Kentucky Law Journal

2000

*183 THE PRIVATIZATION OF BUSINESS AND COMMERCIAL DISPUTE RESOLUTION: A

MISGUIDED POLICY DECISION [FNa1]

Chris A. Carr [FNaa1]

Michael R. Jencks [FNaaa1]

TABLE OF CONTENTS

I. INTRODUCTION ....................................................... 185

II. THE ROLE OF THE COMMON LAW AND SYSTEM OF PRECEDENT IN THE

RESOLUTION OF BUSINESS DISPUTES .................................. 189

A. Precedent Defined .............................................. 190

B. Why Courts Use Precedent ....................................... 191

C. How Courts Use Precedent in Business Cases ..................... 192

III. THE CHANGING NATURE OF BUSINESS TRANSACTIONS AND DISPUTES .......... 194

A. Increased Internationalization ................................. 194

B. The Proliferation of Secondary Rights and Case Complexity ...... 195

C. Increased Speed ................................................ 197

D. Disaffection with the New Law Merchant ......................... 197

IV. BUSINESSES TURNING TO PRIVATE ALTERNATIVE DISPUTE RESOLUTION ....... 198

A. Perceived Court Congestion and Delay ........................... 200

B. Expense ........................................................ 202

C. Perceived Juror Ignorance and Bias Against Business ............ 204

D. Perceived Lack of Expertise in the Judges Presiding Over

Business Disputes ............................................ 205

E. Privacy and Confidentiality .................................... 208

F. The Advertised Ability of ADR to Provide "Win-Win" Business

Solutions and Preserve Business Relationships ................ 209

V. CHANGES IN HOW COURTS SERVICE BUSINESS DISPUTES .................... 211

A. Managerial Judging ............................................. 212

B. The Bureaucratization of the Judiciary ......................... 213

C. Courts Forcing Business Cases into ADR ......................... 213

D. Vacatur, Selective Publication and No-Citation Rules,

Depublication, and Filings Under Seal and Confidential

Settlements .................................................. 215

1. Vacatur ................................. 215

2. Selective Publication and the

No-Citation Rule ...................... 216

3. Depublication ........................... 219

4. Filings Under Seal and Confidential

Settlements ........................... 220

VI. THE INSTITUTIONAL PRACTICE OF LAW FURTHERING THE PRIVATIZATION OF

BUSINESS DISPUTE RESOLUTION ...................................... 221

VII. ADDITIONAL DANGERS POSED BY THE PRIVATIZATION PROCESS .............. 228

A. The Loss of Information and Reduction of the Public Welfare .... 228

B. Widening the Gap Between the "Haves" and "Have-Nots" ........... 230

C. A Reduction in the Power of the Courts ......................... 231

VIII. PROPOSALS FOR REFORM ............................................... 233

A. Course Corrections to Help Maintain a Sufficient Quantity and

Variety of Business Cases at the Trial Court Level ........... 233

1. Recommendation One--Expand the Pool of

Judicial Candidates ................... 237

2. Recommendation Two--Improve Judicial

Continuing Education in Business and

Commercial Practices .................. 237

3. Recommendation Three--Increase the Use

of Law Clerks and Research Attorneys

to Support Judges ..................... 237

4. Recommendation Four--Increase Scrutiny

of Fee Applications ................... 238

5. Recommendation Five--Businesses Must

Become Informed Consumers of Legal

Services .............................. 240

B. Course Corrections to Help Increase the Availability and Use of

Decisions .................................................... 241

1. Recommendation Six--Provide More

Appellate Judges ...................... 241

2. Recommendation Seven--Permit Citation of

Any Decision by an Appellate Court of

Record ................................ 242

3. Recommendation Eight--Bar the Practice

of Depublication ...................... 242

IX. CONCLUSION ......................................................... 243

*185 I. INTRODUCTION

Come gather and sing to the Common Law whose leaf and seed we are, Whether we live by the waggling jaw or counsel, miles from the Bar. The wood is good and the sap is strong that gave us Coke and Hale, Right is a battle to win from Wrong, in spite of contempt and jail. It calls for brain and it calls for will, but an acorn knows his mission: Law is the Oak of Liberty still, in the Common Law Tradition. Rowdy dowdy doodle-ee-o In the Common Law Tradition. Rowdy dowdy doodle-ee-o In the Common Law Tradition. [FN1]

