Thursday, April 19, 2018

Slavery to Reparations

JP Morgan Chase Manhattan Bank and Slavery


March 5, 2004

Testimony of Deadria C. Farmer-Paellmann

My name is Deadria Farmer-Paellmann. I am Executive Director of the Restitution Study Group a not-for-profit organization that examines approaches to securing restitution for injuries inflicted upon oppressed people. I was also lead plaintiff in class action litigation against JP Morgan Chase Manhattan Bank and 18 other companies due to their historical roles in the enslavement of Africans.

I wish to thank Alderman Dorothy Tillman and the Judiciary Committee for your bold leadership in holding modern companies accountable for their complicity in slavery through this hearing and your prior passage of the Slavery Era Disclosure Ordinance.

I thank you all for this opportunity to contribute to the general understanding of slavery through my testimony.

I come before you today to inform you of the dangers of the merger of JP Morgan Chase Manhattan Bank with Bank One an Illinois-based Bank, if JP Morgan Chase does not pay reparations as demanded by slave descendants.

First let me say that my role in the struggle for slavery began as a law student at New England School of Law, in Boston, Massachusetts, in 1997. I went to law school specifically to develop a case for slavery reparations. I thought the case would be against the federal government for the forty-acres and a mule promised in General Shermans Field Order 15 during the Civil War. However, due to legal hurdles in litgating against the federal government, including sovereign immunity, I began focusing on corporations and private estates that were built on slavery, as targets for reparations demands.

I took a class called Race and the Law, taught by Robert V. Ward, now Dean of Southern New England School of Law. I choose to present a case for reparations that required me to research my family roots to link myself to a particular company. To conduct the complicated genealogy research required to trace enslaved ancestors, I referred to the book,Black Genealogy, by Charles L. Blockson. Blockson suggested that one source of tracing enslaved ancestors was slave life insurance policies. He directs readers to Aetna Incorporated, the Insurance Company of North America, and Lloyds of London, as sources of such policies because they used to write them.

This was my first encounter with modern-day corporations that played a role in slavery.

In January of 2000, motivated by a desire for justice in the new millennium, I called Aetna to request copies of their slave policies. An enthusiastic Archivist sent copies of two policies, and a group of circulars from life insurance companies that competed with Aetna in its slave policy business. I conducted preliminary research on all the circulars and traced one circular to Chase Manhattan Bank.

Prior to making this critical link, I asked Aetna to apologize for its role in slavery and to pay restitution. On March 10, 2000, they issued an unprecedented public apology for their role in slavery. Although they also promised me they would pay restitution to benefit slave descendants, they choose not to do so.

I contacted several other companies I traced to slavery making the same requests to no avail.

By September 2000, I had completed research around Chase Manhattan Bank. Using the online New York State Banking History Database, I traced two of JP Morgan Chases earlier banks, The Merchants Bank of New York, and The Leather Manufacturers Bank of New York, to a slave policy circular. They are listed as the exclusive bankers for a $2.5 million venture in writing slave life insurance policies in 1852. This amount of money is substantial for that time. Other slave policy writing ventures I have encountered did not exceed $300,000 in capital investments.

The company in which this investment was made was the National Loan Fund Life Assurance Company of London. The policies were to be written on the lives of enslaved people in Virginia, North Carolina, and Washington, D.C. Some of the wealthiest people of that time were listed as members of the board of directors in this venture such as George Barclay. Some were prominent tobacco planters and shippers such as Henry Ludlam of Virginia.

The local operation of this venture involved insurance agents and medical examiners. Medical examiners were required to inspect enslaved Africans before a policy could be written.

Many insurance companies practiced the writing of slave life insurance policies in 19th Century United States. The effect of this practice was to provide the financial backing necessary to give potential slave owners motivation to purchase human chattel a very expensive investment. The policies gave slave owners the security necessary to employ enslaved Africans in ultra-hazardous capacities.

In exchange for this security, insurers required medical inspections to be sure that they could profit from writing policies. Further, they never insured an African for full value. The circular indicates that JP Morgans early bank helped cover "three-fourths the actual cash value" of the enslaved African. The circular, listing fifty-five businessmen and their institutions, is submitted to the record.

On September 18, 2000, I wrote a letter to William Harrison, Jr., Chairman and CEO of Chase Manhattan Bank, and requested that they verify that such policies were written, and if so, that they apologize and create a restitution trust fund to benefit the descendants of enslaved Africans.

By October 27, 2000, Lynne Federman, one of Chases Vice Presidents, wrote back saying the matter was under investigation and that she would contact me directly. I was never contacted.

During the course of the reparations litigation, I learned that a report was prepared about the matter; however, the report has never been made public. I have never seen it or been offered a copy. I urge this panel to demand a copy of the report.

Subsequent to my communications with Chase Manhattan Bank in 2000, they merged with JP Morgan, but not without inquiries at the Federal Reserve Board about their possible connection to slavery. At that time, Chase Manhattan Bank indicated that the matter was being investigated and that they would take full responsibility for issues arising out of the investigation.

In January of 2003, JP Morgan Chase was added to the list of companies against whom reparations lawsuits were filed. The filing took place in Texas. In response to the filing, a JP Morgan Chase spokesperson said no evidence exists linking the bank to slavery. Tom Johnson, of the bank, is quoted in theHouston Chronicle, on January 21, saying: "Weve found nothing to indicate that we were involved in any of the (slave) transactions that are being quoted in articles about the lawsuit."

This statement raises major questions about the veracity of the company. Is the company violating state consumer protection laws by making misleading statements about their history a history that would motivate many consumers to take their business elsewhere?

If there is no connection between JP Morgan Chase and slavery, what do we make of the circular from Aetnas archives? What about the $2.5 million capital investment advertised in the 1852 circular what became of that? Also, would fifty-five bankers, doctors, insurers, shippers, and others advertise a venture that was never launched?

The public and their consumers, have a right to know the truth!

I urge this committee to uncover that truth. JP Morgan Chase Manhattan Bank must release their investigative report on this matter.


With respect to the potential merger of JP Morgan Chase and Bank One, the historical and current actions around the issue of slavery raise factors the Federal Reserve Board is required to consider under the Bank Holding Company Act -- such as "the financial and managerial resources and future prospects of the companies and banks involved in a merger proposal".

