Democratizing Systemic Legal Change

Matt Prewitt, Paul Healy

October 22, 2019

Impact litigation creates large-scale social change in areas where traditional public- and private-sector solutions may be less effective.

Some social causes are more effectively advanced by litigation than by more traditional routes, like non-profit service provision, social entrepreneurship, or political elections. This is especially true for causes involving civil rights, like mass incarceration, voting rights, and immigration.

The current system is undemocratic and inefficient.

Impact litigation—like philanthropy more broadly—is frequently guided undemocratically by the whims of the wealthy. But impact litigation presents some additional challenges.

These additional challenges, taken together, make it plausible to us that impact litigation may have an even wealthier and narrower donor base than traditional philanthropic areas.

Our proposed solution: crowdfunding + quadratic finance on an outcomes-oriented platform.

We propose a new way to fund impact litigation: crowdfunding with matching via quadratic financing on an outcomes-oriented platform. Let’s take each element in turn.

We are not proposing that all litigation areas be converted into outcomes in terms of dollars, but instead that the platform allow contributors to make their own internal tradeoffs among, say, expansion of the franchise versus days of incarceration averted. If these contribution decisions are made on a single platform, individuals will also be able to “unbundle” their ideological preferences—in contrast to the current system where donors trust that the “bundle” of issues advanced by, say, the ACLU or the Institute for Justice will satisfy all their preferences for social change.

Implementing QF

What is the right scope for the “menu options” that people will contribute to? Menu options for funding can take any level of granularity. We think the appropriate level would be a “litigation stream” that describes a social outcome in a defined geographic region (e.g., “secure voting rights for disenfranchised felons in Florida”). The scope of both the outcomes and geographic area will determine the crowdfunding threshold required to unlock the funds. Scopes that are too large may never get funded, while scopes that are too small may pose information costs on contributors and/or fail to take advantage of economies of scale across lawsuits.

Potential variations: Although the focus of this piece is on philanthropically-funded impact litigation, we see a few variations to this structure worth mentioning.

We are eager to discuss this idea with anyone who is interested in refining it and thinking about how to test it out in the real world.

Matt Prewitt (@m_t_prewitt) is the President of RadicalxChange Foundation and Paul Healy is a student at Yale Law School.