Issue 5

The Common Law of Interpretation

Courts and commentators have claimed that there is no methodological stare decisis. That is, the Supreme Court’s decision to use purposivism or textualism to interpret a legal text in one case is not binding in future cases. While a contrarian strain of scholars has argued that judicial decisions about interpretation should serve as controlling authority in later cases, critics fear that this approach would tie the hands of future courts too tightly.

However, this Note argues that the Supreme Court’s directions about how to interpret legal texts already have a soft and salutary authoritative force. It does so, first, by reconceptualizing so-called “methodological precedent.” Those who argue that interpretive decisions are not binding are led astray by the assumption that methodological stare decisis would look like a categorical commandment, such as: “Thou shalt not consult legislative history.” A more modest vision of methodological precedent is a kind of common law: that is, a collected series of smaller decisions converging on a set of norms for interpreting legal texts. Different norms might be settled to different degrees at different times. But as certain methods become accepted in the case law, even opponents may employ them, or feel that they have some constraining force. This kind of case-by-case development is already happening (albeit imperfectly). It has both horizontal and vertical effects, causing judges to adopt specific interpretive approaches or engage in specific modes of analysis. Additionally, this methodological common law is normatively desirable because it balances goals of stability and predictability while respecting the value of interpretive pluralism.

Introduction

The U.S. Supreme Court is in the business of determining the meaning of legal texts.1 1.Marbury v. Madison, 5 U.S. (1 Cranch) 137, 177 (1803) (“It is emphatically the province and duty of the judicial department to say what the law is. Those who apply the rule to particular cases, must of necessity expound and interpret that rule.”).Show More It should be no surprise, then, that many of the pages in the U.S. Reports are devoted to communicating the Court’s views on the proper methods of interpretation. Some of these statements are general and trans-substantive, like the declaration, “Today, our statutory interpretation cases almost always start with a careful consideration of the text.”2 2.Brnovich v. Democratic Nat’l Comm., 141 S. Ct. 2321, 2337 (2021).Show More Some are specific to the kind of legal directive, such as the principle that “remedial statutes should be liberally construed.”3 3.Peyton v. Rowe, 391 U.S. 54, 65 (1968).Show More Sometimes the Court articulates a canon of construction that is triggered by a particular context, such as the rule that “[i]mplications from statutory text or legislative history are not sufficient to repeal habeas jurisdiction.”4 4.Immigr. Naturalization Serv. v. St. Cyr, 533 U.S. 289, 299 (2001).Show More

But what is the legal status of these interpretive directions? For many years, judges and scholars have agreed there is no such thing as “methodological stare decisis.”5 5.See, e.g., Nicholas Quinn Rosenkranz, Federal Rules of Statutory Interpretation, 115 Harv. L. Rev. 2085, 2144 (2002) (“[T]he Justices do not seem to treat methodology as part of the holding [of a case].”); Jonathan R. Siegel, The Polymorphic Principle and the Judicial Role in Statutory Interpretation, 84 Tex. L. Rev. 339, 389 (2005) (“[S]tare decisis effect attaches to the ultimate holding . . . but not to general methodological pronouncements, no matter how apparently firm.”); Stephen M. Rich, A Matter of Perspective: Textualism, Stare Decisis, and Federal Employment Discrimination Law, 87 S. Cal. L. Rev. 1197, 1197 (2014) (“When the Supreme Court rules on matters of statutory interpretation, it does not establish ‘methodological precedents.’” (quoting Abbe R. Gluck, Intersystemic Statutory Interpretation: Methodology as “Law” and the Erie Doctrine, 120 Yale L.J. 1898, 1902 (2011))); B & B Hardware, Inc. v. Hargis Indus., Inc., 575 U.S. 138, 167 n.4 (2015) (Thomas, J., dissenting) (“[N]o principle of stare decisis requires us to extend a tool of statutory interpretation from one statute to another without first considering whether it is appropriate for that statute.”).Show More No Supreme Court majority opinion purports to require that future justices be textualists or purposivists. Nor does one majority’s decision to use a particular extrinsic source (like dictionaries or drafting history) seem to mean that future courts must do the same. Thus, while a given case may stand for any number of legal propositions, each court supposedly writes on a blank methodological slate.

But this consensus may rest on eroding foundations. First, the wholesale exclusion of interpretive premises from a case’s “holding” has always been in tension with the Supreme Court’s view that the “portions of the opinion necessary to [reach the] result” are binding on future courts.6 6.Seminole Tribe v. Florida, 517 U.S. 44, 67 (1996). Although, what makes a part of an opinion “necessary” to the result and what kinds of propositions are “necessary” is open to interpretation.Show More The fact that the Supreme Court’s conclusions about legal interpretation are treated differently than its other outcome-determinative premises has been assumed more often than it has been defended. Second, an emerging wave of scholars has suggested that the Court’s statements about methodology should (and perhaps do) have some precedential effect.7 7.E.g., Sydney Foster, Should Courts Give Stare Decisis Effect to Statutory Interpretation Methodology?, 96 Geo. L.J. 1863, 1870 (2008) (“[A]s a matter of policy, courts should give extra-strong stare decisis effect to doctrines of statutory interpretation.”); Jordan Wilder Connors, Note, Treating Like Subdecisions Alike: The Scope of Stare Decisis as Applied to Judicial Methodology, 108 Colum. L. Rev. 681, 684 (2008) (terming decisions about judicial methodology “subdecisions” and arguing that “the purposes behind traditional stare decisis suggest that the appropriate reform is to extend the scope of stare decisis to statutory interpretation subdecisions”); Abbe R. Gluck, The States as Laboratories of Statutory Interpretation: Methodological Consensus and the New Modified Textualism, 119 Yale L.J. 1750, 1754, 1848 (2010) [hereinafter Gluck, States as Laboratories] (arguing that methodological stare decisis “appears to be a common feature of some states’ statutory case law” and is therefore possible and potentially beneficial); Grace E. Hart, Comment, Methodological Stare Decisis and Intersystemic Statutory Interpretation in the Choice-of-Law Context, 124 Yale L.J. 1825, 1826 (2015) (arguing that statutory interpretation decisions should be treated as substantive law to help govern choice-of-law disputes); Aaron-Andrew P. Bruhl, Eager to Follow: Methodological Precedent in Statutory Interpretation, 99 N.C. L. Rev. 101, 106 (2020) (arguing primarily that lower courts follow the Supreme Court’s lead on methods of statutory interpretation).Show More They contend that rule of law values would be enhanced by clarity about how courts will approach difficult questions of statutory interpretation.

But these arguments in favor of methodological stare decisis have provoked strong criticism.8 8.See, e.g., Evan J. Criddle & Glen Staszewski, Against Methodological Stare Decisis, 102 Geo. L.J. 1573, 1591 (2014) (“[I]t would be severely problematic for federal courts to attempt to freeze interpretive rules into place by applying stare decisis.”); Chad M. Oldfather, Methodological Stare Decisis and Constitutional Interpretation, in Precedent in the United States Supreme Court 135, 154 (Christopher J. Peters ed., 2013) (“[Adopting] a regime of methodological stare decisis . . . would for some period of time imperil rather than foster stability.”).Show More As a descriptive matter, at least some judges may not feel that they are bound by the Supreme Court’s prior methodological decisions.9 9.See, e.g., Kisor v. Wilkie, 139 S. Ct. 2400, 2444 (2019) (Gorsuch, J., concurring in the judgment) (“[W]e do not regard statements in our opinions about . . . generally applicable interpretive methods . . . as binding future Justices with the full force of horizontal stare decisis.”).Show More Indeed, it is hard for lawyers to believe that the Court’s interpretive views are “binding” in any sense when they have witnessed decades of intractable disagreement over the proper methods of statutory and constitutional interpretation.10 10.Gluck, States as Laboratories, supra note 7, at 1753–54.Show More As a normative matter, judges are likely to chafe at the suggestion that their deeply held convictions about interpretation are trumped by old judicial decisions or long-dead members of their court.11 11.See Randy J. Kozel, Statutory Interpretation, Administrative Deference, and the Law of Stare Decisis, 97 Tex. L. Rev. 1125, 1149 (2019) (suggesting that a jurist would likely protest if “faced with the prospect of subordinating her individual view” and “urged to apply an interpretive methodology”).Show More

This Note pushes back against both of those objections. First, it argues that there is already a soft system of methodological precedent at the Supreme Court and in the lower federal courts. Both critics and detractors of the idea of methodological precedent generally assume that, if such precedent existed, the Supreme Court would issue (and future courts would follow) explicit and broad legal directives, like: “legislative history is a permissible source of evidence for resolving statutory ambiguity,” or “the Constitution should be interpreted according to its original public meaning.”12 12.See notes 57–59 and accompanying text.Show More But the absence of such categorical holdings does not mean that the interpretive statements that the Court does issue are not authoritative. Instead, the Supreme Court’s back-and-forth about interpretation operates as a common law of methods, where individual cases elucidate specific norms and facilitate consensus. It can take multiple cases and many decades for a methodological dispute to be “settled,” and different areas of the law are settled to different degrees. But as interpretive norms are enshrined in case law, they exert an authoritative force on the Supreme Court and lower courts in a way that mimics the effect of precedent. And second, despite the fears of commentators, this system is actually beneficial. In fact, a system of gradual methodological common law achieves many of the rule of law goals underlying stare decisis while still allowing room for interpretive pluralism.