The common law, and how it develops rules for allocating risk and deciding business and commercial disputes through a body of reported public decisions, has provided a framework for governing commercial trade and commerce that many countries have *186 adopted today. [FN2] Relatedly, four scholars from Harvard University and the University of Chicago recently credited the common law as a reason why certain countries develop at a more advanced rate than others. [FN3] The common law, with its tradition of stability and predictability, is also often cited as an important reason why companies are attracted to particular *187 countries and states to conduct business. [FN4] Further, with respect to the area of intellectual property:

[T]he common law has emerged as a source of protection for intellectual property rights throughout this century whenever statutory protection for new forms of media were still evolving. This phenomenon results from the relationship between communication technologies, which are dynamic and often difficult to anticipate, and statutes, which traditionally have been adopted only in reaction to such changes.... [I]n cases in which statutory protection may not readily apply to new technologies, intellectual property owners have repeatedly and successfully resorted to common law theories for legal solutions to new problems. [FN5]

*188 In short, the common law's accomplishments with respect to trade and commerce are impressive. Today, however, our courts and system for developing commercial precedent are under attack, perhaps more than ever before. Private alternative dispute resolution ("ADR") as a method for resolving business disputes is "hot"--courts and traditional litigation are not. [FN6] Yet, in light of the common law's track record, it is more than ironic that business and commercial dispute resolution is becoming more and more privatized, thereby stunting the growth and development of the very body of law that has traditionally served business so well. [FN7]

*189 The primary purpose of this Article is to revisit the role and importance of the common law and our system of precedent, highlight how the development of the contemporary body of commercial law is being thwarted and distorted through various privatization processes, discuss why these privatization processes are shortsighted and erroneous, and most importantly, suggest proposals for reform. Part II revisits the important role that courts and the system of precedent play in the prevention and resolution of business disputes. Part III addresses ways in which business transactions and disputes have changed over the years and how courts have sometimes struggled to service them. Part IV discusses how those changes have resulted in businesses increasingly turning to private ADR--the first level of privatization--to resolve disputes. Part V addresses a second form of privatization: (1) managerial judging; (2) the bureaucratization of the judiciary; (3) the attempt by courts to decrease their workload and conserve judicial resources by diverting business cases into ADR; and finally, (4) the increased use of vacatur, selective publication and the adoption of no-citation rules, depublication, filings under seal and confidential settlements. Part VI explores how these privatization processes have been (and continue to be) furthered and accelerated by changes in the institutional practice of law-- namely, through the advent of the "discovery lawyer" at many corporate law firms.

Standing alone, none of these developments may be cause for concern. However, as pointed out in Part VII, the cumulative effects of these privatization processes pose significant dangers to the business community and society. Part VIII concludes the Article, pointing out that this privatization movement is shortsighted and erroneous. It also proposes that several course adjustments be made so that our courts and the common law can become more important and attractive instruments in regulating and evolving business and commerce.

II. THE ROLE OF THE COMMON LAW AND SYSTEM OF PRECEDENT IN THE RESOLUTION OF

BUSINESS DISPUTES

A foundational principle of American society is to provide citizens-- including businesses--with access to legal and political processes that are open to public scrutiny. [FN8] Yet the widespread privatization of *190 business disputes limits the development of such a system. It also distorts the development of a contemporary body of commercial law. Before we allow or encourage our courts to become even more removed from this process, it is helpful to revisit the role of precedent in the development of commercial law.

