UW School of Law Transcript
Bridging Town & Gown: Academics meet the real world
April 28, 2010
Well, good afternoon, everyone. I'm Kellye Testy, the Dean of the
law school. It's great to welcome you here to our program, Bridging Town
and Gown: Where Academics Meet the Real World. I'm really pleased that
you joined us today and I want to thank all of you from the faculty and
staff and also from the community for being here.
I was really happy to see that the law school has established the
tradition of doing this program. I understand this is the second year
that it's been done. When I'm out and about, I do often hear that the
public would very much like to know more about what the law faculty is
working on and the research. So I'm hopeful that as this tradition
continues, we can find ways to get more of the public in the room when
we have you here to share your work.
I want you to know too that I do
believe it's very important for us to be engaged in the world with our
research. We all love ideas, of course. What drew us to being faculty
members is our love for scholarship, our love for ideas, but one of the
things that I have been so impressed with on this faculty is that it's
not just about ideas.
Though I think being about ideas is very
important, but it's also about the impact and the reach those ideas
have. It's about the difference they make, and that is scholarship at
its finest form. When you really see the difference it makes in the
world. The way it changes law, the way it works for justice, the way it
makes a difference in a person's life, and for most every doctrine
that's out there in law, it started as an idea, as an article, as a
So I think it is wonderful today to be able to celebrate
that very important part of our faculty's work. Indeed, I think that
today, as we welcome Professor Sean O'Connor and Professor Kathryn Watts
as our speakers, they're just two absolutely fabulous examples of the
point that I make a lot, that scholarship and teaching and service,
those are the parts of a faculty member's job, and they go together
very, very well.
It's very tempting sometimes to act as if
scholarship and teaching are somehow inconsistent, or that one might
take away from time for institutional dedication. I believe just the
opposite. That they reinforce one another and that the faculty member's
role in an institution is at its finest when those three things are
integrated and working together.
Now let me, before I introduce
our speakers, thank the planning committee for this event. The planning
committee included Associate Dean Steve Calandrillo, Cathy Klein, who
directs our conferences and CLE programs, Bernadette O'Grady in the
Dean's office, Sheryl Niberg in the library, our Associate Dean, Penny
Hazelton, and in fact, I think most of the law librarians and staff
helped with this program, and also of course, our advancement staff.
I would ask you to join me in giving a round of applause and thanks to
the planning committee for the event.
way that we'll proceed today is Professor Watts will speak first and
share some remarks around 15, 20 minutes or so, and then take some
questions. Then Professor O'Connor will use the same format thereafter.
Speak for 15 or 20 minutes and also take some questions on the topic
that he addresses, and then I want to remind you all that we, at the
conclusion of the program, also have a reception planned in our
beautiful law library where you'll also be able to peruse the other
faculty scholarship that the faculty has been working on for the last
couple of years.
So let me introduce both Professor Watts and
Professor O'Connor, again by thanking them for stepping up today to do
this, and also for just all the ways that you serve the law school and
bring about the educational and academic excellence that we're so known
Professor Watts joined us in 2007, and she had clerked for
Justice Stevens for the US Supreme Court prior to that. Many of us are
kind of holding our breath, wondering who's going to take that
distinguished seat. Maybe Professor Watts. I'd vote for that.
Watts teaches administrative law, constitutional law and also, the
seminars on the Supreme Court and Supreme Court decision-making.
second presenter is Professor Sean O'Connor, who joined us in 2003. He
is the Founding Director of the Entrepreneurial Law Clinic, which is a
thriving clinic here at UW Law. He also led the formation of our law
technology and arts group and continues to be one of the leaders of that
terrific law and technology group within the school of law.
Watts will go first, as I noted, and will discuss bridging the courts,
law and politics, followed by Professor O'Connor discussing bridging law
So with that, Professor Watts, it's all yours.
Thanks so much for coming today. I'm pleased to be here and to
have the chance to talk with you. As many of you in the room know who
are my colleagues, and as Dean Testy said in her introduction, my
teaching here at the UW focuses on three main areas: constitutional law,
administrative law and Supreme Court decision-making.
So what I wanted to do today, hence the title of my talk, which is
Bridging the Courts, Law and Politics, is talk a little bit about how
both my research, my scholarship and my teaching look at the crossroads
of politics, law and the courts.
My classes that I teach raise many,
many opportunities for students to raise a lot of questions about
whether certain doctrines are about law or about politics. I was
thinking as I was preparing this talk about a subject that might
constitutional law students just covered this week, for example. We were
looking at the commerce class, and we studied a case, a 2005 case,
Gonzales vs. Raich. It's the medical marijuana case many of you have
probably read or heard about. In the case, Justice Kennedy and Justice
Scalia joined part of a six Justice majority that upholds a fairly broad
reading of federal power, federal power to regulate controlled
My students, when we took this case, always say, "Why?
Why did Justices Kennedy and Scalia support a broad reading of federal
power when just a few years earlier, in Lopez and Morrison, Lopez, being
a case involved in regulation of guns in schools, and Morrison being a
case involving regulation of violence against women, why did Justices
Kennedy and Scalia support a broad reading of federal power in the
marijuana case, but not in Lopez and Morrison, the cases involving guns
in your school and violence against women?" Because of politics? That's
just the answer to that? Or did they have some legal principled reason
for why they reached different conclusions in the different cases?
That's one example where it services.
In my administrative law
class, those sorts of same questions surface all the time. For example,
when we talk about global warming, we talk about why was it in 2003,
that the EPA denied a petition asking it to regulate certain emissions
from motor vehicles that lead to global warming. We talk about whether
it was for legal reasons. That was one of the reasons the EPA gave. Was
that they thought they didn't have the statutory authority to regulate
under the Clean Air Act? Or was it for political reasons or
policy-driven reasons, or for scientific or technical reasons due to the
lack of scientific certainty surrounding global warming? Or was it some
combination of those factors?