The argument proceeds in four Parts. Part I briefly explores the concept of “precedent.” Part II proposes a common law model of interpretive precedent where individual cases serve as minor but meaningful authorities about the proper way to interpret legal texts. Over time, debates about interpretive methods can be settled through accumulated decisions and judicial practice, even without the Supreme Court explicitly dictating a comprehensive philosophy of interpretation. Part III is descriptive, arguing that such a common law of interpretive methods already exists. Part IV is a normative defense of this status quo.

  1. Marbury v. Madison, 5 U.S. (1 Cranch) 137, 177 (1803) (“It is emphatically the province and duty of the judicial department to say what the law is. Those who apply the rule to particular cases, must of necessity expound and interpret that rule.”). ↑
  2. Brnovich v. Democratic Nat’l Comm., 141 S. Ct. 2321, 2337 (2021). ↑
  3. Peyton v. Rowe, 391 U.S. 54, 65 (1968). ↑
  4. Immigr. Naturalization Serv. v. St. Cyr, 533 U.S. 289, 299 (2001). ↑
  5. See, e.g., Nicholas Quinn Rosenkranz, Federal Rules of Statutory Interpretation, 115 Harv. L. Rev. 2085, 2144 (2002) (“[T]he Justices do not seem to treat methodology as part of the holding [of a case].”); Jonathan R. Siegel, The Polymorphic Principle and the Judicial Role in Statutory Interpretation, 84 Tex. L. Rev. 339, 389 (2005) (“[S]tare decisis effect attaches to the ultimate holding . . . but not to general methodological pronouncements, no matter how apparently firm.”); Stephen M. Rich, A Matter of Perspective: Textualism, Stare Decisis, and Federal Employment Discrimination Law, 87 S. Cal. L. Rev. 1197, 1197 (2014) (“When the Supreme Court rules on matters of statutory interpretation, it does not establish ‘methodological precedents.’” (quoting Abbe R. Gluck, Intersystemic Statutory Interpretation: Methodology as “Law” and the Erie Doctrine, 120 Yale L.J. 1898, 1902 (2011))); B & B Hardware, Inc. v. Hargis Indus., Inc., 575 U.S. 138, 167 n.4 (2015) (Thomas, J., dissenting) (“[N]o principle of stare decisis requires us to extend a tool of statutory interpretation from one statute to another without first considering whether it is appropriate for that statute.”). ↑
  6. Seminole Tribe v. Florida, 517 U.S. 44, 67 (1996). Although, what makes a part of an opinion “necessary” to the result and what kinds of propositions are “necessary” is open to interpretation. ↑
  7. E.g., Sydney Foster, Should Courts Give Stare Decisis Effect to Statutory Interpretation Methodology?, 96 Geo. L.J. 1863, 1870 (2008) (“[A]s a matter of policy, courts should give extra-strong stare decisis effect to doctrines of statutory interpretation.”); Jordan Wilder Connors, Note, Treating Like Subdecisions Alike: The Scope of Stare Decisis as Applied to Judicial Methodology, 108 Colum. L. Rev. 681, 684 (2008) (terming decisions about judicial methodology “subdecisions” and arguing that “the purposes behind traditional stare decisis suggest that the appropriate reform is to extend the scope of stare decisis to statutory interpretation subdecisions”); Abbe R. Gluck, The States as Laboratories of Statutory Interpretation: Methodological Consensus and the New Modified Textualism, 119 Yale L.J. 1750, 1754, 1848 (2010) [hereinafter Gluck, States as Laboratories] (arguing that methodological stare decisis “appears to be a common feature of some states’ statutory case law” and is therefore possible and potentially beneficial); Grace E. Hart, Comment, Methodological Stare Decisis and Intersystemic Statutory Interpretation in the Choice-of-Law Context, 124 Yale L.J. 1825, 1826 (2015) (arguing that statutory interpretation decisions should be treated as substantive law to help govern choice-of-law disputes); Aaron-Andrew P. Bruhl, Eager to Follow: Methodological Precedent in Statutory Interpretation, 99 N.C. L. Rev. 101, 106 (2020) (arguing primarily that lower courts follow the Supreme Court’s lead on methods of statutory interpretation). ↑
  8. See, e.g., Evan J. Criddle & Glen Staszewski, Against Methodological Stare Decisis, 102 Geo. L.J. 1573, 1591 (2014) (“[I]t would be severely problematic for federal courts to attempt to freeze interpretive rules into place by applying stare decisis.”); Chad M. Oldfather, Methodological Stare Decisis and Constitutional Interpretation, in Precedent in the United States Supreme Court 135, 154 (Christopher J. Peters ed., 2013) (“[Adopting] a regime of methodological stare decisis . . . would for some period of time imperil rather than foster stability.”). ↑
  9. See, e.g., Kisor v. Wilkie, 139 S. Ct. 2400, 2444 (2019) (Gorsuch, J., concurring in the judgment) (“[W]e do not regard statements in our opinions about . . . generally applicable interpretive methods . . . as binding future Justices with the full force of horizontal stare decisis.”). ↑
  10. Gluck, States as Laboratories, supra note 7, at 1753–54. ↑
  11. See Randy J. Kozel, Statutory Interpretation, Administrative Deference, and the Law of Stare Decisis, 97 Tex. L. Rev. 1125, 1149 (2019) (suggesting that a jurist would likely protest if “faced with the prospect of subordinating her individual view” and “urged to apply an interpretive methodology”). ↑

  12. See notes 57–59 and accompanying text. ↑

Stakeholderism, Corporate Purpose, and Credible Commitment

One of the most significant recent phenomena in corporate governance is the embrace, by some of the most influential actors in the corporate community, of the view that corporations should be focused on furthering the interests of all corporate stakeholders as well as the broader society. This stakeholder vision of corporate purpose is not new. Instead, it has emerged in cycles throughout corporate law history. However, for much of that history—including recent history—the consensus has been that stakeholderism has not achieved dominance or otherwise significantly influenced corporate behavior. That honor is reserved for the corporate purpose theory that focuses on shareholders and profit. Thus, many view the most recent embrace of stakeholderism as empty rhetoric. In light of this view, and the relatively fickle history of allegiance to stakeholderism, this Article seeks to explore whether we can expect that this most recent resurgence of stakeholderism will be different and hence whether we can expect that corporate actors will work to ensure that their corporations are governed in a way that benefits all stakeholders.

Relying on the theory of credible commitment—a theory focused on predicting whether economic actors will comply with their promises—this Article argues that there are considerable obstacles to achieving stakeholderism. This Article first argues that there are some reasons for optimism that this most recent embrace of stakeholderism will translate into reality. Second, and despite that optimism, this Article draws upon credible commitment theory to argue that it is unlikely that stakeholderism will have a lasting impact on corporate conduct unless corporations make a credible commitment to operating in a way that advances stakeholder interests and a broader social purpose. Third, this Article not only highlights the significant credible commitment challenges posed by efforts to pursue a stakeholder-related corporate purpose, but it also reveals significant concerns with the ability of prevailing reforms to overcome those challenges. Nevertheless, this Article argues that these concerns do not necessarily doom to failure the credible commitment effort. Instead, relying on the too often overlooked emphasis credible commitment theory places on norms, this Article insists that the collection of governance mechanisms aimed at achieving credible commitment, even if flawed, may facilitate norm internalization in a manner that increases the likelihood that corporate actors will align their behaviors with stakeholderism.

