Strategic Legal Bullying

Abstract

The competitive, market-based economy and adversarial legal system in the U.S. encourage strategic behavior and decision-making. This system often yields positive economic results. The system has a dark side, however, since strategic and unethical actors exploit the high costs of the legal system to harm individuals, small businesses, non-profits and society. In particular, strategic legal bullying exploits the high costs of the legal system to advance a weak or non-existent legal claim or argument that yields a favorable result at the expense of a weaker party. This article defines and analyzes this harmful practice in economic terms and classifies it as a form of rent-seeking behavior. The article also analyzes the various manifestations of strategic legal bullying practices and the defensive methods through which it can be countered. Business norms and ethics play a fundamental role in the ongoing efforts to counterbalance the harmful effects of strategic legal bullying.