Students are always very interested
in trying to understand, is it law or is it politics? The same thing in
my Supreme Court decision-making seminar. I'm really looking forward
this fall to being able to talk with students about the upcoming
confirmation proceedings that Dean Testy just alluded to, to be able to
talk with them about some of the issues that I know we'll see surface
Questions like whether it's appropriate for senators
to be asking nominees about their views on topics like abortion. Whether
a justice's or a nominee's personal background and life story should or
should not matter, as it seemed to have in the Sotomayor confirmation
proceedings that we all saw unfold last summer.
So all of these
sorts of questions that students are exploring in my class that help
sort of highlight the intersection of law and politics and of the
courts, all these sorts of questions I think are framed to some extent
by a principle that students start out with, or an assumption that
students start out with. Like they all seem to start out thinking about
these questions by framing politics as a dirty word. They all seem to
assume that politics is a corrupting or a tainting influence, and that
it doesn't have any place in the legal world, or in the legal context.
they seem to be following - I'll borrow from Christopher Edley now,
who's a dean at Berkley who's written a book where he, relatively, in a
nice succinct way, summarizes some of the negative attributes of
politics and some of the positive attributes of politics. Many of my
students and probably many of you in the room, if I had to guess, I
think start out from the standpoint of saying politics are viewed as
negative in the legal context, and so you think of it as being
associated maybe with willfulness, or perhaps subjectivity, or a tyranny
of the majority, or the fact that it's non-scientific, not technical,
not legal, perhaps. Not fair, not reasoned, perhaps.
These are all
some of the negative attributes that I think many, as I said, in this
room perhaps associate with politics, and many of my classes do. So in
my own scholarship though, I question a bit whether we should be
starting from that beginning assumption point of viewing politics as a
Some of the positive attributes that we could associate
with politics have to do with democracy. That it helps further
democratic principles, it's responsive, it helps further public
participation and public dialogue, and it helps further accountability
monitoring. These are some of the positive aspects that come along with
So in my scholarship, one of the things that I aim to do
is to try to question this notion that I think many have that politics
just simply shouldn't play any role in the law and to think about
situations where politics shouldn't necessarily be a dirty word in the
So what I thought I'd do today is focus on one
concrete example of where I've sketched out some of my thoughts on this,
and so I thought I'd focus on my Yale law journal piece, which is
titled "Proposing a Place for Politics: An Arbitrary and Capricious
Review, " which was just published this past October, October of 2009.
in the article, essentially, the question that I'm looking at is the
question involving administrative rule-making decisions. So I'm talking
about informal notice and comment kind of rule-making proceedings
initiated by agencies, and the question that I was looking at is when
courts engage in arbitrary and capricious review.
For those of you
that have forgotten a bit what arbitrary and capricious review is all
about, thinking back to our law principles, arbitrary and capricious
review essentially is just a reason-giving requirement that's imposed
upon agencies. So it tells agencies when you act, you must give us an
adequate or sufficient justification, a reason for why you've acted in
the way that you've acted.
So when courts impose this
reason-giving or apply this reason-giving requirement in reviewing
agency decisions, but they start from the assumption that political
influences or political factors or political explanations could never
help to adequately justify an agency's decision in a rule-making
context. In other words, should they apply arbitrary and capricious
review in a way that we demand technocratic, expert-driven terms, or
instead, should we apply arbitrary and capricious review in a way that
might be read to allow political influences to play a role such that we
could say that politics sometimes helps to legitimize rather than
dictate agency decision-making.
So that's the question that I
started with in this project, and I start out by essentially trying to
paint a descriptive picture of where we stand today, and so what I've
determined as where we stand today is relatively clear. Courts agency
scholars are like all of them essentially start from the standpoint
today of saying agency decision-making needs to be technocratic or
expert-driven. It seems to be the point that we're at.
So if you
take agencies to begin with, for example. Agencies, when they explain
their rule-making decisions, when you look at the statements of basis
and purpose that accompany agencies' final rules, they're generally
filled with cites to the statutes, to the science, to the facts, to
technocratic reasons for why they made the decision that they made.
they either affirmatively hide, or they just fail to disclose, fail to
mention, all of the interaction that they had with the White House
Office of Management and Budget, for example, or the interaction that
they had with the President's staff, directions they got from the
Executive Office about how to proceed, or maybe even the fact that they
should be proceeding, that they should be opening rule-making
proceedings. That just doesn't get mentioned.
So if we take a
common example, if we think back to the 1990s when President Clinton -
it was a major Clinton initiative to try to regulate teen smoking in the
1990s, and President Clinton, who personally announced the initiation
of the rule-making proceeding by the FDA that was going to regulate teen
smoking, and then when the rule was finally promulgated in a Rose
Garden ceremony, President Clinton personally announced the promulgation
of the rule, taking some credit for the fact that this rule had finally
So it was really a major, major Clinton initiative,
and yet, when you read through the extraordinarily lengthy statement of
basis and purpose accompanying the FDA's final rule, you don't get any
hint of the Presidential involvement. There's barely even a reference to
the President's involvement at all. Rather, it speaks in technocratic
So that's generally the norm. There's a few books, a few
outliers I could talk about later if anybody was interested where
agencies do mention political influences, but it's really quite rare.
The FDA proceeding is more of the norm.
Judicial review is
similarly very technocratic and focused today. Massachusetts vs. EPA,
the global warming case that I just mentioned earlier, is a great
example of that. In Massachusetts vs. EPA, when the court was reviewing
the EPA's refusal to regulate greenhouse gases that come from certain
motor vehicles, the court really seemed to demand expert-based
decision-making. So the court said to the EPA, "Yes, you have statutory
authority." So that was a legal question.
But then the EPA had
said, well, even if we have statutory authority, we decline to regulate
for a variety of policy-driven reasons. We don't want to step on the
President's toes in the foreign policy arena, we don't want to have
piecemeal regulation, this is an area that cries out for more
comprehensive regulation, and there's some scientific uncertainty, which
also suggests to me to sort of wait for more comprehensive regulation.
policy-driven kinds of explanations, the court found inadequate. So in
the end, the court seemed to be sending a very strong message to the
EPA, which was go back to the drawing board, put on your hat as an
expert and figure out whether these emissions endanger the public health
and welfare. Figure out whether there is endangerment that exists here.
