Immunologic And Hematologic

 Immunologic and Hematologic Disorders

Complete the following prompts. Be sure you are answering each prompt in its entirety (some may have multiple components). You are encouraged to work on this with others, but everyone should be completing their own worksheet.

1.      How would discuss the benefits of exercise to someone with RA? What exercise recommendations (FITT) would you make and what considerations would you have? (3 points)

2.      List common symptoms of Lupus. What recommendations for exercise would you have for a client with Lupus (FITT & Considerations)? (3 points)

3.      Discuss the pathophysiology of Chronic Fatigue Syndrome. Outline exercise considerations you would have for someone with this condition. (3 points)

4.      What is fibromyalgia. How can exercise benefit individuals with this condition? (2 points)

5.      How does exercise effect individuals with HIV/AIDS? What exercise recommendations (FITT) and considerations would you have for an individual in this special population. (2 points)

6.      What are common symptoms associated with sickle cell disease? How does exercise effect this population? What considerations would you have training someone with this disease? (3 points)

How is exercise beneficial for someone with hemophilia? What exercise considerations would you have for someone within this population? (2 points)

 

 

 

 

Marketing Management

MARKETING MANAGEMENT   

 Task

  • Your brand is New Balance Shoes.
  • Answers must be written in essay format, which means that you shall provide you opinion on each topic.
  • MS Word or PDF are mandatory.
  • Questions:
    • Define Segmentation. Explain the different segments included in your brand’s Target Group.
    • Define emotional and functional brand benefits. Explain New Balance walking shoes emotional and functional benefits and how those relate to each other.
    • Analise New Balance External Marketing Environment using PESTLE.

Formalities:

  • Wordcount: 800 – 1,500
  • Cover, References and Appendix are excluded of the total wordcount.
  • Font: Arial 12.5 pts.
  • Text alignment: Justified.
  • The in-text References and the Bibliography have to be in Harvard’s citation st

Weight:

  • This task is a 30% of your total grade for this subject..

It assesses the following learning outcomes:

Rubrics

  Exceptional 90-100 Good 80-89 Fair 70-79 Marginal fail 60-69
Knowledge & Understanding (30%) Student demonstrates excellent understanding of Marketing Management key concepts and uses vocabulary in an entirely appropriate manner. Student demonstrates good understanding of the task and mentions some relevant Marketing Management concepts and demonstrates use of the relevant vocabulary. Student understands the task and provides acceptable Marketing Management theory and/or some use of vocabulary. Student understands the task and attempts to answer the question but does not mention key Marketing Management concepts or uses minimum amount of relevant vocabulary.
Application (25%) Student applies fully relevant knowledge from the Marketing Management topics delivered in class. Student applies mostly relevant knowledge from the Marketing Management topics delivered in class. Student applies some relevant knowledge from the Marketing Management topics delivered in class. Misunderstanding is evident about the Ultimate Customer Benefit. Student applies little relevant knowledge from Marketing Management topics delivered in class. Misunderstands are evident.
Critical Evaluation (25%) Student critically assesses in excellent ways, drawing outstanding conclusions from Marketing Management topics delivered in class. Student critically assesses in good ways, drawing conclusions from Marketing Management topics delivered in class. Student provides some insights but stays on the surface of the topic. References may not be relevant. Student makes little or none critical thinking insights, does not draw conclusions from Marketing Management topics delivered in class.
Communication (20%) Student communicates their ideas extremely clearly and concisely, respecting word count, grammar and spellcheck Student communicates their ideas clearly and concisely, respecting word count, grammar and spellcheck Student communicates their ideas with some clarity and concision. Long thick paragraphs make difficult to identify relevant topics and concepts. Student communicates their ideas in a somewhat unclear and confusing way. Does not reach or does exceed wordcount excessively and misspelling errors are evident.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

mobile apps

Humdrum of the mid-2000s web apps

Discuss following topic.

From the humdrum of the mid-2000s web apps, Apple radically changed the mobile world with the iPhone, offering well-designed apps of their own and curating apps that were accepted into the App Store.  That influence has been far reaching, prompting Google to push their boundaries and develop material design, a design language that has become the distinctive hallmark of Android apps.

Submitting instructions

Run your submission through grammar checker before submitting.

Minimum 250 words.

At least 2 (scholarly) journal source should be used for each post.

Make your references in correct APA 7 format and cite each reference at least once, but as many times as you rely on it. Citations support each sentence relying on a reference, not an entire paragraph. Do not use direct quotes, do not plagiarize.

 

 

 

 

mobile apps

Humdrum of the mid-2000s web apps

Discuss following topic.

From the humdrum of the mid-2000s web apps, Apple radically changed the mobile world with the iPhone, offering well-designed apps of their own and curating apps that were accepted into the App Store.  That influence has been far reaching, prompting Google to push their boundaries and develop material design, a design language that has become the distinctive hallmark of Android apps.

  • When compared to the web world where some popular apps could get away with mediocre design, why do mobile apps face a higher design bar?
  • When compared to the web world where some popular apps could get away with mediocre design, why do mobile apps face a higher design bar?
  • Compare and contrast native mobile app design versus standard desktop app design. Discuss considerations for choosing one over the other.  Elaborate on main advantages vs disadvantages.

Submitting instructions

Run your submission through grammar checker before submitting.

Minimum 250 words.

At least 2 (scholarly) journal source should be used for each post.

Make your references in correct APA 7 format and cite each reference at least once, but as many times as you rely on it. Citations support each sentence relying on a reference, not an entire paragraph. Do not use direct quotes, do not plagiarize.

 

 

 

 

Case study of cultural diversity

    CULTURAL DIVERSITY IN THE COMMUNITY                        

CASE STUDY # 

 Nurse Betty is teaching a health-promotion class to a group of Hispanic migrant workers. Nurse Betty is white, and this is her first time interacting with people of Hispanic culture. Nurse Betty speaks a little Spanish, but not enough to teach the whole class in Spanish. Most of the migrant workers speak only Spanish. Nurse Betty understands that she needs to provide culturally competent care to make her health-promotion class most effective but is not sure where to start.

Questions

  1. What is the first step that Nurse Betty should take to prepare for her health-promotion class?
  2. What are the language barriers, specific risk factors, and traditional healing practices that Nurse Betty must be aware of if she is to successfully interact with the group of Hispanic workers?
  3. How can Nurse Betty involve the community to improve the effectiveness of her health-promotion class?

 

 

 

 

Health Nursing            

  History of Public Health and Community Health Nursing                            

Case study

Michael works as a home health nurse in his suburban community. He visits 7-10 clients each day. On today’s visitations, Michael will provide care for four clients who are recovering from hip replacement surgery and three clients who are recovering from heart surgery, and he will provide intravenous (IV) antibiotics for a man with an infected wound.

Among this list of clients, Michael visits Mrs. T., an 87-year-old white woman who lives alone and is recovering from triple bypass surgery that she underwent a month ago. Michael’s goals are to check on her recovery progress, reload her medications in her weekly medication container, and administer an influenza vaccine.

Upon entering Mrs. T.’s small house, Michael finds the house in disarray: clothes are scattered about, dirty dishes with crusted food line the kitchen counters, and no lights are on. Michael finds Mrs. T. lying in bed watching television. Mrs. T. complains to Michael of feeling too tired to do anything; she eats only what is already prepared (e.g., frozen dinners or snack foods like potato chips) because cooking requires too much effort. She spends most of her days lying in bed and has not bathed in a week.

Michael helps Mrs. T. out of bed and assists her with a bath. After the bath, Michael fixes Mrs. T. a quick lunch and refills her medication box while she eats. Michael encourages Mrs. T. to start getting some exercise by doing the household chores so that her heart can get stronger. “The stronger your heart is, the more energy you will have,” Michael tells Mrs. T. Michael also enlists several services for Mrs. T.: A home health aide will come to the house three times a week to help Mrs. T. bathe, and Meals-on-Wheels will bring her breakfast and lunch. Finally, Nurse Michael administers the influenza vaccine.

During Nurse Michael’s visit the following week, Mrs. T. is showing improvement. She tells Michael, “I just love that little girl who comes to help me; she is just so sweet. And the Meals-on-Wheels program is a blessing, I now have more energy to keep this place clean the way I like it.”

Questions

  1. What challenges did Nurse Michael face in his first visit with Mrs. T. that public health nurses (PHNs) in the late 1800s also faced?
  2. From your knowledge about the history of public health, compare an example of care displayed by nursing leaders of the past versus the current activities of Nurse Michael. For example, how was Nurse Michael’s nursing care similar to what Mary Breckinridge provided in the Frontier Nursing Service (FNS)?
  3. How do the types of illnesses of Nurse Michael’s clients differ from the types of illnesses that were experienced by clients of PHNs in the early 1900s?

 

 

 

 

 

health care environment

Managed Care Organizations  Vs Accountable Care Organizations

Discuss the differences and similarities between Managed Care Organizations (MCOs) vs. Accountable Care Organizations (ACOs). Given the current health care environment, provide a solid speculation to how MCOs and ACOs may transform to meet the needs of its consumers.

Note

Be sure to support your thoughts and analysis with scholarly sources.

*Will also need to respond to 3 classmate’s post, will send that after you turn in assignment.

Shadow Health

Shadow Health

After you have achieved at least 80% on the assignment(s) download, save and upload your Lab Pass document to the drop box.

Professional Development

Note

  • Write a 500-word APA reflection essay of your experience with the Shadow Health virtual assignment(s). At least two scholarly sources in addition to your textbook should be utilized. Answers to the following questions may be included in your reflective essay:
    • What went well in your assessment?
    • What did not go so well? What will you change for your next assessment?
    • What findings did you uncover?
    • What questions yielded the most information? Why do you think these were effective?
    • What diagnostic tests would you order based on your findings?
    • What differential diagnoses are you currently considering?
    • What patient teaching were you able to complete? What additional patient teaching is needed?
    • Would you prescribe any medications at this point? Why or why not? If so, what?
    • How did your assessment demonstrate sound critical thinking and clinical decision making?

