods of Statutory Interpretation
1. Which method of statutory interpretation is most consistent with democracy?
2. Which method of statutory interpretation is most likely to result in interpretations that promote social goals such as justice, efficiency, or fairness?
3. Which method of statutory interpretation is most likely to constrain judges so that a judge’s ideology or policy preferences have the least effect on judicial decisions?
4. Which method of statutory interpretation is likely to give citizens and corporations the clearest notice of their obligations?
5. Which method of statutory interpretation is likely to give legislators the best incentives to draft statutes carefully? 6 6

7. Methods of Statutory Interpretation
6. Consider the following drastic simplification of the debate over Title VII. Congress was composed of three groups. 35% were Southern Democrats. They were racists who opposed equal treatment for African Americans. They would vote against any civil rights bill. 35% were Northern Democrats. They were ardent advocates of civil rights, who favored not only equal treatment, but affirmative action, quotas, and other means of swiftly integrating African Americans into the mainstream of American life. Although ardent advocates of civil rights would favor a bill which allowed affirmative action, they would support a bill which required only equal treatment. 30% were Republicans. They were moderates who favored color-blind decisionmaking and equality of opportunity, but who opposed (and would vote against any bill that permitted or required) affirmative action or quotas… So, according to the theory that statutes should be interpreted in accordance with the intentions of the pivotal lawmakers, Title VII should have been interpreted to forbid affirmative in United Steelworkers v, Weber. Does it make sense to interpret Title VII this way, even though most of those who supported the statute would have favored a contrary outcome? 7 7

8. Methods of Statutory Interpretation
7. In what way is the simplification of the debate over Title VII in question 6 accurate? In what way is it inaccurate?
8. Which method of statutory interpretation would you adopt if you were a judge? 8 8

9. Sexual Harassment Catherine MacKinnon set out the theory in 1979 book
EEOC adopted idea in its guidelines
2 kinds: Quid pro quo and hostile environment
Supreme Court held sexual harassment is sex discrimination in Meritor Savings Bank v. Vinson (1986)
Vinson employed by bank
Taylor, supervisor, allegedly
Pressured her to have sex with him
Followed her into women’s restroom, fondled her publicly, raped her
District court: Bank not liable
Sex was voluntary and bank did not have notice of misconduct
Supreme Court
Endorses EEOC view that sexual harassment is sex discrimination in violation of Title VII
Doesn’t matter if sex was voluntary, because it was “unwelcome”
Does not decide on employer liability issue 9 9

10. Sexual Harassment
1. Are there textualist arguments in the MacKinnon book excerpt and/or in the majority or concurring opinions in Meritor Savings Bank v Vinson? If so, what are they? How strong are they? Can you think of counter-arguments?
2. Are there intentionalist arguments in the MacKinnon book excerpt and/or in the majority or concurring opinions in Meritor Savings Bank v Vinson? If so, what are they? How strong are they? Can you think of counter-arguments?
3. Are there purposivist arguments in the MacKinnon book excerpt and/or in the majority or concurring opinions in Meritor Savings Bank v Vinson? If so, what are they? How strong are they? Can you think of counter-arguments?
4. Are there pragmatic arguments in the MacKinnon book excerpt and/or in the majority or concurring opinions in Meritor Savings Bank v Vinson? If so, what are they? How strong are they? Can you think of counter-arguments?
5. Are there arguments that cannot be categorized as textualist, intentionalist, purposivist, or pragmatic in the MacKinnon book excerpt and/or in the majority or concurring opinions in Meritor Savings Bank v Vinson? If so, what are they? How strong are they? Can you think of counter-arguments? 10 10

11. Sexual Harassment
6. Justice Rehnquist and Catherine MacKinnon agree that sexual harassment violates Title VII. In what ways are their arguments in favor of that conclusion similar? In what ways are they different?
7. Do you think employers should be liable for sexual harassment by supervisors and/or fellow employees who are not supervisors? Why or why not? If you think supervisors and non-supervisors should be treated differently, explain why.
8. What do you think of the arguments in MacKinnon’s book? Are there some that you find particularly persuasive? Are there some that you think are wrong? Are there some that you think might have been correct in 1979, but are no longer valid? 11 11

12. Adverse Selection
Markets may fail where one side lacks information and thus sets prices based on average
Thus inducing those who are above average to leave the market (b/c price not attractive to them)
Classic example: Insurance
If insurer has imperfect information
Insurance priced at average risk
But person who knows low risk may then decide not to insurer
But that raises average risk of those still buying insurance
Thus raising prices
Causing more people to drop out of insurance market

13. Adverse Selection Example I
Suppose 2 people want health insurance
A is smoker, 10% probability that will get cancer next year
$10,000 expected cost to insurer
A is willing to pay $11,000 for insurance
B is non-smoking marathon-runner
1% probability that will need expensive medical care next year
$1,000 expected cost to insurer
B is willing to pay $2000 for insurance
If insurer can’t get credible information on smoking and exercise habits
Price for insurance, if both A and B are both buying insurance must be at least, $5500 (average of $10,000 and $1,000)
But then insurance is not worthwhile to B

14. Adverse Selection II Lemons problem
Used car purchaser has imperfect information
Willing to pay price that reflects average used car quality
But person who has above average quality used car doesn’t want to sell at average price, so doesn’t sell
But that lowers average quality and thus price, leading more used car owners not to sell
Other examples

15. Responses to Adverse Selection
Ex ante information gathering
So can price product in accordance with individual characteristics, rather than market average
Life insurance – blood pressure and cholestoral screenings, different rates for smokers, etc.
Inspection and certification of used cars
Warranties
Reputation
Mandatory insurance
So no one can drop out of market
Health insurance “mandates” / universal coverage