A. Precedent Defined

Precedent is defined as "an adjudged case or decision of a court of justice, considered as furnishing a rule or authority for the determination of an identical or similar case afterwards arising, or a similar question of law." [FN9] Stare decisis, the doctrine that courts should follow precedent in deciding cases, has been in place for centuries [FN10] and remains "the everyday working rule of our law." [FN11] In law school, through the use of the case method, students are taught how to identify and use precedent. More specifically, future attorneys and judges are taught to identify the holding of a case within the context of the particular dispute, and then analyze and evaluate its precedential effect. This process is more than merely academic and does not end upon graduation from law school. Young trial attorneys soon learn that judges--at least the good ones--do *191 in fact "examine and compare" [FN12] precedent, and that the modification and development of precedent depends upon a change in the holdings of individual courts about specific disputes. [FN13] When this process is properly implemented and followed, in the words of Judge Learned Hand, our body of commercial law grows like a "monument slowly raised, like a coral reef." [FN14]

B. Why Courts Use Precedent

Different theories exist as to why courts use precedent. One holds that prior judicial decisions serve as the "public record of the 'unwritten law,' customs and legal traditions, acquiring both their meaning and authority from recognition as part of the collective wisdom or reason." [FN15] Under this theory, "precedent helps establish a smooth transition between the accumulated experience of the past, evidenced by judicial decisions, and the present, to which the reasoning of the prior decision is applied, unless the present court determines that the prior court's reasoning was in error." [FN16]

Another theory provides that precedent is powerful and used by courts not because it represents society's collective wisdom or reasoning, but because of the authority of the judiciary. [FN17] Under this view, the judiciary, as the sovereign, has the authority and right to establish a legal framework by which rules can be known, legal consequences can be predicted, and public expectations can thereby be protected. [FN18] Jeremy Bentham advocated *192 this view centuries ago, [FN19] and his concern with stability and predictability can also be found in the writings of contemporary jurists. [FN20]

C. How Courts Use Precedent in Business Cases

Courts use precedent in business cases in a variety of ways. First, they look to precedent to help resolve the dispute at hand. [FN21] Professor Melvin Eisenberg notes the following with respect to how courts accomplish this task:

Complex societies characteristically need an institution that can conclusively resolve disputes deriving from a claim of right based on the application, meaning, and implications of the society's existing standards. In our society that institution is the courts, and the resolution of such disputes is accordingly a central function of our courts. This centrality is manifested in a variety of ways. To begin with, courts in our society are structured to be fundamentally passive. Unlike a legislature, a court may not properly initiate action on its own motion but may act only when set *193 in motion by a party with a claim. Correspondingly, a court is limited to action that is responsive to the claim made. The kinds of claims the court may properly act upon are also limited. The claim normally must be contested--that is, the subject of a dispute. The claimant normally must assert that the respondent has either infringed (or threatens to infringe) upon his rights, or is otherwise at fault in a manner that sufficiently involves the claimant's interests to render it appropriate for him to make a claim whose disposition turns on that fault. The claim must be based on a standard that relates to [business norms] rather than, say, on an artistic standard. The standard on which the claim is based must rise to a certain level of significance, in terms of either the seriousness of the injury that typically results from its violation or the importance of the norm or policy that it reflects. [FN22]

Second, courts use precedent to further enrich the supply of legal rules that govern business disputes. [FN23] Eisenberg also writes:

Our society has an enormous demand for legal rules that actors can live, plan, and settle by. The legislature cannot adequately satisfy this demand. The capacity of a legislature to generate legal rules is limited, and much of that capacity must be allocated to the production of rules concerning governmental matters, such as spending, taxes, and administration; rules that are regarded as beyond the courts' competence, such as the definition of crimes; and rules that are best administered by a bureaucratic machinery, such as the principles for setting the rates charged by regulated industries. Furthermore, our legislatures are normally not staffed in a manner that would enable them to perform comprehensively the function of establishing law to govern action in the private sector. Finally, in many areas the flexible form of a judicial rule is preferable to the canonical form of a legislative rule. Accordingly, it is socially desirable that the courts should act to enrich that supply of legal rules that govern ... [business] conduct--not by taking on lawmaking as a free-standing function, but by attaching much greater emphasis to the establishment of legal rules than would be necessary if the courts' sole function was the resolution of disputes. [FN24]

*194 In light of the above, the following question is presented: are today's courts being utilized to their fullest potential in developing and refining our body of contemporary commercial law? Parts IV, V and VI point out that, for a variety of reasons, the answer is no. Part VII highlights the dangers of this development and why this policy is shortsighted and erroneous. Before this question can be addressed in detail, we must first consider how business cases have changed over the years and how those changes have challenged the courts' ability to efficiently resolve such disputes.