The Prehistoric Baseball Rule Outdated for Todays Game Annotations

The Prehistoric Baseball Rule Outdated for Todays Game Annotations

DePaul Journal of Sports Law Volume 16 Issue 1 Spring 2020 Article 7 The Prehistoric Baseball Rule: Outdated for Today’s Game Kyle Tanzer Follow this and additional works at: https://via.library.depaul.edu/jslcp Part of the Entertainment, Arts, and Sports Law Commons Recommended Citation Kyle Tanzer, The Prehistoric Baseball Rule: Outdated for Today’s Game, 16 DePaul J. Sports L. & Contemp. Probs. (2020) Available at: https://via.library.depaul.edu/jslcp/vol16/iss1/7 This Article is brought to you for free and open access by the College of Law at Via Sapientiae. It has been accepted for inclusion in DePaul Journal of Sports Law by an authorized editor of Via Sapientiae. For more information, please contact digitalservices@depaul.edu. 147 DePaul J. Sports Law, Volume 16, Issue 1 I. INTRODUCTION One of the biggest changes to Major League Baseball (MLB), in the modern era, is the expansion of its protective screening. As of 2015, all MLB ball clubs had “no more than the standard, behind-the-plate netting in their ballparks.”1 That all changed when a little girl got hit in the head by a 105 mile-per-hour foul ball while attending a New York Yankees game.2 As a result, the little girl suffered a fractured scull and was hospitalized for six days.3 Today, the little girl has to “wear an eye patch for five hours over her non-injured eye to help the weaker side recover from the hit.”4 Out of all the foul balls that came before, this incident was the tipping point that made a change to MLB’s protective screening.5 This occurrence was so devastating to everyone at the ballpark. You could hear a pin drop in the stadium, and there was a long stoppage in play while the little girl got medical attention.6 Todd Frazier, the Yankee player that hit the foul ball was emotional. He instantly dropped in a crouching position with his head folded into his chest.7 The majority of baseball players and coaches from both teams were showing the same if not similar body language, and a few were brought to tears.8 This was not an ordinary pop-up foul ball. It was a line drive that kept pulling toward the fans sitting behind third base.9 At the time, like most ballparks, the protective screening at Yankee Stadium only extended from behind home plate to the beginning of the dugout.10 This made every fan above or past the dugout vulnerable to foul balls and other objects that may end up flying into the stands.11 “The incident at Yankee Stadium sparked a league-wide response for a change in netting in areas of baseball stadiums that were most at risk for high-speed balls.”12 Two months before this incident, the New York Yankees were “‘seriously exploring’ extending protective netting after a series of events including: New York City council member … proposed a law mandating netting from behind home plate to both foul poles, the Mets extended their netting beyond the dugouts, and a … line drive foul ball bloodied a man at Yankee Stadium.”13 1 John Harper, MLB’s Announcement of Extended Netting is a Long Overdue Win for Those Seriously Injured by Foul Balls, N.Y. DAILY NEWS, Feb. 01, 2018, https://www.nydailynews.com/sports/baseball/extended-netting-longoverdue-win-injured-foul-balls-article-1.3793772. 2 See Dean Balsamini, Girl Hit by Yankees Foul Ball is Still Traumatized, N.Y. POST, Apr. 14, 2018, https://nypost.com/2018/04/14/girl-hit-by-yankees-foul-ball-is-still-traumatized/. 3 See Danielle Zoellner, Revealed: Girl, 2, Who Suffered A Fractured Skull When She Was Hit in The Face by 105mph Foul Ball at Yankees Game is Still Recovering From Her Injuries Months Later, DAILY MAIL U.K., Apr. 14, 2018, https://www.dailymail.co.uk/news/article-5617137/Girl-2-hospitalized-getting-hit-face-105mph-foul-ballrecovering.html. 4 Id. 5 Harper, supra note 1. 6 Chris Goossens, Child Gets Hit with Todd Frazier Foul Ball Line Drive at Yankee Stadium – Yankees v Twins, YOUTUBE (Sept. 20, 2017), https://www.youtube.com/watch?v=kEUfrSxTQ1s. 7 Id. 8 Id. 9 Id. 10 Id. 11 See id. 12 Zoellner, supra note 3. 13 William Weinbaum, How One Fan’s Story Contributed to a Conversation About MLB’s Safety Netting, ESPN, Mar. 31, 2018, http://www.espn.com/mlb/story/_/id/22955279/how-baseball-reached-tipping-point-fan-protection. DePaul J. Sports Law, Volume 16, Issue 1 148 The question becomes whether the father of the minor child would prevail if he brought suit against the Yankees. Would the Yankees be held liable for failure to extend its netting when they were “seriously exploring” the idea two months before the incident? Should the little girl’s age be a factor? All of these questions should be considered. This horrific incident created the expansion of netting on top of the dugouts. Some franchises have even chosen to extend it further – to the edge of the outfield.14 The question then becomes, how high does the netting have to extend? This is a guideline that has not been set by MLB. This is a scary yet understandable omission. If MLB set a guideline and the owner’s complied with the dimensions of screening, they would not be held liable for regular foul balls that end up in the stands. However, if there are no set guidelines, owners are able to decide these matters on their own. Thus, if a ball is hit an inch over the netting and injures a spectator in the stands, an argument can be made that if the screening was simply an inch higher, the injury would not have occurred. However, this argument can be made at any dimension. In these potential lawsuits, decisions would most probably be left to a reasonable test on whether the owner should be held liable for the foul ball injury. However, if there are guidelines set by the MLB, owners would simply need to follow them or be subject to liability. For foul ball cases, courts have been relying on the “Baseball Rule” for over one hundred years. The Baseball Rule holds: 15 that where a proprietor of a ball park furnishes screening for the area of the field behind home plate where the danger of being struck by a ball is the greatest and that screening is of sufficient extent to provide adequate protection for as many spectators as may reasonably be expected to desire such seating in the course of an ordinary game, the proprietor fulfills the duty of care imposed by law, and therefore, cannot be liable in negligence.16 The Baseball Rule has been applied by a majority of courts for over a century. This Paper will discuss the history and scope of the Baseball Rule and courts’ detachment from the Rule. In addition, this Paper will make reference to how the Baseball Rule is interpreted today. The purpose of this Paper is to rebut the courts’ use of the Baseball Rule. The target is for courts to dismiss the Baseball Rule and adopt a factor test when a spectator gets struck with an object that leaves the field of play. In addition, the goal is for all baseball leagues to adopt guidelines for its protective netting location and dimensions. First, in Part I, this Paper will narrate the history behind the creation of the Baseball Rule. It discusses the nature of baseball when it was first played in the 1800s. This section will then 14 Andrew Joseph, The Red Sox Are Dramatically Expanding Netting at Fenway After Scary Incidents, FORTHEWIN, Jan. 22, 2018, https://ftw.usatoday.com/2018/01/red-sox-netting-mlb-stadium-fenway-park-yankee-stadiumprotective-fan-hurt-foul-ball-rules. 15 16 Crane v. Kan. City Baseball & Exhibition Co., 153 S.W. 1076 (Mo. Ct. App. 1913). Akins v. Glens Falls City Sch. Dist., 424 N.E.2d 531, 534 (N.Y. 1981). DePaul J. Sports Law, Volume 16, Issue 1 149 examine how the Baseball Rule evolved from the early 1900s to the late 1900s. Part I will then show how the Baseball Rule would be applied differently today. Next, Part II of this Paper will detail how the Baseball Rule is outdated. This section will go through more recent case law that has moved away from the Baseball Rule. Part II will also discuss when the Baseball Rule is not applied, such as when the owner increases the risks of the game. Part III of this Paper will discuss how particular states have included the Baseball Rule in its legislation. This section discusses the scope of the Baseball Rule, so it does not become guesswork for the courts. Finally, Part III will illustrate the most recent cases that involve challenging the Baseball Rule. Finally, Part IV of this Paper will discuss how the Baseball Rule has been applied inconsistently. Finally, this section will discuss factors that a court should consider when determining whether an owner should be held liable for a foul ball that injures one of his or her spectators. II. THE DEVELOPMENT OF THE BASEBALL RULE A. Where It All Began “The first recorded baseball game in America was played in 1846 on Elysian Fields in Hoboken, New Jersey.”17 At the beginning of baseball’s era, the game was pitched underhand, which was less dangerous than the style of baseball played today.18 “By the 1880s, the rules of the game had [changed, which allowed] pitchers to throw overhand and catchers wore masks and chest protectors.”19 Because of the new pitching rule change, “the grandstand area behind home plate became known as the ‘slaughter pen,’ because of the frequent injuries suffered by spectators watching the game from that area.”20 B. Baseball’s Protective Netting After a long list of injuries, in 1879, the Providence Grays were the first professional baseball team to erect netting behind home plate.21 The purpose of screening the area behind home plate was to protect spectators from being hit by foul balls.”22 Although this was a clever innovation for professional baseball’s spectator safety, “the new screens were not always well received.”23 A minor league baseball club in Milwaukee installed wire netting “in front of the grandstands, but it was removed a week later due to fan complaints about the obstruction of 17 Edward C. v. City of Albuquerque, 241 P.3d 1086, 1092 (N.M. 2010) (quoting LEONARD KOPPETT, KOPPETT’S CONCISE HISTORY OF MAJOR LEAGUE BASEBALL 5, 7 (2004)). 18 See Edward, 148 N.M. at 652 (quoting ROBERT M. GORMAN & DAVID WEEKS, DEATH AT THE BALLPARK: A COMPREHENSIVE STUDY OF GAME RELATED FACILITIES OF PLAYERS, OTHER PERSONNEL AND SPECTATORS IN AMATEUR AND PROFESSIONAL BASEBALL, 1862-2007 9, 131 (2009)). 19 Edward C., 241 P.3d at 1092 (quoting J. Gordon Hylton, A Foul Ball in the Courtroom: The Baseball Spectator Injury as a Case of First Impression, 38 TULSA L. REV. 485, 488 (2003)). 20 Id. 21 Id. 22 Id. 23 Edward C. v. City of Albuquerque, 241 P.3d 1086, 1092 (N.M. 2010). 150 DePaul J. Sports Law, Volume 16, Issue 1 view.”24 This Milwaukee situation became an outlier as “by the late 1880s, it was commonplace for owners of baseball parks used by professional teams to screen the grandstand directly behind home plate, leaving the rest of the grandstand area and bleacher seats unscreened and unprotected.”25 The purpose for not screening the grandstands adjacent to home plate was to prevent obstruction to the spectators’ view.26 “[M]any field-level fans do not want screens or other protective devices in these areas because they feel their views will be degraded, foul ball catching opportunities will be decreased, [and] the intimate feeling derived from sitting close to the action will be reduced.”27 Since the implementation of netting the grandstands directly behind home plate, there have been thousands of suits brought by fans as the “limited protective screening failed to eliminate spectator injuries.”28 C. The Baseball Rule’s Debut The “Baseball Rule” made its appearance in 1913 when a spectator at a Kansas City professional baseball game was struck by a foul ball.29 The spectator, S.J. Crane, bought a grandstand ticket to see the baseball exhibition up close, but unlike reserved seating at today’s sporting events, there were no assigned seats in the early era of professional baseball.30 The spectator had the option to sit behind the netting, which would protect him from foul balls and other object flying into the stands, or in an unprotected area.31 The spectator chose to sit in an area that was unprotected, and he was hit by a foul ball.32 The spectator brought suit against the owners of the ballpark for their negligence in not screening the entire grandstand.33 The court described baseball and its risks as follows: “[T]he general public is invited to attend [baseball] games [where] hard balls are thrown and batted with great force and swiftness, and that such balls often go in the direction of the spectators.”34 The court held that the stadium owners “fully performed [their duty to provide] seats protected by screening from wildly thrown or foul balls for the use of patrons who desired such protection.”35 The court reasoned that the spectator “voluntarily chose an unprotected seat and thereby assumed the ordinary risk of such position.”36 In addition, the court articulated that “[one] who is offered a choice of two positions one of which is less safe than the other cannot be said to be in the exercise of reasonable care if, with full knowledge of the risks and dangers, he chooses the more dangerous place.”37 “That is a fundamental rule of the law of negligence.”38 As a result of the Crane case, the Baseball Rule was born. 24 Id. (quoting Hylton, supra note 19, at 488). (The minor league Milwaukee club was a part of the Northwestern League). 25 Id. 26 Id. 27 Edward, 241 P.3d at 1092 (quoting GORMAN & WEEKS, supra note 18, at 132). 28 Id. 29 See Crane v. Kan. City Baseball & Exhibition Co., 153 S.W. 1076, 1077 (Mo. Ct. App. 1913). 30 Id. 31 Id. 32 Id. 33 Id. 34 Id. at 1095. 35 Id. 36 Id. 37 Id. 38 Id. 151 DePaul J. Sports Law, Volume 16, Issue 1 Crane is the foundational case that lays out how ballpark owners can avoid foul ball liability. The owners simply need to erect protective netting in the high-risk areas where foul balls are usually hit. If the owner offers a reasonable amount of protected seats and spectators have the opportunity to sit in those seats, the owner has performed his duty.39 This appears to be a practical conclusion because owners cannot be expected to screen or protect every seat in their ballpark. If they were expected to do so, the enjoyment of watching a baseball game would be ruined with obstructed views. Thus, the court in Crane left the spectators responsible for wisely selecting their seats when attending a baseball game. If there were seats available behind the protected screening area but the spectator chose to sit where his view would not be obstructed, a ballpark owner could not be held liable for any injury because the fan assumed the risk of being struck by a foul ball. The court in Crane looked at multiple factors when deciding its holding. It took into account Crane’s age, vision, knowledge of the game, number of games he had attended in the past, and his opportunity to sit in the protected area. This case was also decided at a time where there was no reserved seating. Spectators would sit in the ballpark based on a first-come-firstserve basis. As a result, the 1913 outcome of Crane may come out differently today. In the current era, fans can purchase tickets with assigned seating. Spectators can buy tickets online where they can select particular seats that are available. In addition, these websites, where tickets are sold, include an approximate view from those seats.40 Thus, ticket purchasers are able to see if their view will be obstructed by any netting or ballpark pillars.41 Buyers are also able to determine which parts of the ballpark become blind spots from their assigned seats. However, the biggest problem with the Crane decision in today’s era is that spectators may not have the option to sit behind protected screening. First, the seating area that has protective netting are usually the most expensive tickets at the ballpark.42 This includes seats behind home plate and the dugouts. This leaves buyers with what might seem as the only option to purchase tickets down the first and third base line, where most foul balls are hit. Thus, while spectators may have a choice to sit in a protected area, it may not be economically feasible for all. Second, a lot of seating is occupied by season ticket holders.43 The big purchasers are corporations, which bring its clients to games for business rapport building.44 Again, these seats are usually in the popular areas, which are behind home plate and the dugouts. This leaves very limited seats available for other or infrequent spectators. Thus, if there are no protected seats available to purchase, fans are forced to sit further down the base lines or in the outfield where there is no protective screening. Finally, if the spectators sit in a section that has protected screening, they are still at risk of being struck with a foul ball. Many of the foul balls go over the screens. In addition, the screening does not properly protect spectators seated in the upper decks 39 See id. TICKPICK, Chicago Cubs vs. St. Louis Cardinals, https://www.tickpick.com/buy-chicago-cubs-vs-st-louiscardinals-tickets-wrigley-field-9-22-19-3AM/3677680/ (last visited Nov. 29, 2018). 