Future Prospects and Financial Resources

The prospects for this merger are clear news reports indicate that high profile litigation teams are preparing new reparations lawsuits against companies, including JP Morgan Chase. The new entity comprised of JP Morgan Chase and Bank One will be forced to fight expensive legal battles that JP Morgan Chase could resolve right now. The prospect is that their financial resources will beadverselyaffected by this litigation.

In addition to the litigation, there is the prospect of more financial woes due to actions by state and local governments, such as you. Laws, modeled after your Slavery Era Disclosure Ordinance, are being ntroduced and passed around this country requiring disclosure of ties to slavery. Besides you, Los Angeles has slavery disclosure laws, and New York City and Cleveland, Ohio, have pending disclosure bills.

Disclosure laws are making life more difficult for companies that are trying to hide their tainted histories. The laws force them to tell the whole truth about their connections to slavery. When a company reports, it becomes exposed to more reparations lawsuits. If a company is found to have failed to disclose the truth, they could loose lucrative contracts with state and local governments.

One example of a company caught in the crosshairs of Chicagos slavery disclosure law is Lehman Brothers. As you know, Alderwoman Dorothy Tillman introduced the slavery disclosure bill that became a City ordinance in October of 2002, and took effect at the beginning of 2003. Consequently, last year Lehman Brothers was forced to disclose its connection to slavery, or forgo a $145 million contract with the City. In January of this year, just one month after the media reported on the disclosure filing, a new class action lawsuit for reparations was filed against Lehman Brothers. In addition, an investigation is underway to determine whether their disclosure was incomplete. If Lehman Brothers is found to have distorted their history, they could loose their contract with the City.

This merger will make JP Morgan Chase/Bank One of the ten largest companies in the world. If this is true, their financial exposure to ongoing slavery reparations litigation and disclosure laws could have a profound impact on the nations banking system, the national economy, and certainly the City of Chicago. Considering these factors, this merger should not be allowed to go forward, until JP Morgan Chase tells the truth about their history, pays reparations, and changes a legacy of shame, to a future of dignity and respect for humanity.

Thank you.

The Case Against Black Reparations

Richard A. Epstein

Richard A. Epstein, The Case Against Black Reparations, 24 Boston University Law Review 1177-1192 (December, 2004)(68 Footnotes Omitted)


The legal case for black reparations has been rejected. The political struggle for black reparations continues. The purpose of this short essay is to indicate my views on both the legal and political sides of the current sputtering campaign. Section I talks briefly about some of the legal issues raised by the recent claims for reparations. Section II addresses the political movement, with some reference to events taking place by close to Boston, namely the self-study on the complicity of Brown University in slavery and regulation organized by Ruth Simmons, the President of Brown and herself a black woman of much distinction.

I. The Legal Position

Quite by chance, I recently picked up a copy of Boris Bittker's The Case for Black Reparations, published in 1973. Its elegant text is obviously dated, but it reflects the open wound that slavery and segregation continued to inflict on American society even after Brown v. Board of Education had been on the books for almost twenty years. The memory of Plessy v. Ferguson remained stuck in the craw of this distinguished American liberal whose main area of expertise was taxation and not civil rights or race relations. (The joke at Yale when I was a student was that Bittker, with his relentless intellectual rigor, was able to make his civil rights course resemble his courses in taxation, when most people hoped for the opposite result). In his book, Bittker offers a merciless dissection of the claims for and against judicially-imposed reparations. He makes it clear that he prefers some kind of legislative program, perhaps one modeled on the German compensation program for victims of the Holocaust, which included payments to Israel. He entertains the possibility of bringing action under Section 1983 against various officials who had enforced segregation while acting under color of state law. In evaluating the remedial alternatives, Bittker is genuinely troubled about whether the distribution of the cash in a program of reparations ought to be paid to individuals for their personal grievances, or paid over to black organizations for use in promoting various social programs. He is further troubled by the charge that the introduction of a race-specific reparations program could undermine the color-blind norm of state action that animated Justice Harlan's famous dissent in Plessy. The pain of past injustices runs very deep.

I mention these materials because the passage of thirty years has not put all of these questions to rest, particularly in light of the recent flurry of action over this question. Bittker's elegant exposition of his case reveals the difficulties that have dogged the various claims for black reparations, all of which Judge Norgle firmly rejected recently in African American Slave Descendants Litigation. That case addressed the possibility of judicially created remedies, and did not discuss the legislative route that has been used, for example, in the award of limited reparations to the Japanese who were interned in the United States during the Second World War. In this regard, the most impressive feature of the Norgle opinion is that he spent very little time discussing the substantive merits of the individual cases, and instead focused much more on the bewildering array of procedural and constitutional objections to the plaintiffs' cases.
Here I shall consider three of those procedural points: standing, political question, and the statute of limitations. Under received law, Norgle was right to think that each of these obstacles could not be overcome. As a matter of principle, however, I think that the last objection is the only one that works. But in law, generally one good argument is enough, and this argument is indeed sufficient to carry the day. In the course of dealing with that last issue, I will discuss some of the substantive issues that it necessarily raises. These cluster largely about the question of what should be done when the individual perpetrators of past wrongs are beyond the reach of the law, and the plaintiff must ground its claims on a theory of vicarious liability.

A. Standing

The initial obstacle to the plaintiff's case was the doctrine of standing, which in its accepted modern form requires that any plaintiff show that his injury is separate and distinct from that of the public at large, and that the harm in question be traceable to some wrongful action of the defendant. In Norgle's view this test was not satisfied when the descendants of past slaves could only state a derivative claim for injuries rather than one personal to themselves. In rejecting a claim for historical injustice, he chided the plaintiffs for presenting a claim that was "contrary to centuries of well-settled legal principles requiring that a litigant demonstrate a personal stake in an alleged dispute." In this particular case, unlike others, I do not have any deep conceptual objections to the definitions of standing that Norgle applied here. I think that these tests of discrete injury are wholly inappropriate, however, for those claims that seek to enjoin the government from the commission of actions that are ultra vires a particular branch of the federal government. As I have argued elsewhere, the judicial power extends to cases in equity, and one standard tenet of equitable remedies, such as those crafted to deal with derivative actions against the officers of corporations and voluntary associations, is that all members of the relevant class stand in the same position to the wrongdoer, such that one individual may become the virtual champion of the entire group.

