Saturday, February 23, 2013
Scholarship and Indemnity Clauses by the Law Reviews
I'm on the AALS Scholarship Section exec board for some reason, and in that capacity, I recently rec'd a great email from Donald Tobin, the associate dean for faculty at Ohio State Law, who writes on an important but frequently neglected issue: indemnity clauses in law review agreements. Specifically, he wrote the following:
I think there is a growing and real problem with law reviews requiring authors to sign indemnity clauses. These clauses require authors to indemnify the journal and university from any costs associated with lawsuits, including, in some cases, costs associated with frivolous cases. The problem with these types of clauses is that they impact the most vulnerable of our faculty and also those writing in controversial areas including human rights, minority rights, equality, etc. I have just finished trying to help one of my faculty members negotiate one of these releases. We came across the following problems:
1) While Universities will defend faculty members who are sued based on their scholarship, many Universities will not indemnify other institutions. For example, the State of Ohio prohibits its institutions from indemnifying other institutions.
2) Insurance protection does not work. I looked at whether the faculty member could purchase insurance through AAUP. The insurance company indicated that it would defend the faculty member, but would not make payments under an indemnity clause.
3) The faculty member is thus stuck. We are placing the burden on the people least able to bear it. From the university to the faculty member and the faculty member has no means of protecting herself.
4) Journals sometimes say, Don't worry; suits are unlikely. But if the suits were so unlikely...why shouldn't journals bear that risk?
5) Journals might also say: the author has the most control to determine if they are committing a tort. But there is no protection for frivolous suits or for suits generated for political reasons.
6) These indemnity clauses, I am led to believe, were standard. I did not think that was the case but I have a list of a number of top journals that had similar clauses.
7) Finally, I was told that the AALS model agreement had an indemnity clause – and it does. So we as an institution are contributing to this mess.
To me, this is what institutions do. They protect academic freedom and they should shoulder the burden of dealing with frivolous suits. They should not then seek payment from an author. It might be different if the author did something wrong – like plagiarized – but the idea that in general authors are on the hook seems very wrong to me. As an institution we should either discourage these types of provisions or we should obtain some type of group insurance that either authors or institutions can buy for protection. When I spoke about this at AALS, most people were unaware of these provisions and there is some indication that even as lawyers we just sign these things, but they pose a real problem for some of our most vulnerable colleagues. Here is a link to a model agreement containing an indemnity clause: http://www.aals.org/deansmemos/98-24.html
The AALS agreement is better than the one my faculty member was asked to sign because it at least doesn’t put the author on the hook for frivolous claims, but it still requires an author to pay the judgment and attorney’s fees.
Thanks for that Donald. So, what is to be done? A collective response by the associate deans for scholarship at the top law schools or even better, more generally, would be helpful. Of course, indemnity clauses are just one obnoxious aspect of law review agreements. Copyright assignments are typically the other!
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It seems to me there's a far greater danger of author liability (mainly defamation) in blogging than in academic writing. I am pretty sure nobody indemnifies anybody with regard to blogging. That seems like the primary concern, as Dean Tobin acknowledges that plagiarizing really ought to be on the author's dime (as, it seems to me, should be copyright infringement). I can think of two buzz phrases as to plagiarism and copyright: "least cost avoider"- clearly the author is in the best position to know, and "moral hazard" if the author is indemnified against professional malfeasance.
As to defamation, I maintain what is known as a "moonlighting" malpractice insurance policy (about $650 per year), and one of the things it covers is defamation claims. There is no exclusion for indemnification claims.
The legal analysis regarding payment of insurance under indemnity claims strikes me as incomplete or overbroad or both. I don't think you can make a blanket statement that "insurance coverage doesn't work." You have to read the policy, and the coverages are often negotiable.
Posted by: Jeff Lipshaw | Feb 23, 2013 10:45:01 AM
Hi Jeff, can you share with us some more information about your insurance policy, or point us in the direction of the insurer? Sounds like a wise investment.
Posted by: John Harris | Feb 23, 2013 3:36:24 PM
Jeff, you remind me: I actually had the permaprawfs sign an indemnity for that stuff, but now that I think about it, I'm now telling all current and future guest bloggers that they're on notice too -- don't think I'll fight or front your lawsuits for you, friends and frenemies!
Posted by: Dan Markel | Feb 23, 2013 4:27:45 PM
John, the agent is Marsh, and the coverage comes from Zurich. Full disclosure: the coverage is for "professional services" but that term is never defined. I can imagine a debate over what that means. I know what my position is!