41 Some of the old stadiums, such as Wrigley Field, have pillars that obstruct the spectators view. Tyler Perkowitz, See Every Pole at Wrigley Field (And Find Out How to Avoid Them), RATE YOUR SEATS (Feb. 13, 2020), https://www.rateyourseats.com/blog/cheap_seats/location-of-every-pole-at-wrigley-field-and-how-to-avoid-them. 42 Id. 43 Nathan Hubbard, The End of Season Tickets, THE RINGER (Aug. 16, 2017), https://www.theringer.com/nfl/2017/8/16/16147716/season-tickets-end-secondary-sellers. 44 Robert Tuchman, How Corporate Hospitality Has Become a Major Part of the Sports Business, FORBES (Jun. 10, 2015). 40 152 DePaul J. Sports Law, Volume 16, Issue 1 behind home plate or the dugouts. In fact, fans seated behind home plate in a high numbered row are also at risk as the netting is not erected high enough to prevent all foul balls from entering the stands.45 Therefore, because professional baseball allows spectators to purchase seats for its exhibitions, the Crane decision might come out differently today. However, there are still factors to consider when the spectator chooses not to sit behind protected screening, whether it is due to the availability of seats, preference, or price. Just a year after the Crane case, another foul ball case was decided by the same court. In Edling v. Kansas City Baseball & Exhibition Corporation,46 a fan bought a ticket to the game and decided to sit behind home plate where there was protected screening.47 However, during the game, a foul ball passed through a hole in the netting, which struck and broke the plaintiff’s nose.48 The spectator sued the owner of the ballpark, and the court held that the owner of the ballpark was liable for negligence.49 The court reasoned that “[i]t was the duty of the [owner] to exercise reasonable care to keep the screen free from defects and if it allowed it to become old, rotten and perforated with holes larger than the ball, it did not properly perform its duty.”50 Therefore, because the owner failed to provide sufficient screening in the area most exposed to foul balls, it cannot avoid liability with the application of the Baseball Rule. D. The Duty Test Since the decisions in Crane and Edling, there have been thousands of foul ball cases, and the Baseball Rule has been carried out consistently. However, one of the most cited cases regarding the Baseball Rule is Akins v. Glens Falls City School District.51 Akins was the first case where the Court of Appeals in New York52 defined what the duty of care is for a “proprietor of a baseball field to its spectators.”53 In Akins, the spectator arrived at a high school baseball exhibition while it was in progress and decided to watch behind the “three-foot fence along the third base line.” 54 As the game progressed, she was hit by a foul ball, and she sued the City School District for “failing to provide safe and proper screening devices along the base lines of its field.”55 There was seating 45 The first photograph in the following link reflects how some ballparks have low protective netting behind home plate. Vinny Messana, What’s The Best Stadium to Visit This Summer?, AXCESS BASEBALL (Dec. 31, 2017), https://www.axcessbaseball.com/2017/12/31/whats-best-stadium-visit-summer/. 46 168 S.W. 908 (Mo. Ct. App. 1914). 47 See id. at 908. 48 See id. 49 See id. at 908-09. 50 Id. at 910. 51 424 N.E.2d 531, 534 (N.Y. 1981). 52 The Court of Appeals is the highest court in the state of New York. 53 Akins, 424 N.E.2d at 533. 54 Id. (The baseball diamond had a backstop 60 feet behind home plate, and it was 24 feet high and 50 feet wide. Id. at 532. The diamond also had small fences running down the first and third base lines, approximately 60 feet behind [the bases]. Id. The spectator was situated 10 to 15 feet from the end of the backstop and 60 feet from home plate. See id.). 55 Id. (The issue presented at the trial level was “whether [a proprietor of a baseball field], having provided protective screening for the area behind home plate, is liable in negligence for the injuries sustained by a spectator as a result of being struck by a foul ball while standing in an unscreened section of the field.” Id. at 327.). 153 DePaul J. Sports Law, Volume 16, Issue 1 behind the backstop, but there was no proof that the seats were filled.56 According to the Court of Appeals, “the critical question becomes what amount of screening must be provided by an owner of a baseball field before it will be found to have discharged its duty of due care to its spectators.”57 At the trial court level, the jury found in favor of the spectator.58 Damages resulted in $100,000, and the jury determined that the school district was 65% at fault while the spectator was 35% at fault.59 At the Appellate Division, the case was affirmed. However, the Court of Appeals reversed the order of the Appellate Division.60 When the case appeared in front of the Court of Appeals, the court considered how other jurisdictions addressed the question presented.61 The Court of Appeals decided to follow trend of the other jurisdictions, and it adopted the majority rule – “in the exercise of reasonable care, the proprietor of a ballpark need only provide screening for the area of the field behind home plate where the danger of being struck by a ball is the greatest.”62 The court added that “such screening must be of sufficient extent to provide adequate protection for as many spectators as may reasonably be expected to desire such seating in the course of an ordinary game.”63 The court reasoned that “an owner of a baseball field is not an insurer of the safety of its spectators.”64 Rather, like any other owner or occupier of land, it is only under a duty to exercise ‘reasonable care under the circumstances’ to prevent injury to those who come to watch the games played on its field.”65 Justice Jasen further explained that “due care on the part of the owner [does not] require that the entire playing field be screened. [M]any spectators prefer to sit where their view of the game is unobstructed by fences or netting and the proprietor of the ballpark has a legitimate interest in catering these desires.”66 The Akins case changed the narrative of foul ball decisions in the courtroom. The Court of Appeals found it inappropriate to follow the trial and appellate court in conducting a comparative fault scheme. Instead, the court looked at the issue as a duty test. Although it adopted the majority rule on the issue, it clearly defined the scope of an owner’s duty to provide protective screening for its spectators. However, the facts of this case were related to a high school baseball game, which usually has minimal seating. Even in this case, it was not determined whether there were any available seats for Ms. Akins behind the home plate backstop. If there were not any seats available, spectators would be forced to stand on the fence going down the base lines to watch the game. In cases where there is not enough seating in the 56 See id. Id. at 533. 58 See id. 59 See id. 60 See id. 61 (Specifically, it looked at three possible scopes for the owner’s liability: (1) “the owner merely has a duty to screen such seats as are adequate to provide its spectators with an opportunity to sit in a protected area if they so desire;” (2) “a proprietor of a baseball field need only screen as many seats as may reasonably be expected to be applied for an ordinary occasion by those desiring such protection;” and (3) “the owner must screen the most dangerous section of the field – the area behind home plate – and the screening that is provided must be sufficient for those spectators who may be reasonably anticipated to desire protected seats on an ordinary occasion.” Id. at 534.). 62 Akins, 424 N.E.2d 533. 63 Id. 64 Id. 65 Id. (quoting Basso v. Miller, 352 N.E.2d 868, 872 (N.Y. 1976)). 66 Akins, 424 N.E.2d at 533. 57 154 DePaul J. Sports Law, Volume 16, Issue 1 protected areas, should spectators be liable for the owner’s failure to provide enough seats or screening in additional sections of the ballpark? Courts cannot hold the owner’s liable for satisfying every spectator’s needs, but this issue raises questions about the Baseball Rule. Akins is the most recent precedent for New York foul ball cases. However, would it still be considered good law if Todd Frazier’s victim filed suit against the Yankees? Because the little girl’s father never filed suit, Akins remains, to this day, the law in New York for foul ball cases. Thus, the Baseball Rule is alive and well in New York. The Akins case has become one of the most popular case cited for foul ball suits.67 Since Akins, the courts have remained consistent with its ruling. However, several courts have handled the issue68 differently. These courts decide not to adopt the Baseball Rule.69 For the owners to perform their duty and be free from liability, is it enough for them to simply erect a sufficient net behind home plate? The Baseball Rule from 1913 and the Akins case is outdated. Courts in the early era of the Baseball Rule made its decisions based on whether the spectator had an option to sit behind home plate. This option is not of the same magnitude as it was back in 1913 when you would pay fifty cents to enter the ballpark and sit wherever you desired. Now, there is reserved seating, and each seat is priced differently based on where it is located in the ballpark.70 In addition, the protected seats are the most expensive. Recently, courts have made its rulings based on whether the owner provided the minimum protective screening in the greatest zone of danger – behind home plate. However, most foul balls do not hit the screen behind home plate. In today’s game, the pitching is so fast that when a player hits a foul ball, it surpasses the netting, thus going into the crowd at high speeds. Thus, if behind home plate is in fact the most dangerous section, the owners should erect the screen significantly higher or angle it, so it does not allow foul balls to go over the netting. Courts are also basing its decisions on whether the screening is sufficient to provide protection for as many reasonably expected spectators desiring to sit behind netting. While the majority of spectators prefer not to have their view obstructed by a screen, there are other fans that would feel more comfortable sitting in a protected area. Again, this might not always be possible based on the demand and cost for those seats. Thus, this type of reasoning should not be included in the court’s analysis because it is virtually impossible to determine what reasonable number of spectators would desire a seat behind protective netting. Finally, the court in Akins also reasoned that “an owner of a baseball field is not an insurer of the safety of its spectators.”71 However, from an objective standpoint, the owners are in the hospitality business. The goal for owners is to make a profit. Again, all of the owners’ profits are derived from the fans. Baseball is a spectator sport, and it would not generate the 67 A search on Lexis would reveal that the case has been cited by 438 other authorities. (last visited Nov. 29, 2018). (Whether [a proprietor of a baseball field], having provided protective screening for the area behind home plate, is liable in negligence for the injuries sustained by a spectator as a result of being struck by a foul ball while standing in an unscreened section of the field. Akins v. Glens Falls City School Dist., 424 N.E.2d 531, 532 (N.Y. 1981)). 69 Rountree v. Boise Baseball, LLC, 296 P.3d 373 (Idaho 2013); Lowe v. Cal. League of Prof. Baseball, 65 Cal. Rptr. 2d 105 (Cal. Ct. App. 1997); Coronel v. Chicago White Sox, Ltd., 595 N.E.2d 45 (Ill. App. Ct. 1992); Yates v. Chicago National League Ball Club, Inc., 595 N.E.2d 570 (Ill. App. Ct. 1992). 70 See TICKPICK, supra note 40. 71 Akins, 424 N.E.2d at 533. 68 DePaul J. Sports Law, Volume 16, Issue 1 155 revenue that it does without the fans. The majority of the owners’ profits derive from TV deals, advertising, team apparel, concessions, tickets, etc. All of these features would not be relevant without the fans. The fans are the ones who watch the games on TV, and TV deals are generated by viewers and attendance at ballparks. The advertisements in the ballpark are for the fans. The team apparel, concessions, and tickets are all bought by the fans. Thus, the owners would not be able to make a profit without its spectators. Being in the hospitality business includes providing safety for its patrons. At a baseball game, baseballs and bats can strike a fan in many areas of the ballpark. Not only are foul balls a concern, but players also throw the ball at an extremely fast speed to get the runner out at a particular base. Spectators sitting behind first and third base are in line with the infielders throw to those respective bases. There have been many occasions where a ball is thrown too high into the stands, or a ball might be thrown too short, which can bounce into the bleachers at a high speed. In addition, when a batter loses his grip during his swing, fans are at risk of being struck by a bat flying into the stands. Furthermore, when a bat is broken from contact with the ball, small pieces of the wooden bat can end up in the stands or even fly between the screen netting and strike spectators. There are many ways in which a spectator can get injured at a baseball game. Therefore, the rationale that “owners of baseball fields are not insurers of the safety of its spectators” is inconsistent with reality. While the owners cannot provide screening for all seats in their ballpark, they are still responsible for the safety of their spectators. In fact, owners should take pride in providing safety measures for their fans as the spectators are the ones who pay the bills. Not to mention that these safety measures can alleviate owners from liability. Providing safety on behalf of the owners is very crucial because the injuries that occur at the ballparks are not minor. Baseballs and bats fly into the stands at very high speeds. Thus, when the spectator is struck by an object, the impact is severe, and the owners can be on the hook for millions of dollars. III. DIVERGENCE FROM THE BASEBALL RULE A. Jurisdictional Preference From baseball’s earliest foul ball cases, the legal theory underlying the Baseball Rule has been the spectators’ “assumption of risk and contributory negligence.”72 The courts have rendered its decisions based on the spectator’s knowledge of the game, choice to sit in the protected or unprotected area, and the stadium owners providing sufficient netting in the high risk danger zones – behind home plate. A recent case that did not follow the Baseball Rule is Rountree v. Boise Baseball.73 The spectator, Rountree, attended a Boise Hawks baseball game, and the Hawks stadium has a unique layout.74 It has multiple areas including the Viper section, the Hawks Nest, and the Executive 72 Id. at 532. (quoting Quinn v. Recreation Park Asso., 46 P.2d 144, 145 (Cal. 1935)). 