In cases that take this form, the object of the lawsuit is to protect against actions - such as the appointment of a national bishop or the refusal to publish the budgets of our intelligence agencies - that may be conducted in violation of structural limitations contained in the Constitution. These violations will go largely unredressed unless one person can bring the case for everyone. The insistence on a separate and discrete injury in these cases necessarily results in an odd truncation of the doctrine of judicial review established in Marbury v. Madison. Hence I think that there is a strong case for citizen or taxpayer standing, which means that the chief task for the court is to decide which case should be allowed to go forward when multiple challenges are made.
None of the plaintiffs' claims in African American Slave Descendents Litigation fall into this class. These actions sought damages for conversion and restitution against private corporations who allegedly profited from the forced labor of black slaves, or from insurance or lending businesses relating to the slave trade. These are not claims for citizen standing which I would allow, even if the current law allowed for citizen or taxpayer standing. Rather, these claims are straight claims for compensation for past wrongs, or for the performance of particular acts, such as opening corporate books to inspection or for an accounting. Whatever the merits of these suits, their form is far from exotic.

Regarding a different justification for denying standing, the damage claims should not be dismissed solely because they are not brought by the persons directly injured but by their descendants. Derivative actions are routinely allowed in other contexts. For instance, the normal action for loss of consortium when brought by the disappointed spouse or child is actually a derivative action because the real victim in the case is the party who was physically injured in the accident. The same could be said about any action for wrongful death brought by a descendant under a tort theory that would have been available to the decedent had he lived.
The plaintiff's cases are sharply distinguishable, moreover, from the full range of tort cases in which standing doctrine does bar actions that might be allowed if the only tools in the defendant's war chest were duty of care and proximate cause. I refer here to situations in which the pollution of public waters is said to generate a cause of action for fishermen, but not for the packers who are dependent on their catch. The defense of the result in these cases is that the inner tier of plaintiffs will satisfy the need for deterrence, so that the huge administrative costs associated with the second tier of actions can be safely avoided. In reparations cases, on the other hand, there is no inner circle of claims that are allowed: all actions for reparations fail even if the standing objection is allowed.

In light of these considerations, it is therefore a real puzzle why standing should be such an obstacle when the case is so similar to those where standing is routinely allowed and so different from those where it is routinely denied. A finding of standing does not announce to the world that the claim is sound. It only signals that the plaintiffs should have the opportunity to show that it is sound, both on the law and the facts. What has happened in this case is little more than a disguised ruling on the merits.

B. Political Question Doctrine

The court also dismissed African American Slave Descendants for running afoul of the political question doctrine. The court conceived of the doctrine in the standard formulation of Baker v. Carr, and reasoned that judicial power is restricted because the entire matter of reparations had been committed to the legislative branch. The basic elements of the political question doctrine have been expressed as follows:

[1] A textually demonstrable constitutional commitment of the issue to a coordinate political department; or [2] a lack of judicially discoverable and manageable standards for resolving it; or [3] the impossibility of deciding without an initial policy determination of a kind clearly for non-judicial discretion; or [4] the impossibility of a court's undertaking independent resolution without expressing lack of respect due coordinate branches of government; or [5] an unusual need for unquestioning adherence to a political decision already made; or [6] the potentiality of embarrassment from multifarious pronouncements by various departments on one question.

I confess a genuine difficulty in seeing how this doctrine should apply. Starting from the top, there is little reason to think that reparations are committed to any other branch of government apart from the judiciary. The usual cases in which the political question doctrine has real legs arise in connection with claims brought by foreign individuals in the United States, when the executive branch, often with Congressional backing, has sought to work out some accommodation with foreign governments and foreign nationals. The argument in these cases is that the domestic litigation works at cross purposes with our diplomatic objectives. Exactly how these two goals should be reconciled is an issue far beyond the scope of this short essay. Regardless of the right resolution, however, I do not think that we should express the political question doctrine as a limitation on the judicial power. If we do, then it is hard to see how that power could ever be conferred, even if the executive branch waived objections to the suit on the ground that the suit did not impede the nation's own diplomatic initiatives. The better way to think of the doctrine is as an exercise of inter-branch comity, which recognizes that international problems are often better solved by political rather than judicial means, even if it results in the loss of individual claims.
Many of the claims for reparations in which the political question doctrine has been used take place in international contexts. With respect to domestic situations, I am again hard pressed to understand why an ordinary claim for restitution or conversion should be thought of as raising the political question doctrine simply because the matter is politically explosive. No one raised such an objection in Brown v. Board of Education, and I see no reason why the reparations issue should be bounced out of court on the ground that it is too hot to handle. One might as well say that all current asbestos litigation should be brought to a halt because Congress is hard at work in a quixotic endeavor to fashion some claim facility that will deal with these issues. Nor is there any difficulty in discovering the underlying legal principles to govern these cases. After all, it is quite permissible at common law to deny a cause of action on the ground that it has been barred by the statute of limitations or that the plaintiff has not pleaded or proven sufficient acts that will allow for a definitive determination of damages. The entire body of law that relates to the indefiniteness of certain promises proceeds on exactly these grounds. It is not as though a court is asked to rule on a declaration of war, or even to act to undermine a compensation scheme already in place. Here again the political question evasion seems to make little sense, and indeed has the appearance of being an opportunistic doctrine used to put aside political hot potatoes that raise standard legal issues.

