Escaping Battered Credit: A Proposal for Repairing Credit Reports Damaged by Domestic Violence
Debt and domestic violence are connected in ways not previously imagined. A new type of debt—which I have labeled “coerced debt”—is emerging from abusive relationships. Coerced debt occurs when the abuser in a violent relationship obtains credit in the victim’s name via fraud or coercion. It ranges from secretly taking out credit cards in victims’ names to coercing victims into signing loan documents to tricking victims into relinquishing their rights to the family home. As wide ranging as these tactics can be, one consequence consistently emerges: ruined credit ratings.
Coerced debt wreaks havoc on credit scores, which is particularly problematic because the use of credit reports is no longer confined to traditional lenders. Employers, landlords, and utility companies all make extensive use of credit scores when screening potential customers. Thus, a credit score that has been damaged by coerced debt can make it prohibitively difficult for victims to obtain employment, housing, or basic utilities—all of which are requirements for establishing an independent household.
In this Article, I propose amending the Fair Credit Reporting Act to allow victims of coerced debt to repair their credit reports. My proposal would enable family courts to rule on whether alleged coerced debt is, in fact, coerced. The victim could then submit the court’s certification to the credit reporting agencies, which would block the coerced debt from her credit report to the extent that the block did not unduly harm her creditors. My proposal would build a bridge between the deci-sionmakers already determining issues related to coerced debt and the credit reports that victims need to have reformed in order to move beyond the abuse.
Federalism, Regulatory Lags, and the Political Economy of Energy Production
The production of natural gas from formerly inaccessible shale formations through the use of hydraulic fracturing has expanded domestic energy supplies and lowered prices and is stimulating the replacement of dirtier fossil fuels with cleaner natural gas. At the same time, shale gas production has proven controversial, triggering intense opposition in some parts of the United States. State and local regulators have scrambled to adapt to the boom in natural gas production, raising the question of whether federal regulators should step in to supplant or supplement state regulation. This Article takes a policy-neutral approach to the federalism questions at the center of that inquiry, asking which level of government ought to resolve these policy questions, rather than which level of government is likely to produce a particular favored policy outcome. Consequently, this analysis begins with four economic and political rationales typically used to justify federal regulation. Federal regulation is necessary (1) to address spillover effects that cross state boundaries, (2) to prevent economic forces at the state level from initiating a “race to the bottom” in environmental regulation, (3) to promote business efficiencies through uniform national standards, and (4) to respond to national interests in the development of natural resources through a federal licensing system. Applying these rationales to the regulation of fracking yields several important conclusions. First, while a few of the externalities of shale gas production cross state boundaries, most are experienced locally. Second, existing federal regulatory regimes offer ample authority to address those few interstate externalities. Third, the race-to-the-bottom rationale does not justify federal regulation of shale gas production because shale gas states are not competing for quantity- or time-limited capital investment. Fourth, given that the impacts of fracking are still under study and the subject of considerable ongoing debate, there is currently no overriding national interest supporting the creation of a comprehensive federal licensing or regulatory regime for shale gas production.
State Law, the Westfall Act, and the Nature of the Bivens Question
In the past few years, four courts of appeals have applied a presumption against recognition of a Bivens cause of action in dismissing damages suits alleging constitutional violations arising out of federal officials’ pursuit of various national security and counterterrorism policies. In each of these cases, the court’s approach was based on the belief that allowing such suits to proceed would threaten undue interference with the executive branch’s conduct of military and national security affairs—interference that should be tolerated, if ever, only where Congress has expressly so provided. As Fourth Circuit Judge J. Harvie Wilkinson III explained in declining to recognize a Bivens claim that would have allowed José Padilla to seek compensation for his allegedly unconstitutional detention and treatment as an “enemy combatant,” “To stay the judiciary’s hand in fashioning the requested Bivens action, it suffices to observe that Padilla’s enemy com-batant classification and military detention raise fundamental questions incident to the conduct of armed conflict, and that Congress . . . has not provided a damages remedy.”
The Second Circuit, sitting en banc, used similar reasoning in declining to recognize the right of Maher Arar to seek compensation for the allegedly unconstitutional injuries he received at the hands of government officers arising out of his extraordinary rendition to Syria. Other courts have sounded variations on this theme to preclude relief for claims by, for example, former Guantánamo detainees and U.S. citizens who were detained and allegedly abused by U.S. military personnel while working as military contractors in Iraq. In the view of each of these courts, concerns about judicial interference with national security justified their refusal to recognize a federal damages remedy for the injuries caused by the defendants’ allegedly unconstitutional conduct.