So that's just an example of a recent arbitrary and capricious review
case where the court engaged in this kind of technocratic model that's
really come to be the norm today.
Scholars generally have followed
the line of agencies and courts in terms of tending to accept the
notion that politics shouldn't be proper. Accepting the notion that
politics should be viewed as a dirty word, in other words. There are two
really notable exceptions that I should mention. One of them is
Christoper Edley, who's the Dean at Berkley, and the other one is Elena
Kagan, who's former Dean at Harvard, and notable, or should be notable
to all of us because she's currently Solicitor General, and she's one of
the people whose name is being floated most prominently to potentially
replace Justice Stevens on the United States Supreme Court.
article that touches on this topic, I think is an interesting one, to
see if she has nominated, whether it comes out in the confirmation
proceedings, because that's somewhat controversial, the fact that she's
taking the stance that politics happens all the time in the
administrative world. Her article is titled "Presidential
Administration" and she chronicles the involvement of the President in
administration. And she, at the very end, in a short section in her
article, floats out some implications of this, and one of the
implications that she suggests is that perhaps we need to rethink
arbitrary and capricious review. Perhaps it does need to take into
account political influences. That's sort of the path then that I go
down in this article.
So Kagan and Edley are two of the anomalies
that I should note in the scholarly world. But otherwise, for the most
part, scholars have sort of started from the same standpoint, which is
politics is bad. A bad word. It doesn't belong in the legal context.
that's kind of the picture that we're at in terms of the descriptive
picture, is that courts, agencies and scholars alike, seem to have
assumed that rule-making proceedings, administrative rule-making
proceedings, need to be viewed as technocratic in nature. So in my
article, I make the case for change, the argument for change, once I
described the state we're at and make the normative case for why we
should move into a new model, a different model that would tweak
arbitrary and capricious review. Not lessen it, but tweak it such that
more factors would be accepted as adequate reasons justifying agencies'
So essentially, my bottom line argument is that what
counts as a valid or an adequate reason for agency decision-making
should be expanded to include political influences from certain
political factors. The President, other high level executive officials,
Congress. When those factors are openly and transparently disclosed in
the rule-making record, that's one key, because part of the basis for my
article is trying to achieve greater monitoring and transparency and
So if it's not openly disclosed in a rule-making
record, it doesn't count, and as long as the statutory scheme can't be
read to foreclose considerations of the factors that are considered. I
am not proposing that any and all political influences should be read to
legitimize. Rather, you have to try and draw a line to some degree
between good politics and bad politics, permissible politics and
That is probably the hardest question that
my project raises is: How do we actually draw this line? It is a tough
one to draw. Is it going to be one that courts could police? Part of the
suggestion, although this is tentative at this stage and something that
I can think about in future projects. Part of the suggestion I have is
we can roughly think of good politics or permissible politics as being
those influences that seek to further policy considerations or public
values that are in some way only generally tied to the statutory scheme
or the statutory purpose that is at issue. But illegitimate political
influences, on the other hand, they are not going to be tied to public
values to the statutory theme, to statutory general purposes or goals.
If they are unconnected in any way then to the public values with public
interests, it would be viewed as illegitimate.
For example, raw
politics, pure partisan politics, would fall, likely on the side of an
impermissible one. So, what would all of this mean? To give you a
concrete example. HHS, the provider conscience rule. Something that some
of you probably read about in the paper. A Bush-era rule that forbid
medical facilities that receive federal money from discriminating
against health care providers who worked years to perform certain
procedures like abortions. So when Obama came into office and the Obama
administration was thinking about rescinding this, how do you go about
explaining as the new Obama administration, why you want to rescind this
Bush-era rule? In terms of my thinking, it would be legitimate for HHS
to explain. Part of the reason why we are going to rescind this is
because President Obama has publicly articulated his pro-choice agenda.
He has explained why his pro-choice agenda helps to serve the public
It wouldn't be permissible, of course, on the hand, if
Obama's HHS said, "President Obama directed us to rescind the rule so
that he could give kind of a favor, a thank you, to the various
pro-choice organizations that supported his campaign." Of course that
would be impermissible.
So again I am not suggesting there is not
going to be a line to draw. There is one and that is the tough issue,
just like the fact that those two examples I just gave you. One is on
the easier side of the line, clearly, and one is not.
of benefits would flow if we moved towards this type of system? Why do I
think it is worthwhile making this proposal? There is mainly four main
benefits that I see flowing from moving towards a greater acceptance for
politics, greater acknowledgment of politics in the rule making arena.
The first one is doctrinal, essentially. It has to do with the argument
that there is some vacillation in administrative law doctrines between
an embrace... Perhaps the myopic embrace right of expertise on the other
hand, and an embrace of politics on the other hand.
doctrine like the famous Chevron doctrine, which tells us that agencies
get deference for reasonable interpretations of ambiguity, seem to
acknowledge a rule for political influences. Part of the reason why that
courts say you give deference to agencies in that context is because
when there are multiple reasonable interpretations... Not up to the
unelected judiciaries to pick one or the other, rather that should be
the choice they are asking the executive branch. And it can change their
choice from administration to administration. So there is some tension
between the embrace, to some degree, of political influences in that
kind of a doctrine versus hard-look, which really hasn't moved towards
embracing political influences at all. So that is one benefit that I
Another is that I think if you gave a role, an acknowledged
role to political influences, we help create a better separation between
science and politics. Think about all the articles that you read in the
papers during the recent Bush administration that charge the Bush
administration with having manipulated science. It happened in the
global warming context in many areas where the charges thrown at the
Bush administration saying that those that are supposed to be acting in a
scientific manner have manipulated the science or manipulated the data
to serve political end.