C. Statute of Limitations

The statute of limitations defense, however, seems to be impregnable in these cases. These statutes can raise individual issues of immense complexity, but the basic outlines are tolerably clear. As a basic matter, a statute of limitations has two major purposes. The first purpose is to make sure that the cause of action is brought when the evidence is fresh so that a trial can conclude with tolerable accuracy. Second, and equally laudable, these statutes allow parties to bring to closure past disputes so that everyone can get on with the business of life. These considerations also rationalize the doctrines of adverse possession and prescription developed in connection with claims for real property. In general, the statute of limitations starts to run when the cause of action accrues, that is, when plaintiff suffers the harm.
As a first approximation, therefore, the individual causes of action for slavery and segregation accrued when the injuries were inflicted, so that the statutes in question have long run unless some tolling exception applies. Tolling refers to those equitable circumstances that "toll," or stop, the statute of limitation from running. In the simplest case, the statute is tolled during the minority of an individual who lacks the capacity to bring suit on his own behalf. It takes little imagination to accept that the statute should be tolled when the injured person is prohibited by law from bringing any legal action at all, which occurs when a slave is a nonperson. But even if we allow this tolling defense, it only gets us up to around 1865. Much of the wrongs inflicted in the United States took place after the civil war during the period of official segregation. But segregation does not toll the statute of limitations because segregation did not limit the right to bring suit, even if the climate of opinion made it impossible to win on these cases. That happens in countless areas of life. For example, the privity limitation relevant to product liability law once made it impossible for an injured person to sue a remote supplier of goods in New York unless certain limited exceptions applied. Although MacPherson v. Buick undid this limitation in 1916, a tort cause of action barred in New York in 1866 could still not be revived fifty years later. The same is true with reparations. The hostile legal climate surrounding a cause of action for reparations, or for anything else, does not prevent the statute from running.

Furthermore, this case is not one where the individual plaintiff does not suffer an injury until years after the defendant has acted. In contrast, in cases where someone inhales asbestos fibers in 2004, under traditional law the plaintiff has a cause of action against the manufacturer who made the fiberboard fifty years earlier. A statute of repose could bar actions based on the number of years since the defendant has parted with possession of the dangerous product. This bar, however, is wholly without regard to the time of the plaintiff's injury. Nor is this a case of concealment or of a continuing wrong, apart from the want of redress of the older wrong, which if allowed in any case always makes the statute a dead letter. I think that the statute of limitations defense should be allowed, and that the case should turn on that ground alone, not that of standing or political question.

This result is consistent with the basic theory of the statute of limitations because the passage of time is, in general, a reliable proxy for the increased complexity of events. The correct view of the substantive law allows for the descent of the action to take place on both sides of the case. On the plaintiff's side, each passing year results in the multiplication of the number of descendants to whom some fractional interests have passed. The analogous problem in connection with the possibilities of reverter and determinable fees has resulted in a number of legislative and private initiatives whose purpose is to cut down these actions because of the huge number of parties involved. Thus a legislature could require that individuals reregister their interests to keep their interests alive, or the legislature could require the creation of trustees who are allowed to proceed on behalf of all parties. But no such mechanism is available here, so that we see with each passing year the numbing difficulties of trying to figure out who is a descendant of whom, and to what fraction.

This seems to make the class action approach difficult if we were to aggregate the individual claims, where each claim is dubious in itself and differs in some particulars from the others. In the years since 1865 we have had at least seven generations, so that a direct descendant of a slave is 127 parts not slave descendant, unless there is another slave somewhere else in his or her line of ascent. The truncation worked by the statute of limitations prevents these reparations actions from lasting for more than a single generation. To circumvent this problem, we have to contrive of some class-wide payment that goes to no one in particular, but to entities who are said to represent these individuals. But at this point, why think of the claim as one for reparations when the program looks far more like some legislative initiative that does not have to observe the standard constraints of corrective justice, but simply has to command sufficient political support to pass.
Similar difficulties exist on the side of the defendant. Let us assume that the claim really does ask for an accounting of profits that were achieved by using black labor, by selling insurance on slaves, or by making loans to purchase slaves. We have no idea how much of that profit (assuming that it could be calibrated) actually descended to the next generation. The ordinary business will reinvest some fraction of its profits, but will declare some as dividends and pay some out in salaries to its employees. Dividends and wages do not descend to the next generation. Hence it becomes necessary to figure out just how much of the current worth of any firm is related to these distant events, as opposed to those of more recent vintage that were conducted on a far larger scale. Any calculation that takes interest at just 2% of the full profits, or even some fraction thereof, improperly ignores the distributions and consumption that cause this action to fail.
The numbers generated by faulty calculations are orders of magnitude too high. Think of the matter this way: $100 invested in 1865 at 2% interest compounded annually equals $1600 140 years later. But if one allows a bit for inflation and does the calculations at 5%, then we are at $92,500. Those numbers increase exponentially to $11,589 for profits invested in 1765 at 2%, and to $12,173,957 for that same $100 invested at 5% interest. These calculations would suggest that huge fractions of the net worth of the targeted firms, if not their entire value, is attributable to the slave trade, until it is remembered that the same dubious calculations could be used to attribute the full net worth of the firm to virtually all of its other activities as well. None of these calculations are accurate because they all assume that all earnings were retained and invested, which does not happen anywhere. The use of a statute of limitations truncates these inquiries to a smaller number of years where it is possible to actually trace the dollars in question through specific transactions, instead of relying on some general statement that X institution was engaged in some activity that allowed it to profit from slavery.

In this regard, it is instructive to note that the most common cases in which the statute of limitations is tolled are those that seek the return of specific works of art taken from their owners during the Holocaust or some other cataclysmic event. But these claims present none of the difficulties associated with the claims for reparations. First, with art claims there is a genuine case for denying the operation of the statute of limitations, for even though the plaintiff knows that a wrong is committed, it may be impossible to figure out by whom, especially for art not on public display. Second, there is no valuation problem involved in these cases because the art work remains (precisely because it is art) in its original condition, give or take a few levels of dirt or varnish. And third, the plaintiffs almost always seek only the restoration of the art in question, not recovery for the fair rental value of the art work for the many years that it was in the hands of others. These underlying claims are much more focused than those for reparations, and the remedy demanded is far more limited.

In sum, the decision in African American Slave Descendants offers a full range of reasons for denying claims for reparations. As a descriptive matter, I think that courts will eagerly embrace all of the reasoning in that decision in order to rid themselves of cases from which they can see no good coming. As a normative matter, I think that the case is rightly decided on the prosaic grounds of the statute of limitations. I would prefer to see the matter left right there on the ground that we could then avoid making bad law on other issues that could spill over into cases that have little or nothing to do with reparations, or which do not present any major time issue. That said, recall that the statute of limitations only bars a legal right of action. It does not determine that no right has ever existed; it is thus hornbook law that money owed which is paid over voluntarily after the expiration of the statute of limitations cannot be recovered, even if a suit for that same sum could be effectively resisted. For the same reason, the running of the statute of limitations does not block nonjudicial responses to the underlying problem. The view that I have taken of the case therefore fairly invites consideration of how these matters ought to proceed once litigation against all public and private defendants is out of bounds. It is to that question that I next turn.

