Monday, June 04, 2012

Suever v. Connell (9th Cir. - June 4, 2012)

Recusal's a funny thing.  Judges are generally really, really careful about making sure that there's no actual or perceived impropriety resulting from their participation in a case.  Especially federal judges.  Judges usually go out of their way to make sure that their financial self-interest doesn't even arguably affect the outcome of a case.

This is often a huge pain.  Witness recusals in the Supreme Court.  Own one share of stock in a publicly-traded company that's a litigant?  Recused.  Participate minimally (or merely formally, like having your name on a brief) in defending a statute when you were a federal official before you were confirmed?  Recused.  Recusals like these sometimes mean that decisions are 4-4 and have to be reheard again, years later, with the resulting cost in the meantime.  Moreover, these recusals are generally for things that no one in their right mind would think would actually change a judge's vote.  Is X really going to decide Y because s/he owns some stock and might potentially see an insubstantial upswing in a stock price?  No.  Not on the level we're typically talking about (e.g., pennies).  This recusal practice also imposes costs.  Money gets put in a blind trust in order to avoid recusal even though the individual prefers to actively manage it.  Spouses have to be told where they can or can't put their money, or when they have to dump it.  That's a pain.

That's not to say there aren't some cases where recusal for financial self-interest isn't warranted.  There surely are.  We're rightly worried about judges taking bribes.  Either under the table or (via self-interest) over it.  As a result, it doesn't especially bother me when judges are overly recusal-oriented (as I think they are).  Often, it's a nice thing to see.  I think of it as a sort of tip-of-the-hat to the importance of impartiality.  The recusal itself is meaningless, because no one would actually think that staying on the case would matter.  But taking one's self off the case is a way of saying:  "We care about these things.  So I'm going to take myself off just to reaffirm that message."  Most every recusal is thus effectively just wearing a yellow ribbon that says that the judge appreciates the importance of not selling a judicial vote.

That overly long prologue may help explain how I viewed Judge Dorothy Nelson's published order earlier today.

Judge Nelson got assigned to a panel in a case involving a putative class action about unclaimed property held by California.  She (or more likely, someone in her chambers) discovered that she, in fact, had some unclaimed property.  Probably by checking this site.  Which you should too.

As a result, she's part of the potential class.  So if she permits the class action to go forward, she might potentially get some money.  She accordingly has to decide whether to recuse herself.

This is a perfect example of what I'm talking about.  As I read her order, I said out loud:  "I bet she's got like $25 in there."  So I checked it out.  Bingo.  California's holding $25.56 in dividends from Southern California Edison that never made it to her.  (I'm omitting the link because it shows Judge Nelson's home address.)

The class action likely doesn't involve the actual $25 -- which Judge Nelson can get just by submitting a form -- but rather something like interest on this money or reinvestment or something like that.  So what's really at stake for Judge Nelson is probably something more like 75 cents or so.  I guess that in theory that might be enough to convince her to decide a case more favorably to the plaintiffs.  But come on.  She could get more money by simply looking through the cushions of her couch.  A lot more easily, I might add.

Judge Nelson presumably realizes all this, but she nonetheless remains financially self-interested in the outcome.  Which generally means recusing yourself.  Though that's a huge pain.  Especially when you realize that you're recused only after you've been assigned to the panel, drafted a disposition, prepared for the oral argument, etc.  Recusing yourself at that point requires a duplication of effort as someone else takes your place.  All over a paltry amount that won't actually matter.  It's silly.

So Judge Nelson doesn't recuse herself.  She instead publishes an order that says that she'll refuse to accept any benefits from the class action.  Thereby avoiding any self-interest.

Problem solved.

As I said, in my mind, there's in fact no actual problem to solve.  Nonetheless, for symbolic as well as bright-line rule reasons, I get (and appreciate) what Judge Nelson does.  It makes sense to me.  Fine.  Appropriate.  Good job.