Posted by: Jeff Lipshaw | Feb 23, 2013 4:34:04 PM
Posted by: John Harris | Feb 23, 2013 9:52:49 PM
This is an issue near and dear to my heart. I am working on an article that carries with it a small--but real--chance that I will be sued. When I sent out the article, I got an offer from a Top 30 journal. The publication contract, however, included a broad indemnification clause that, given the circumstances, worried me. I confirmed with my own university that I am protected by its insurance policy, but neither this policy nor the university’s indemnification policy covers any additional expenses that I agree to take on. My personal insurance policies also do not cover liability that I contractually assume. In other words, I started off protected from personal liability, but would have given up much of this protection if I had agreed to the indemnification clause. In the end, after long discussions with my dean, associate dean, and university general counsel, I let the offer go, and I am now publishing with another journal. Thankfully, I am just as excited about publishing with this journal, but the experience was nail-biting to say the least.
This experience convinced me that we need to have a broader conversation about indemnification standards. Do we really want professors to take on personal liability as a cost of publishing important, but controversial, research? Yes, professors should stand behind what they say, but even the most careful research may not protect against a nuisance suit. And most professors (myself included) do not have especially deep pockets, so the possibility of putting our family’s financial security at risk is a real disincentive to engage with controversial topics. At a time when legal academics are criticized for being disconnected from legal practice, we should be wary of institutional policies that further distance us.
Indemnification clauses can also undermine the role of tenure. The chief benefit of tenure is to allow academics to conduct their research unconstrained by the threat of university sanctions. This benefit disappears if we are nonetheless constrained by the threat of monetary sanctions. I was untenured when I was going through most of the publication process, but it was not the threat of losing my job that kept me up at night.
All in all, I am glad to be publishing the article. But the experience will make me think twice about engaging with controversial issues in the future. And that seems like a shame.
Posted by: JE | Feb 24, 2013 3:05:05 PM
Thank you, Professor Markel. This is an interesting post and an issue that my journal has been thinking about for the past year.
We currently do not have an indemnity clause in our author agreement. The prospect of adding one has been raised by several people. The journal's hesitation is twofold. First, the editorial board disagrees with the fundamental premise of making the author personally liable for any and all suits (if the indemnity is broad). This could chill those scholars writing in sensitive areas of the law—the scholars most in need of the journal's backing.
Second—the real reason for my post—indemnity agreements in this context seem effectively, or at least, practically, unenforceable. A journal faces the obvious hurdle of seeking indemnity from a professor who may have little personal assets (absent some agreement from the professor's employing university). Further, enforcing an indemnity agreement would create a public nightmare, extending even to the relationships between the two institutions involved.
Are there examples of indemnity clauses in law review author agreements actually being enforced?
Posted by: EIC of top 40 law review | Feb 24, 2013 8:10:21 PM
An anecdote from a different side of the trench: Over the last three years, we (University of Pittsburgh School of Law) have been working with our university librarians to move the e-publishing of all of our law journals from websites designed, maintained, and hosted locally (at the law school) to an e-publishing platform hosted and maintained by our librarians. The new platform comes with a variety of professional tools and open access features. Accessibility of our journals' content is going up, and each journal's web presence not only looks much better but all of the journals have a consistent look-and-feel. So much to the good.
Along the way, we standardized our publishing agreement, so that every author publishing with any Pitt Law journal will sign the same agreement. In the course of getting the form of that agreement approved by various powers that be, the document landed in the in-box of the university's general counsel - because the library's resources belong to the university, not to the law school. And the relevant lawyer there took the position that no matter what I argued about scholars' views of indemnity clauses and their chilling effects, an indemnity clause protecting the university was (and remains) mandatory. Take it or leave it. The argument made to me was that the university is offering something substantial to the law school and to authors who publish in its journals; the university is entitled to some consideration, and protection, in return. (As a factual matter, it seems incontrovertible that a defamation or invasion of privacy suit lodged against the author of an article appearing in a Pitt Law journal likely would name the University of Pittsburgh as a defendant, and it also seems incontrovertible that the University as an institution is not in any position ex ante to determine whether or not any given article includes potentially harmful material.) The same argument was used to defend indemnity clauses in publication agreements governing other (non-law) academic journals published by our library.
In short: Indemnity clauses in journal publishing -- not just law journal publishing, but in academic publishing generally (there is nothing unique or special about legal scholarship here) -- are part of a matrix of tradeoffs that include publication costs and distribution costs (hard money costs) as well as interests in academic freedom. Freeing an institution from an indemnity obligation costs money, and in our case the tradeoff -- the indemnity clause is part of a new and modern distribution platform that increases access to scholarship; authors retain their copyrights and license their content to the journals under a Creative Commons license -- was worth it.