II. The Political Dimension

The elimination of all legal avenues of relief will, we can be confident, place great emphasis on political efforts to achieve the same results. These efforts will in turn take place in two distinct arenas. First, there will be efforts to induce the Congress of the United States, and perhaps even individual states, to make reparations or apologies, perhaps on the model that was done with respect to the Japanese who were inexcusably interned during World War II. Second, there will be efforts to reach private parties whose operations were tainted by slavery, segregation, or both, just as in African American Slave Descendants. I think that the political efforts at compensation will go nowhere, but may engender a fair bit of bitterness along the way. The private efforts will produce stranger results, as the new initiative of Brown University is likely to show. Here are some of the particulars. In dealing with efforts to obtain compensation from governmental entities, the first puzzle is why the primary action takes place at the federal level. Here the obvious culprits were the Southern states who practiced slavery until 1865 and perhaps some of the Northern states which had abolished it at some earlier time. With respect to claims against the states, an obvious point is that we do not have to enmesh in struggles those states that entered the Union only after 1865 and thus had no part in any of the earlier practices (except perhaps as territories, which is a complication that I shall happily skip). But here it takes a major effort to remove any of the symbols of the old confederacy, and it seems likely that resistance to any reparations program will be the fiercest in those situations where the case for action is likely the strongest. It is, however, easy to see that those who still bear grudges for the "War of Northern Aggression" will be ill-disposed toward such claims, while the recent arrivals to these states will think it odd that they are taxed for actions done by others long before they arrived. The situation will get only more complicated because other groups that believe that they have fair grievances, such as for the horrible treatment given to Chinese immigrants to the United States, will wonder why they are classified as wrongdoers and not victims. It is just not possible to achieve these efforts one state house at a time.

So we think about nationwide claims, but these too are in turn subject to real difficulties. Over 300,000 northerners, many of whom were black, were killed during the Civil War in the successful effort to end slavery. Their descendants could think that they have paid reparations in blood and do not wish to go further. Next to them stand vast numbers of individuals who regard themselves as wholly unrelated to the wrongs in question and are asked to foot some fraction of the bill, while their own grievances remain largely unredressed. Such is the difficulty whenever a claim to reparations appeals to some principle of vicarious liability. All claims for vicarious liability necessarily affect individuals who were not responsible for the wrong in question: think only of the operation of the law of vicarious liability in tort. But in many cases vicarious liability is tolerated on the ground that the liability in question has some efficiency justification, such as the reduction of accidents that would otherwise take place. Vicarious liability is often approved because it eliminates the need to prove the negligence in hiring or supervision that was present in the particular case. But here there is no efficiency peg on which to hang the reparations claim, so that hordes of indignant taxpayers will rise forward asking, "why should my tax dollars go to compensate for wrongs that I did not commit?"

The second problem arises on the plaintiff side of the equation: Who should get the dollars in question? Any state-wide program is haunted by the problem of migration, which makes it likely that much of the cash would go to the wrong people. But even at the national level, the situation is a lot different from when Bittker wrote about these matters back in 1973. There have been generalized programs of affirmative action and special education, so that the open wound left by Plessy has healed somewhat, except in the eyes of those who are determined to keep any scab from forming. A program of reparations could easily take into account collateral payments, which is done of course in connection with the 9/11 compensation program. The United States has committed huge remedial resources for affirmative action programs and for general social welfare programs to aid the needy, and there is no doubt that a substantial fraction of those expenditures have gone to help individual African Americans. Do these programs count as reparations when they were originally understood as social welfare measures? Do they count as a credit against any reparation claim that could be asserted? The answer is hard to say, one way or the other. But unless someone comes up with a convincing explanation of why all the positives since 1954 should be disregarded, the claims for reparations will stall on the obvious ground that many political steps have already been taken in that direction. It would be a tragedy of national proportions if claims for reparations to all or some blacks were to interfere with other programs that tend in the same direction but lack such a divisive social quality. There is too much water over the dam for this reparation claim to have any traction, even in a Democratic administration. There is much that could be done in individual cases, such as when President Clinton apologized to the human subjects who were mistreated at Tuskegee. But the most likely upshot is that the arguments for reparations will be used as bargaining chips to maintain the level of affirmative action programs that were found to meet a compelling state interest in Grutter v. Bollinger.

The next question is whether there is any chance that reparations claims could be addressed to private parties. Here it is an open secret that just about every major private institution in the United States fears the tarnish to its good name that comes from a credible assertion that it is racist. I think that corporations are often so timid in how they proceed on these questions because they fear that any revelation of improper conduct will result in a massive loss of good will and increased levels of regulation from Congress. They will not be willing to undertake mea culpas that look to the past and ignore all that they have done on affirmative action and similar topics for the last forty or so years. I do not think that we should ask the various corporate defendants who were unsuccessfully sued in African American Slave Descendants to make endless mea culpas, for to do so is to start down a road that has no endpoint at all. In addition, I don't think that it will be easy to shame these corporations into making such declarations in the absence of specific proof of recognizable wrongdoing to identifiable persons. The most that can be expected are bland declarations that X company has been a good corporate citizen that is responsive to African American interests in the communities that it serves. But we get that right now, even from Wal-Mart. The upshot is that the reparations campaign will continue to sputter along. It may generate a few more contracts, jobs, and grants than before, but it will not crystallize into any political groundswell.
The situation with Brown University and its striking initiative is quite different. Non-profit organizations with liberal constituencies and University Presidents can do things that larger corporations must shy away from. In my view, Brown is wholly within its rights as a private institution to conduct whatever internal investigation that it chooses into its own past and to initiate whatever corrective program that it chooses. It is all the more admirable because this particular move is not made in response to any external efforts. I am happy, however, that as a member of the faculty at the University of Chicago, founded in 1891, I will not have to face the prospect of such a hearing. My fear is that such efforts will come to little good.

