Statutory Inflation and Institutional Choice

Article excerpt



A. The Standard Model

1. Two Basic Principles

a. Broad Interpretation of Remedial Statutes

b. The Rule of Lenity

2. Application of the Standard Model:

Two Examples

a. The Copyright Act

b. Bankruptcy Crimes

B. The Inflationary Model

1. Insider Trading and Inflation of the Securities Laws

2. Antitrust Laws

3. Environmental Law

C. The Lenity Model

D. The Law Enforcement Model

1. Mail Fraud as a RICO Predicate Act

2. Criminal Mail Fraud and Criminal RICO


A. How Much Should Statutory Inflation Be Controlled?

B. Imposing Strong Mens Rea Requirements

C. Writing Rules of Construction into the Statute Itself: The Wrong Path

D. Modifying the Chevron Doctrine in Criminal Cases



Statutes that contain both civil remedies and criminal penalties are typical in the modern regulatory state. Among them are RICO, (1) the antitrust laws, (2) the securities laws, (3) environmental laws such as the Clean Water Act, (4) various tax statutes, (5) the Copyright Act, (6) and the Bankruptcy Code. (7) These statutes most often regulate business affairs and provide for criminal penalties to punish willful violators. The Sarbanes-Oxley Act of 2002, (8) the statute enacted in response to the financial scandals of Enron, WorldCom, and other major corporations, provides a recent example of this remedial scheme, which remains popular with lawmakers.

This Article argues that the standard array of interpretive tools employed by judges and academics does not adequately account for important irregularities in the ways that courts construe these dual-remedy statutes, especially in criminal cases. Most of the literature focuses on two institutions: the legislature and the courts. To the extent that administrative agencies become part of the mix, the main issue addressed is how much deference courts should give to the interpretation of a statute by the agency that has been charged with enforcing it. This Article, in contrast, suggests that the institutional setting in which a statute is enforced has a profound effect on how courts construe the statute over time. Although deference doctrines play a role, judicial decisions also reflect the resources committed to litigation by governmental institutions in civil and criminal cases.

Even on the surface, this kind of legislative scheme creates complex interpretive problems. Deeply entrenched in our system of statutory jurisprudence are two complementary canons of construction: Remedial statutes are interpreted liberally; penal statutes are interpreted narrowly. (9) The former reflects concern about public health and welfare, the latter the due process rights of those accused of committing crimes. Should courts interpret these dual-remedy statutes narrowly in criminal cases, but broadly in civil cases, thus creating two different readings of each statute? Should they interpret the statute narrowly in both kinds of cases to be fair to criminal defendants without creating multiple interpretations of the same language? Should they interpret the statute broadly in both criminal and civil cases, forsaking the value of lenity in order to promote both uniformity and aggressive regulation in civil cases? Should they sometimes interpret a statute broadly in criminal cases but narrowly in civil cases, perhaps to limit private litigation when the statute is basically a criminal one? Each of these possible solutions requires the courts to weigh values that would be noncontroversial were they not in conflict with one another. Institutional choices that determine the ways these statutes are enforced influence the weight that courts ultimately give in different statutory settings. …