UCLA Law Review Volume 58, Issue 1

Secrets Worth Keeping: Toward a Principled Basis for Stigmatized Property Disclosure Statutes

Since the late 1980s, a majority of states have enacted statutes protecting nondisclosure of stigmas affecting property in residential real estate transactions. While many of these statutes have elements in common, there are substantial differences with respect to the set of stigmas covered, the duty to answer direct inquiries concerning particular stigmas, the relevance of time elapsed since the stigmatizing event, and whether brokers, sellers, or both are protected. This Comment argues that much of this variation is due to some legislatures’ justified reluctance to fully embrace the traditional arguments in favor of stigma statutes. Assessing the validity of arguments focusing on stigma statutes’ capacity to promote efficiency and rationality, this Comment suggests problems for both. The efficiency argument is criticized for exaggerating the stability and other virtues of “hard- edged” rules and for underestimating the potential for consistent application of more flexible rules in this area. The rationality argument is criticized for its unrealistic notion of the potential for legislation to influence people’s beliefs, particularly with respect to stigmas associated with death and disease. This Comment recommends an alternative approach by which nondisclosure of most stigmas is protected because the seller’s interest in maintaining her privacy or in ridding herself of a property at which she has suffered some calamity outweighs the puzzling but real harm to buyers concerned about such stigmas.

Setting National Coverage Standards for Health Plans Under Healthcare Reform

On March 23, 2010, President Barack Obama signed into law the Patient Protection Affordable Care Act (Affordable Care Act), the most far-reaching healthcare reform legislation since the establishment of the Medicare program in 1965. The Affordable Care Act directs the U.S. Department of Health and Human Services (HHS) to establish a minimum level of health benefits, called the essential health benefits, that must be offered by certain health plans, including all plans participating in the individual and small group health insurance markets. This Article argues that this process for defining the essential health benefits will fail to produce coverage standards that are both fair and serve the public interest, as political considerations will lead politicians to mandate coverage of health benefits desired by the public and special interest groups, regardless of the merits of doing so. To reduce the influence of short- term politics in the development of national coverage standards, the Article recommends two fundamental changes to the process. First, Congress should establish an independent commission that would make recommendations to Congress regarding the essential health benefits. Second, Congress should adopt internal rules of congressional procedure that, in the event that lawmakers modify the commission’s recommendations, obligate them to offset the costs of mandating coverage of certain conditions or procedures by excluding other benefits from the essential health benefits. Together, these requirements would make it more difficult for lawmakers to modify the shape of the essential health benefits for political gain, as they would intensify conflict among interest groups and place procedural hurdles in the path of mandated benefits legislation. With significant independence from both Congress and the president, a commission would then have the freedom to engage in a thoughtful, deliberative review of the relevant scientific, economic, and moral factors, with primary consideration given to the overall fairness of the coverage standards rather than their political impact.

Shareholder Campaign Funds: A Campaign Subsidy Scheme for Corporate Elections

In the vivid imagination of Delaware courts, the shareholder franchise is “the ideological underpinning” upon which corporate power rests. A corporate election to choose who should lead the firm is corporate democracy at work since such elections give shareholders the power “to turn the board out.” However, in reality, the vast majority of corporate elections are ho-hum affairs. The current board members are reelected without contest. Annual corporate meetings to hold the elections are dull—held in front of tame audiences in quiet auditoriums. Election outcomes are predictable. Rarely is there a contested corporate election in which the incumbent directors face a challenge for their board seats. Even these affairs, while more interesting, are still as predictable. The incumbents always have the upper hand. The corporate election system is, as a consequence, broken, anticompetitive, and in need of significant reform. Yet, as this Article shows, previous proposals have overlooked the “genius” of the public sector. In particular, in political elections, campaign reformers have already offered a good answer for how to create competitive elections: Make campaign subsidies available to challengers. This solution works even though the contestants’ campaign costs are high, voters are apathetic and dispersed widely, and incumbents have a natural, built-in advantage. Most notably, for instance, in federal elections, the system of public subsidies for eligible presidential campaigns, the Presidential Campaign Fund, provides a remarkably sturdy roadmap for how to reform corporate elections and create a subsidy system for shareholder challenges to the board of directors.