296 P.3d 373 (Idaho 2013). (In the Rountree case, the spectator took his family to a Boise Hawks baseball game. Rountree, [the spectator], has been a Boise Hawks ticket season holder for over 20 years. Id.). 74 See id. at 375; see also CHARLIE’S BALL PARKS, Boy, oh, Boise!, http://www.charliesballparks.com/st/ID-BoiseMemorial.htm (last visited Nov. 29, 2018); Boise Hawks Stadium, WRIGHT BROTHERS THE BUILDING COMPANY, http://www.wbtbc.com/portfolio_page/boise-hawks-stadium/ (last visited Nov. 20, 2018). 73 156 DePaul J. Sports Law, Volume 16, Issue 1 Club.75 Rountree brought his family to the Executive Club, and while “he was talking to another spectator, he “stopped paying attention to the game.”76 During that conversation, “Rountree heard the roar of the crowd and turned his head back to the game.”77 He was struck by a foul ball, and as a result, lost his eye.”78 Due to the injury, Rountree filed suit against Boise Baseball and the owner of Memorial Stadium.79 “The district court was unable to adopt the Baseball Rule [on behalf of the defendants] because it claimed that the legislature knows how to define the scope of duties owed in the case of particular high risk businesses, and that public policy decisions must be made by the legislature, not the courts.”80 The district court reasoned that “until the legislature intervenes baseball stadium owners will be held to the standard applicable to all business owners – that being a general duty to exercise ordinary care to prevent unreasonable, foreseeable risks of harm to others.”81 Thus, although the district court “found there may be a good reason to adopt the [B]aseball [R]ule, it declined to do so.”82 However, the “district court granted permission for the [defendant] to appeal its decision, and ultimately, Boise Baseball appealed.”83 There were two issues on appeal: (1) “[whether this court] [s]hould adopt the “Baseball Rule,” which limits the duty owed by stadium operators to spectators injured by foul balls; and (2) [whether] primary implied assumption of risk a valid defense in Idaho”84 The Supreme Court of Idaho explained that “despite the district court’s conclusion that only the [l]egislature could adopt the Baseball Rule, it is also within this Court’s power to do so.”85 The court held that “even though the court may have the power to adopt … the Baseball Rule, which limits the duty of a business owner, we decline to do so here. We find no compelling public policy requiring us to do so.”86 The court reasoned that the “rarity of [this incident] weighs against crafting a special rule. There is no history of accidents that we can look to, and draw from, to sensibly create a rule.”87 “Furthermore, Boise Baseball has not provided any other broader statistical evidence regarding the prevalence of foul ball injuries in general, and – 75 See id. (The Viper section is an area for the fans to watch the exhibition behind a net that goes 30 feet high. See id. The Hawks Nest is a “dining area along the third base line,” which is protected by “vertical and horizontal netting.” Id.). 76 See id. (The Executive Club is at the top of the stadium in line with third base. See id. “The Executive Club, which is only protected by horizontal netting, is one of the only areas in the whole stadium not covered by vertical netting.” Id.). 77 Id. 78 Id. 79 See id. (Rountree also filed suit against fifteen other defendants. Rountree alleges that the owner’s negligence caused the loss of his eye. See id. Boise Baseball moved for summary judgment, alleging that the court “should adopt the Baseball Rule, which limits the duty of stadium operators to spectators hit by foul balls[.]” Id. Boise Baseball also argued that Rountree impliedly consented to the risk of being hit by a foul ball.” Id. The district court denied these motions. See id.). 80 Id. 81 Id. at 376. 82 Id. 83 Id. at 375. 84 Id. 85 Id. at 378. 86 Id. at 379. 87 Id. 157 DePaul J. Sports Law, Volume 16, Issue 1 assuming they are so prevalent – how varying stadium designs might prevent them.”88 “Without this information, drawing lines as to where a stadium owner’s duty begins, where netting should be placed, and so on, becomes guesswork.”89 The court thinks that these questions are best suited for the legislature because “ it has the resources for the research, study and proper formulation of broad public policy.”90 The court also concluded that “primary implied assumption of risk is not a valid defense.”91 “Contributory negligence is not to be a complete bar to recovery; instead, liability is to be apportioned between the parties based on the degree of fault for which each is responsible.”92 Thus, the court concluded that the proper standard, in Idaho, when resolving a tort, is comparative negligence.93 In addition, the court held that the “assumption of risk has no legal effect as a defense [in Idaho], except in instances of express written or oral consent.”94 Thus, because the court found no compelling public policy, it decided not to follow the Baseball Rule. In addition, it found that when looking at a tort issue in Idaho, the proper standard is comparative negligence. Rountree is the first case in the modern era that does not follow the Baseball Rule. The court declined to adopt the Baseball Rule simply because it does not want that rule to act as precedent under Idaho law. The court explained that it could adopt the Baseball Rule, but it was going to leave that decision for the legislature. Instead, the court decided to follow the standard of a “general duty to exercise ordinary care to prevent unreasonable, foreseeable risks of harm to others.”95 Even under that standard, the court could have ruled the other way. The Executive Club is located in an area where spectators are not expecting to encounter foul balls. The purpose of Executive Clubs is for a handful of fans to attend, have an alcoholic beverage, and enjoy the game from a bird’s eye or VIP view. Thus, under a general duty standard based on what was reasonably foreseeable under the circumstances, Rountree’s case would not be one where he would be expected to assume the risk of being hit by a foul ball. This demonstrates that a spectator’s injury at a baseball game is not only subject to its facts, but it is also subject to which state the injury took place. In addition, the court claims that there is no public policy argument supporting the adoption of the Baseball Rule. However, there is a clear public policy argument. Owners of baseball stadiums cannot be held liable for all the foul balls hit during the game. First, owners cannot be liable because they cannot screen the entire stadium. Providing protective netting for all the fans would diminish the purpose of going to watch a game live. Most fans do not want to have their view obstructed when watching professional sports. Second, the majority 88 Id. Id. 90 Id. (quoting Anstine v. Hawkins, 447 P.2d 677, 679 (Idaho 1968)). 91 Id. (For the implied assumption of risk issue, the court laid out the doctrine’s subcategories: primary and secondary. Primary implied assumption of risk … means that the defendant was not negligent because there was no breach, or no duty. Id. at 380 (quoting Lawson by & Through Lawson v. Salt Lake Trappers, Inc., 901 P.2d 1013, 1016 (Utah 1995)). Primary implied assumption of risk arises when “the plaintiff impliedly assumes those risks that are inherently in a particular activity.” Id. (quoting Turner v. Mandalay Sports Entm’t, LLC, 180 P.3d 1172 (Nev. 2008). Secondary implied assumption of risk “is an affirmative defense to an established breach of duty and as such is a phase of contributory negligence. Id. (quoting Lawson, 901 P.2d at 1016)). 92 Id. (quoting Salinas v. Vierstra, 695 P.2d 369, 374 (Idaho 1985)). 93 See id. at 381. 94 Id. at at 380. 95 Id. at 377. 89 158 DePaul J. Sports Law, Volume 16, Issue 1 of baseballs end up in the stands during the game – there are more foul balls than hits in a game. In addition, the majority of these foul balls do not remain on the field. Thus, for an owner to be held liable for almost every time a ball is made contact with a bat would be extremely burdensome. There were enough reasons for an Idaho court to adopt the Baseball Rule without making any stretch in the law. For whatever reason, the Idaho Supreme Court does not want the owners of baseball stadiums to be free from liability. B. Increasing the Risks of the Game There are also many other cases where a spectator at a baseball game gets struck by a foul ball while he or she is distracted by events which are produced by the stadium owner or the ball club. A great illustration of this scenario is in the case of Lowe v. California League of Professional Baseball.96 This is a second case that does not follow the Baseball Rule. In this case, John Lowe attended a Rancho Cucamonga Quakes minor league baseball game.97 The Rancho Cucamonga Quakes, like most sport teams, have a mascot.98 The mascot, Tremor, is a seven-foot tall dinosaur with a long tail.99 While the game was taking place, Tremor was “performing his antics” to engage the crowd and young fans.100 Tremor was positioned directly behind Lowe’s seat, which was in an unscreened area down the left field line.101 During Tremor’s antics, his tail hit Lowe in the back of the head multiple times.102 As a result, Lowe turned around to notice what was hitting him.103 When Lowe directed his attention back to the game, he was struck, instantaneously, with a foul ball, which broke “multiple facial bones.”104 Lowe filed suit against the “California League of Professional Baseball.105 The issue before the court was “whether the Quakes’ mascot cavorting in the stands and distracting [Lowe’s] attention, while the game was in progress, constituted a breach of that duty, i.e., constituted negligence in the form of increasing the inherent risk to [Lowe] of being struck by a foul ball.”106 According to the law in California, “a defendant generally has no duty to eliminate, or protect a plaintiff from risks inherent to the sport itself, but has only a duty not to increase those risks.”107 The California Supreme Court concluded that a mascot is not integral to the sport of baseball.108 The court reasoned that “Tremor’s antics and interference, while the baseball game was in play, prevented the plaintiff from being able to protect himself from any batted ball and foreseeably increased the risk to Lowe and above those inherent in the sport.”109 Therefore, because the 96 65 Cal. Rptr. 2d 105 (Cal. Ct. App. 1997). See id. at 106. 98 See id. 99 See id. 100 Id. 101 See id. 102 See id. 103 See id. 104 Id. 105 Id. Lowe also sued Valley Baseball Club, Inc., which does business as the Quakes. See id. 106 Id. (The trial court granted the defendants’ motion for summary judgment. See id. The trial court was persuaded that “under the doctrine of primary assumption of risk, [the] defendants owed no duty to [Lowe], as a spectator, to protect him from foul balls.” Id. The California Court of Appeal found that the trial level erred in granting the defendants’ motion for summary judgment. See id.). 107 Id. at 109. 108 Id. 109 Id. 97 DePaul J. Sports Law, Volume 16, Issue 1 159 mascot was distracting Lowe from the action of the game, the owner was held liable for increasing the spectator’s risk of being hit by a foul ball. However, unlike the Lowe case in California, other jurisdictions do not follow the same holding. For example, an Ohio case, Harting v. Dayton Dragons Professional Baseball Club,110 decided the mascot interaction did not “absolve Harting from the duty to protect herself from the ordinary risks inherent in the sport.”111 Again, this goes to show that the scope of the Baseball Rule is dependent on which jurisdiction is hearing the case. The Lowe decision is more practical than Harting. Mascots are representing the sport’s team brand. The mascot is there to enhance fan engagement with the team and especially the younger fans. Thus, the mascot for sport’s teams are acting as an agent of the owners for the purpose of making a great experience for fans at the ballpark. In addition, the owner can control or set limits to the mascot’s antics. The owner can choose at what points during the game the mascot can interact with fans. The best way to avoid a potential Lowe liability case would be to only allow the mascot to interact with fans between innings. This will ensure that all spectators have the opportunity to be concentrating on the game and all potential hazards that may arise. In this regard, owners would have complied with its duty to keep fans safe at the ballpark. A plaintiff would not have a credible argument claiming that they were distracted if the mascots antics took place when the game was at a stoppage. If an owner does not want to put limitations on their mascots, he or she has the choice of not having a mascot. In fact, some sport franchises have decided not to have a mascot because it distracts fans from the live action, which can lead to an injury. Instead, owners have decided to engage fans through other streams of entertainment. This may include cheerleaders or other activities taking place on the diamond. These alternatives, however, all take place during stoppages in play. Therefore, this prevents distracting spectators while the game is taking place. Thus, the Lowe decision demonstrates a proper duty upon the owner not to increase the risks of the game. By having a mascot interact with fans while the game is taking place, it distracts the fans while a ball or bat can be coming in the fan’s direction at a high speed. In addition, the owner is the boss. He or she gets to decide the scope of the mascot’s antics. When the owner has control over the mascot’s actions, he should be held responsible for any injury that may occur due to the mascot’s antics. Thus, the only logical conclusion is that courts should follow this rule – if an owner increases the risk of the game, he should be held liable for the fan’s injury. IV. LEGISLATION REVIVING THE BASEBALL RULE A. Inked in Black Letter Law In light of all these foul ball injuries, four state have created legislation that makes the Baseball Rule black letter law. The state of Illinois made that decision based on two cases: Coronel v. Chicago White Sox112 and Yates v. Chicago National League Ball Club.113 In the Coronel case, the spectator was attending her first baseball game, and she sat three seats over 110 870 N.E.2d 766 (Ohio Ct. App. 2007). Id. at 770. 112 595 N.E.2d 45 (Ill. App. Ct. 1992). 113 595 N.E.2d 570 (Ill. App. Ct. 1992). 