But if the truth be told, I don't think she had to do this.  And if she did have to do it, I'm not sure that what she does actually solves the problem.

Sure, giving up the benefits of a litigation effectively negates the monetary self-interest.  But you're still nominally a party since you're a member of the putative class.  Parties aren't supposed to be judges too, right?  So if we're talking about the need to enforce a bright-line rule, repudiating the proceeds doesn't solve the problem.  Just like it wouldn't solve the problem if Justice Breyer said "Yes, I own stock in X, but I agree to donate any appreciation in X's stock price on the day my decision about X is rendered to charity."  He'd still own stock and be formally recused notwithstanding that decision.

Similarly, even if financial self-interest wasn't at stake, you've still in part of the underlying transaction.  We can say (with confidence) that 75 cents won't swing your vote one way or another, and yet we still recuse.  I think there may be a similar -- or even greater -- problem with the fact that even if you don't have money at stake (any longer), you still had the events that are at issue in the lawsuit happen to you.  Once conduct that was directed at you is at issue, you're not longer merely a judge deciding a hypothetical case that involves a plethora of people you've never met and don't especially care about.  You're adjudicating a dispute that is in some ways personal.  The state took Judge Nelson's money.  The state didn't pay Judge Nelson interest (or whatever).  The state ripped her off.  You might well understand the recusal rules to say that it doesn't matter that you decline to accept the benefits of the lawsuit.  You nonetheless retain a stake in the litigation -- albeit a less concrete one -- because the lawsuit's about something that involved you personally.  Even if it involved thousands of other people as well.

You could see how this might matter, at least potentially.  The sting of having money "taken" from you might make you more pro-plaintiff.  You'll feel the loss greater.  "How dare they take money from me!"  "I can feel the plaintiff's pain; I didn't get the interest either."  A different judge might have the opposite reaction.  "This lawsuit is trivial.  It's 75 cents.  Not even worth getting, which I'll prove by giving up my stake.  It's just about lawyers getting money."  "This is bogus.  I never expected any interest, nor do I feel entitled to it.  I never even thought about this stuff."  The fact that a judge might have a personal reaction would persist even if the judge gave up the actual financial benefits.

This is theft, after all.  At least allegedly.  So maybe a judge would have a personal reaction.  Change the facts slightly and make the class action one about trespass.  X hacked into the e-mails of millions of people, including federal judges, and a class action is filed.  Y secretly deposited toxic chemicals on the lawns of everyone in Southern California, including federal judges, and another class action is filed.  We'd expect that a judge would recuse herself from both of these class actions even if she entered a published order that said she'd waive any financial benefits from the litigation.  We wouldn't want the fact that the judge was involved personally in the underlying events to potentially cloud things.  Ditto for a judge who had been mugged who is assigned to a panel reviewing the restitution order entered against the mugger.  That the judge agrees not to take a dime doesn't obviate the problem.  She's still involved in the underlying transaction.

Again, I don't think that any of this means that Judge Nelson should have recused herself.  Nor does it mean that what she did was wrong.  It may reaffirm that what she did was in fact unnecessary.  But we do lots of things that are unnecessary but nonetheless worth doing.  Holding doors open for other people springs to mind.  Gestures.  Like this one.  That are good.

But we shouldn't lose sight of what the rule should be in cases like this.  And, to me, the right rule relates to de minimus benefits or involvement.  Getting 75 cents is de minimus.  Ditto for $25.  Owning one (or even a thousand) shares of stock that might potentially benefit is generally de minimus.  Participating marginally in a formal capacity is de minimus.  Having your spouse be a conservative activist who's publicly against X is de minimus.

You can recuse yourself if you'd like.  It might even be a nice gesture.  But it's unnecessary, and especially when recusal imposes substantial costs, you might not want to do it.

I'll trust Judge Nelson to adjudicate this case fairly regardless of whether she'll pocket 75 cents either way.  So should everyone else.