Introduction

One of the most significant recent phenomena in corporate governance is the outspoken embrace of the view that corporations should operate in a manner that benefits society and all of the corporations’ stakeholders.1 1.See, e.g., Elizabeth Pollman, The History and Revival of the Corporate Purpose Clause, 99 Tex. L. Rev 1423, 1447–51 (2021) [hereinafter Pollman, History and Revival]; Colin Mayer, Prosperity: Better Business Makes the Greater Good 5–7, 9 (2018) (proposing that corporations be legally required to articulate a purpose); Lucian A. Bebchuk & Roberto Tallarita, The Illusory Promise of Stakeholder Governance, 106 Cornell L. Rev. 91, 124–26 (2020) (discussing reactions reflecting belief that focus on social purpose represented a “significant turning point”); Ofer Eldar, Designing Business Forms to Pursue Social Goals, 106 Va. L. Rev. 937, 939 (2020) (discussing trends toward firms pursuing social goals); Jill E. Fisch & Steven Davidoff Solomon, Should Corporations Have a Purpose?, 99 Tex. L. Rev. 1309, 1309–11 (2021) [hereinafter Fisch & Solomon, Should Corporations Have a Purpose?]; Elizabeth Pollman, Corporate Social Responsibility, ESG and Compliance, in The Cambridge Handbook of Compliance 662, 662–63 (Benjamin van Rooij & D. Daniel Sokol eds., 2021).Show More This Article refers to this view of corporate purpose as stakeholderism.2 2.See infra note 146 (explaining other labels used to refer to stakeholder-centered view of corporate purpose).Show More This recent embrace of stakeholderism is best captured by two of the most influential actors in the business community. In 2018, Larry Fink, the Chief Executive Officer (“CEO”) of BlackRock, Inc. (“BlackRock”), the world’s largest shareholder and asset manager,3 3.See The Rise of BlackRock, Economist (Dec. 5, 2013), https://www.economist.com/leader​s/2013/12/05/the-rise-of-blackrock [https://perma.cc/CVY2-R373]; Liam Kennedy, Top 500 Asset Managers 2021, IPE (June 2021), https://www.ipe.com/reports/top-500-asset-ma​nagers-2021/10053128.article [https://perma.cc/8M8U-3YTX] (identifying BlackRock, Vanguard, and State Street as three of the largest asset managers).Show More posted a letter to CEOs proclaiming that corporations had an obligation to make a “positive contribution to society.”4 4.See Larry Fink, 2018 Letter to CEOs: A Sense of Purpose [hereinafter Fink, 2018 Letter], https://ww​w.blackrock.com/corporate/investor-relations/2018-larry-fink-ceo-letter [https://perma.cc/H​U35-78YS] (last visited Apr. 14, 2022).Show More Fink asserted that corporations should be operated with a view towards benefitting all stakeholders as well as the broader community.5 5.See id.Show More In 2019, Fink reiterated these sentiments, proclaiming that corporations need to have purpose and that “[p]urpose is not the sole pursuit of profits but the animating force for achieving them.”6 6.Larry Fink, 2019 Letter to CEOs: Purpose and Profit [hereinafter Fink, 2019 Letter], https://www.blackrock.com/corpora​te/investor-relations/2019-larry-fink-ceo-letter [https://perma.cc/Y3NB-JSA7] (last visited Apr. 14, 2022).Show More

Along these same lines, in 2019, the Business Roundtable, the nation’s leading nonprofit association of chief executives and directors, released a statement signed by 181 CEOs, expressing a commitment to embracing a corporate purpose that included a “fundamental commitment” to deliver value to all of the corporations’ stakeholders.7 7.Business Roundtable Redefines the Purpose of a Corporation to Promote ‘An Economy that Serves All Americans,’ Bus. Roundtable (Aug. 19, 2019) [hereinafter Business Roundtable Statement], https://www.businessroundt​able.org/business-roundtable-redefines-the-purpose-of-a-corporation-to-promote-an-econom​y-that-serves-all-americans [https://perma.cc/XJS9-TTR4].Show More The Business Roundtable made clear that its statement was aimed at “[r]edefin[ing]” corporate purpose to promote “an economy that serves all Americans.”8 8.Id.Show More A 2020 Fortune survey revealed that sixty-three percent of CEOs surveyed agreed with the Business Roundtable statement.9 9.See Ira T. Kay, Chris Brindisi, Blaine Martin, Soren Meischeid & Gagan Singh, The Stakeholder Model and ESG: Assessing Readiness and Design Implications for Executive Incentive Metrics – A Conceptual Approach, PayGovernance (Sept. 1, 2020), https://w​ww.paygovernance.com/viewpoints/the-stakeholder-model-and-esg [https://perma.cc/K2JF-WAZZ]; Alan Murray & David Meyer, The Pandemic Widens Rifts; Businesses Need to Help Heal Them, Fortune (May 11, 2020), https://fortune.com/2020/05/11/coronavirus-pandemic-stakeholder-capitalism/ [https://perma.cc/53H3-P39R].Show More

There are certainly reasons to be skeptical about the potential impact of this statement. First, we have been here before.10 10.See Leo E. Strine, Jr., Restoration: The Role Stakeholder Governance Must Play in Recreating a Fair and Sustainable American Economy: A Reply to Professor Rock, 76 Bus. Law. 397, 411–15 (2021) [hereinafter Strine, Restoration] (discussing origins of social purpose debate).Show More The concept of a corporate purpose focused on stakeholders and social purpose is far from new. As early as 1932, Columbia Law Professor Merrick Dodd insisted that the corporation must serve a community of interests, including employees, creditors, and the broader society, and that the corporation should behave in a socially responsible manner.11 11.See E. Merrick Dodd, Jr., For Whom Are Corporate Managers Trustees?, 45 Harv. L. Rev. 1145, 1147–48, 1161 (1932).Show More Moreover, throughout the history of corporate law, various scholars and corporate actors have advanced the view that corporations have an obligation to be socially responsible and serve the interests of all stakeholders impacted by the corporation’s activities, including shareholders, non-shareholders, and the broader community.12 12.See Lisa M. Fairfax, Doing Well While Doing Good: Reassessing the Scope of Directors’ Fiduciary Obligations in For-Profit Corporations with Non-Shareholder Beneficiaries, 59 Wash. & Lee L. Rev. 409, 432 (2002) [hereinafter Fairfax, Doing Well While Doing Good]; Lisa M. Fairfax, The Rhetoric of Corporate Law: The Impact of Stakeholder Rhetoric on Corporate Norms, 31 J. Corp. L. 675, 690–98 (2006) [hereinafter Fairfax, Rhetoric of Corporate Law] (noting proliferation of social purpose and social responsibility rhetoric in corporate documents and throughout the business community); Margaret M. Blair & Lynn A. Stout, A Team Production Theory of Corporate Law, 85 Va. L. Rev. 247, 280–81 (1999); William W. Bratton, The Economic Structure of the Post-Contractual Corporation, 87 Nw. U. L. Rev. 180, 208–15 (1992) (outlining the “entity theory” of corporation); Timothy L. Fort, The Corporation as Mediating Institution: An Efficacious Synthesis of Stakeholder Theory and Corporate Constituency Statutes, 73 Notre Dame L. Rev. 173, 184–86 (1997) (detailing stakeholder theory); C.A. Harwell Wells, The Cycles of Corporate Social Responsibility: An Historical Retrospective for the Twenty-First Century, 51 U. Kan. L. Rev. 77, 91–96 (2002) (discussing the debate on corporate social responsibility sparked by Dodd’s 1932 article).Show More Despite these periods, many scholars consistently and vehemently insist that “shareholder primacy,” which maintains that the corporation’s purpose is to maximize profits to its shareholders,13 13.See Adolf A. Berle, Jr. & Gardiner C. Means, The Modern Corporation and Private Property 8–9 (1932); Milton Friedman, The Social Responsibility of Business Is to Increase Its Profits, N.Y. Times Mag., Sept. 13, 1970, at 32, 33, 126 (stating that corporate executives are employees of shareholders). For a discussion of more recent supporters of shareholder maximization, see, for example, Sanjai Bhagat & Glenn Hubbard, Should the Modern Corporation Maximize Shareholder Value?, AEI Econ. Perspectives, Sept. 1, 2020, at 1, 3–4 and Bebchuk & Tallarita, supra note 1, at 94–95. See also Fairfax, Doing Well While Doing Good, supra note 12, at 430–31 (discussing shareholder primacy theory); Edward B. Rock, For Whom is the Corporation Managed in 2020?: The Debate over Corporate Purpose, 76 Bus. Law. 363, 363–67, 375 (2021) [hereinafter Rock, For Whom is the Corporation Managed?] (detailing various perspectives on stakeholderism).Show More should serve as the primary guide for how corporate agents govern their corporation.14 14.See Henry Hansmann, How Close is the End of History?, 31 J. Corp. L. 745, 746 (2006); Fairfax, Rhetoric of Corporate Law, supra note 12, at 690.Show More This includes scholars who believe that stakeholderism is more appropriate.15 15.See Fairfax, Rhetoric of Corporate Law, supra note 12, at 682.Show More The very fact that we have been here before, and that scholars continue to dismiss stakeholderism, suggests reason for skepticism about whether the promises contained in stakeholderism will be realized. A second reason for skepticism is the fact that many corporations, including those who signed the Business Roundtable commitment, have a history related to socially responsible acts that is questionable at best.

This history, coupled with the historically fickle nature of the embrace of stakeholderism, begs an important question: Can we really expect that the most recent embrace of stakeholderism will translate into real change in corporate behavior? This Article answers that question by drawing on insights from the theory of credible commitment. The theory of credible commitment is an ideal lens through which to explore the viability of stakeholderism because it is aimed at exploring the extent to which individuals will honor the promises they make in an economic exchange.16 16.See infra Part II (describing credible commitment theory).Show More

With credible commitment theory as a backdrop, this Article makes four important claims. This Article begins by acknowledging reasons to be skeptical about the impact of the most recent embrace of stakeholderism on corporate behavior. Nonetheless, this Article first contends that the type of corporate actors involved in this most recent embrace, coupled with socially conscious stakeholders’ growing ability to influence corporate reputation and bottom line through their use of twenty-first century public and social media platforms, may be influential enough to offer a genuine opportunity to turn the corner, thus setting the stage for corporations to genuinely make efforts to operate in a manner that advances the interests of all stakeholders.