Whether or not those charges are true, it
certainly highlights the fact that there can be some pressure on
agencies to feel the need to line up science with the preferred policy
outcome in certain circumstances. So do you give both a role rather than
focusing only on one side of the equation? Then perhaps you'll take
some pressure off that problem.
The third major benefit that I
see, which is more of a minor one, has to do with dealing with this
ossification charge that's often thrown against arbitrary and capricious
review. Many argue that "hard look" review, by having agencies give us
this long laundry list of reasons for why they've done what they've
done, ossifies or slows down the rule-making process. And so, if you
give courts yet another reason for deferring to agencies, then perhaps
you can help soften that ossification charge. Although, by no means, do I
think it will eliminate it.
The main reason that I think this is
beneficial, the biggest benefit that I see flowing from my proposal -
has to do with accountability and monitoring. By bringing these
political influences out in the open - influences that everyone
acknowledges are going on all the time - from underneath the rug, we're
going to enable greater accountability, greater monitoring, and greater
transparency, which is really where I see the biggest benefits lying.
But I'm not naive. I know that this requires some significant change,
and there will be a lot of hurdles and obstacles in the way of getting a
proposal like this to succeed.
I think there are really five main
objections that you might think about. The first would have to do with
whether the carrot that I'm offering needs to be balanced by a stick.
The carrot being if you disclose these influences then you can get some
additional level of deference from the courts. Do we need to balance
that with a stick where we tell agencies, if you fail to disclose these
influences, you're going to be penalized in some way?
something that I do think is really worth some thought. There's a new
article coming out this spring by Professor Nina Mendelson at Michigan,
and she argues essentially for just that. She argues that we don't know
enough about political influences.
Like me, she says we all know
it's going on. It's going on all the time, but it's not disclosed. And
so, her bottom line is we can't figure out what's a good political
reason versus a bad political reason without at least having the reasons
So let's pass a statute - here's one of her main
suggestions - that mandates some disclosure, at least disclosure of
certain communications. Primarily, she's focused on communications
between OMB and the agencies, mandating that they disclose some of these
influences. So if you went down that path then I think you'd have your
stick provided more easily to help balance the carrot that I'm dangling
Another concern is that separation of powers issues
might be raised. There's judicial dislike of politics. Again, many
judges like my students and like many of you in the room just think of
politics as being a dirty word, so that's likely to get in the way.
difficulty of judicial review is how manageable would it be for courts
to draw these lines between good and bad politics? Is that something
that would ever be possible? That's another one of the obstacles that I
have to deal with and try to deal with in my paper.
there's what you could think of as the "chicken-and-egg" problem, as Ed
Meese put it, or the "first mover" dilemma. Are agencies going to be
brave enough to start acknowledging that these sorts of influences are
influencing their decisions, when they're not sure what courts are going
Or will courts send some signals to agencies ahead of time
to try to enable some guinea pig to step forward and start relying upon
these considerations? So there's that "first mover" dilemma also that
might stand as an obstacle towards achieving change in this area.
that's just a quick highlight of some of the obstacles. I'd be happy in
Q&A to talk about in more detail some of my main thoughts on those.
Hopefully, this gives you a sense of it. One of these concrete projects
of mine is meant to try to struggle with this question of whether we
should always be assuming that politics doesn't play a proper role, or
shouldn't be able to play a proper role in the legal context. So I'd be
happy to answer questions.
I do think there are a couple of things to keep in mind, in terms of
executive versus independent agencies that could be quite significant.
One is under my proposal, if a statute can be read to foreclose
political influences from being a permissible decisional factor then, of
course, agencies shouldn't be able to take that factor into account.
with independent agencies, some of how they were created, some of the
legislative history behind the statutory schemes supporting their
creation, could be read potentially to suggest that political influences
are not a relevant decisional factor that should remain on the table.
suggested--there was a recent case. The frigging expletives case, the
FCC versus Fox, where Stevens actually talks about the legislative
history behind the creation of the Federal Communications Commission.
And he makes sort of a point along those lines. That it was meant to be
an agency that's supposed to be insulated. Of course, that's the reason
why it's an independent agency.
So I think that's something that
you'd have to think through. Is the statutory scheme with respect to the
independent agency that you're talking about and whether it would
foreclose the consideration. But if you get past that hurdle and you
assume that this specific statutory scheme you're talking about doesn't
foreclose political influences as a relevant decisional factor. Then I'm
not sure that it matters so much if it's independent or executive,
because independent agencies of course aren't independent from politics.
makes this point in the FCC case. They're just insulated from the
President, but not from politics. And so again I think the same benefits
would flow if you get them to disclose the political influences. Maybe
they're coming more from Congress than they're coming from the
President. But the same accountability and transparency and monitoring
principles should flow, whether you're talking about executive or
independent. It's just that there's a bigger hurdle to get over for
independent in terms of whether it's a permissible decisional factor, I
Yeah. If you go down that path then it
just helps, as you say. It helps support my position that at least as to
the executive agencies, it shouldn't be all that controversial. And yet
it is, right? So why, why is it so controversial? Why is it so hard for
so many people to stomach the notion that we now know?
As I said,
politics play a role. Why is it so hard to stomach the notion that we
should have those roles brought out into the open? Particularly, as you
say, when we're talking about executive agency?
The FDA and EPA are two that have faced a lot of press lately, right? A
lot of attention in the public eye for what people would view I think
as tainted decisions or bad decisions. You can't answer it. In my mind,
you can't answer it blanket across the board as to the EPA as a whole.
It's either OK or not OK. Again it's going to depend on the specific
statutory scheme that we're talking about, the relevant specific
In Massachusetts versus EPA, we're talking
about the EPA. But we're talking about the section 202A of the Clean Air
Act. And whether the statue forecloses certain decisional factors or
doesn't. In my mind the statue didn't say anything about the decisional
factors that should factor into the mix when an agency is deciding
whether or not to initiate the rule making proceeding. Just going to be a
bit more specific...