The first point to note is that the initiative starts on the wrong foot. The emphasis is too introspective. Ruth Simmons may be worried about explaining to herself that her great-grandparents were slaves. She should relax, or at least keep Brown out of it. The true story, moreover, is all to the good, for it highlights the enormous capacity of the United States to correct for its past wrongs through a tortuous political process. How many other nations can claim that members of a despised minority of one generation can see their great-grandchildren rise to join its social elites? One only hopes that the Brown program will give due credit to that enormous transformation as part of its larger engagement with the issue. But here I fear that this will not happen. The announcement made to the Brown community notes that President Simmons asked the committee "'to organize academic events and activities that might help the nation and the Brown community think deeply, seriously, and rigorously about the questions raised' by the emerging national debate over slavery and reparations." It notes further that "[a]t the time of Brown's founding, Rhode Island was the epicenter of the North American slave trade," which seems odd given the prominence of Charleston, South Carolina in that business in 1764, the year of the founding.
It is fine to sponsor lectures on an issue that should be discussed and debated anyhow. But the entire committee process suggests that Brown is to some extent complicit in these activities and ought to do something to purge itself of the wrong. To me, that course of action is a mistake, for the business of universities is teaching and research, and I just don't believe that actions that concentrate on the Rhode Island slave trade will have such results. The great fear is that the efforts at absolution will magnify the relative level of wrong and understate the powerful forces at Brown and elsewhere that opposed slavery in all its forms and worked fearlessly and with great effort to stop its activities. It is worth remembering that there was no single national position on slavery during the period of its existence. In our efforts to give prominence to the institutions that supported slavery, there is the danger that we shall overlook the individuals who were able to bring the issue to a halt.

So why do we have these efforts at self-examination? Here I think that they say as much about the present as they do about the past. Until the passage of the Civil Rights Act of 1964, the Civil Rights Movement marked the single most heroic achievement of the American past. Its great accomplishment was to make sure that all individuals had equal rights and liberties under law. That is a result that can be applauded by people of all political persuasions, and it does us well to remember that it took the better part of two centuries to end practices that were unalloyed disasters. But since 1965 the Civil Rights Movement has suffered from "the March of Dimes" problem. Once you have rid the nation of polio, what do you do for an encore? The civil rights equivalent is that the fall of segregation ended the struggle against obvious human rights violations. In its place came complex debates over antidiscrimination laws, affirmative action programs and the like. The old allies could no longer hold together the coalition, for some people believed in the colorblind principle and opposed affirmative action, while others (like me) believed in the importance of liberty and private voluntary associations, and accepted affirmative action but were hostile to the enforcement of many of the civil rights laws as an unwarranted limitation on freedom of contract. Brown, it should not be forgotten, took a heroic but futile role in its modest attack on Title IX, involving matters of sex discrimination in interscholastic sports.

Against this fractured background, we can see in the movement for reparations more of a political than a financial cause. It is an effort to reinvigorate the old struggle for civil rights by appealing to an issue on which it is possible once again to assert a profound moral unity. But this campaign to relive the present through the past will surely fail. We do not face slavery or segregation. There is no support anywhere in this nation for a return to either practice. The effort to place reparations front and center ignores that time has shifted the locus of our current concerns to a new set of issues that will not be resolved by reliving the horrors of an early generation in some collective or official capacity. We have to live life going forward. We cannot make collective amends for all the wrong in the past. But we can create new and unnecessary hurts by trying to remedy past wrongs. A divisive campaign for reparations will undercut the efforts that we all want to make a stronger, more vital, more productive and more caring nation.

[1]. James Parker Hall Distinguished Service Professor of Law University of Chicago Law School, Peter and Kirsten Bedford Senior Fellow, The Hoover Institution

The Mass Tort Analogy and African American Reparations

James R. Hackney, Jr.

excerpted from: James R. Hackney, Jr., Ideological Conflict, African American Reparations, Tort Causation and The Case for Social Welfare Transformation , 84 Boston University Law Review 1193-1207, 1195-1206 (December, 2004) (61 footnotes omitted)

The vestiges of slavery, contemporary racism, and Jim Crow can be analogized to toxins that infect America. These contagions have in many ways disabled America, crippling its ability to live up to its democratic creed and humanistic ideals. The malady, however, has had its most direct impact on descendents of slaves and those who by virtue of their skin color are subject to similar ill treatment. In fact, the legacy of slavery has robbed African Americans, as a group, of sorely needed "race capital." This represents a Black Nationalist position, constructing a modified tort causation framework in order to make an argument for reparations.

Assuming that vestiges of slavery may be analogized to toxins in our environment, we face familiar common law tort causation issues. In this respect, the Black Nationalist position confronts fairly standard doctrinal concerns. Causation, however, is a threshold issue in any discussion ofreparations, even those that do not explicitly raise legal doctrinal concerns. Popular critics of the reparations movement, from the left and right, have raised issues regarding African American reparations, which, stripped of their rhetoric, boil down to rather technical questions of causation. These issues include questioning how we determine the beneficiaries of reparations, who bears responsibility for the slave industry, and who benefited from it. In addition, such thoughtful philosophical commentators as George Sher, Janna Thompson and Jeremy Waldron have directly raised technical issues regarding causation in reparative claims.

In his landmark article on toxic torts, Robert Rabin noted three common causation issues: identification, boundary, and source. In framing the case for African American reparations, analogous issues emerge when one attempts to form causal connections.

Identification problems in tort causation arise when no necessary connection exists between the harm and agent alleged to have caused the harm. Rabin discussed, for example, how toxins breed disease but given the time lag between exposure and contracting these diseases, it is impossible to connect a particular injury to a toxin because frequently the harm is not unique. Similarly, although some injuries suffered by African Americans are unique to the slave experience, it is difficult to trace many of the misfortunes suffered by individual African Americans to slavery with the typeof causal certainty required in tort. This is the Individualist position.