Second, however, this Article argues that unless corporations make a credible commitment to ensuring that corporations will focus on other stakeholders, it is not likely that corporations will be able to seize this opportunity so that it translates into a genuine shift in corporate attitude and behavior, particularly in the medium and long-term. In advancing this argument, this Article draws from credible commitment theory to remind us that the realities of the economic environment along with the nature of economic promises mean that we cannot simply assume that corporations will be incentivized to adhere to their commitments, even if we assume they are acting in good faith when they make those commitments. In other words, this Article reminds us why corporate commitments have credibility problems.

Third, this Article not only argues that there are significant challenges to credible commitment in the context of stakeholderism but also questions whether available corporate governance mechanisms can overcome these challenges. In so doing, this Article sketches out a typology of factors necessary to facilitate credible commitment, and through the lens of this typology, demonstrates the manner in which prevailing credible commitment vehicles, even if reformed, may fall short of addressing those factors.

However, this Article argues that this demonstration does not doom credible commitment in this area to failure. To be sure, several prominent scholars have concluded that the kind of credible commitment flaws highlighted in this Article render efforts to actualize stakeholderism infeasible.17 17.See Bebchuk & Tallarita, supra note 1, at 147; Rock, For Whom is the Corporation Managed?, supra note 13, at 391–95 (noting factors that complicate implementing a regime of stakeholder primacy); Dorothy S. Lund, Corporate Finance for Social Good, 121 Colum. L. Rev. 1617, 1619–21 (2021).Show More This Article rejects that conclusion. Instead, this Article argues that such a conclusion fails to account for the emphasis credible commitment theorists place on informal constraints in the form of norms and thus fails to account for the possibility that the cumulative effect of reforming foundational governance mechanisms may serve a very important normative function.18 18.See infra Part IV.Show More This Article uses the term “norm” to refer to expectations regarding how individuals ought to behave.19 19.For general discussion of the meaning of the term “norm,” see Cristina Bicchieri, Norms in the Wild: How to Diagnose, Measure and Change Social Norms 28–32 (2017) [hereinafter Bicchieri, Norms in the Wild]; Cristina Bicchieri, The Grammar of Society: The Nature and Dynamics of Social Norms 29 (2006) [hereinafter Bicchieri, The Grammar of Society]; Eric A. Posner, Law and Social Norms 5 (2000); Cass R. Sunstein, Social Norms and Social Rules, 96 Colum. L. Rev. 903, 914 (1996) [hereinafter Sunstein, Social Norms]; Robert D. Cooter, Decentralized Law for a Complex Economy: The Structural Approach to Adjudicating the New Law Merchant, 144 U. Pa. L. Rev. 1643, 1656–57 (1996).Show More Social science and empirical research reveal that norms can have a significant impact on behavior because individuals feel pressure to align their behavior with prevailing norms.20 20.See infra Section IV.B.Show More While external pressures such as those embedded in formal rules and legal constraints associated with corporate governance vehicles can ensure norm compliance, norms have the greatest chance of influencing behavior when they are internalized.21 21.See infra Section IV.B.Show More This is because when norm internalization occurs, individuals comply with the norm irrespective of formal rules, legal enforcement, or other forms of external pressure.22 22.See infra Section IV.B.Show More While the process of norm internalization is inexact, consistent and repeated exposure to norms, the credibility and legitimacy of normative sources, and the visibility of the norm can all contribute to the process of norm internalization.23 23.See infra Part IV.Show More Based on these insights, this Article argues that the collection of governance mechanisms aimed at achieving credible commitment, even if flawed, will be instrumental in facilitating norm internalization in a manner that increases the potential for corporate actors to align their behaviors with stakeholderism.

From this perspective, credible commitment theory suggests that while these reforms may not be an end, they may facilitate a means to an end. That is, their cumulative effect may be to increase the likelihood that individual corporate actors will believe that they ought to embrace stakeholderism, thereby increasing the likelihood that such actors will seek to engage in behaviors that align with such embrace—even or especially when external actors are not around to pressure them to do so.

Part I of this Article highlights the most recent embrace of stakeholderism and then articulates reasons for skepticism and optimism related to that embrace. Part II introduces the theory of credible commitment and demonstrates why credible commitment is necessary to actualize stakeholderism. Part II then draws upon credible commitment theory to advance a typology of factors that hinder credible commitment. Finally, Part II utilizes that typology to illustrate how the significant challenges associated with credible commitment apply to corporate behavior in general and to behavior focused on stakeholders in particular.

In light of this illustration, Part III begins by identifying the set of factors necessary for overcoming credible commitment challenges to stakeholderism. Part III concludes by surfacing several flaws with prevailing credible commitment reforms and pinpointing the difficulties with overcoming those flaws.

Despite this conclusion, Part IV redeems the collection of proffered reforms by demonstrating that they can play a role in facilitating credible commitment through increasing the potential for norm internalization, and thus opening a pathway for altering corporate behavior in favor of stakeholderism in a manner that does not rely on formal rules and constraints. Part IV then addresses important limitations and concerns associated with this norm internalization exercise. Part V concludes.

Credible commitment theory demonstrates that credible commitments are an essential component to any economic promise, thereby highlighting the importance of credible commitment to the promises embedded in stakeholderism. That theory also highlights the difficulty of credibly committing to stakeholderism and raises serious concerns about whether reforms can combat those difficulties. Viewed from this lens, credible commitment theory appears to confirm the skepticism with which many have greeted this new wave of stakeholder rhetoric. However, this Article concludes with a note of optimism. It is entirely possible that the collection of mechanisms aimed at reforming core aspects of our governance system can facilitate credible commitment by altering the normative expectations that guide corporate behavior, paving the way for corporations to make real on their promise to focus on all of their stakeholders.