111 160 DePaul J. Sports Law, Volume 16, Issue 1 from the edge of the protective netting.114 As the fan put her head down to reach for her popcorn, which was sold by the ballpark, she was struck in the face with a foul ball.115 As a result, she received a broken jaw and sued the owner of the ballpark for negligence.116 The Appellate Court reversed and remanded the trial court’s summary judgment decision because a question of fact existed whether the Sox violated its duty to the spectator seated in the most dangerous part of the ballpark.117 The court reasoned that the Sox’s netting behind home plate was twenty-one feet high and thirty-nine feet wide, which was one of the smallest in MLB.118 Furthermore, the court determined that although an owner might have “provided adequate netting for the most dangerous part of the grandstands,” he has not necessarily “exculpated himself from further liability.”119 The owner must “exercise reasonable care to give a warning adequate to enable the visitors to avoid the harm[.]”120 In the Yates case, Dr. Yates bought tickets to a Chicago Cubs game thinking they were behind home plate and protected screening.121 During the game, his minor son was hit by a foul ball, which caused blood to pour out of the child’s eye.122 Yates sued the ball club for its failure to provide adequate screening behind home plate and warn him about the dangers of foul balls.123 The appellate court held that the trial court did not err in admitting expert witness’s testimony, other foul ball injuries at the ballpark, or excluding the club’s evidence based on contractual assumption of risk.124 Like the Coronel case, this court reasoned that although an owner might have “provided adequate netting for the most dangerous part of the grandstands,” he is not necessarily “exculpated himself from further liability.”125 After these two cases, the Illinois legislature decided to take the issue of foul ball cases and the Baseball Rule into its own hands. The legislature created the Baseball Facility Liability Act.126 Under the limited liability section, it states: The owner or operator of a baseball facility shall not be liable for any injury to the person or property of any person as a result of that person being hit by a ball or bat unless: (1) The person is situated behind a screen, backstop, or similar device at a baseball facility and the screen, backstop, or similar device is defective (in a manner other than in width or height) 114 Coronel, 595 N.E.2d at 46. See id. 116 See id. (The trial court granted summary judgment to the owner. See id.). 117 See id at 48. 118 See id. 119 Id. 120 Id. at 48-9. 121 Yates v. Chicago Nat. League Ball Club, 595 N.E.2d 570, 573 (Ill. App. Ct. 1992). 122 See id. (The child’s injury required surgery and a hospital stay for five days. Following the injury, the child suffered from excruciating headaches and double vision. See id. at 573–74.). 123 See id. (The jury found in favor of Yates in the amount of $67,500 as a result of the ball club’s negligence. See id. at 574.). 124 See id. at 579-82. 125 See id. at 582 (quoting Coronel v. Chicago White Sox, Ltd., 595 N.E.2d 45, 48 (Ill. App. Ct. 1992)). 126 745 ILL. COMP. STAT. 38/10 (2018). 115 161 DePaul J. Sports Law, Volume 16, Issue 1 because of the negligence of the owner or operator of the baseball facility; or (2) The injury is caused by willful and wanton conduct, in connection with the game of baseball, of the owner or operator or any baseball player, coach or manager employed by the owner or operator.127 This statute significantly limits the owner’s liability and strengthens the Baseball Rule in Illinois. For the Act’s first prong, anyone who is not seated behind protective netting does not have a defense. Thus, courts in Illinois would not be able to provide the same rationale as the court did in Lowe. This statute also eliminates the possibility of analyzing other factors such as the spectator’s age, complying with league screen standards, spectator’s seat location, spectator’s knowledge of the game, spectator’s first game, stadium design, and entertainment interference. The first prong is identical to the Baseball Rule. All that is required of the owner is to erect sufficient netting behind the most dangerous area of the ballpark. If a spectator is sitting behind the netting, he or she cannot have a claim against the owner, unless the net is in some way defective (not accounting for width and height). This statute eliminates all the progress the courts have made in trying to veer away from an outdated Baseball Rule. This statute is also unclear about what constitutes “situated behind a screen.”128 If a spectator is sitting directly behind or within the vicinity of home plate, this statute has no flaws because all aspects of the screen will protect him from line drive foul balls. However, if the spectator is situated down the baselines, depending on the seat’s angle to the netting and trajectory of the baseball, he may not be considered to be protected by the screen. Therefore, because there are so many aspects to consider, a factor test is more suitable to analyze causes of actions relating to foul balls. B. The Baseball Rule in 2018 While Pennsylvania does not have the Baseball Rule inked in its legislation, the Baseball Rule is floating around the Wendy Camlin case. Camlin was attending a Pittsburgh Pirates baseball game, and her seat was in the first row behind home plate, which is screened with protective netting.129 As Camlin was walking in the first row, behind home plate, to get to her assigned seat, a foul ball hit the netting, which caused the screen to extend, and the ball and the net struck Camlin in the head.130 Camlin sued Major League Baseball and the Pittsburgh 127 Id. (Under the Act, the term ‘Baseball facility’ “means any field, park, stadium, or other facility that is used for the play of baseball (regardless of whether it is also used for other purposes) and that is owed or operated by an individual, partnership, corporation, unincorporated association, the State or any of its agencies, officers, instrumentalities, elementary or secondary schools, colleges, or universities, unit of local government, school district, park district, or other body politic and corporate.” Id. § 5. In addition, the term ‘Baseball’ “includes the game of baseball or softball, including practice, regardless of whether it is played on a professional or amateur basis and regardless of whether it is played under an organized or league structure or outside of any such structure.” Id. Furthermore, the term ‘Wilful and wanton conduct’ “means a course of action which shows an actual or deliberate intention to cause harm or which, if not intentional, shows an utter indifference to or conscious disregard for the safety of others or their property.” Id.). 128 Id. § 10. 129 Jairus Miller, Fan Hit in Head at Pirates/Cubs Game, YOUTUBE (Apr. 20, 2015), https://www.youtube.com/watch?time_continue=8&v=syXi7MNNikE. 130 See id. 162 DePaul J. Sports Law, Volume 16, Issue 1 Pirates.131 However, MLB was dismissed shortly after.132 In addition, the plaintiff’s joined Promats Athletics (Promats), the company that owns and installed the netting at PNC Park.133 Before trial began, the Pirates settled with the Allegheny County Sports and Exhibition Authority for an undisclosed amount.134 It is unclear why the Pirates settled with the county instead of Camlin directly. Regardless, the only remaining defendant is Promats.135 Camlin’s attorney intends to argue that the screen was defective because it “did not do what it was supposed to do,” which is to shield spectators from foul balls behind home plate.136 This case is similar to the Edling case because although the protective screening did not have any holes, it is still considered defective netting for not properly protecting spectators. Courts must be cautious when determining whether the screening is sufficient based how much resistance it has. If the screen is too tight, it will bounce directly back onto the field, potentially striking players or umpires at a fast speed. However, if the screen is too loose, spectators in the first row behind the protective netting are in danger of getting hit by a foul ball, like Wendy Camlin. As a result of her injury, she “continues to have headaches, tinnitus, vertigo, confusion, neck and shoulder pain and memory loss.”137 It took Camlin six month to return to work on a part-time basis until she was terminated.138 She has not worked since. The Camlin case is one where the owner increased the risk of the game. The purpose of protective netting is to block or intercept foul balls from striking spectators. Camlin was seated in the high-risk danger zone – behind home plate. She is arguably the most vulnerable spectator at the ballpark because she has the least amount of time to react to a foul ball. However, when spectators sit behind protective netting, even in the first row, he or she does not expect to be hit by a foul ball or for the ball to come through the screen. Thus, Camlin could not have assumed any risk once she was in the first-row walking to her seat. In addition, the ushers allowed Camlin to walk down to her seat while the game was in action. While the employee may have allowed Camlin to enter the stands before the first pitch was thrown, ushers should be aware of when the game is about to start so accidents like these do not happen. It will be interesting to see how the Camlin case plays out, but it would be surprising if a court found in favor of Promats. V. THE FACTOR TEST The Baseball Rule is not applied or used consistently within the United States. Baseball is played in all fifty states, and it is not played differently amongst those states. Thus, why should its laws be applied differently for the same or similar set of circumstances in different jurisdictions? The Baseball Rule is useful but only to a certain degree – an owner cannot be held liable for every foul ball that ends up in the stands. However, the owner needs to be held liable based on if it provides the necessary protection to ensure spectator safety at the ballpark. The Baseball Rule or lack thereof should be adopted or applied identically in all cases subject to the 131 Paula Reed Ward, Trial Begins Over Errant Foul Ball at Pirates Game, PITT. POST-GAZETTE, Nov. 16, 2018. See id. 133 See id. 134 See id. 135 See id. 136 Id. 137 Id. 138 Id. 132 163 DePaul J. Sports Law, Volume 16, Issue 1 facts of the incident. This includes providing a factor test to determine whether the owner should be held liable for foul balls injuring his or her spectators. The factors include: (1) whether the owner erected protective netting subject to the league’s standards; (2) whether the spectator has knowledge about the game and the risk of foul balls; (3) whether the spectator has ever attended a baseball game in the past; (4) where the spectator was seated; (5) the spectator’s age; (6) whether the fan was distracted by the owner’s entertainment; and (7) the stadium’s design. While these factors should be considered as a whole when the court is deciding whether to apply the Baseball Rule, it is still important to go through each one individually. First, leagues should provide its ball clubs a standard for erecting their netting. This can be complex as each stadium has a different design. However, if a league were to have a set of standards governing its protective netting, the courts should look to whether the owner was in compliance with those standards. The court should then ask itself whether the injury would not have occurred if the owner was obedient to the standards provided by the league. If the owner could have prevented the spectator’s injury by following the league-imposed standards, the court should refrain from applying the Baseball Rule. Second, the spectator’s knowledge about baseball should be analyzed based on his or her experience playing and watching the game, as well as the risks that are involved in being hit with a foul ball. If the spectator is familiar with the game, the court may rely on the Baseball Rule. However, if the spectator has little or no experience with the game and does not understand the risks relating to foul balls, the court should refrain from applying the Baseball Rule. This factor should be strongly considered along with whether the spectator has ever attended a baseball game in the past. Third, whether the spectator has ever attended a baseball game in the past should be analyzed in two lenses – previous games attended and previous games attended where the spectator was seated in the vicinity of foul balls. If the spectator never attended a baseball game before the injury occurred, the court should be lenient toward the spectator and refrain from applying the Baseball Rule. If the spectator has attended a baseball game in the past, the court should then determine whether the spectator was familiar with the risk of foul balls from previous attendances. For example, if a spectator was previously seated in a box seat or the outfield, he or she may not truly understand the risks of sitting in the danger zones where foul balls are often hit at high speeds. Like most things in life, sometimes people need to experience something before they can truly understand the situation. The same can be true for foul balls. If a spectator has never sat along the baselines, he or she may not truly understand the risks of foul balls in that location. Thus, if a spectator was not familiar with the risks of foul balls although he or she has attended a baseball game in the past, the court may decide not to apply the Baseball Rule. This factor should be strongly considered along with the spectator’s knowledge of the game. Fourth, where the spectator was seated is a factor that has been considered by all courts since 1913. If the spectator is seated in the section directly behind home plate, the owner should not be liable for any spectator injury relating to objects leaving the field of play. However, this analysis becomes complex for spectators who sit toward the end of the screen because, as mentioned above, depending on the seat’s angle to the netting and trajectory of the baseball, it might be difficult to determine whether the spectator was protected by the netting. 164 DePaul J. Sports Law, Volume 16, Issue 1 Fifth, the spectator’s age can have serious consequences if he or she is a toddler or a young child. Children are more at risk than adults because they simply do not think of the risks associated with the game of baseball. Adults on the other hand, especially mothers, will usually expect the worst in all situations. These adults would take precautionary measures or at least be aware of the risks to prevent being injured. Therefore, if a spectator is young in age, there should be more leniency toward the spectator, and a court should refrain from applying the Baseball Rule. This factor should be strongly considered along with the spectator’s knowledge of the game. Sixth, entertainment interference has been the only scenario that has held the owner liable for spectator foul ball injuries other than defective screening. However, for this factor, the owner’s liability should not only be with regard to the spectators situated behind a screen, it should include all spectators in the ballpark. The reasoning behind this is that if there is entertainment interference, which is conducted under the owner’s business, the act takes away the spectator’s attention from the game. Thus, the interference increases the risk of the spectator being hit by a foul ball. This factor should include the analysis of both line drive and pop-up foul balls because, regardless of the spectator’s reaction time, his or her attention has veered away from the game as a result of one of the owner’s agents. The owners should assume this risk in the event to make a profit while the game is on-going. This factor should also be looked at for spectator’s who are hit by a homerun. A non-exhaustive list of entertainment interference may include mascots, cheerleaders, employees serving concessions, messages on the jumbotron, Tshirt giveaways, etc. All of these examples are acceptable forms of entertainment, but for the owner not to be held liable for spectator foul ball injuries, all of these must be performed during a stoppage in play. In addition, the ushers should not allow spectators to walk to their seats while the game is in action. Spectators are more focused on the uneven steps in stadiums, looking for their row number, and then squeezing by a set of fans to get to their seats. Thus, if an usher allows spectators to return to their seats while the game is on-going and the fan gets injured by a foul ball, line drive or pop-up, the owner may be subject to liability. Finally, the stadium’s design is extremely relevant to how screening should be erected at the ballpark. Most stadiums and spectator seats are designed in the usual diamond shape.139 However, there are some stadiums where spectator seats stick out of the ordinary diamond shape and are close to the field of play.140 These seats that are close to fair territory are in extreme danger of being hit by a line drive foul ball. Stadiums of this design should consider netting those areas in the outfield that stick out close to the first and third base lines. Thus, if a spectator was hit in this area and it is unprotected, the court should not apply the Baseball Rule. The court should not consider whether the spectator had time to react because the foul balls being referred to are only with regard to line drives. If there was a pop-up foul ball, it is assumed that the spectator had enough time to react and avoid being hit by the baseball. However, this does not apply when the owner increases the risks of the game. It is not reasonable for the owner to screen all sections of the ballpark. Therefore, if a spectator is sitting in an area that has no protective screening, and he or she is struck by a foul ball, whether it is a line drive or pop-up, the court may apply the Baseball Rule. 139 Jason Notte, 10 Most Luxurious Seats in Major League Baseball, THESTREET, Aug. 2, 2016, https://www.thestreet.com/slideshow/13661373/1/10-most-luxurious-seats-in-major-league-baseball.html. 140 Fenway Park Seat Map, RED SOX, https://www.mlb.com/redsox/ballpark/seat-map (last visited Nov. 29, 2018). 