Well, if you've...
That's why you're getting law involved.
I think implicit in your question is the assumption that if you
had a case where the facts and the science are clear, right? As to the
answer, it's clear that substance is harmful and needs to be banned. Or
if it's clear, right? What the answer should be, based on science or
facts. I'm not suggesting that politics should be allowed to come in,
that an agency should be able to rely upon politics to trump science.
But while they're in those situations which are muddy, where there's not
a clear answer based on the science or the facts. There's not a clear
answer based on the law. Rather, there's multiple open options. Or
perhaps the science and the facts lean more heavily towards answer A but
don't rule out answer B. It's in those situations where it would be
much more helpful to see the political influences brought to light.
question asking about the EPA and the FDA brings up an example in my
mind about one situation where the FDA recently was said to have engaged
in doing bad politics. The Tamino versus Totti case, which is an
interesting one involving a drug, Plan B. Emergency contraception. The
case is particularly interesting because it's not very often that we can
actually get the discovery to find out that the bad politics was going
That's part of the problem with this. And that's why maybe
Nina Mendelson's proposal that we need an actual stick to force
disclosure, maybe that is the right route. But in this FDA case that I'm
thinking of involving the drug Plan B, the litigants have made a strong
enough showing of bad faith on the part of the FDA that they were able
to get the discovery they needed to have the court ultimately determine
that the FDA had acted in an arbitrary and capricious manner.
they were aided. The litigants were aided by the fact there was a GAO
study into the issue. There had been a lot of attention to that
particular issue involving Plan B, which helped them to prove that there
were really bad politics going on there.
desire to see agencies again, which is implicit in your question, as
being scientific and being factual, right? And you say, "But they're
not." And that's part of... I think, my point, right?
those situations where it's not facts and it's not science always
driving certain decisions. Where it's really much more of a policy
choice, and wouldn't we like to know what those influences and those
factors are that are making the decision come to outcome A or B? So that
we can hold the decision makers accountable, so that we can benefit
from accountability and monitoring, so I think I'm copacetic to some
degree to the points that you're making.
I see that
I'm just running out of time. And I don't want to eat up Sean's time. So
I should probably hand over the mike to Sean, I would think.
OK. Thanks, Kathryn. Now we're going to switch gears a bit. OK,
about something different, about law and entrepreneurship. We will
actually get to some bio-tech stuff though, in the very glancing kind of
The title of my talk is "Bridging Law and Business, " teaching research
and clinic innovations in law and entrepreneurship. What I'm going to
try to do in 20 minutes. And I'm always overly optimistic about what I
can get done, is talk about the interface of lawyers and entrepreneurs
in the first place. What it is that lawyers do with and for
entrepreneurs? Talk about the innovation entrepreneurship ecosystem.
Which actually is a focus on attention now, in part by the Obama
administration, without a call for information actually on how we help
build innovation ecosystems. That's actually very exciting personally to
me because it's something I think it quite important and is something
I've been trying to do through the clinic and through a lot of the
things I'm going to talk about today.
And then, not surprisingly, I'm
going to bring it into professional schools into the law school but also
into other professional schools on the campus and talk about how those
places can be the locus of advancing innovation ecosystems. Both making
it happen, studying, thinking about it.
Then I'm going to shift to
a more theoretical approach to talk about a new way of thinking about
law innovation entrepreneurship. How they go together and how many
disciplines in fact work that will then help us reintegrate teaching
research and service.
As Dean Testy said, they shouldn't be
separate things. Sometimes they are separate things. There has been a
trend to separate them more and more and I think that they truly can be
brought together and reinforced.
Is there a field of law in
entrepreneurship? Insert reference to law of the horse or whatever other
kind of thing, right? We make up fields on law all the time. We have
cyber law and biotech law, just to say that I do some work in. Are they
really field of law? They're not contracts, they're not torts, they're
not standard legal categories. Are we just kind of making this up? Well,
Another way to think about legal fields, and this is
particularly I think, how a lot of practitioners have come to view legal
fields, is they do say there is a field of biotech law or cyber law but
what they mean is it becomes industry or client focused, or rather an
activity that is going on. There is a bunch of ways law interfaces with
that area and that becomes the field.
That leads to the next
thing. Are we just hybrid specialists? At times in my career, I think
I've portrayed as IP/corporate securities and I've always been trying to
say: "No, I actually do one thing. I do commercialization and
entrepreneurship." To do that, particularly in the technology space, you
need to cover a lot of different areas of traditional categories of
law. Again, intellectual property, corporate law, securities law, things
That leads to the next problem. Are we really jack of
all trades, master of none? I admit to that frequently. I find myself in
my classes often saying: "I'm not a master of this but I'm going to
tell you what I think about that field because it's relevant." You need
to think about that. Let's say tax, say Sam or somebody else who really
knows tax, so I fake tax in the classroom and then I quickly disclaim
and say: "See Sam, he can talk to you about tax for real."
this problem in front of us right now, even if we're in a securities law
class or an IP class or a biotech law class, we can't ignore that. We
can't separate everything artificially and say: "All we can talk about
right now are the patent issues." That leads to an odd way of viewing
the clients problems and what we do as lawyers.
What's the core of
law and entrepreneurship? For me, it really is governance and deals.
What do I mean by that? Governance is how you put together the legal
entity in which the entrepreneur is going to do his or her business
venture. The deal is any of the transactions or the relationships among
parties that are memorialized in contacts. They are much richer than
just the written contract. There is more going on there but I think you
can break it down into governance and deals. Focusing on those issues.
question that comes up frequently is, is this even the practice of law?
Some state bars have angsted about this. Why? Well, because if you're
trying to say what is unauthorized practice of law you have determine
first what the practice of law is. We kind of skirt the boundaries
somehow because there is nothing that prevents parties from writing
their own contract. We, as lawyers, might think we can help them do it
better. Even in front of the patent office, if you're an inventor you
can get your patent issued just between you and the patent office. You
don't need that patent lawyer.