  1. See, e.g., Elizabeth Pollman, The History and Revival of the Corporate Purpose Clause, 99 Tex. L. Rev 1423, 1447–51 (2021) [hereinafter Pollman, History and Revival]; Colin Mayer, Prosperity: Better Business Makes the Greater Good 5–7, 9 (2018) (proposing that corporations be legally required to articulate a purpose); Lucian A. Bebchuk & Roberto Tallarita, The Illusory Promise of Stakeholder Governance, 106 Cornell L. Rev. 91, 124–26 (2020) (discussing reactions reflecting belief that focus on social purpose represented a “significant turning point”); Ofer Eldar, Designing Business Forms to Pursue Social Goals, 106 Va. L. Rev. 937, 939 (2020) (discussing trends toward firms pursuing social goals); Jill E. Fisch & Steven Davidoff Solomon, Should Corporations Have a Purpose?, 99 Tex. L. Rev. 1309, 1309–11 (2021) [hereinafter Fisch & Solomon, Should Corporations Have a Purpose?]; Elizabeth Pollman, Corporate Social Responsibility, ESG and Compliance, in The Cambridge Handbook of Compliance 662, 662–63 (Benjamin van Rooij & D. Daniel Sokol eds., 2021). ↑
  2. See infra note 146 (explaining other labels used to refer to stakeholder-centered view of corporate purpose). ↑
  3. See The Rise of BlackRock, Economist (Dec. 5, 2013), https://www.economist.com/leader​s/2013/12/05/the-rise-of-blackrock [https://perma.cc/CVY2-R373]; Liam Kennedy, Top 500 Asset Managers 2021, IPE (June 2021), https://www.ipe.com/reports/top-500-asset-ma​nagers-2021/10053128.article [https://perma.cc/8M8U-3YTX] (identifying BlackRock, Vanguard, and State Street as three of the largest asset managers). ↑
  4.  See Larry Fink, 2018 Letter to CEOs: A Sense of Purpose [hereinafter Fink, 2018 Letter], https://ww​w.blackrock.com/corporate/investor-relations/2018-larry-fink-ceo-letter [https://perma.cc/H​U35-78YS] (last visited Apr. 14, 2022). ↑
  5. See id. ↑
  6.  Larry Fink, 2019 Letter to CEOs: Purpose and Profit [hereinafter Fink, 2019 Letter], https://www.blackrock.com/corpora​te/investor-relations/2019-larry-fink-ceo-letter [https://perma.cc/Y3NB-JSA7] (last visited Apr. 14, 2022). ↑
  7. Business Roundtable Redefines the Purpose of a Corporation to Promote ‘An Economy that Serves All Americans,’ Bus. Roundtable (Aug. 19, 2019) [hereinafter Business Roundtable Statement], https://www.businessroundt​able.org/business-roundtable-redefines-the-purpose-of-a-corporation-to-promote-an-econom​y-that-serves-all-americans [https://perma.cc/XJS9-TTR4]. ↑
  8. Id. ↑
  9. See Ira T. Kay, Chris Brindisi, Blaine Martin, Soren Meischeid & Gagan Singh, The Stakeholder Model and ESG: Assessing Readiness and Design Implications for Executive Incentive Metrics – A Conceptual Approach, PayGovernance (Sept. 1, 2020), https://w​ww.paygovernance.com/viewpoints/the-stakeholder-model-and-esg [https://perma.cc/K2JF-WAZZ]; Alan Murray & David Meyer, The Pandemic Widens Rifts; Businesses Need to Help Heal Them, Fortune (May 11, 2020), https://fortune.com/2020/05/11/coronavirus-pandemic-stakeholder-capitalism/ [https://perma.cc/53H3-P39R]. ↑
  10. See Leo E. Strine, Jr., Restoration: The Role Stakeholder Governance Must Play in Recreating a Fair and Sustainable American Economy: A Reply to Professor Rock, 76 Bus. Law. 397, 411–15 (2021) [hereinafter Strine, Restoration] (discussing origins of social purpose debate). ↑
  11. See E. Merrick Dodd, Jr., For Whom Are Corporate Managers Trustees?, 45 Harv. L. Rev. 1145, 1147–48, 1161 (1932). ↑
  12. See Lisa M. Fairfax, Doing Well While Doing Good: Reassessing the Scope of Directors’ Fiduciary Obligations in For-Profit Corporations with Non-Shareholder Beneficiaries, 59 Wash. & Lee L. Rev. 409, 432 (2002) [hereinafter Fairfax, Doing Well While Doing Good]; Lisa M. Fairfax, The Rhetoric of Corporate Law: The Impact of Stakeholder Rhetoric on Corporate Norms, 31 J. Corp. L. 675, 690–98 (2006) [hereinafter Fairfax, Rhetoric of Corporate Law] (noting proliferation of social purpose and social responsibility rhetoric in corporate documents and throughout the business community); Margaret M. Blair & Lynn A. Stout, A Team Production Theory of Corporate Law, 85 Va. L. Rev. 247, 280–81 (1999); William W. Bratton, The Economic Structure of the Post-Contractual Corporation, 87 Nw. U. L. Rev. 180, 208–15 (1992) (outlining the “entity theory” of corporation); Timothy L. Fort, The Corporation as Mediating Institution: An Efficacious Synthesis of Stakeholder Theory and Corporate Constituency Statutes, 73 Notre Dame L. Rev. 173, 184–86 (1997) (detailing stakeholder theory); C.A. Harwell Wells, The Cycles of Corporate Social Responsibility: An Historical Retrospective for the Twenty-First Century, 51 U. Kan. L. Rev. 77, 91–96 (2002) (discussing the debate on corporate social responsibility sparked by Dodd’s 1932 article). ↑
  13. See Adolf A. Berle, Jr. & Gardiner C. Means, The Modern Corporation and Private Property 8–9 (1932); Milton Friedman, The Social Responsibility of Business Is to Increase Its Profits, N.Y. Times Mag., Sept. 13, 1970, at 32, 33, 126 (stating that corporate executives are employees of shareholders). For a discussion of more recent supporters of shareholder maximization, see, for example, Sanjai Bhagat & Glenn Hubbard, Should the Modern Corporation Maximize Shareholder Value?, AEI Econ. Perspectives, Sept. 1, 2020, at 1, 3–4 and Bebchuk & Tallarita, supra note 1, at 94–95. See also Fairfax, Doing Well While Doing Good, supra note 12, at 430–31 (discussing shareholder primacy theory); Edward B. Rock, For Whom is the Corporation Managed in 2020?: The Debate over Corporate Purpose, 76 Bus. Law. 363, 363–67, 375 (2021) [hereinafter Rock, For Whom is the Corporation Managed?] (detailing various perspectives on stakeholderism). ↑
  14. See Henry Hansmann, How Close is the End of History?, 31 J. Corp. L. 745, 746 (2006); Fairfax, Rhetoric of Corporate Law, supra note 12, at 690. ↑
  15. See Fairfax, Rhetoric of Corporate Law, supra note 12, at 682. ↑
  16. See infra Part II (describing credible commitment theory). ↑
  17. See Bebchuk & Tallarita, supra note 1, at 147; Rock, For Whom is the Corporation Managed?, supra note 13, at 391–95 (noting factors that complicate implementing a regime of stakeholder primacy); Dorothy S. Lund, Corporate Finance for Social Good, 121 Colum. L. Rev. 1617, 1619–21 (2021). ↑
  18. See infra Part IV. ↑
  19. For general discussion of the meaning of the term “norm,” see Cristina Bicchieri, Norms in the Wild: How to Diagnose, Measure and Change Social Norms 28–32 (2017) [hereinafter Bicchieri, Norms in the Wild]; Cristina Bicchieri, The Grammar of Society: The Nature and Dynamics of Social Norms 29 (2006) [hereinafter Bicchieri, The Grammar of Society]; Eric A. Posner, Law and Social Norms 5 (2000); Cass R. Sunstein, Social Norms and Social Rules, 96 Colum. L. Rev. 903, 914 (1996) [hereinafter Sunstein, Social Norms]; Robert D. Cooter, Decentralized Law for a Complex Economy: The Structural Approach to Adjudicating the New Law Merchant, 144 U. Pa. L. Rev. 1643, 1656–57 (1996). ↑
  20. See infra Section IV.B. ↑
  21. See infra Section IV.B. ↑
  22. See infra Section IV.B. ↑

  23. See infra Part IV. ↑

Debunking the Nondelegation Doctrine for State Regulation of Federal Elections

One objection to the conduct of the 2020 election concerned the key role played by state executives in setting election rules. Governors and elections officials intervened to change a host of regulations, from ballot deadlines to polling times, often acting pursuant to legislation granting them emergency powers. Some advocates, politicians, and judges cried foul. They argued that state legislatures may not devolve the power to set the “Times, Places, and Manner” of federal elections under Article I, Section 4 of the Constitution.

This Article contests that view. Drawing on a survey of elections statutes in the thirteen original colonies, I argue that local officials frequently made critical decisions about the time, place, and manner of early American elections. Executive officers like sheriffs and local officials like selectmen had enormous discretion to determine the time and place of elections, and sometimes also their manner. That discretion was repeatedly affirmed by Congress. Advocates of the Independent State Legislature (“ISL”) theory must interpret these exercises of local power as evidence that Founding-era legislatures delegated their power under the Elections Clause. As a doctrinal matter, this history suggests that courts embracing the ISL theory ought to accord a broad permission for legislatures to delegate their Elections Clause powers today. For opponents of the ISL theory, the history of local power over federal elections may provide further reasons to question the literal meaning of the term “legislature” in Article I, Section 4.

Introduction

Imagine that a state legislature amends its election laws by passing the following statute: “The Secretary of State is authorized to amend existing election law if, in her judgement, such amendments would promote the fairness of an upcoming election.” Call this the “Delegation Act”; assume it is legal under the state constitution. Would a regulation promulgated under this Act violate Article I, Section 4 of the U.S. Constitution?

This hypothetical question was exactly the one faced by tens of federal courts during the 2020 election, when state executives across the country began modifying election rules to ensure COVID-safe elections. The result was a serious divide between Supreme Court precedent and a literalist reading of the Elections Clause pressed by textualists.

Article I, Section 4’s Elections Clause provides that “[t]he Times, Places and Manner of holding Elections for Senators and Representatives, shall be prescribed in each State by the Legislature thereof.”1 1.U.S. Const. art. I, § 4, cl. 1 (emphasis added). The Constitution contains numerous references to elections, but in this Article, I use the phrase “Elections Clause” to refer specifically to this clause.Show More Precedent going back over a century reads this clause broadly, such that that “Legislature” means “whoever is allowed to legislate.”2 2.See Smiley v. Holm, 285 U.S. 355, 368 (1932) (holding that a gubernatorial veto is part of the “legislature” for Elections Clause purposes); Ohio ex rel. Davis v. Hildebrant, 241 U.S. 565, 566, 568 (1916) (holding that the Elections Clause permits Ohio to use a referendum to pass its redistricting plan); see also infra Section I.A (discussing scholars’ broad interpretation of “Legislature”).Show More Under this rule, the Delegation Act is legal: the Secretary of State is authorized to promulgate regulations and is thus “allowed to legislate.”3 3.Of course, the Secretary of State would still be restrained by a number of other federal constitutional provisions, like the Equal Protection Clause and the Due Process Clause.Show More This interpretation was most recently affirmed by the U.S. Supreme Court in 2015.4 4.Ariz. State Legislature v. Ariz. Indep. Redistricting Comm’n (“AIRC”), 576 U.S. 787, 808 (2015).Show More

But several Justices have advocated discarding this precedent in favor of an alternative theory of the Elections Clause that features a so-called “Independent State Legislature” (“ISL”).5 5.Other scholars refer to an “Independent State Legislature Doctrine,” see, e.g., Hayward H. Smith, History of the Article II Independent State Legislature Doctrine, 29 Fla. St. U. L. Rev. 731, 732 (2001), though referring to this view as a “doctrine” may lend it too much heft.Show More When the Elections Clause speaks of the “Legislature,” they say, it means that exactly one entity may regulate the time, place, and manner of federal elections: “the representative body which ma[kes] the laws of the people.”6 6.AIRC, 576 U.S. at 825 (Roberts, C.J., dissenting) (alteration in original) (emphasis omitted) (quoting Smiley, 285 U.S. at 365).Show More Legislatures are thus “independent” when regulating federal elections in the sense that they are unbound by state constitutions (and, by implication, are free of the institutions that enforce state constitutions, namely state courts).7 7.See, e.g., Michael T. Morley, The Independent State Legislature Doctrine, Federal Elections, and State Constitutions, 55 Ga. L. Rev. 1, 8 (2020) (“[S]tate constitutions . . . cannot limit a legislature’s power to regulate most aspects of federal elections.”).Show More As this Article was going to press, the Court granted certiorari to reconsider the ISL theory.8 8.See Moore v. Harper, No. 21-1271, 2022 WL 2347621 (U.S. June 30, 2022) (granting certiorari).Show More

The Delegation Act raises a different question arising from the literalist reading of the Elections Clause: May the legislature itself convey its power? This Article argues that the right answer is yes. The Federal Constitution allows expansive legislative delegations under the Elections Clause.