Posted by: Mike Madison | Feb 25, 2013 3:30:50 PM
There are a few points that I think need to be added to the many goods ones already made that militate against a reflexive stance on the part of law reviews associations and universities to put indemnity clauses into publication agreements:
1. The law generally provides ways, outside of contractual indemnity, for an innocent publisher to recover from a reckless or unscrupulous author. For instance, doctrines of equitable indemnity and contribution allow less blameworthy defendants to seek total or partial reimbursement from more blameworthy parties. Jurisdictions vary, but my question to publishers wanting contractual indemnity clauses would be, what is it in the background law that you object to? (I think that attorneys with university general counsel's offices often haven't checked to see what their state's background law is.) In general, the background law is preferable, because the law looks for what is fair on a case-by-case basis rather than simply making one party the other's insurer. What if, for instance, a student editor generates defamatory content by rewording sentences as the article is on the way to the printer? Should the author bear that risk?
2. The involvement of the law review and the university increases the risk of nuisance lawsuits. Nuisance plaintiffs may be more likely to sue over law-review articles than the same content in blog posts or internet-posted manuscripts. There are many reasons for this, including: (a) plaintiffs may perceive that the institution has deep pockets; (b) they have a beef with the institution as much as or more than the author; (c) they may be as much offended by the fact that the article carries the imprimatur of a respected institution as they are by its content. Does it make sense for the author to bear these increased risks?
3. The involvement of the law review and the university increases the risk of larger verdicts and judgments. Juries are more comfortable awarding verdicts against large institutions. I suspect that many juries that would let an individual professor off the hook wouldn't hesitate to stick it to a mammoth university system. Again, should the author bear all that risk?
4. The involvement of an institution increases defense costs. A professor might defend herself or himself quite cheaply. But institutions tend to incur greater legal fees, including because of overhead and the involvement of layers of intermediary personnel. Also, when a large institution is involved in a lawsuit, discovery costs balloon as many more witnesses and documents are implicated. Again, I'm not sure it makes sense for authors to bear these costs.
Posted by: Eric E. Johnson | Feb 26, 2013 1:14:11 PM
I find the University of Pittsburgh's attitude towards scholarship quite strange. The University seems to think that it publishes scholarship only to benefit authors and so there ought to be a quid pro quo with respect to the risk of publishing because it costs money to publish. I thought Universities subsidized the publication of scholarship because they have a broader mission to perpetuate and advance knowledge. Isn't this why they are not for profits? Is this part of the broader movement for professors to be seen only as independent contractors?
I understand that the University bears some risk of being sued, as does the author (who does not have an in house staff of attorneys and is not in as good a position to defend his or her-self). But isn't the University in the best position to insure against this risk rather than an individual? Does the University think that these authors are really good insurers? And why isn't a warranty from the author enough? Many of these clauses I have seen don't even have a "reasonableness" clause with respect to the attorneys fees provision. So the University could hire David Boies to represent it at market rates and the professor would theoretically be on the hook for that. And what happens in the case of settlement?
I think there are better ways for Universities to protect themselves of this relatively small risk that would be catastrophic for the professor (who, remember, will also be sued and will be trying to cover their own defense costs). I'm frankly not sure if Prof. Lipshaw's policy ultimately protects him (sorry Prof. Lipshaw). Is he going to have to pay a lawyer to litigate that issue against the insurer?
If Universities insist on this, I hope that AALS should look into making insurance accessible to law professors that covers indemnity clauses as well.
Posted by: Anon | Feb 26, 2013 4:38:12 PM
AAUP offers professor liability insurance through Marsh. I called them. They said the policy would insure the faculty member in a lawsuit but would not insure the faculty member for costs incurred due to the faculty member signing an indemnity clause. One possibility is for the AALS to negotiate a policy that would cover these types of clauses.
Posted by: Donald Tobin | Feb 27, 2013 10:22:11 AM
With respect to Pitt, I was (and am) disappointed by the outcome, but understand the internal institutional dynamics at work: The wing of the university that actually undertakes the work of publishing is in fact committed to scholarship-for-scholarship's sake, that is, to the broadest possible public dissemination of the work of scholars. The general counsel's office takes the risk-mitigation view that is, in my experience with university counsel's offices at other universities, very common. Research universities may be not-for-profits, but that does not mean that they are indifferent to reducing costs and risks, or to increasing revenue. On behalf of our law school and our law journals, I have to triangulate. What's the cost of obtaining a bigger and better and more accessible distribution mechanism? No one thinks that scholars are good insurers, but some think that scholars are good risk-avoiders, chilling effects and all.
Posted by: Mike Madison | Feb 27, 2013 8:56:36 PM