On the other hand, there is a lot
of value add that we do. There is this question lingering out there.
That exacerbates this sense of what is exactly is this that we do?
now to complicate it even further. For lawyers who work with
entrepreneurs it's not even just trying to have some handle on multiple
areas of law, it's multiple disciplines too that you have to have some
working knowledge of to be effective with your entrepreneurial clients.
schools can and do serve as a hub of teaching research and service for
entrepreneurship service providers. I threw that word in and that throws
it off a little bit from what might you normally be thinking about when
I say: "I have an entrepreneurship program at a university."
Traditionally it's not that old of a field but a lot of entrepreneurship
programs are in the business school or maybe the engineering school but
they need to focus on training people to be entrepreneurs. Of course,
that's a great starting place. We think we want entrepreneurs, you may
disagree with that but if we want to entrepreneurs we need to have a
place to have them thinking about how to become entrepreneurs.
focus of this talk is not to train people on how to be the entrepreneur
but how to serve the entrepreneur. To help the entrepreneur to achieve
their goals. That's why I threw that word in here and that's what we're
going to focus on for the remainder of this talk.
business and engineering schools, even though these latter two often
mainly focus on producing the entrepreneurs, they all can and should
work together to help develop entrepreneurship and it's full ecosystem.
Each discipline now, law, business and engineering and the subcategories
within those, need to understand the other and the entrepreneur.
Well, because when an entrepreneurial venture is moving forward, there
is a cast of supporting players who have to come together and coordinate
their activities. It's not just the lawyers, it's the accountants,
business consultants, a whole range of folks who have to come together
and coordinate their activities to the entrepreneur. They also need to
understand what the other is doing.
It doesn't mean I need to
become the MBA and that probably never will happen. I won't be as good
at churning out those spreadsheets and doing things like that but I have
to understand at least enough to read the spreadsheets and read the
On the flip side of that, each of us who is
sitting in a specialty area needs to meet the other one halfway and
figure out how to communicate the concepts of our field and the
important things we are doing in accessible language and context.
these things together and allowing teams to work together to start
understanding how to coordinate your activities is quite critical. It is
also critical to understanding the ecosystem itself.
What have we done so far at the law school? Well, we have the
entrepreneurial law clinic that I started a few years ago. It's actually
a joint venture of the law school and the Foster School of Business. In
particular, the center for innovation and entrepreneurship there. What
we focus on again, is serving the entrepreneur and not being the
We haven't really defined what I mean by
entrepreneurship yet. These categories of the clients we serve will help
give a sense of how the full range. Even though a lot of times I made
default into sounding like I'm talking about just technology
entrepreneurs, I actually always mean to be speaking more broadly of
I'm including first and foremost, low income
micro-entrepreneurs. No technology involved at all. They want to start a
store or some kind of craft activity or any number of things. Small
micro-entrepreneur because they want two or maybe three people involved,
max. How do they get there venture going.
And yes, of course the
technology stuff; high-tech life sciences, clean green tech. Also
nonprofit and social ventures. Seattle is a great place now because we
have a lot of social entrepreneurship going on. We always have but in
particular, now there are a lot of twenty-something's who are out there
doing all these great amazing things. A lot of whom have come into the
clinic for help launching their venture.
We also work with UW's
Center for Communication, it used to be called Tech Transfer, to help
the researchers at UW think through how to spin-off UW technology.
There's a lot of different ways you could go with spinning off a
technology including just licensing it to a big establishing company or
building a startup venture around it. How do you think through what's
the best way to go?
We are also part of and partly funded by NAH
through the Institute of Translations Health Sciences. There again, we
help not only UW researchers but all of the researchers who are at
institutes who are part of ITDH. We help them think through what they
can do with the great science breakthrough they have, advancing it from
being "cool science" into some sort of product or service that can
actually help cure people, help diagnosis illness, etc.
of the clinic then, from the student's perspective, is experiential,
team-based learning among MBA students. So each team in the clinic has
three law students: IP focus, corporate law focus, and tax law focus.
And they work with MBA students from a range of the MBA specialties,
whether it's accounting and finance, or management operations,
marketing, and things like that. And that team then serves the client
and goes over - as I'll talk about in a moment - all the legal and
business issues that venture might face.
We also harness the
experience of local attorneys and business executives because they
supervise the student teams. This actually came about as a completely
pragmatic fix to the fact that when I got here, - as a regulatory,
so-called doctrinal, faculty member - I didn't come here to build a
clinic. I was not a member of the Washington State Bar, and so, we had
to go back and forth as to whether I could actually supervise a clinic,
when I decided, for whatever odd reason that I wanted to start a clinic.
I figured why don't you just use local practitioners? They can
supervise. Later, I did end up coming into the Washington Bar. But I
discovered that this was a great mechanism because it could scale-up the
clinic more. We have more supervisors. And we get the students working
with local practitioners, so they're not just talking to me.
talking to potential future employers, and it brings that practitioner
community back into the UW, in a way that's not just about us going out
and doing some fund-raising. Fund-raising is important, - I'm looking at
my dean here - but it's not the only way in which we should involve our
What does it do for the attorneys? Well it gives them
targeted, pro bono opportunities. A lot of the attorneys we target to
come and supervise free legal services are ones who don't normally fit
in with regular pro bono opportunities. Normal pro bono opportunities,
or at least traditional ones, are often around criminal cases, or
landlord/tenant, or asylum cases. There's a whole range of things that
are still, I think, truly the heart of pro bono services. The neediest
people need these kinds of services.
