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Precedents and Timing: A Strategic Analysis of Multi-Plaintiff Litigation

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Author Info
Jihong Lee (Birkbeck College, University of London)

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Abstract

We study the decision of when to sue in a game in which multiple plaintiffs have similar cases against a single defendant. Two legal regimes are considered. In one, prior results are binding in all future cases. In contrast, under the prevalent asymmetric regime, adverse results are binding against the defendant in future actions, but a judgement adverse to one plaintiff will not be binding against another plaintiff. Some legal scholars have argued that such a system is unfair to defendants and benefits plaintiffs. Our analysis reveals, however, that an asymmetric regime may actually hurt plaintiffs in equilibrium by inducing them to wait.

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Publisher Info
Article provided by Berkeley Electronic Press in its journal Contributions to Theoretical Economics.

Volume (Year): 4 (2004)
Issue (Month): 1 ()
Pages: 1143-1143
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Handle: RePEc:bep:thecon:v:4:y:2004:i:1:p:1143-1143

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Related research
Keywords: Timing game Litigation Precedent Class action

Find related papers by JEL classification:
C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

References listed on IDEAS
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  1. Spurr, Stephen J., 1991. "An economic analysis of collateral estoppel," International Review of Law and Economics, Elsevier, vol. 11(1), pages 47-61, May. [Downloadable!] (restricted)
  2. Andrew F. Daughety & Jennifer F. Reinganum, 2002. "Informational Externalities in Settlement Bargaining: Confidentiality and Correlated Culpability," RAND Journal of Economics, The RAND Corporation, vol. 33(4), pages 587-604, Winter.
  3. Cooter, Robert D & Rubinfeld, Daniel L, 1989. "Economic Analysis of Legal Disputes and Their Resolution," Journal of Economic Literature, American Economic Association, vol. 27(3), pages 1067-97, September. [Downloadable!] (restricted)
  4. Che, Yeon-Koo, 1996. "Equilibrium formation of class action suits," Journal of Public Economics, Elsevier, vol. 62(3), pages 339-361, November. [Downloadable!] (restricted)
  5. Kathryn E. Spier, 2002. "Settlement with Multiple Plaintiffs: The Role of Insolvency," Journal of Law, Economics and Organization, Oxford University Press, vol. 18(2), pages 295-323, October.
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