Justice Alito

It’s beginning to look (at least on Intrade) like Justice Samuel Alito.  Scrutiny will no doubt focus on his dissent in Casey.  But, by my count (Westlaw search "OPINION OF THE COURT" W/2 ALITO  &  "CIRCUIT JUDGE"), Alito has also written 243 majority opinions. And as I discussed regarding Miers, e.g., here and here, it’s important we get a judge who will decide business cases with some sensitivity to the value of free markets and the problems firms face from litigation and regulation.

Based on a quick check Alito is such a judge.  Although he may not be the nominee, I think it’s worth briefly discussing some of Alito’s opinions, at least to indicate what a business-friendly justice might look like.  So here goes (no cites – those of you with Westlaw can find them fast enough by running the above search, or you can search on Findlaw by name):

• MBIA Ins. Corp. v. Royal Indem. Co.: enforced a waiver of an insurer's fraudulent inducement defense, applying Delaware’s “objective theory of contract.”
• Trippe Mfg. Co. v. Niles Audio Corp.: applied a NY choice of law provision in an asset purchase agreement to the issue of the duty to arbitrate.
• Pitt News v. Pappert: struck down a Pennsylvania statute prohibiting advertisers from paying for alcoholic beverage advertising by news media affiliated with educational institutions, reasoning under the Central Hudson test for commercial speech that the financial burden the regulation imposed infringed the newspaper’s First Amendment rights.
• National Data Payment Systems, Inc. v. Meridian Bank: held that the contract precluded an oral waiver of a contractual termination date and that the seller was not estopped from invoking the termination provision.
• U.S. ex rel. Merena v. SmithKline Beecham Corp.: denied a reward to a qui tam relator whose claim was subject to dismissal for being based on publicly disclosed information
• Keller v. Orix Credit Alliance, Inc.: held that an employer's articulated reason for an allegedly discriminatory employment action was not pretextual.
• John Wyeth & Bro. Ltd. v. CIGNA Intern. Corp.: applied a forum selection clause giving exclusive jurisdiction to English courts.
• Barton & Pittinos, Inc. v. SmithKline Beecham Corp.: held that a company lacked an antitrust injury sufficient to support standing to sue.
• In re Burlington Coat Factory Securities Litigation: denied securities claims for failure to adequately allege scienter and materiality, and for lack of a duty to update.
• Hakimoglu v. Trump Taj Mahal Associates: denied recovery to a patron under a dram shop law for gambling losses allegedly caused by casinos' serving free booze and allowing the patron to continue gambling after becoming drunk, saying “[w]e are also influenced by the difficult problems of proof and causation that would result from the recognition of claims such as those involved here.”
• Cooper Distributing Co., Inc. v. Amana Refrigeration, Inc.: reversing award of $4.37 million in damages under New Jersey Franchise Protection Act, holding that the contract unambiguously provided for a nonexclusive distributorship, and denying punitive damages for tortious interference on award of $0 in compensatory damages.
• Gade v. Csomos: denied civil liability for authorizing or permitting an unlicensed driver to operate a vehicle where the car's owner neither knew nor had reason to know that the driver's license had been suspended.
• Clowes v. Allegheny Valley Hosp.:  holding that a nurse failed to establish constructive discharge for ADA claim.

In short, Alito has displayed a marked tendency to enforce contracts as written, specifically including choice of law/forum and arbitration provisions that are intended to mitigate litigation costs. He's also obviously aware of the problems that can be caused by lax proof standards and open-ended liability.

Alito isn’t my first choice.  In a perfect world I would have Frank Easterbrook or Edith Jones.  But, unlike Miers, he actually has a long record on these issues and not just tea leaves, and the record is a good one.  It may be too much to hope that the debate won't get bogged down on the sole issue of abortion, but if it actually gets around to whether Alito would be a good justice, the above analysis offers one relevant perspective.

Update:   In the wake of the Alito nomination, there's been fairly widespread recognition of Alito's business credentials.  Lots of links to the above post, as indicated by the trackbacks below.  I'm quoted here and here, and the content of this post looks familiar.  In a close battle between the social right and the social left, the business perspective might emerge as an important tie-breaker.

Update 2:  Also quoted in this front page WSJ story.

Comments

[Adam]

I'm curious if you have any sense of his take on arbitration provisions in contracts of adhesion?

To my mind, at least, an artbitration provision in a negotiated contract is quite different from one in a 'take it or leave it' situation.

[Larry E. Ribstein]

I don't have any specific evidence from his cases, other than the general indication that he enforces contracts as written. The Supreme Court and the rest of the federal judiciary has been aggressive in enforcing arbitration provisions against non-corporate plaintiffs, significantly because of the Federal Arbitration Act. I doubt very much Justice Alito would depart from this trend.

[Adam]

Thanks!

[John]

You ended your update commenting that "In a close battle between the social right and the social left, the business perspective might emerge as an important tie-breaker." I had always thought the bush Administration was really just a pro-business adminstration feeding off of the "social right" constituency bu not really caring on way or another. It blew it with Miers because the "trust us, she's one of ours" was not backed up with enough evidence. His pick of Alito is intended to stick with pro-business,while throwing a bone to the social right. The social left, meanwhile, will go berzerk on the social issues debate and totally miss the aspects of "pro-business" that are antagonistic to "pro-person". Commerical freedom will win over individual freedom.

[http://www.worldbusinessforsale.com/]

Interesting discussion; we will be linking soon, we would be honored if we could be added to this business blogger. We are from the World Business for sale is the leading independent businesses for sale listing service.
http://www.worldbusinessforsale.com/