165 DePaul J. Sports Law, Volume 16, Issue 1 This factor test incorporates a comparative negligence analysis. The problem with the Baseball Rule is that it is based on a whether the owner complied with his or her duty. However, the factor test allows the court to embrace a comparative negligence scheme to establish a percentage of fault for all the parties involved. Comparative negligence allows the court to determine whether the spectator assumed the risk instead of reverting to contributory negligence – a complete bar from recovery. In the United States, forty-five of the fifty states have a comparative fault scheme.141 Thus, a strong majority of states have moved away from contributory negligence and have veered to a comparative fault distribution. However, courts are not following its jurisdiction’s negligence laws when determining assumption of risk for its foul ball cases. This becomes a problem because the spectator’s chance of recovery is dependent on where the injury occurred. If the injury occurred in a Baseball Rule jurisdiction, and it is a comparative fault state, the plaintiff may still be barred from recovery. There has been a lot criticism about the Baseball Rule, but the most recent pushback has come from Nathaniel Grow and Zachary Flagel.142 Grow and Flagel’s position is that the courts should replace the Baseball Rule with a strict liability scheme, which would hold professional baseball teams liable for spectators’ injuries.143 Grow and Flagel believe a strict liability scheme is the best solution because it “[forces] teams to internalize the cost of spectator injuries, thereby best incentivizing them to implement the most economically efficient level of fan protection in their stadiums.”144 The problem with a strict liability scheme is that if the stadium owners wanted to completely avoid liability, they would screen the entire ballpark. However, most fans do not want to watch a game live with an obstructed view. Thus, owners are using a balancing test to determine what areas of the stands should be screened to save themselves from liability while considering the spectators’ experience and profit. A strict liability may be the proper scheme from an economical standpoint but not a practical one. The best solution is to follow and apply the factor test because it analyses and takes into account comparative fault on behalf of the owner and the spectator. VI. CONCLUSION The sports industry is driven by money. The sport market in North America is expected to reach $73.5 billion in revenue by 2019.145 The majority of this revenue is a result of media rights.146 However, the media rights are not driving the sport industry. The fans are. Professional and amateur exhibitions are products for the consumers. The four major professional leagues, the National Football League, Major League Baseball, the National Basketball Association, and the National Hockey League, are spectator sports. The National Collegiate Athletic Association is no different. While the sports industry would not be as rich as it is today without its media rights, it would not be what it was today without its fans. The spectators are the ones willing to pay to 141 Contributory Negligence/Comparative Fault Laws in All 50 States, MATTHIESEN, WICKERT & LEHRER, S.C. (last updated Feb. 14, 2018). 142 Nathaniel Grow & Zachary Flagel, The Faulty Law and Economics of the “Baseball Rule”, 60 WM. & MARY L. REV. 59 (2018). 143 See id. at 111. 144 See id. at 68. 145 Darren Heitner, Sports Industry to Reach $73.5 Billion by 2019, FORBES, Oct. 19, 2015. 146 See id. 166 DePaul J. Sports Law, Volume 16, Issue 1 experience the product that each league sets up on display. Without interest from the market, there would be no TV rights for the sports leagues. These leagues have become popular through fan interest. Although the media rights are a big portion of the league and team revenues, the fans are driving their success. Thus, because the fans are arguably the most important piece to the sports industry’s success, leagues and teams should be concerned about fan protection at their sporting events. It is also within the owner’s interest to protect its fans because it will prevent them from giving up millions of dollars in potential foul ball suits. If the owner is held liable for the spectator’s injuries, for whatever reason decided by the court, the owner should be responsible for the spectator’s short and long-term medical expenses. This shall include immediate expenses for the spectator to recover from his and her injury, but it should also include potential disabilities in the future. Some fans lose an eye, break facial bones, and others, who are hit in the head, cannot return to work. Thus, the court should consider potential lost wages and other damages that may be applicable. Therefore, because the Baseball Rule is outdated, courts should rely on the factor test. Times have changed since the Baseball Rule was first seen in 1913. The foul ball danger zone is bigger than it used to be, spectators are seated closer to the action, and baseballs fly into the stands at higher speeds. This factor test puts the courts in the best situation to analyze the case based on the totality of the circumstances instead of whether the owner complied with his duty by erecting a sufficient net where most foul balls are hit. Whether the owner increases the risks of the game is a crucial issue to these foul ball cases. If this is the case, owners should be held liable for the spectator’s injuries. In addition, the factors should be considered as a whole. By going through each factor, the court should have a better idea of whether to hold the owner liable for the spectator’s injuries. These factors consider the most crucial issues when analyzing spectator foul ball injuries. Task: For this assignment, you will need to create 4 annotations. Create 3 annotations that provide facts (such as definitions, explanations, data, etc., directly from the reading) and 1 that adds an insight (connect to another idea in the course, current events, another student’s comments, etc.) or asks a question. Comment of a student that will need to be responded to(that adds an insight): Example: Quate a part of the text and then write a comment. How to Analyze Case Problems Understand the Facts Before you can analyze or apply the relevant law to a specific set of facts, you must clearly understand those facts. To clearly understand the facts, you should read through the case information carefully – more than once if necessary – to make sure you understand the plaintiff(s) and defendant(s) in the case and the progression of events that led to the lawsuit. Law students and lawyers often use abbreviations for the parties. To indicate a reference to a plaintiff, the pi symbol – 𝜋π – is often used, and a defendant is denoted by a delta – ΔΔ – a triangle. Legal Analysis and Reasoning Once you understand the facts, you can begin to analyze the case. The IRAC method is a helpful tool to use the analysis and reasoning process. IRAC is an acronym for Issue, Rule, Application, and Conclusion. Issue: first, you decide what legal issue is involved in the case. Let’s use a hypothetical slip and fall at a grocery store due to a wet floor to walk through these steps. For example, the issue is whether the grocery store failed to warn customers of the wet floor and, therefore, was negligent. Rule: once you have identified the issue, the next step is to determine what rule of law applies to the issue. In the grocery store example, tort law says that business owners owe a duty to protect their customers by using reasonable care. Reasonable care in this context includes warning customers of foreseeable risks which the owner knew or should have known about. If a business owner breaches this duty of care and the breach of duty causes a customer to be injured, the business owner will be liable for the customer’s injuries. Application: the next step is the application of the relevant rule of law to the specific facts of the case. In the grocery store example, an employee just mopped the floor in the aisle where the customer slipped and fell and there wasn’t a sign warning of a wet floor. That a customer might fall on a wet floor is clearly a foreseeable risk. Therefore, the failure to warn customers about the wet floor was a breach of the duty of care owed by the grocery store to its customers. Conclusion: Once you have completed step 3 in the IRAC method, you should be ready to draw a conclusion. For example, the grocery store is liable to customer for his injuries because the store’s breach of its duty of care caused the customer’s injuries. Often, the fact patterns aren’t as simple as the grocery store example. There may be more than one issue in a case and one or more applicable rule of law. There may also be a defense – possibly, the employee verbally told the customer to avoid the area. Give this method a try as you read through the cases. Hopefully, it will help you in this course and other courses! Directions, Grading: How to annotate assignments: • • • • • • Highlight words and concepts that are unclear to you, look them up, then share what you found in a comment. Remember to include the source of your reference. Share facts and descriptions from the text that surprise you and tell us why. Engage each text in multiple places. Ask questions (using a “?” in your comment in Perusall automatically turns it into a question). Read the comments and questions posed by others. Answer the questions of your classmates by “mentioning” them (use @ to tag a classmate in your response so that the individual knows you are directly engaging them). • • • Upvote comments or questions you find helpful. Connect ideas found in the readings to the real life experiences you have or know of. Use the picture tool to add a visual element to your annotation or illustrate your point. Task: For this assignment, you will need to create 4 annotations. Create 3 annotations that provide facts (such as definitions, explanations, data, etc., directly from the reading) and 1 that adds an insight (connect to another idea in the course, current events, another student’s comments, etc.) or asks a question. Comment of a student that will need to be responded to(that adds an insight): Example: Quate a part of the text and then write a comment. How to Analyze Case Problems Understand the Facts Before you can analyze or apply the relevant law to a specific set of facts, you must clearly understand those facts. To clearly understand the facts, you should read through the case information carefully – more than once if necessary – to make sure you understand the plaintiff(s) and defendant(s) in the case and the progression of events that led to the lawsuit. Law students and lawyers often use abbreviations for the parties. To indicate a reference to a plaintiff, the pi symbol – 𝜋π – is often used, and a defendant is denoted by a delta – ΔΔ – a triangle. Legal Analysis and Reasoning Once you understand the facts, you can begin to analyze the case. The IRAC method is a helpful tool to use the analysis and reasoning process. IRAC is an acronym for Issue, Rule, Application, and Conclusion. Issue: first, you decide what legal issue is involved in the case. Let’s use a hypothetical slip and fall at a grocery store due to a wet floor to walk through these steps. For example, the issue is whether the grocery store failed to warn customers of the wet floor and, therefore, was negligent. Rule: once you have identified the issue, the next step is to determine what rule of law applies to the issue. In the grocery store example, tort law says that business owners owe a duty to protect their customers by using reasonable care. Reasonable care in this context includes warning customers of foreseeable risks which the owner knew or should have known about. If a business owner breaches this duty of care and the breach of duty causes a customer to be injured, the business owner will be liable for the customer’s injuries. Application: the next step is the application of the relevant rule of law to the specific facts of the case. In the grocery store example, an employee just mopped the floor in the aisle where the customer slipped and fell and there wasn’t a sign warning of a wet floor. That a customer might fall on a wet floor is clearly a foreseeable risk. Therefore, the failure to warn customers about the wet floor was a breach of the duty of care owed by the grocery store to its customers. Conclusion: Once you have completed step 3 in the IRAC method, you should be ready to draw a conclusion. For example, the grocery store is liable to customer for his injuries because the store’s breach of its duty of care caused the customer’s injuries. Often, the fact patterns aren’t as simple as the grocery store example. There may be more than one issue in a case and one or more applicable rule of law. There may also be a defense – possibly, the employee verbally told the customer to avoid the area. Give this method a try as you read through the cases. Hopefully, it will help you in this course and other courses! Directions, Grading: How to annotate assignments: • • • • • • Highlight words and concepts that are unclear to you, look them up, then share what you found in a comment. Remember to include the source of your reference. Share facts and descriptions from the text that surprise you and tell us why. Engage each text in multiple places. Ask questions (using a “?” in your comment in Perusall automatically turns it into a question). Read the comments and questions posed by others. Answer the questions of your classmates by “mentioning” them (use @ to tag a classmate in your response so that the individual knows you are directly engaging them). • • • Upvote comments or questions you find helpful. Connect ideas found in the readings to the real life experiences you have or know of. Use the picture tool to add a visual element to your annotation or illustrate your point.