But why leave our corporate
attorneys, our IP attorneys, and tax attorneys with no pro bono
opportunities, or force them to go and act in an area in which they
don't have real expertise, when we can have them help us in the clinic
to help poor folks who want to start a business? So that's worked out
A service that we do is we don't just do any kind of
random thing for the client. We have a highly-structured legal and
business audit that we make all of our clients go through before we'll
do any other things for them. And as long as you do a due diligence type
of exercise, we want the client to have a chance to undergo the kind of
intensive analysis that an outside investor, or a bank that might loan
them money, or anyone else who might be looking at them later on will do
to see whether this business seems sound, or be successful.
entrepreneurs are quite good at doing this kind of analysis of the
venture before they launch it. They also, if they have enough money, are
used to bringing in specialized attorneys to help them think through
it. First-time entrepreneurs don't have this. Lower-income folks don't
have this. So we give them that kind of a service.
forward from that we do what we call preventive legal services. And we
help them establish and maintain proper documents, procedures, and
governance. All these are good housekeeping things to make sure they
don't make what seem like minor missteps in the early days that can
become major problems later on and lead to litigation.
And an easy
way to think about this, my motto has become "I don't want any business
to fail because of some dumb legal issue. A business should fail on its
own merits". That sounds harsh. But think about it. That's what should
happen. It turns out there's not really a market for the product. OK.
You gave it a chance and you went for it. It shouldn't fail though
because of some little legal thing.
And then, we will sometimes do
other transactional procurement compliance. By that I mean some
trademark issuance, and things like that as indicated. But we try to
hand off these clients, once we've brought them through the audit
service to regular counsel, and try to get them in a situation where
they can afford regular counsel and move them on from there.
also started revamping a lot of so-called doctrinal courses. They are
sort of in hand with setting up the clinic because I also tried to teach
in the area of transactional law analogue, you know that the other
traditional law school teaching method doesn't do so well for
transactional law. It doesn't help you understand what deal lawyers are
And so, when I started doing them was doing course
long hypothetical or case studies. It is kind of a simulation where we
have the same cast of characters from the beginning of the course
through to the end. It is often some business that is being formed. We
got concerned that it's kind of a one trick pony thing for me but if it
is a really good pony and a good trick, just keep riding it.
hasn't fill me yet. We followed the life cycle of a business or deal.
OK. So starting in the beginning, where is it all go? And if you are
kind of crafty about it, artificially manipulate some things. You can
kind of trigger all the main topics you wanted to cover in the course of
the doctrinal matter. But do it because it's triggered by something
that happens in the hypothetical. OK.
As you march along through
the quarter. And then for good measure then, we also do some negotiation
and drafting of governance and ideal documents. We get to policy for
thinking about the impact of legislation and rule making on business. A
lot of areas that I think about teaching again in high tech fields that
are constantly undergoing scrutiny.
There is a lot of rule making
that is happening related to them. So it is kind of easy. I just sit
back and wait for something else to come out of Washington DC and then
drop them on my students and say, how does this impact? This thing that
just happened. This rule that just came out are the business that we are
talking about. You have to analyze and why.
The heart of what I'm
trying to do then is to teach them to think about the law business kind
of hybrid space. OK? And in particular then, I started using the term
private ordering that other people have been using in a legal editor for
quite a while now. I'm not sure if it's entirely for what I'm trying to
deal or rather it may only cover part of it. But it is the only term I
can find that everyone at least sort of uses and understands.
ordering is often a term used when you are going to have an ultimate
kind of a governance dispute resolution mechanism. So it is like an
alternative to the courts. It's like a kind of a private ordering
system. But I mean it's a cover not just the kind of law of the entity,
governance thing but law of the deal. And so thinking about it that when
you have parties enter into contracts, particularly kind of contracts
that will set up a relationship that will last for years not just a one
off, one shot deal.
That then they are very much a sort of area of
law that... Set of law that is created and I'm captain of that under
this private ordering term as well. OK. Now, part of ordering and I
tried to teach my student is happening within the bounds of statutory,
regulatory in Kate's law. And so it means that I do something a little
unexpected from my students, they've gotten very good to the first year,
what not at learning how to think about case law first and foremost.
then even statutory regulatory law and I say to them push that all to
the side, OK. That's all good stuff but now, we'll come back to this in a
second. This is what I'm really talking about here. What I am going to
try to teach you about is what goes on or what I call the free play
zone. I am just making this stuff out right? But I said I'll practice
what I preach. This is what... We are doing the transactional page,
right along, we are just making it up, OK.
Now, we are making it
up in a bounded environment though. So, we have... Let's say you have a
bio tech start up or try to think about how to form this tech? So it is
not just a matter in of filling in a simple articles of incorporation's,
some pre-print form like the one the Secretary of State has online.
It's much more new ones than that and you have to think about creating
exactly the kind of entity you want, exact kind of governance
The deals that we are going to be struck with all the
players involved. And all of these has to be done within the bounds of
securities law, cooperation's law, IP, competition law, just to name a
few things. FDA and human subjects and regulation. But still this is a
zone left in here in which you have some legal room. Actually quite a
lot of wiggle room often.
And in some ways, you can look at the
evolution of a lot of statutory law as looking at how tightly you shrink
that pre-play zone. So at different times in the history of this
country and other countries, the zone gets shrunken down and it's very
little area of movement. And other times, it gets to be quite large.
the documents we used though as opposed to statutory are regulatory
documents. They are almost always a blend of law and business language
and concepts. So, they are very much in this hybrid space. And the
challenge is that traditional law and even MBA training doesn't really
get you where you need to be to understand that.
An example is a
venture capital deal. To hear the businessperson talk it's almost this
sense of, it's a private financing so it outside of the security laws
entirely. Well no, it's actually no outside of it at all. It's in here.
Think about all of the zoning laws and securities. You have a safe
harbor in which you might be able to structure your deal but how you
structure it is going to matter quite a bit as to whether it stays
within the free place safe zone or whether it goes outside of that.
key deal terms, other than just the price of stock, price per shares
and price of purchase, are actually very much legal terms that are going
to be negotiated. Especially if your using preferred stock.
Registration rights, meaning can the investors force the company to
register the stock the SCC so it can be sold freely and trigger an IPO.