We argue that the analysis employed by these courts of appeals to deter-mine whether to recognize a Bivens action improperly combines two problematic features. The first is the courts’ conceptualization of the Bivens question as a choice between recognizing a Bivens action and leaving the plaintiff with no damages remedy at all. Because the reasons that led the courts to decline to recognize a Bivens action are reasons to preclude all judicial involvement in the cases, these courts clearly understood the choice before them as “Bivens or nothing.” The second problematic feature is the courts’ application of what the Arar court described as a “remarkably low” standard for declining to recognize a Bivens action. In the words of the Arar court, all that is necessary to justify a decision not to recognize a Bivens claim is that the court have reason to “pause.” Considered separately, these two features of the courts’ analysis are both highly problematic. When combined, they produce a wholly insupportable approach to the Bivens question.
Rethinking the Cooperation Clause in Standard Liability Insurance Contracts
Liability insurance literature has identified three central duties owed by the insurer to the policyholder that grow from the standard personal liability contract: the duty to defend covered claims against the policyholder, the duty to indemnify the insured against liability within policy limits stemming from covered claims, and the duty to settle those claims for a reasonable amount when feasible. The duty to cooperate stands opposite these as the central duty owed by the policyholder to the insurer. But while scholars have extensively examined, analyzed, and critiqued the insurer’s duties of defense, indemnification, and settlement, the insured’s duty to cooperate has not been adequately scrutinized. This Comment seeks to begin the scholarly discussion of the duty to cooperate by examining its impact on policyholder and insurer incentives, as well as on the resulting allocation of the costs of accidents. It goes on to propose several adjustments aimed at bringing the duty to cooperate back in line with its stated goals, as well as those of liability insurance in general.
Importantly, much of the harm this Comment seeks to eradicate arises when policyholders refuse to cooperate with their insurance companies when sued on a covered claim. While there are many breeds of non-cooperation, there is no indication—nor does this Comment suggest—that noncooperation is the prevalent policyholder reaction to being sued. Presumably, many policyholders comply with the requests of their insurers for reasons having little to do with their net worth: what the insurer requests may not present a burden, the policyholder may know the victim and affirmatively want to speed up the claims process, or the policyholder may simply believe that cooperating is the right thing to do. All of which prompts the question of whether this Comment ventures to fix that which, according to the old cautionary maxim, “ain’t broke.” But a system of liability insurance should not entrust its efficacy to the goodwill of its policyholders without an effective backstop of enforcement. If, as Professor Kenneth Abraham suggests, insurers can be “understood as the intermediary through which individuals motivated by concern for themselves become part of an enterprise that transforms selfish concern into altruism,” a structural defect in the policy that allows (indeed encourages) both the insurer and the policyholder to subvert that goal should not be forced to hang its remedial hopes upon an economically irrational goodwill. To be sure, voluntary policyholder cooperation serves liability insurance in many ways: it speeds up what is often a drawn out process, reduces costs to insurers who are not forced to track down the policyholder and coerce cooperation, and promotes the truth about the circumstances surrounding accidents. Relying on such voluntary cooperation, however, not merely to improve the delivery of insurance, but to hold the system together, is to beg divergent outcomes. This Comment proposes a duty to cooperate that instead relies on structural guarantees to serve the compensatory ends of the liability insurance system.
Preserving Judicial Supremacy Come Heller High Water
Minimalism does not only facilitate doctrinal innovation in a given area of the law. On my account, the Court sometimes issues minimalist rulings in order to preserve its ability to develop doctrine at all. The Court’s ability to “say what the law is” depends entirely on its institutional credibility—credibility that is risked when the Court rules on controversial topics. Thus, in certain “hot-button” cases, when the Court is required to make a controversial legal determination, it does so on narrow grounds in order to preserve its institutional power. I call this approach “power-preserving minimalism.” Unpopular decisions can harm the Court’s authority when they result in resistance—that is, when the Court’s mandate goes unfollowed. Minimalist decisions avoid this pitfall: they state a legal principle in a way that requires fairly little (or no) action by the population at large.
This Comment argues that Heller and McDonald were decided in just such a way. They were the subject of intense public debate and were quite significant jurisprudentially, but their innovative legal holdings were tempered by judicial tolerance of most existing gun laws. Thus, whether they agreed or not, it was dificult for citizens or political actors (federal, state, or local) to resist or defy the decisions in any way. By demanding fairly little, the decisions preserved the Supreme Court’s power.
In displaying power-preservation tactics, Heller and McDonald are two in a line of cases that includes Marbury v. Madison, Brown v. Board of Education, and, most recently, National Federation of Independent Business v. Sebelius, the Court’s decision resolving the constitutionality of the Affordable Care Act. In all of these cases, the Court set new legal precedent but demanded very little in practical effect. And in all of these cases, a chief factor motivating the Court was the preservation of its own institutional power.