The Anti-Injunction Act and the Problem of Federal–State Jurisdictional Overlap

James E. Pfander & Nassim Nazemi

92 Texas L. Rev. 1

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Ever since Congress decided in 1789 to confer jurisdiction on lower federal courts over matters that the state courts could also hear, the nation has faced the problem of how to allocate decision-making authority between the two court systems.  Central to this body of concurrency law, the federal Anti-Injunction Act of 1793 (AIA) was enacted to limit the power of the federal courts to enjoin state court proceedings.  Justice Felix Frankfurter decisively shaped our understanding of those limits, concluding in Toucey v. New York Life Insurance Co. that the statute absolutely barred any such injunction.  Much of the law of federal–state concurrency has been predicated on Toucey’s account.

In this Article, Professor James E. Pfander and Ms. Nassim Nazemi offer a new account of the AIA that challenges prior interpretations.  Rather than a flat ban on injunctive relief, they show that the AIA was drafted against the backdrop of eighteenth century practice to restrict “original” federal equitable interference in ongoing state court proceedings but to leave the federal courts free to grant “ancillary” relief in the nature of an injunction to protect federal jurisdiction and to effectuate federal decrees.  It was this ancillary power that gave rise to the exceptions that Toucey decried and Congress restored in its 1948 codification.

Professor Pfander and Ms. Nazemi draw on their new account of the 1793 and 1948 versions of the Act to address current problems of jurisdictional overlap.  Among other things, they raise new questions about the much maligned RookerFeldman doctrine; offer a new statutory substitute for the judge-made doctrine of equitable restraint; and suggest new ways to harmonize such abstention doctrines as Burford and Colorado River.  Curiously, answers to these (and other) puzzles were hiding in the careful decision of the 1793 drafters to restrict only the issuance of “writs of injunction” and otherwise to leave federal equitable power intact.

Regulating Ex Post: How Law Can Address the Inevitability of Financial Failure

Iman Anabtawi & Steven L. Schwarcz

92 Texas L. Rev. 75

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Unlike many other areas of regulation, financial regulation operates in the context of a complex interdependent system.  The interconnections among firms, markets, and legal rules have implications for financial regulatory policy, especially the choice between ex ante regulation aimed at preventing financial failure and ex post regulation aimed at responding to that failure.  Regulatory theory has paid relatively little attention to this distinction.  Were regulation to consist solely of duty-imposing norms, such neglect might be defensible.  In the context of a system, however, regulation can also take the form of interventions aimed at mitigating the potentially systemic consequences of a financial failure.  Professors Anabtawi and Schwarcz show that this dual role of financial regulation implies that ex ante regulation and ex post regulation should be balanced in setting financial regulatory policy, and they offer guidelines for achieving that balance.

Self-Government and the Judicial Function

David Rudenstine

92 Texas L. Rev. 161

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Rudenstine reviews J. Harvie Wilkinson III’s Cosmic Constitutional Theory: Why Americans Are Losing Their Inalienable Right to Self-Governance.

The Arbitral Judgment Rule: Using the Business Judgment Rule to Redefine Arbitral Immunity

Matthew Bricker

92 Texas L. Rev. 197

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In the United States, arbitrators enjoy an absolute immunity from civil liability provided that they perform the arbitral acts within their jurisdiction.  Accordingly, arbitrators can only be held liable when they fail to render a decision at all or when they no longer assume responsibilities that are functionally comparable to those of a judge.  In this respect, arbitrators are unique in the world of professionals.  Other professionals (e.g., doctors, lawyers, and accountants) incur civil liability for breach of contract, and tort liability for professional misconduct, i.e., failing to follow the proper standard of care.  This prompts an obvious question: why are arbitrators immune from suit while other professionals are not?

In this Note, Mr. Bricker argues that the distinction is mainly the result of the superficial comparison between judges and arbitrators, and as such, there is no persuasive justification for absolute arbitral immunity.  Hence, Mr. Bricker proposes a new rule of arbitral liability that better holds arbitrators accountable for the professional services they provide.

Mr. Bricker begins by examining the origins and development of judicial immunity and traces its extension to arbitrators.  Mr. Bricker then analyzes the justifications for arbitral immunity and argues that the functional comparison between judges and arbitrators is unpersuasive.  He also argues that, while it is important to protect the independent judgment of the arbitrator, doing so does not require absolute immunity.  Mr. Bricker next crafts a new rule of arbitral liability that better holds arbitrators accountable by first acknowledging the difficulties of the problem and then applying a familiar solution––the business judgment rule.  Finally, Mr. Bricker defends the new rule of arbitral liability against contractual-based criticisms by exploring what would occur if the liability of the arbitrator were to be increased or decreased.

Off-Label Drug Promotion and the Use of Disclaimers

Dina McKenney

92 Texas L. Rev. 231

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Under the current enforcement system, promoting a drug for unapproved, “off-label” uses is a violation of the Federal Food, Drug, and Cosmetic Act (FDCA).  Ms. McKenney’s Note begins by examining the current regulatory scheme in place for off-label promotion and the possible benefits and consequences of allowing the promotion of off-label uses.  Ms. McKenney then discusses how current case law regarding commercial speech threatens the government’s off-label promotion prosecution scheme.  Finally, Ms. McKenney proposes a two-tiered disclaimer system that reconciles the potential harm with the noted benefits and addresses widespread concerns about the constitutionality of the current system.  Under this system, basic disclosure requirements would apply to all off-label promotions of drugs.  A heightened, second level of disclosure requirements would apply if a pharmaceutical company is not currently seeking FDA approval for the off-label use.  The effect of such a system would be to increase data transparency about the claims of off-label efficacy while simultaneously encouraging drug companies to seek FDA approval for off-label uses.