III. THE CHANGING NATURE OF BUSINESS TRANSACTIONS AND DISPUTES

Our society has changed over the years, as have the nature of our business transactions and the resulting business disputes courts are being asked to resolve.

A. Increased Internationalization

In recent years we have witnessed the emergence and development of a global economy. [FN25] We no longer live in a world in which local manufac *195 turers use local materials and labor to create a product for sale only in a local market. Instead, many products are made for a national or international market. It is not uncommon for manufacturers to "obtain raw materials or parts in one country, perform subassembly in another country, [[[[[with] final assembly [occurring] in yet another, then deliver [the] products "just in time' to customers in several countries." [FN26] This phenomenon has presented difficult and complex choice of forum, choice of law, discovery, and judgment enforcement issues for courts, especially state courts unfamiliar with such issues. [FN27]

B. The Proliferation of Secondary Rights and Case Complexity

It is not only the increased internationalization of the marketplace that has presented courts with new and difficult business disputes to resolve; there has also been a proliferation of "secondary rights" in many types of business cases. This has in turn significantly increased the complexity of many business disputes. Some commentators label this development the "law of contorts." [FN28] By way of example, twenty years ago a dispute *196 between a law firm and its client over fees, to the extent that unpaid fees were even pursued, normally consisted of the law firm filing a complaint for breach of contract, with the client in turn filing an answer that alleged a few straightforward affirmative defenses. Discovery in the case was clean and simple, as were the legal issues. Today, that same dispute results in the client not only filing an answer, but a counterclaim for professional negligence (usually for leverage purposes), and the cost and complexity of the case is thereby significantly increased. Similarly, in the past a licensor who licensed a patent to a licensee and then discovered that the licensee was misusing the patent was likely to allege that the right that had been violated was the licensing agreement (i.e., it was breached). Today, that same case will see a plethora of secondary rights--"contorts"--come into play based on contract law, federal patent law, and unfair competition law. Specifically, as in the past, the licensor's complaint will allege a cause of action for breach of the licensing agreement. But it will also allege a cause of action for patent infringement--in part to attempt to obtain the benefit of treble damages [FN29] versus typical breach of contract damages. Also, the licensee will bring its own counterclaim for unfair competition and antitrust violations. In a nutshell, these secondary rights often transform what used to be a relatively straightforward business case into the exact opposite. [FN30]

*197 C. Increased Speed

Many of today's business transactions and markets, especially in an era of electronic commerce, move faster than ever before. Take Internet entrepreneurs as an example. In the past such entrepreneurs did not think in terms of the patentability of their business ideas and inventions. [FN31] Yet the market is now forcing them to do so, and they are discovering that it can take eighteen months just for a patent to be issued, [FN32] let alone litigate any related ownership dispute in the courts. By the time such litigation is resolved, "the cyber-marketplace will have changed several times over," [FN33] thereby often making the end-result of the litigation irrelevant. In short, courts sometimes find it difficult to keep pace with a marketplace that demands such quick resolutions. [FN34] Another example is the venture capital arena. Today, "most venture capitalists look for companies that can provide liquidity in three to five years." [FN35] The venture capital process now moves so quickly that it can be fatal for a start-up company to be tied up in litigation to sort out its "legal messes," even for a short period of time.