56 The Purpose of the Corporation Managing for Stakeholders R. Edward Freeman

56 The Purpose of the Corporation Managing for Stakeholders R. Edward Freeman

INTRODUCTION T h e p u r p o s e of this essay is to o u t l i n e an e m e r g i n g view of business t h a t we shall call ” m a n a g i n g for stakeholders”.” This view has e m e r g e d over the past 30 years from a g r o u p of scholars in a diverse set of disciplines, from finance to philosophy.’ T h e basic idea is that businesses, a n d the executives w h o m a n a g e them, actually do a n d should create value for customers, suppliers, employees, c o m m u n i ties, a n d financiers (or s h a r e h o l d e r s ) . And, that we n e e d to pay careful attention to how these r e l a t i o n s h i p s are m a n a g e d a n d how value gets created for these stakeholders. We contrast this idea with the d o m i n a n t m o d e l of business activity, namely, that businesses are to be m a n a g e d solely for the benefit of shareholders. Any o t h e r benefits (or harms) that. are created are incidental. Simple ideas create complex questions, a n d we p r o c e e d as follows. In the next section we examine why the d o m i n a n t story or m o d e l of business that is deeply e m b e d d e d in o u r cult u r e is n o l o n g e r workable. It is resistant to c h a n g e , n o t consistent with the law, a n d for the most part, simply ignores matters of ethics. Each of these flaws is fatal in the business world of the twenty-first century. Wc t h e n p r o c e e d to define the basic ideas of ” m a n a g i n g for s t a k e h o l d e r s ” a n d why it solves some of the problems of the d o m i n a n t model. In particular we pay attention to how using “stakeholder” as a basic u n i t of analysis makes it m o r e difficult to ignore matters of ethics. We argue that the primary responsibility of the executive is to create as m u c h value for stakeholders as possible, a n d that n o stakeh o l d e r i n t e r e s t is viable in isolation of t h e o t h e r stakeholders. We sketch t h r e e primary a r g u m e n t s from ethical theory for a d o p t i n g “managing for stakeholders.” We conclude by outlining a fourth “pragmatist a r g u m e n t ” that suggests we see m a n a g i n g for stakeholders as a new narrative a b o u t business that lets us improve t h e way we currently create value for each other. Capitalism is o n this view a system of social cooperation a n d collaboration, rather than primarily a system of competition. THE DOMINANT STORY: MANAGERIAL CAPITALISM WITH SHAREHOLDERS AT THE CENTER T h e m o d e r n business c o r p o r a t i o n has e m e r g e d d u r i n g the twentieth century as o n e of the most i m p o r t a n t innovations in h u m a n history. Yet the changes that we are now experiencing call for its reinvention. Before we suggest what this revision, “managing for stakeholders” or “stakeholder capitalism,” is, first we n e e d to u n d e r s t a n d how t h e d o m i n a n t story came to b e told. Somewhere in the past, organizations were quite simple and “doing business” consisted of buying raw materials from suppliers, converting it to products, a n d selling it to customers. For the most part owner-entrepreneurs f o u n d e d such simple businesses a n d worked at the business along with members of their families. T h e d e v e l o p m e n t of new p r o d u c t i o n processes, such as t h e assembly line, m e a n t t h a t jobs could be specialized and more work could be accomplished. New technologies a n d sources of power became readily available. These and other social a n d political forces c o m b i n e d to require larger amounts of capital, well beyond the scope of most individual owner-manageremployees. Additionally, “workers” or n o n family m e m b e r s began to d o m i n a t e the firm a n d were the rule rather than the exception. The Purpose of the Corporation Ownership of the business became more dispersed as capital was raised from banks, stockholders, and other institutions. Indeed, the management of the firm became separated from the ownership of the firm. And, in order to be successful, the top managers of the business had to simultaneously satisfy the owners, the employees and their unions, suppliers, and customers. This system of organization of businesses along the lines set forth here was known as managerial capitalism or laissez faire capitalism, or more recently, shareholder capitalism. As businesses grew, managers developed a means of control via the divisionalized firm. Led by Alfred Sloan at General Motors, the divisionalized firm with a central headquarters staff was widely adapted. 6 The dominant model for managerial authority was the military and civil service bureaucracy. By creating rational structures and processes, the orderly progress of business growth could be wellmanaged. Thus, managerialism, hierarchy, stability, and predictability all evolved together, in the United States and Europe, to form the most powerful economic system in the history of humanity. The rise of bureaucracy and managerialism was so strong that the economist Joseph Schumpeter predicted that it would wipe out the creative force of capitalism, stifling innovation in its drive for predictability and stability. During the last 50 years this “Managerial Model” has put “shareholders” at the center of the firm as the most important group for managers to worry about. This mindset has dealt with the increasing complexity of the business world by focusing more intensely on “shareholders” and “creating value for shareholders.” It has become common wisdom to “increase shareholder value,” and many companies have instituted complex incentive compensation plans aimed at aligning the interests of executives with the interests of shareholders. 57 These incentive plans are often tied to the price of a company’s stock, which is affected by many factors not the least of which is the expectations of Wall Street analysts about earnings per share each quarter. Meeting Wall Street targets and forming a stable and predictable base of quarter over quarter increases in earnings per share has become the standard for measuring company performance. Indeed, all of the recent scandals at Enron, WorldCom, Tyco, and others are in part due to executives trying to increase shareholder value, sometimes in opposition to accounting rules and law. Unfortunately, the world has changed so that the stability and predictability required by the shareholder approach can no longer be assured. The Dominant Model Is Resistant to Change The Managerial View of business with shareholders at the center is inherently resistant to change. It puts shareholders’ interests over and above the interests of customers, suppliers, employees, and others, as if these interests must conflict with each other. It understands a business as an essentially hierarchical organization fastened together with authority to act in the shareholders’ interests. Executives often speak in the language of hierarchy as “working for shareholders,” “shareholders are the boss,” and “you have to do what the shareholders want.” On this interpretation, change should occur only when the shareholders are unhappy, and as long as executives can produce a series of incrementally better financial results there is no problem. According to this view the only change that counts is change oriented toward shareholder value. If customers are unhappy, if accounting rules have been compromised, if product quality is bad, if environmental disaster looms, even if competitive forces threaten, the only interesting questions are whether and how these forces 58 The Purpose of the Corporation for change affect shareholder value, measured by the price of the stock every day. Unfortunately in today’s world there is just too much uncertainty and complexity to rely on such a single criterion. Business in the twenty-first century is global and multifaceted, and shareholder value may not capture that dynamism. Or, if it does, as the theory suggests it must eventually, it will be too late for executives to do anything about it. The dominant story may work for how things turn out in the long run on Wall Street, but managers have to act with an eye to Main Street as well, to anticipate change to try and take advantage of the dynamism of business.’ THE DOMINANT MODEL IS NOT CONSISTENT WITH THE LAW In actual fact the clarity of putting shareholders’ interests first, above that of customers, suppliers, employees, and communities, flies in the face of the reality the law. The law has evolved to put constraints on the kinds of trade-offs that can be made. In fact the law of corporations gives a less clear answer to the question of in whose interest and for whose benefit the corporation should be governed. The law has evolved over the years to give de facto standing to the claims of groups other than stockholders. It has, in effect, required that the claims of customers, suppliers, local communities, and employees be taken into consideration. For instance, the doctrine of “privity of contract,” as articulated in Winlerbottom v. Wright in 1842, has been eroded by recent developments in product liability law. Greenman v. Yuba Power gives the manufacturer strict liability for damage caused by its products, even though the seller has exercised all possible care in the preparation and sale of the product and the consumer has not bought the product from nor entered into any contrac- tual arrangement with the manufacturer. Caveat emptor\\2& been replaced, in large part, with caveat venditor. The Consumer Product Safety Commission has the power to enact product recalls, essentially leading to an increase in the number of voluntary product recalls by companies seeking to mitigate legal damage awards. Some industries are required to provide information to customers about a product’s ingredients, whether or not the customers want and are willing to pay for this information. Thus, companies must take the interests of customers into account, by law. A similar story can be told about the evolution of the law forcing management to take the interests of employees into account.

