This Note addresses an often overlooked issue facing state prisoners suing for federal civil rights violations: the impact of rules about the source of a monetary judgment or settlement on correctional agencies' litigation strategies. Using empirical data for fifteen states, it confronts traditional assumptions about government liability and practice and adds to the scholarly debate in at least two dimensions. First, it undercuts the view that state agencies do not pay damages from their budgets and are therefore unaffected by litigation or its threat. In fact, states take a variety of approaches to paying claims against their agencies - ranging from a statewide judgment fund to charging the agency budget. Second, it analyzes the impact of such state-by-state budgeting differences on litigation behavior ex ante and ex post. Broadly, the data suggest that when correctional agencies pay damages directly, they may internalize costs better but also settle less often than when agencies pay from a general judgment fund. The data also reveal considerable differences state to state, even within groups with similar policies for sourcing damages payments. No conclusive relationship exists between a state agency's source of damages payments and litigation outcomes. These mixed results suggest that making agencies pay damages from their budgets may not affect government behavior in the way past commentators suggested or hoped. Moreover, although a desire for uniform national standards originally motivated federal courts to intervene in state prisoner suits, the inconsistent findings lead this Note to caution against any broad-brush policies to be applied to all states.
When litigants sue a state agency or its officers for money damages, they face enormous obstacles. Sovereign immunity guards the states,1 while doctrines of qualified immunity protect state officials.2 Moreover, underlying standards can hamper litigants' ability to establish liability. Constitutional values and federal rights contend with concerns about sovereign dignity and fears of chilling government conduct.3 For state prisoners suing a Department of Corrections or its officers, the challenge is even greater. The Prison Litigation Reform Act (PLRA)4 imposes substantial procedural and remedial restrictions on prisoners.5 There are also considerable functional constraints - some are a byproduct of being incarcerated others while others reflect the unique culture of prison litigation.6 This landscape is well known to scholars, practitioners, and inmates.
This Note addresses an additional, and often overlooked, issue facing prisoner litigants: the impact of rules about the source of a monetary judgment or settlement on agency litigation strategies. Perhaps the impact is overlooked because traditional assumptions about suing state agencies are fairly well-established. First, commentators frequently assume that state agencies do not pay money damages from agency budgets.7 Under that assumption, many suggest that agencies and their officers care little about the threat of liability because they do not feel its effects.8 If agency budgets were charged for payment, many commentators believe that agencies would respond more to the threat of liability ex ante by internalizing the costs of unconstitutional behavior.9 Moreover, once sued, agencies forced to make budgetary outlays for damages should be more risk averse and therefore more willing to settle.10 Empirical evidence addressing these issues, however, is lacking.11
Using data about state practice and prison case filings and outcomes, this Note makes an initial attempt to confront these traditional theories.12 The empirical evidence suggests problems with several assumptions. Looking at only fifteen states, the evidence indicates that states take a variety of approaches to paying claims against their agencies - ranging from a statewide judgment fund to charging the agency …