D. Disaffection with the New Law Merchant

Marc Galanter points out that in our society certain "indigenous forums" exist that operate by "codes of conduct" independent of the law. [FN36] Professor Robert Cooter adds that with respect to trade and commerce, many business communities are self-regulating and promulgate their own *198 norms, rules, and enforcement mechanisms. [FN37] As examples, he cites such professions as accounting and law, and "formal networks like Visa [[[[[that] promulgate their own rules." [FN38] Cooter creatively labels such norms and rules the "new law merchant." [FN39] Yet when businesspersons become disaffected with the "new law merchant" that governs their particular industry, they often turn to the courts as a last resort for help. [FN40] As an example, consider the entrepreneurs who become entangled in domain name disputes and subscriber problems with Internet service providers. One would think that the norms (or "new law merchant") of that industry would make it ideal for the disputing parties to sit down and resolve the matter short of a lawsuit. [FN41] Yet the opposite is occurring. Many of these parties instead want their day in court--yet again requiring the courts to address a new, different, and complex type of business dispute. [FN42]

IV. BUSINESSES TURNING TO PRIVATE ALTERNATIVE DISPUTE RESOLUTION

We now return to the question earlier posed: are today's courts being utilized to their fullest potential in developing and refining our body of *199 contemporary commercial law? Similarly, have courts done a good job of adapting to the changes in the nature of business transactions and disputes earlier discussed? If business behavior is used as the primary indicator in answering this question, many would say that the answer is no, as over the past several decades businesses have been increasingly turning to private ADR to resolve their disputes. [FN43] In this section, we discuss some of the *200 primary reasons for this development, but even more importantly, why many of these reasons may be grounded more on misconception than fact.

A. Perceived Court Congestion and Delay

For those who advocate an increased role for ADR in resolving business disputes, the point is often made that the courts are congested, rife with delay, and inaccessible due to a "litigation explosion." [FN44] One commentator has noted that with the "excessive delays and exploding caseloads of the civil courts, many disputants view traditional litigation as unable to meet their conflict resolution needs. More and more parties are turning away from the judicial system and are resorting to private dispute resolution firms." [FN45] Certainly, many business executives and their in-house counsel perceive that a litigation explosion has occurred. [FN46]

*201 The cause of this so-called litigation explosion has been the subject of intense debate. The list of proffered reasons includes the growing diversity and size of the American population, a heightened level of litigiousness among Americans, an increase in the number of judicially and statutorily created rights and a broadening of the definition of the class of people entitled to enforce those rights, expanded discovery, excessive lawmaking, and an increase in crime and criminal prosecutions (especially drug-related offenses). [FN47] But what is interesting to note is that to the extent such an explosion has occurred, no study exists which suggests it has been disproportionately fueled by business cases. Further, Marc Galanter, other scholars, and even some judges point out that the claim of a "litigation explosion" is vastly exaggerated, if not outright false. [FN48] Finally, many *202 business executives and their corporate counsel are finding that private ADR does not always live up to its billing in this regard, and if anything, often results in excessive delay. [FN49]

B. Expense

Private ADR is often touted as being cheaper than traditional litigation. [FN50] Again, there is evidence that suggests that business executives *203 and their in-house counsel at least perceive that the traditional court system is too expensive. [FN51] However, due to a lack of empirical data, it is unclear whether ADR is, in fact, cheaper than traditional litigation. [FN52] Some commentators contend that it is not, [FN53] and as Marc Galanter notes, critics of the cost aspect of litigation often ignore the benefits:

*204 [S]ociety's accounts should reflect not only the costs but the benefits of enforcing such transfers, which afford vindication, induce investments in safety, and deter undesirable behavior. For instance, the sums transferred by successful patent infringement litigation not only are not lost, but maintain the credibility of the patent system that in turn has powerful incentive effects. To put forward estimates of gross costs--even ones that are not make-believe--as a sufficient guide to policy displays indifference to the vital functions that the law performs. [FN54]

C. Perceived Juror Ignorance and Bias Against Business

Another reason why businesses may be increasingly turning to private ADR is because they perceive that juries do a poor job determining liability and assessing damages in lawsuits against businesses and judge businesses more harshly than individuals. [FN55] The following statement from a business executive is typical:

Is it any surprise that many commercial contracts these days have a clause where each party waives its right to a trial by jury? Doesn't that tell you something? That they are not willing to trust twelve peers off the street with the complexity of their business transaction ... And that doesn't *205 mean that people are stupid. It means that businesses have become very complex in many respects. The nature of their product offerings, not necessarily how the business is run, but the nature of the products. Open up the insides of a laptop computer and try to have some jury decide whether or not there has been a patent infringement on the design of a microchip. I certainly wouldn't be capable of doing that. [FN56]

Yet, the research of Valerie Hans, William Lofquist and others strongly suggests that if anything, the contrary is true and that juries do know what they are doing and do give businesses the benefit of the doubt. [FN57]

D. Perceived Lack of Expertise in the Judges Presiding Over Business Disputes

In theory, another touted benefit of many forms of private ADR is the ability to select a "dispute resolver" with "expertise" in the business issue *206 at hand. [FN58] Judges in the traditional court system, on the other hand, are sometimes perceived to lack such expertise, [FN59] especially by business executives. [FN60] To the extent that a lack of such expertise exists, the *207 politicization of judicial selections [FN61] and even their salaries [FN62] may contribute to the problem. Yet the lack of expertise is by no means unique to judges in the traditional court system. If anything, businesses are finding that it may be even more acute with respect to many purported "ADR specialists." [FN63]

*208 E. Privacy and Confidentiality

With private ADR, the parties can obtain a large measure of privacy and confidentiality. Often being a private proceeding, ADR allows businesses to resolve their disputes without creating a public record. [FN64] For a business concerned about eroding public confidence in its products or services, any proceeding that allows it to resolve its disputes outside the public eye is attractive. [FN65] Similarly, ADR is often attractive to a business concerned about being forced to reveal one or more of its trade secrets during litigation. [FN66] Businesses may also seek to avoid creating a legal precedent that may later prove to be disadvantageous to them or their industry, and are thus drawn to ADR processes in which the likelihood of a successful appeal is small. [FN67]

*209 However, many businesses are discovering that the touted privacy and confidentiality of private ADR is by no means a sure thing and can be problematic. For example, with respect to mediation, judges who have ordered a case to mediation often request a status report from the mediator in order to determine which party is bargaining in good faith and which is footdragging. [FN68] In other cases, prosecutors may call the mediator or arbitrator to testify. [FN69] There are also situations in which a company's decision to seek refuge in the privacy of ADR backfires. Consider a large company who has been sued by multiple customers. Assume that the company believes that all of the cases are without merit, but agrees to mediation, and for economic, publicity, and risk considerations agrees to pay ten cents on the dollar to settle the first ten cases. As part of its strategy in mediating the eleventh case, the company may wish to use this data to its advantage and as evidence of what the case is "worth." However, depending upon the confidential settlement terms that were reached and agreed to during the first ten mediations, the company and its counsel may have failed to think things through and may have inadvertently waived the ability to utilize such information in the eleventh case. [FN70]

F. The Advertised Ability of ADR to Provide "Win-Win" Business Solutions and Preserve Business Relationships

Another touted advantage of private ADR is its ability to offer "win-win" solutions that courts cannot provide in a business dispute. [FN71] If, for *210 example, a plaintiff's primary goal is to obtain an apology from a defendant as opposed to monetary compensation, ADR is probably the way to go. [FN72] ADR is frequently viewed as being less hostile than traditional litigation, [FN73] thereby allowing businesses to better preserve ongoing relationships. [FN74] Yet these claimed benefits are often overly simplistic, presumptuous, and even misleading. There is also nothing that prevents an attorney in traditional *211 litigation from exploring and implementing "win-win" solutions. [FN75] In fact, a well-trained attorney does so and skillfully uses the tools and leverage of the court system to attain that goal as quickly as possible for his or her client. [FN76] Moreover, scholars such as Owen Fiss, Marc Galanter, and Mia Cahill have argued that many disputes involve such important issues that they should be litigated and that the "feel-good" results of ADR are often inferior to those obtained in traditional litigation. [FN77]