That claim is contested among proponents of the Independent State Legislature theory. Some approve of delegations. Chief Justice Rehnquist’s concurrence in Bush v. Gore9 9.531 U.S. 98, 112 (2000) (per curiam). An earlier per curiam decision in Bush v. Palm Beach County Canvassing Board, 531 U.S. 70, 76–77 (2000), had also strongly intimated that the Court was inclined to adopt the Independent State Legislature theory, but the opinion fell short of actually adopting the theory as its holding.Show More endorses the Florida Legislature’s decision to “delegate[] the authority to run the elections and to oversee election disputes to the Secretary of State . . . and to state circuit courts.”10 10.Bush v. Gore, 531 U.S. at 113–14.Show More The Arizona Legislature made similar arguments when it challenged a referendum establishing an independent redistricting commission in 2015: the legislature, it claimed, has total freedom to assign its regulatory duties to whomever it pleases.11 11.AIRC, 576 U.S. at 814.Show More

But more recent treatments of the ISL theory have begun to view delegations with greater skepticism. Several articles have expressed doubt about the propriety of delegations under the Elections Clause, arguing that the legislature cannot empower others to make rules for federal elections.12 12.I provide more detail on this claim in Section I.A, infra. To briefly summarize that discussion, two prominent scholars have advocated a strict view of statutory delegations. Derek Muller claims in a 2016 piece that “the historical understanding of the power of the ‘Legislature’ precluded a delegation of its power to another entity,” an almost-wholesale repudiation of delegations. Derek T. Muller, Legislative Delegations and the Elections Clause, 43 Fla. St. U. L. Rev. 717, 718 (2016). In some of his writing, Michael Morley has likewise argued against any restrictions on legislative power to set election regulations, including restrictions passed by legislatures themselves. Morley, supra note 7, at 92 (arguing that state legislatures should not be able to restrict their own “inalienable authority granted by the U.S. Constitution” to write elections laws); Michael T. Morley, The New Elections Clause, 91 Notre Dame L. Rev. Online 79, 93–94 (2016) [hereinafter Morley, The New Elections Clause] (criticizing AIRC for foreclosing future delegation challenges). Note, however, that a more recent perspective disclaims hostility to delegations. Michael T. Morley, The Independent State Legislature Doctrine, 90 Fordham L. Rev. 501, 555 (2021) [hereinafter Morley, The Independent State Legislature Doctrine].Show More And even more modest proposals, like the proposal to use the general federal nondelegation doctrine in federal elections, open the door to a future in which legislative delegations under the Elections Clause are highly contested.13 13.That is, many scholars expect federal nondelegation doctrine to be significantly tightened in coming years. See, e.g., Nicholas R. Parrillo, A Critical Assessment of the Originalist Case Against Administrative Regulatory Power: New Evidence from the Federal Tax on Private Real Estate in the 1790s, 130 Yale L.J. 1288, 1295–97 (2021) (describing the support for a much more stringent version of the doctrine). If this were to occur, then applying federal nondelegation rules to state elections might prove problematic.Show More

Some members of the judiciary appear even more hostile to Elections Clause delegations. During the 2020 election, a number of plaintiffs who brought Elections Clause challenges against executive actions found a sympathetic audience among federal judges. Citing the Elections Clause, for instance, the U.S. Court of Appeals for the Eighth Circuit overturned a Minnesota order extending the deadline for receiving mail-in ballots, even though the Minnesota Secretary of State claimed to possess delegated statutory authority to issue it.14 14.Carson v. Simon, 978 F.3d 1051, 1062 (8th Cir. 2020); see infra Section I.B.Show More Other judges either followed suit or issued dissenting opinions indicating they would have liked to.15 15.Tex. League of United Latin Am. Citizens v. Hughs, 978 F.3d 136, 150 (5th Cir. 2020) (Ho, J., concurring); Wise v. Circosta, 978 F.3d 93, 104 (4th Cir. 2020) (en banc) (Wilkinson & Agee, JJ., dissenting); see infra Section I.B.Show More

In short, an emerging movement that spans academia and the judiciary would severely curtail the power of state legislatures to delegate power over elections.

This Article’s primary purpose is to show that, as a doctrinal matter, Elections Clause delegations are entirely permissible. The Federal Constitution recognizes the power of state legislatures to delegate their authority over elections to state executives and state courts. Federal courts reviewing such delegations should give full effect to Elections Clause delegations, regardless of their view on whether state legislatures are bound by state constitutions in making federal elections law, and regardless of the delegation rules they might apply to Congress under Article I, Section 8.

I argue that a delegation-friendly reading of the Elections Clause is the only interpretation that accounts for the clear course of practice in the Founding era. Specifically, I undertake an original, comprehensive survey of election laws in the original thirteen states during the four decades following the ratification of the Constitution in 1788. While many scholars have used historical evidence to construe the meaning of the Elections Clause, all previous studies focus on evidence from the Civil War and the decades that followed it.16 16.See infra Section I.A; see also, e.g., Muller, supra note 12, at 718–20 (outlining an argument on legislative delegations rooted in late nineteenth-century congressional precedents and the pre-ratification history of the Seventeenth Amendment).Show More This is the first study to draw on the early American practice most relevant to an originalist interpretation of the Constitution.17 17.The text of the Elections Clause is susceptible to interpretation by reference to historical practice because it is ambiguous with respect to delegations. See William Baude, Constitutional Liquidation, 71 Stan. L. Rev. 1, 14 (2019).To see this, first note that the Elections Clause is simply equivalent to a grant of legislative power—no different than the grant of power to Congress in Article I, Section 8. In particular, no special significance should be attached to the appearance of the word “prescribe,” a word that the Supreme Court’s favorite Founding-era sources treat as synonymous with “make legislation about.” See, e.g., 1 William Blackstone, Commentaries *38 (defining law as a “rule of action, which is prescribed by some superior, and which the inferior is bound to obey”); id. at *44 (“Municipal law . . . is properly defined to be ‘a rule of civil conduct prescribed by the supreme power in a state . . . .’”); id. at *46, *52; see also The Federalist No. 57, at 280 (James Madison) (Terence Ball ed., 2003) (using the phrase “the mode prescribed by the Constitution for the choice of representatives” to refer to the states’ control over elections under the Elections Clause); The Federalist No. 75, at 365 (Alexander Hamilton) (Terence Ball ed., 2003) (“The essence of the legislative authority is to enact laws, or in other words to prescribe rules for the regulation of the society.”). Because “prescribe” simply means “make law about,” the Elections Clause is no different from other grants of legislative power. Does a grant of legislative power preclude delegations?Virtually everyone agrees that the Constitution’s other major grant of legislative power—Article I, Section 8—is textually ambiguous with respect to delegations. See, e.g., Keith E. Whittington & Jason Iuliano, The Myth of the Nondelegation Doctrine, 165 U. Pa. L. Rev.379, 389 (2017) (noting “[t]here is no explicit textual prohibition on the delegation of legislative power,” though “such a rule has long been thought implicit”); Gary Lawson & Patricia B. Granger, The “Proper” Scope of Federal Power: A Jurisdictional Interpretation of the Sweeping Clause, 43 Duke L.J.267, 274, 324 n.233 (1993) (anchoring the nondelegation doctrine in the Necessary & Proper Clause, not in the grant of power at the outset of Article I, Section 8).The conjunction of these two facts suggests that the propriety of Election Clause delegations cannot be determined from the text alone. Thus, historical evidence matters. It might either reveal Americans’ expectations about what the Clause’s text meant or reveal the settlement of their meaning in the first decades of the republic. See Baude, supra, at 14.Show More

The historical evidence shows that local power over elections was widespread in the decades following the Founding. In nine of thirteen states, profoundly consequential control over the “Times” and “Places” of elections was exercised by local officials like sheriffs or justices of the peace. To name just one example, Virginia sheriffs had the authority to adjourn elections up to four days, and they could relocate polling from the county courthouse if the county was “infected with any contagious disease, or . . . in danger of an attack from a public enemy.”18 18.Act effective Jan. 1, 1787, ch. 55, § 3, 1785 Va. Acts 38, 39.Show More Or take New York, where elections inspectors had total power to determine polling places and polling times.19 19.See, e.g., Act of Feb. 13, 1787, ch. 15, § 4, 1787 N.Y. Laws 316, 318; see also infra Appendix (“New York”).Show More Advocates of the Independent State Legislature theory must interpret these examples as delegations, and thus ought to embrace the legality of legislative delegations today.