Black Nationalists seek to address the issue in group terms. Robert Westley has made an ingenious argument that the discrepancy in African American wealth, versus European American wealth, can be traced to the harms done as a result, and in the aftermath, of slavery. The problem with his analysis from a tort causation perspective is that there are background causes that may also account for wealth discrepancies. Conservatives ("Individualists"), such as Thomas Sowell, George Gilder, and more recently John McWhorter would attribute the inequalities to differing cultural values or the negative incentive effects of the welfare system. While some might chafe at these narratives as plausible explanations, it is obvious from even a cursory glance at the recent direction of public policy (particularly welfare reform) that such arguments have much currency in mainstream political thinking.

Boundary problems are raised when there is a difficulty in calculating the damages resulting from harm because its effects are felt beyond the "initial" victim. In toxic torts, Rabin identified boundary problems where in utero exposure to toxins injured succeeding generations. Common law tort was designed to settle disputes in which the harm is immediate. Therefore, it is very difficult to meet the traditional causation test when boundary issues arise.

African American reparations present obvious boundary problems. We arealmost five generations removed from slavery being formally dismantled. The vestiges of slavery have been manifest through the generations, and no obvious signs indicate that the harms will ever be fully alleviated. Moreover, the negative consequences are not limited to descendants of slaves but impact many of those with a darker hue whose ancestors immigrated to America after slavery was abolished.

Source problems arise due to the difficulty of identifying the agent who injured the aggrieved party. While at first blush it may seem as though the source issue is straightforward, simply a matter of tracing the record of slave ownership, it is actually very complex. Slavery, as an institution, constitutes many intricate relationships. Although the slave owner plays a major role, the institution is supported by other actors, including northern ship merchants who profited from the slave trade. Current litigation claiming reparations from financial institutions that funded the slave trade illustrates the interconnectedness of numerous economic and social forces.

The litigation also highlights a crucial fact regarding the source issue and slavery. It might be a relatively simple task to identify slave owners. However, since many plantations were family-owned sole proprietorships, there is no continually existing entity (such as a corporation) to answer for these claims. In this regard, the source problem is even more intractable than inthe toxic torts context where, except for bankrupt institutions, corporate perpetrators are frequently available to litigate claims.

In sum, claims for African American reparations present a mix of vexing causation issues (identification, boundary, and source). From a philosophical perspective, such causal uncertainty raises technical difficulties in dealing with very complex counterfactuals. For example, what would the lot of any individual African American be were it not for the institution of slavery? It is difficult to say with certainty. The claim of reparations based on slavery fails to satisfy Professor Sher's "automatic effect" requirement: the current harm does not necessarily flow from the initial wrong. Thus, at a minimum, extant tort doctrine would have to be expanded in an effort to do justice.

Of course, the conceptual foundation for tort causation and the philosophical positions Sher articulates rest on Individualist assumptions. Mari Matsuda has put forth one of the most extensive critiques of the Individualist position relating to causation, which she refers to as "liberal legalism." Observing that reparations fail to meet the Individualist causation standard, Matsuda argues that the locus of analysis should be groups as opposed to individuals. However, the problem she quickly runs up against is that group identification can be difficult and complex. For example, there are obvious class and other differences within the AfricanAmerican community. In order to sustain her argument for reparations, Matsuda claims that "continuing group damage engendered by past wrongs ties victim group members together." This begs, however, certain questions that an Individualist is sure to raise. Should wealthy (or even middle class) African Americans receive compensation? Do we limit reparations to those who can trace their lineage to slavery? A tort law regime provides an imperfect forum for tackling these issues.

Let us take up one of Rabin's questions: "Does it still make sense to rely on a tattered version of the traditional [tort] system?" Rabin replies to his own query by stating that it does not make sense to rely on the traditional system, and that we should at least explore alternatives. I reach the same conclusion regarding Black reparations. Moreover, given the nebulous nature of the harm stemming from American slavery and its vestiges, even the mixture of non-tort compensation schemes Rabin suggests seems to fall short. The various no-fault compensation schemes all presuppose a readily identifiable harm, such as asbestosis, which a claimant can present to an administrator. In addition, the harm's source can be traced to a pool of similarly situated actors. It is just not that simple in the case of African American reparations. The harm of racism is both too great and too amorphous to count. Regarding perpetrators, Matsuda attempts to address this issue by arguing that, although individual whites may not be responsible forslavery and its legacy, they (as members of the group) benefit from a regime of white privilege. Matsuda in effect makes a Nationalist (group-based) claim for reparations. Like Matsuda, reparationists almost invariably turn to group-based approaches to deal with the boundary, source, and identification problems associated with Black reparations, thus suggesting that a social remedy is the preferred policy prescription (as opposed to payments to individual claimants). It is useful to tease out the logic and policy implications.

An economic and cultural development program funded by the federal government would provide a level of group justice to victims, while eliding vexing causation problems. The logic is as follows: (1) Africans, as a group, suffered a unique harm in becoming part of America - enslavement; (2) the United States government played a crucial role in upholding the institution of slavery; (3) the United States government owes a debt to descendents of African slaves and African Americans, as a people, who are subject to the racist legacy of slavery; and (4) payment should take the form of community economic and cultural development. The balance of this section will focus on expanding these four points, while integrating the previous causation analysis.

The harm to African Americans as a group may be conceptualized as a depletion of "race capital," expanding on the group focus Professor Matsuda articulates. The idea of race capital, which has been discussed as aconceptual category, builds on the notions of economic, cultural, social and symbolic capital articulated by the French philosopher, Pierre Bourdieu. We can take the race capital of any particular ethnic group to be an amalgam of all four forms of capital set forth by Bourdieu. Westley has made a persuasive case that the vestiges of slavery have depleted the "economic" capital of Blacks. In which case, a strong argument can be made that the institution of slavery has severely decimated African Americans' race capital. I take this to be the strong claim made by Randall Robinson and other Black Nationalists in the reparations movement.
The unique nature of the United States' role in the depletion of race capital cannot be fully understood unless one appreciates a central fact about slavery, which Professor Keith Hylton has so aptly described: The institution of slavery cannot exist without the absence of law. What makes the institution of slavery unique is that the relationship between master and slave is unregulated. To the extent that the government does intervene in this relationship, it acts to protect the "property" interest of slave owners. There could not have been any legal slave ownership without government sanction - it was prior and necessary. While, a mange of institutions were morally culpable for supporting the slave industry, the brunt of responsibility falls squarely on the United States government. In taking no action against slavery, it effectively acted for it. As such, it is not only the primary source ofslavery, but of the legacy of slavery that came in its wake.