Liquidation preferences, who gets paid out first it there is a
bankruptcy of the company. Voting, how many votes per share. Do you get
board seats? All these things are legal and nature and yet they're not
defined or limited by the state corporations law in what you can do. You
get the free play zone and you have to decide how you want to set that
IP strategy is similar. I said, with a little hyperbole here:
"Anyone can get a patent issued." I know that if there are any patent
lawyers in the room, you'll cringe at that. Although on the other hand,
real good patent prosecutors will nod a little bit and say: "You'll
always get some kind of claims issued." The question though is, how well
do they map on and serve what the client is actually trying to do? Does
that final patent that gets issued actually achieve the goals that
And further, IP is not just all about patents. In
the kind of way I do intellectual property and most entrepreneurships
do, is again it's this hybrid legal business counseling. It has to
incorporate all IP tools; copyright, trademark, patent, trade secret and
also related areas such as publicity rights as applicable, privacy,
contractual means to protect data, and know-how materials, et cetera.
the big idea here? It might be sounding like I'm ending towards a model
of law school that's going to be the dreaded trade school model. Skills
based and all we do is teach students is how to shuffle paper and fill
out forms. I would try to fight against that. No, what happens is we
have a false dichotomy that's been set up. We have this trade school
versus academic notion. Two very different models. Practice skills
versus theory. I'm rejecting that.
I'm saying invoke the 80/20
rule and realized that there is a 10 percent on one extreme of pure
skills and I mean that in the negative sense that people use it. Anyone
can be taught. A paralegal can be taught to fill out a form but that's
only the ten percent of what you would need if you're thinking richly
about skills and the stuff I want to talk about.
At the other
extreme you have pure theory that is completely untethered from what's
going on in the real world. My argument then is that 80 percent of what
we really should be focusing on and what everyone should mostly care
about is actually something that blends these things. It's in the
Now, I'm am going to go very theoretical on you. Invoke
Aristotle. Release Aristotelian terms. I'm applying my brief tour
through graduate level philosophy and hijacking some terms I learned
along the way. Because I didn't learn enough about them, I think I can
just freely use them for whatever I want. Actually these should hue
pretty closely to a lot of ways these terms have been used historically
over time, but I do want to recapture them in a new way.
is a profession or field body of "scientific," and I'm putting that in
air quotes, knowledge or facts. I'm not trying to talk about this as
theory. Theory is something that can happen in any way of practicing.
It's not just the knowledge you have but I'm using the term practice
here. When you think about the traditional dichotomy between theory and
practice, we think about as if that's all that lawyers or any
professional thinks about. You are doing something actively in the world
or you're just thinking theoretically and that's not what I'm setting
up with this episteme.
Episteme is just the generally accepted
principals or knowledge points within a field. I'm putting "scientific"
in air quotes because I don't mean it to be Science with a capital s. I
just mean science in an older sense of the term science that just means
to study an area. In fact, I know this will sound controversial, but you
could have a science with a small s, the science of astrology, not to
say astrology is scientific in the way we think of science today, but it
does mean you could say: "Well, I could study what astrologers do or
claim to be doing and study the steps they claim to go through. The
reading of tarot cards. That could make a science out of something.
all I mean by episteme. It's just saying what is the generally accepted
set of principles and facts that a profession taps into when they are
doing their field. The temptation is to use the word "practice" to mean
"doing." Thinking like a lawyer.
I loved it when I was in
philosophy and we would now do philosophy. I didn't understand how you
would do philosophy. I thought philosophy was just learned but there are
active ways of doing it.
I'm using the term practice to mean what
problem needs to be solved at a given time. Your client comes to you
and does the practice part. They say: "I want to start a business."
Getting back down to the mundane here. You now take the role of the
lawyer and any professional is techne. Techne meaning an artisanal
ability to bridge between episteme, the generally accepted principals of
that field that your going to use, and praxis, what the end result is
supposed to be, to craft and deliver innovative solutions.
don't want to use the terms tran, praxis for these things here is
because techne will have it's own theory and practice aspects to it.
That's what we really need to be focusing on in professional schools.
This is really what we as lawyers do, whether we're in the academy or
whether we're practicing.
It's true that in the academy we might
tend to be the place that systematizes the knowledge that the
practitioners are using but we are also thinking about systematizing and
thinking about the ways in which it gets done.
If you take any
field you have your episteme, your client comes to you with something
you need to do, the techne then mediates between those things. It gets
even more complicated because the professional here is not just tapping
into one body of knowledge, on episteme. There's multiple ones.
I mentioned before, when I work with entrepreneurial clients I have to
think a little bit about IP law. What are the standard principles there?
Little bit about corporate securities law, a little bit about tax.
do something quite similar, any professionals do. Entrepreneurs are
saying: "OK, globing warming seems to be a problem. There's probably a
market for goods and services that will somehow combat global warming or
help us do more green technologies." They then act as this techne
change agent to establish things that are there and come up with a whole
new kind of solution that actualizes the substatic knowledge that is in
There's much more to that than you can probably
guess. It's the book project that I'm working on during my sabbatical
right now, while I'm standing here. No. If anyone is interested in the
book topic, I will give you more on that.
The play that this gives
us is we can basically reintegrate teaching, research and service by
focusing on this techne space in this techne model because it's both a
research and a teaching agenda. It helps us to understand and study how
innovation actually happens in all fields and at all levels. Innovation
in legislation. Innovation in administrative rule making. All these
things, you can use this techne model to do that. It helps us to teach
the next generation how to operate across the full spectrum of their
profession not in some narrow construct of theory versus practice.
more than just technique, which is one of the historical uses and
that's why I want to clarify that. It has it's own theory and practice
aspects. Think about the things we use in law like the theory of the
case, the theory of the deal. It's very much about the active practice
of the field yet it is bonafide theory.
Our service then, as a
professional school comes from delivering on this new teaching agenda.
We both sort of study it and do it at the same time. Just to give you a
little preview, this summer we're going to be working on a new law,
business and entrepreneurship program that will be somewhat based around
this agenda. We will then be looking at how we can become a major hub
for thinking and training in the areas of law, business..