In modern elections, of course, state executives have joined local officials in exercising power over federal elections. One might well wonder whether there is a constitutional difference between local power at the Founding and state executive power today.

Proponents of the ISL theory cannot sustain that view. First, as a factual matter, both “local” and “executive” officers received delegated power in the Founding era. Second, what makes Founding-era local governments arguably distinguishable from modern-day state executives is their claim to quasi-sovereignty in regulating their own affairs.20 20.See infra Part III.Show More It might thus be plausible to see local control over federal elections as an exercise of inherent, rather than delegated, power, a very different matter than horizontal delegations to state executives. But that interpretation would be utterly incompatible with the Independent State Legislature theory, which requires that state legislatures be the sole sources of legitimate rulemaking authority for federal elections; an exercise of inherent local power would scramble that narrative. Thus, advocates of the ISL theory ought to embrace delegation as the explanation for the historical evidence presented below.

Getting the delegation question right matters a great deal. COVID-19 is a powerful illustration of the need for occasional flexibility in election regulation, with dozens of states shifting their rules via executive action.21 21.See infra note 72 and accompanying text.Show More It is an open question whether safe and fair elections could have been held absent such delegations. But the implications of a nondelegation doctrine for the Elections Clause go far beyond COVID. State and local elections officials depend heavily on delegation to keep their agencies moving.22 22.See, e.g., Justin Weinstein-Tull, Election Law Federalism, 114 Mich. L. Rev. 747, 778–80 (2016); Daniel P. Tokaji, The Future of Elections Reform: From Rules to Institutions, 28 Yale L. & Pol’y Rev.125, 130–31 (2009) (describing the discretion baked into current election administration systems).Show More Adopting a nondelegation rule would wreak havoc on those systems.

With that said, the primary purpose of this Article is to intervene in the doctrinal debate over Elections Clause delegation; its aim is not to defend the practice of delegation as a matter of policy. It may be true, as some political science research suggests, that delegation is a necessary (though insufficient) ingredient in creating independent and expert agencies, in which case we might see delegation as a good.23 23.See generallyGary J. Miller & Andrew B. Whitford, Above Politics 17–22(2007) (arguing that delegation is key to establishing credibly neutral agencies like the Federal Reserve). As Michael McConnell points out, the issue of neutrality is less pronounced when legislatures make generalized ex ante rules. Michael W. McConnell, Two-and-a-Half Cheers for Bush v Gore, 68 U. Chi. L. Rev. 657, 661–62 (2001). But a regime without any delegation at all would inevitably require significant policy choices to be made at a close enough vantage point to an election that the stakes of any decision, and the likely beneficiaries, would be readily apparent.Show More Some of the examples cited below demonstrate a darker side of delegation, which is the risk that delegees use their positions to further the political ambitions of their allies. For present purposes, I bracket the normative question of whether we ought to celebrate delegation or deplore it. The goal here is to show that local power was a fact that was widely viewed as legal and to draw out the doctrinal implications of that historical evidence.

This Article also does not resolve two broader issues raised by the Independent State Legislature theory, namely (1) whether state legislatures are bound by state constitutions and (2) whether state courts can review state election laws governing federal elections. To be sure, my argument matters most in a world where the ISL theory is adopted, since current doctrine would defer entirely to state constitutions to determine the legality of delegations.24 24.See Ariz. State Legislature v. Ariz. Indep. Redistricting Comm’n (“AIRC”), 576 U.S. 787, 808 (2015) (“[R]edistricting is a legislative function, to be performed in accordance with the State’s prescriptions for lawmaking.”).Show More And the evidence here may be relevant to debates over the ISL theory. As I note above, what I call “silent delegations” to local governments might instead be interpreted as evidence of inherent local power over federal elections, which would undercut the ISL theory’s literalist reading of “legislature.”25 25.As noted below, I thank Greg Ablavsky and Robert Gordon for helping me see this alternative possibility.Show More Also, as Hayward H. Smith has noted, the aggressive delegations I document below may undercut the view that legislative power over federal elections was sacrosanct.26 26.Hayward H. Smith, Revisiting the History of the Independent State Legislature Doctrine, 53 St. Mary’s L.J. (forthcoming 2022) (manuscript at 37), https://papers.ssrn.com/sol3/paper​s.cfm?abstract_id=3923205 [https://perma.cc/78LE-H76B].Show More But this Article is not primarily about whether the ISL theory is correct.

As I argue in Part I, that is partially in recognition of the fact that the ISL theory appears very likely to be adopted. The Supreme Court has not taken a case addressing the proper interpretation of the Elections Clause since the Arizona redistricting litigation in 2015. In that case, Chief Justice Roberts authored a ringing dissent, joined by Justices Thomas and Alito, effectively endorsing the ISL theory.27 27.AIRC, 576 U.S. at 824–25 (Roberts, C.J., dissenting);see infra note 69 and accompanying text.Show More Today, the Chief Justice would almost certainly be in the majority. Justices Kavanaugh and Gorsuch trumpeted their adherence to the ISL theory during the 2020 election cycle, making five sitting Justices who have recently endorsed the ISL theory in their opinions.28 28.Democratic Nat’l Comm. v. Wis. State Legislature, 141 S. Ct. 28, 29 (2020) (Gorsuch J. concurring); id. at 34 n.1 (Kavanaugh, J. concurring); see infra notes 70–71 and accompanying text.Show More In recent redistricting litigation, several Justices have restated their commitment to this view.29 29.Moore v. Harper, 142 S. Ct. 1089, 1089–90 (2022) (mem.) (Alito, J. dissenting from denial of application for stay); id. at 1089 (Kavanaugh, J., concurring in denial of application for stay).Show More Even if it has not yet powered a majority opinion, the ISL theory already represents the views of the majority on the Supreme Court.

Finally, while this Article’s primary purpose is to contribute to a revived debate on the meaning of the Elections Clause, the pervasiveness of local delegations I document here adds to a growing literature on delegations in the early republic more generally. Most notably, Nicholas Parrillo has recently uncovered the history of federal boards of tax assessors empowered in 1798 to review property assessments under an ambiguous congressional statute.30 30.Parrillo, supra note 13, at 1302, 1304.Show More As Parrillo notes, originalist advocates of a more stringent nondelegation doctrine have traditionally argued that all Founding-era legislative delegations fall into the categories of (1) delegations concerning foreign affairs or (2) voluntary transactions and government benefits, such as those pertaining to veterans’ benefits.31 31.Id. at 1301 & n.48.Show More If, as advocates of the ISL theory believe, state legislatures make federal law when they regulate federal elections and are subject to the same nondelegation rules as Congress,32 32.See, e.g., Morley, The Independent State Legislature Doctrine, supra note 12, at 535 (“When plaintiffs allege a violation of their constitutional rights or federal voting-related statutes, they raise a federal question.”).Show More then the proliferation of delegation in the Elections Clause context would seem to provide another example of delegation under the Federal Constitution that affected the exercise of core political rights.33 33.See supra note 17 for a defense of the view that the language of the Elections Clause is not meaningfully different from that in Article I, Section 8.Show More

This Article proceeds as follows. Part I places this intervention in context by reviewing the scholarly and judicial discussion of the Independent State Legislature theory. It argues that the issue of permissible delegations has yet to be answered by extant scholarship and demonstrates that delegations were a major issue during 2020 election litigation. Part II presents the historical evidence suggesting that expansive and politically significant delegations to local officials were a pervasive feature of early American elections. Part III links that historical record back to modern controversies, arguing that state executives are no different from local officials. I conclude with some reflections on how federal courts should analyze delegations in future litigation.