Historically, the United States government has been faced with specific choices regarding the fate of African Americans - beginning with their enslavement, but also continuing after the official abolition of slavery. Faced with these choices, Professor David Lyons chronicles a pattern of malign neglect: failure to live up to the promise of Reconstruction, acquiescence to the system of Jim Crow, and an all too tepid commitment to post-World War II social welfare programs (including those associated with the so-called "war on poverty"). From this perspective, we are dealing with a continuing wrong and its automatic effects do not seem so attenuated.

The idea that a reparations argument should not be limited to the initial wrong, slavery, but also account for the action (and inaction) of government post-abolition is hardly novel. In fact, it formed the basis for the first sustained treatment of the subject, Boris Bittker's The Case for Black Reparations. As the frame of reference moves further away from slavery, however, the argument begins to look more like a standard social welfare claim as opposed to reparations.

Implementing a social welfare remedy, as that term is broadly defined, helps us address the boundary problems. Institutions established to enhance victim communities attend to the needs of not only the current generation but also others to follow, which, if history repeats itself, willsuffer the same affliction. In this regard, the group form of reparations called for by advocates, such as Robinson and Westley, has merit. If the monies of the United States government are directed towards developing impoverished African American communities (including direct funding for public schools and basic infrastructure), supporting African American institutions (such as historically Black colleges, and cultural institutions), and creating new institutions (for example, a national museum chronicling African American history or creating a slave memorial), it would be a boon not only to present descendents of slaves, but to future generations as well. In addition, others harmed by the stain of racism based on skin color prejudice would also benefit.

The social form of reparations also helps address the identification problem. While it may be difficult to lay the problems of any one descendent of African slaves on the doorstep of slavery's legacy, there is a strong case to be made that, as a people, African Americans suffer particular harms due to this unique chapter in their history, such as the loss of race capital. Under almost every significant indicator of economic and social progress African Americans lag behind others, particularly those of European descent. This is not to ignore, as Individualists would note, significant economic gains in the African American community, particularly the burgeoning middle class in post-Civil Rights America. Nevertheless, the continuing groupinequalities persist. . . .

[1]. Northeastern University School of Law. The essay was supported by a Northeastern University School of Law research grant for which the author is grateful.

Slavery and Tort Law

Keith N. Hylton

Abstract of: Keith N. Hylton, Slavery and Tort Law, 84 Boston University Law Review 1209- 1255, 1209-1213 (December, 2004) (186 Footnotes Omitted)

On March 26, 2002, a class action complaint seeking reparations for slavery was filed in the federal district court for the Eastern District of New York under the name Farmer-Paellman v. FleetBoston. The complaint named as defendants FleetBoston Financial Corporation (a bank), Aetna (an insurance company), CSX (a railroad) and a large number of unnamed corporations described as "Corporate Does Numbers 1- 1000." The complaint asked for restitution, compensatory damages, punitive damages, and an accounting of the profits earned by the predecessors of these firms from slavery.

The FleetBoston complaint transformed a long-discussed theoretical matter into a living animal with the potential to bite someone. For up until the date of the complaint, the reparations debate had been conducted largely among friends and receptive audiences. Anyone who objected to the notion of paying reparations for slavery could ignore the issue, and most people did just that. One member of Congress, John Conyers, introduced a bill seeking slavery reparations twelve years in a row, each time meeting a lopsided defeat and a collective yawn from his colleagues. The class action suit, though a long shot from the start for the plaintiffs, represented a significant change in the terms of the debate.

This paper evaluates the claim for slavery reparations from a torts perspective. I start with an examination of the injuries inflicted on slaves, and the extent to which tort law provides a vehicle for redressing these injuries. Next, I address the question of "derivative claims," claims brought by someone other than the direct victim. This category of claims covers the reparations complaint. As I will explain, tort law, for the most part, has not been receptive to derivative claims. Lastly, I discuss the accounting demand by the reparations plaintiffs.

Tort doctrine appears to be inadequate as a means of converting the injuries to slaves into claims for damages. Slavery involves some obvious torts, such as assault and battery, conversion, and wrongful confinement. A person held as a slave today could surely collect damages. Slavery also involves a category of "social torts," however, that are equally if not more harmful, for which tort law appears to be an inadequate means of seeking compensation. Among these social torts are the slave marriage, the deprivation of status, and the denial of religious freedom. Traditional tort doctrine does not have any readily available "forms of action" for these injuries. And yet it is the social torts that are potentially most damaging to slave descendants because, like a constantly mutating virus, they have the capacity to injure successive generations.

Of course, reparations claims are derivative in the sense that they are not brought by direct victims, and thus the fact that a person held as a slave today could collect damages does not tell us whether descendants of slaves should be able to seek compensation through the tort system. The derivative status of reparations claims presents special obstacles for plaintiffs. However, the fact that slavery was entirely within the law when it was practiced should not be viewed as a substantial obstacle. The slaveholder sought a regime in which the law would not constrain him in his dealings with slaves. Applying today's law to that relationship should be viewed as bringing law to a regime from which it had been entirely displaced, not as a retroactive application of a different set of rules.

The more troubling problem for plaintiffs is the passage of time. After enough time has passed, tort doctrine shuts the door on compensation claims based on old and distant injuries. The FleetBoston complaint and its progeny are clearly vulnerable to this argument.

The only component of the new reparations claims that has the potential for social gain is the demand for an accounting. Information on slavery's victims and how they were hurt has been readily available for a long time. Information on slavery's beneficiaries and precisely how they profited should also be in the public's hands, for it has the potential to clarify perceptions on the social costs of slavery, bring about a more honest exchange on racial issues, and reduce incentives to discriminate in the present. I would prefer to see the scope of the demand expanded to include information not only on profits from slavery, but also profits from the oppressive and discriminatory regimes that appeared in its wake.

[1]. Professor of Law and Paul J. Liacos Scholar, Boston University,


Transatlantic Slave Trade
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