Reading Ricci: Whitening Discrimination, Racing Test Fairness

This Article posits that the Supreme Court’s decision in Ricci v. DeStefano does not evaluate all claims of discrimination on a level playing field but rather “whitens” discrimination and “races” test fairness. The authors explicate how Ricci whitens discrimination by reframing antidiscrimination law’s presumptions and burdens to focus on disparate treatment of whites as the paradigmatic and ultimately preferred claim; Ricci races test fairness by finding that efforts to use job-related assessment tools that correct racial imbalance and better measure merit constitute racially disparate treatment of whites. Under Ricci all forms of racial attentiveness— like attending to the racial impact of promotional exams—become racial discrimination. This conflation derives in part from the application of the colorblindness/race- consciousness dyad, which obscures the more finely grained distinctions between racial attentiveness and inattentiveness that better parse the question of whether, in a given circumstance, taking account of race constitutes race discrimination. Contrary to Ricci’s presumptions, not all racially attentive conduct is discriminatory; nor is all racially inattentive conduct nondiscriminatory. Secondly, while Ricci was framed as a reverse discrimination case, the authors evaluate it as a disparate impact claim using empirical analysis to examine the promotional lists at the heart of the Ricci lawsuit and to assess the effect of the City’s failure to comply with accepted professional standards for proper test design and test use on Black and Latino firefighters and white firefighters who were not part of the Ricci plaintiff class. From this vantage point, New Haven’s exams did not identify the most qualified candidates but instead unfairly and unnecessarily reproduced the fire department’s racially skewed status quo. Nevertheless, in Ricci, the City’s efforts to ameliorate this racial imbalance were themselves treated as attempts to racially rig the results, exemplifying how the pursuit of fair testing was raced. The Article concludes by evaluating proposals geared towards rectifying Ricci’s dilution of Title VII disparate impact law, situating these alternatives in the broader context of the agenda to prevent the conversion of antidiscrimination law into discrimination itself.

Just Notice: Re-Reforming Employment at Will

This Article proposes a fundamental shift in the movement to reform employment termination law. For forty years, there has been a near consensus among employee advocates and worklaw scholars that the current doctrine of employment at will should be abandoned in favor of a rule requiring just cause for termination. This Article contends that such calls are misguided, not—as defenders of the current regime have argued—because a just cause rule grants workers too much protection vis-à-vis management, but because it grants them too little. A just cause rule provides only a weak cause of action to a narrow subset of workers: those able to prove they were fired for purely arbitrary reasons. It fails to account for the justifiable, but still devastating, termination of workers for economic reasons, by far the most common reason for job loss today. In this way, a just cause rule is not only inadequate, but also anachronistic. Just cause protection is consistent with a mid-twentieth-century view of the social contract of employment, one that anticipates a long-term, symbiotic relationship between employer and employee in an economy dependent on internal labor markets. Under such a system, a just cause rule gives legal force to parties’ mutual and implicit understanding of their obligations to one another. In contrast, today’s employers operate principally in an external labor market in which implicit promises of long-term employment have been replaced by implicit promises of long-term employability. Companies and workers alike anticipate significant job turnover both in times of economic turbulence, such as the recent downturn, in which employers were forced to shed numerous workers due to financial hardship, as well as during economic bubbles, in which companies lay off workers and reorganize for strategic reasons. Given these practices and expectations, the goal of termination law should not be protecting individual jobs but assisting workers in the inevitable situation of job loss. To that end, this Article proposes the adoption of a universal “pay-or-play” system of employment termination. Absent serious misconduct, employers would be required to provide advance notice of termination or offer wages and benefits for the duration of the notice period. In contrast to just cause proposals, “pay-or-play” recognizes the necessity and inevitability of employment termination. Rather than encourage parties to maintain status quo relationships, “pay-or-play” facilitates transition. It affirms managerial discretion to hire and fire by eliminating fact-intensive inquiries into the reason for termination. At the same time, it makes real employers’ implicit promise of employability by granting workers a window of income security during which they can comfortably search for the next opportunity.