V. CHANGES IN HOW COURTS SERVICE BUSINESS DISPUTES

While there is disagreement about whether a "litigation explosion" has occurred, [FN78] there is little doubt that many people, including many of our own courts and judges, perceive that one has occurred. [FN79] Our judiciary has attempted to cope with this perceived increase in its workload primarily through the following tools: (1) managerial judging; (2) the process of "self-bureaucratization"; (3) the forcing of business cases into some form of ADR (often against the parties' will); and finally, (4) through the increased use of vacatur, selective publication and the adoption of no-citation rules, depublication, and filings under seal and confidential settlements. As shown below, for the businesses that do decide to enter into *212 the traditional court system, these tools amount to yet another level of privatization, thereby further distorting and thwarting the growth of our common law.

A. Managerial Judging

Professor Judith Resnik has written extensively about what she calls ""managerial judging"--where judges become involved in the pretrial management of the case to try and relieve perceived court congestion (e.g., ruling on discovery disputes, deciding joinder issues, conducting pretrial conferences, settlement conferences, and the like). [FN80] This type of judging poses several dangers. First, a deeper involvement by judges in the pretrial phase of the case may compromise their independence and prematurely cause them to favor one side or position in the dispute, in turn impacting the quality of their deliberations. [FN81] Second, and more importantly for the purposes of this article, managerial judging undercuts the obligation and requirement that judges act in public and formally record the reasons behind what they do. [FN82]

The following is an example of the second problem. In the past, a young attorney who wanted to learn how a particular judge handled pretrial matters (e.g., discovery motions) could walk over to the courthouse and spend the morning in the gallery of the judge's courtroom observing the judge ruling on various law and motion matters. But now this is becoming more and more difficult to accomplish. Today, it is not uncommon for the case to be called and the parties' counsel to be led into the judge's private chambers (or a conference room) to sit down and discuss the case with the judge (or a discovery referee or judge pro tem). With no court reporter present, the matter is argued and decided. This same routine is then repeated for every case on the calendar. [FN83] Relatedly, and perhaps even more disturbingly, today's courts and judges are often evaluated not for the quality of their decisions (e.g., how often they are appealed and reversed), but for their ability to move cases along and clear the docket. [FN84] While the *213 impact of this management philosophy on the development of our contemporary body of commercial law is difficult to measure, we submit that it is more deleterious than beneficial.

B. The Bureaucratization of the Judiciary

We have also witnessed an increase in the size of the judiciary and its support staff (e.g., magistrates, special masters, judge pro tems, discovery referees, law clerks, staff attorneys, and the like), as well as an increase in judges' reliance on that staff. [FN85] Owen Fiss, Joseph Vining, and Judge Alvin Rubin refer to this development as the "bureaucratization of the judiciary." [FN86] When judges delegate responsibility for initially assessing or deciding portions of a case to their support staff, they diminish their own level of personal responsibility for their decisions, which in turn leads to greater anonymity in judging. [FN87] This results in the impression that these decisions have not been rendered or written by an individual with an identity of their own, but are instead the product of an impersonal institution. [FN88] The downside of this impersonalization is that it gives businesses another reason to flee the court system for private ADR, thereby further distorting the growth of our commercial precedent. [FN89]

C. Courts Forcing Business Cases into ADR

The problem is not just a case of businesses wanting to avoid the traditional court system. Our courts have made the conscious policy decision to divert business cases into ADR in order to conserve judicial *214 resources. [FN90] Thus, for the company that does opt into the court system to have its "day in court," it is likely to find itself entangled in the very form of dispute resolution--ADR--that it sought to avoid from the beginning. In California, it has reached the point where, if the court learns that the two disputing businesses in a lawsuit have money and resources, they are ordered into some form of ADR (usually mediation) and are thereby stalled on the way to trial.