Shareholders You Can Do Without

Slate's blog on legal issues.
June 29 2008 5:53 PM

Shareholders You Can Do Without

Justice Samuel Alito, for example, who blew a cool $500 million for his fellow Exxon shareholders at least, if conventional wisdom is correct that Alito would have broken a 4-4 tie and deprived the Exxon plaintiffs of punitive damages if he had not recused himself because of his Exxon stock holdings. You would think there would be room for a bargain here. Exxon should have paid Alito a small sum of money say, $1 million to sell his stock, so that Alito could have cast a vote for Exxon without violating the code of judicial ethics. After all, Exxon would not be paying Alito to vote for Exxon; it would be paying Alito to cast an impartial vote after shedding his Exxon stock and thus his pecuniary interest in an Exxon victory. The plaintiffs would lose their punitive damages, of course, but they cannot reasonably argue that their case be heard by eight impartial justices rather than nine. Aside from the plaintiffs, there would be gains all around. Alito's paltry salary would be supplemented, Exxon's shareholders would be up $499 million, and the public's interest in the impartial adjudication of legal disputes by the nation's highest court would be served.

Eric Posner, a professor at the University of Chicago Law School, is a co-author of The Executive Unbound: After the Madisonian Republic and Climate Change Justice. Follow him on Twitter.