  1. U.S. Const. art. I, § 4, cl. 1 (emphasis added). The Constitution contains numerous references to elections, but in this Article, I use the phrase “Elections Clause” to refer specifically to this clause. ↑
  2. See Smiley v. Holm, 285 U.S. 355, 368 (1932) (holding that a gubernatorial veto is part of the “legislature” for Elections Clause purposes); Ohio ex rel. Davis v. Hildebrant, 241 U.S. 565, 566, 568 (1916) (holding that the Elections Clause permits Ohio to use a referendum to pass its redistricting plan); see also infra Section I.A (discussing scholars’ broad interpretation of “Legislature”). ↑
  3. Of course, the Secretary of State would still be restrained by a number of other federal constitutional provisions, like the Equal Protection Clause and the Due Process Clause. ↑
  4. Ariz. State Legislature v. Ariz. Indep. Redistricting Comm’n (“AIRC”), 576 U.S. 787, 808 (2015). ↑
  5. Other scholars refer to an “Independent State Legislature Doctrine,” see, e.g., Hayward H. Smith, History of the Article II Independent State Legislature Doctrine, 29 Fla. St. U. L. Rev. 731, 732 (2001), though referring to this view as a “doctrine” may lend it too much heft. ↑
  6. AIRC, 576 U.S. at 825 (Roberts, C.J., dissenting) (alteration in original) (emphasis omitted) (quoting Smiley, 285 U.S. at 365). ↑
  7. See, e.g., Michael T. Morley, The Independent State Legislature Doctrine, Federal Elections, and State Constitutions, 55 Ga. L. Rev. 1, 8 (2020) (“[S]tate constitutions . . . cannot limit a legislature’s power to regulate most aspects of federal elections.”). ↑
  8. See Moore v. Harper, No. 21-1271, 2022 WL 2347621 (U.S. June 30, 2022) (granting certiorari). ↑
  9. 531 U.S. 98, 112 (2000) (per curiam). An earlier per curiam decision in Bush v. Palm Beach County Canvassing Board, 531 U.S. 70, 76–77 (2000), had also strongly intimated that the Court was inclined to adopt the Independent State Legislature theory, but the opinion fell short of actually adopting the theory as its holding. ↑
  10. Bush v. Gore, 531 U.S. at 113–14. ↑
  11. AIRC, 576 U.S. at 814. ↑
  12. I provide more detail on this claim in Section I.A, infra. To briefly summarize that discussion, two prominent scholars have advocated a strict view of statutory delegations. Derek Muller claims in a 2016 piece that “the historical understanding of the power of the ‘Legislature’ precluded a delegation of its power to another entity,” an almost-wholesale repudiation of delegations. Derek T. Muller, Legislative Delegations and the Elections Clause, 43 Fla. St. U. L. Rev. 717, 718 (2016). In some of his writing, Michael Morley has likewise argued against any restrictions on legislative power to set election regulations, including restrictions passed by legislatures themselves. Morley, supra note 7, at 92 (arguing that state legislatures should not be able to restrict their own “inalienable authority granted by the U.S. Constitution” to write elections laws); Michael T. Morley, The New Elections Clause, 91 Notre Dame L. Rev. Online 79, 93–94 (2016) [hereinafter Morley, The New Elections Clause] (criticizing AIRC for foreclosing future delegation challenges). Note, however, that a more recent perspective disclaims hostility to delegations. Michael T. Morley, The Independent State Legislature Doctrine, 90 Fordham L. Rev. 501, 555 (2021) [hereinafter Morley, The Independent State Legislature Doctrine]. ↑
  13. That is, many scholars expect federal nondelegation doctrine to be significantly tightened in coming years. See, e.g., Nicholas R. Parrillo, A Critical Assessment of the Originalist Case Against Administrative Regulatory Power: New Evidence from the Federal Tax on Private Real Estate in the 1790s,
    130

    Yale

    L.J. 1288, 1295–97

    (2021) (describing the support for a much more stringent version of the doctrine). If this were to occur, then applying federal nondelegation rules to state elections might prove problematic. ↑

  14. Carson v. Simon, 978 F.3d 1051, 1062 (8th Cir. 2020); see infra Section I.B. ↑
  15. Tex. League of United Latin Am. Citizens v. Hughs, 978 F.3d 136, 150 (5th Cir. 2020) (Ho, J., concurring); Wise v. Circosta, 978 F.3d 93, 104 (4th Cir. 2020) (en banc) (Wilkinson & Agee, JJ., dissenting); see infra Section I.B. ↑
  16. See infra Section I.A; see also, e.g., Muller, supra note 12, at 718–20
    (

    outlining an argument on legislative delegations rooted in late nineteenth-century congressional precedents and the pre-ratification history of the Seventeenth Amendment). ↑

  17. The text of the Elections Clause is susceptible to interpretation by reference to historical practice because it is ambiguous with respect to delegations. See William Baude, Constitutional Liquidation, 71 Stan. L. Rev. 1, 14 (2019).To see this, first note that the Elections Clause is simply equivalent to a grant of legislative power—no different than the grant of power to Congress in Article I, Section 8. In particular, no special significance should be attached to the appearance of the word “prescribe,” a word that the Supreme Court’s favorite Founding-era sources treat as synonymous with “make legislation about.” See, e.g., 1 William Blackstone, Commentaries *38 (defining law as a “rule of action, which is prescribed by some superior, and which the inferior is bound to obey”); id. at *44 (“Municipal law . . . is properly defined to be ‘a rule of civil conduct prescribed by the supreme power in a state . . . .’”); id. at *46, *52; see also The Federalist No. 57, at 280 (James Madison) (Terence Ball ed., 2003) (using the phrase “the mode prescribed by the Constitution for the choice of representatives” to refer to the states’ control over elections under the Elections Clause); The Federalist No. 75, at 365 (Alexander Hamilton) (Terence Ball ed., 2003) (“The essence of the legislative authority is to enact laws, or in other words to prescribe rules for the regulation of the society.”). Because “prescribe” simply means “make law about,” the Elections Clause is no different from other grants of legislative power. Does a grant of legislative power preclude delegations?

    Virtually everyone agrees that the Constitution’s other major grant of legislative power—Article I, Section 8—is textually ambiguous with respect to delegations. See, e.g., Keith E. Whittington & Jason Iuliano, The Myth of the Nondelegation Doctrine, 165 U. Pa. L. Rev.

    379, 389 (2017) (noting “[t]here is no explicit textual prohibition on the delegation of legislative power,” though “such a rule has long been thought implicit”); Gary Lawson & Patricia B. Granger, The “Proper” Scope of Federal Power: A Jurisdictional Interpretation of the Sweeping Clause, 43 Duke L.J.

    267, 274, 324 n.233 (1993) (anchoring the nondelegation doctrine in the Necessary & Proper Clause, not in the grant of power at the outset of Article I, Section 8).

    The conjunction of these two facts suggests that the propriety of Election Clause delegations cannot be determined from the text alone. Thus, historical evidence matters. It might either reveal Americans’ expectations about what the Clause’s text meant or reveal the settlement of their meaning in the first decades of the republic. See Baude, supra, at 14. ↑

  18. Act effective Jan. 1, 1787, ch. 55, § 3, 1785 Va. Acts 38, 39. ↑
  19. See, e.g., Act of Feb. 13, 1787, ch. 15, § 4, 1787 N.Y. Laws 316, 318; see also infra Appendix (“New York”). ↑
  20. See infra Part III. ↑
  21. See infra note 72 and accompanying text. ↑
  22. See, e.g., Justin Weinstein-Tull, Election Law Federalism, 114 Mich. L. Rev. 747, 778–80 (2016); Daniel P. Tokaji, The Future of Elections Reform: From Rules to Institutions, 28 Yale L. & Pol’y Rev.

    125, 130–31 (2009) (describing the discretion baked into current election administration systems). ↑

  23. See generally Gary J. Miller & Andrew B. Whitford, Above Politics 17–22 (2007) (arguing that delegation is key to establishing credibly neutral agencies like the Federal Reserve). As Michael McConnell points out, the issue of neutrality is less pronounced when legislatures make generalized ex ante rules. Michael W. McConnell, Two-and-a-Half Cheers for Bush v Gore, 68 U. Chi. L. Rev. 657, 661–62 (2001). But a regime without any delegation at all would inevitably require significant policy choices to be made at a close enough vantage point to an election that the stakes of any decision, and the likely beneficiaries, would be readily apparent. ↑
  24. See Ariz. State Legislature v. Ariz. Indep. Redistricting Comm’n (“AIRC”), 576 U.S. 787, 808 (2015) (“[R]edistricting is a legislative function, to be performed in accordance with the State’s prescriptions for lawmaking.”). ↑
  25. As noted below, I thank Greg Ablavsky and Robert Gordon for helping me see this alternative possibility. ↑
  26. Hayward H. Smith, Revisiting the History of the Independent State Legislature Doctrine, 53 St. Mary’s L.J. (forthcoming 2022) (manuscript at 37), https://papers.ssrn.com/sol3/paper​s.cfm?abstract_id=3923205 [https://perma.cc/78LE-H76B]. ↑
  27. AIRC, 576 U.S. at 824–25 (Roberts, C.J., dissenting); see infra note 69 and accompanying text. ↑
  28. Democratic Nat’l Comm. v. Wis. State Legislature, 141 S. Ct. 28, 29 (2020) (Gorsuch J. concurring); id. at 34 n.1 (Kavanaugh, J. concurring); see infra notes 70–71 and accompanying text. ↑
  29. Moore v. Harper, 142 S. Ct. 1089, 1089–90 (2022) (mem.) (Alito, J. dissenting from denial of application for stay); id. at 1089 (Kavanaugh, J., concurring in denial of application for stay). ↑
  30. Parrillo, supra note 13, at 1302, 1304. ↑
  31. Id. at 1301 & n.48. ↑
  32. See, e.g., Morley, The Independent State Legislature Doctrine, supra note 12, at 535 (“When plaintiffs allege a violation of their constitutional rights or federal voting-related statutes, they raise a federal question.”). ↑

  33. See supra note 17 for a defense of the view that the language of the Elections Clause is not meaningfully different from that in Article I, Section 8. ↑

©Virginia Law Review Association. All rights reserved.