The National Labor Relations Act gave employees the right to unionize and to bargain in good faith. It set up the National Labor Relations Board to enforce these rights with management. The Equal Pay Act of 1963 and Tide VII of the Civil Rights Act of 1964 constrain management from discrimination in hiring practices; the56 The Purpose of the Corporation Managing for Stakeholders R. Edward Freemanse have been followed with the Age Discrimination in Employment Act of 1967, and recent extensions affecting people with disabilities. The emergence of a body of administrative case law arising from labor-management disputes and the historic settling of discrimination claims with large employers have caused the emergence of a body of management practice that is consistent with the legal guarantee of the rights of employees. The law has also evolved to try and protect the interests of local communities.

The Clean Water Act of 1977 and the Clean Air Act of 1990, and various amendments to these classic pieces of legislation, have constrained management from “spoiling the commons.” In a historic case, Marsh v. Alabama, the Supreme Court ruled that a company-owned town was subject to the provisions of the U.S. Constitution, thereby guaranteeing the rights of local citizens and negating the “property The Purpose of the Corporation r i g h t s ” of t h e firm. C u r r e n t issues c e n t e r a r o u n d p r o t e c t i n g local businesses, forcing c o m p a n i e s to pay t h e h e a l t h c a r e costs of t h e i r e m p l o y e e s , i n c r e a s e s in m i n i m u m wages, e n v i r o n m e n t a l standards, a n d the effects of business d e v e l o p m e n t o n t h e lives of local c o m m u n i t y m e m b e r s . T h e s e issues fill the local political landscapes, a n d executives a n d t h e i r c o m p a n i e s m u s t take a c c o u n t of them. Some may argue that the constraints of the law, at least in the U.S., have b e c o m e increasingly irrelevant in a world w h e r e business is global in n a t u r e . However, globalization simply m a k e s this a r g u m e n t stronger. T h e laws that are relevant to business have evolved differently a r o u n d t h e world, b u t they have evolved nonetheless to take into account the interests of groups o t h e r t h a n just shareholders. Each state in India has a different set of regulations that affect how a c o m p a n y can d o business. In China the law has evolved to give business some property rights b u t it is far from exclusive. A n d , in m o s t of t h e E u r o p e a n Union, laws a r o u n d “civil society” a n d the role of “employees” are m u c h m o r e complex than even U.S. law. “Laissez-faire capitalism” is simply a myth. T h e idea that business is a b o u t “maximizing value for stockholders regardless of t h e consequences to others” is o n e that has outlived its usefulness. T h e d o m i n a n t m o d e l simply does n o t describe h o w business operates. Ano t h e r way to see this is that if executives always have to qualify “maximize s h a r e h o l d e r value” with exceptions of law, or even g o o d practice, t h e n the d o m i n a n t story isn’t very useful a n y m o r e . T h e r e are j u s t too m a n y exceptions. T h e d o m i n a n t story could b e saved by arguing that it describes a normative view a b o u t h o w business s h o u l d o p e r a t e , despite h o w actual businesses have evolved. So, we n e e d to look m o r e closely at some of the conceptual and normative problems that the d o m i n a n t m o d e l raises. 59 T h e Dominant M o d e l Is N o t Consistent with Basic Ethics Previously we have a r g u e d that most theories of business rely o n separating “business” decisions from “ethical” decisions. This is seen most clearly in the p o p u l a r j o k e a b o u t “business ethics as an oxymoron.” More formally we m i g h t suggest that we define: T h e Separation Fallacy It is useful to believe that sentences like “x is a business decision” have no ethical content or any implicit ethical point of view. And, it is useful to believe that sentences like “x is an ethical decision, the best thing to do all things considered” have no content or implicit view about value creation and trade (business). This fallacy u n d e r l i e s m u c h of t h e d o m i n a n t story a b o u t business, as well as in o t h e r areas in society. T h e r e are two implications of rejecting the Separation Fallacy. T h e first is t h a t almost any business decision has s o m e ethical content. To see that this is true one need only ask whether the following questions make sense for virtually any business decision: T h e O p e n Question A r g u m e n t 1. If this decision is made for whom is value created and destroyed? 2. Who is harmed a n d / o r benefited by this decision? 3. Whose rights are enabled and whose values are realized by this decision (and whose are not)? 4. What kind of person will I (we) become if we make this decision? Since these questions are always o p e n for most business decisions, it is reasonable to give u p the Separation Fallacy, which would have us believe that these questions aren’t relevant for m a k i n g business decisions, o r that they could never b e answered. We n e e d a theory a b o u t business that builds in answers to the ” O p e n Question Argument” above. O n e such answer 60 The Purpose of the Corporation would b e “Only value to shareholders counts,” b u t such a n answer w o u l d have to b e enm e s h e d in the l a n g u a g e of ethics as well as business. Milton F r i e d m a n , unlike most of his expositors, may actually give such a morally rich answer. H e claims t h a t t h e responsibility of the executive is to make profits subject to law a n d ethical custom. D e p e n d i n g o n how “law a n d ethical custom” is i n t e r p r e t e d , t h e key difference with the stakeholder a p p r o a c h may well b e that we disagree a b o u t how the world works. In o r d e r to create value we believe t h a t it is b e t t e r to focus o n integrating business a n d ethics within a c o m p l e x set of stakeholder relationships rather t h a n treating ethics as a side constraint o n making profits. In short we n e e d a theory that has as its basis what we m i g h t call: T h e Integration Thesis Most business decisions, or sentences about business have some ethical content, or implicit ethical view. Most ethical decisions, or sentences about ethics have some business content or im10 plicit view about business O n e of the most pressing challenges facing business scholars is to tell compelling narratives t h a t have t h e I n t e g r a t i o n Thesis at its heart. This is essentially the task that a g r o u p of scholars, “business ethicists” a n d “stakeh o l d e r theorists,” have b e g u n over the last 30 years. We n e e d to go back to the very basics of ethics. Ethics is a b o u t t h e rules, principles, consequences, matters of character, etc., that we use to live together. These ideas give us a set of o p e n q u e s t i o n s t h a t we are constantly searching for better ways to answer in reasonable complete ways.11 O n e might define “ethics” as a conversation a b o u t how we can reason tog e t h e r a n d solve o u r differences, recognize where o u r interests are j o i n e d a n d n e e d development, so t h a t we can all flourish without resorting to coercion a n d violence. Some may disagree with such a definition, a n d we d o n o t intend to privilege definitions, b u t such a pragmatist a p p r o a c h to ethics entails that we reason a n d talk together to try a n d create a better world for all of us. If o u r critiques of the d o m i n a n t m o d e l are correct t h e n we n e e d to start over by reconceptualizing the very language that we use to u n d e r s t a n d how business operates. We want to suggest that s o m e t h i n g like the following principle is implicit in most reasonably comprehensive views a b o u t ethics. T h e Responsibility Principle 2 Most people, most of the time, want to, actually do, and should accept responsibility for the effects of their actions on others. Clearly the Responsibility Principle is incompatible with the Separation Fallacy. If business is s e p a r a t e d f r o m ethics, t h e r e is n o question of m o r a l responsibility for business decisions. More clearly still, without something like the Responsibility Principle it is difficult to see how ethics gets off the g r o u n d . “Responsibility” may well b e a difficult a n d multifaceted idea. There are surely many different ways to u n d e r s t a n d it. But, if we are n o t willing to accept the responsibility for o u r own actions (as limited as t h a t may b e d u e to complicated issues of causality a n d the like), t h e n ethics, u n d e r s t o o d as how we reason together so we can all flourish, is likely a n exercise in b a d faith. If we want to give u p the separation fallacy a n d a d o p t the integration thesis, if the o p e n question a r g u m e n t makes sense, a n d if something like the responsibility thesis is necessary, then we n e e d a new m o d e l for business. And, this new story must be able to explain how value creation at o n c e deals with e c o n o m i c s a n d ethics, a n d how it takes account of all of the effects of business action on others. Such a model exists, a n d has b e e n developing over the last 30 years by m a n a g e m e n t researchers a n d ethics scholars, a n d t h e r e are many businesses who The Purpose of the Corporation have adopted this “stakeholder framework” for their businesses.

MANAGING FOR STAKEHOLDERS

The basic idea of “managing for stakeholders” is quite simple. Business can be understood as a set of relationships among groups which have a stake in the activities that make up the business. Business is about how customers, suppliers, employees, financiers (stockholders, 61 bondholders, banks, etc.), communities, and managers interact and create value. To understand a business is to know how these relationships work. And, the executive’s or entrepreneur’s j o b is to manage and shape these relationships, hence the title, “managing for stakeholders.” Figure 1 depicts the idea of “managing for stakeholders” in a variation of the classic “wheel and spoke” diagram. 13 However, it is important to note that the stakeholder idea is perfectly general. Corporations are not the FIGURE 1 PRIMARY SECONDARY STAKEHOLDERS STAKEHOLDERS Source: R. Edward Freeman, Jeffrey Harrison, and Andrew Wicks, Managing for Stakeholders (New Haven: Yale University Press, 2007). 62 The Purpose of the Corporation center of the universe, and there are many possible pictures. One might put customers in the center to signal that a company puts customers as the key priority. Another might put employees in the center and link them to customers and shareholders. We prefer the generic diagram because it suggests, pictorially, that “managing for stakeholders” is a theory about management and business; hence, managers and companies are in the center. But, there is no larger metaphysical claim here. Stakeholders and Stakes Owners or financiers (a better term) clearly have a financial stake in the business in the form of stocks, bonds, and so on, and they expect some kind of financial return from them. Of course, the stakes of financiers will differ by type of owner, preferences for money, moral preferences, and so on, as well as by type of firm. The shareholders of Google may well want returns as well as be supportive of Google’s articulated purpose of “Do No Evil.” To the extent that it makes sense to talk about the financiers “owning the firm,” they have a concomitant responsibility for the uses of their property. Employees have their jobs and usually their livelihood at stake; they often have specialized skills for which there is usually no perfectly elastic market. In return for their labor, they expect security, wages, benefits, and meaningful work. Often, employees are expected to participate in the decision making of the organization, and if the employees are management or senior executives, we see them as shouldering a great deal of responsibility for the conduct of the organization as a whole. And, employees are sometimes financiers as well, since many companies have stock ownership plans, and loyal employees who believe in the future of their companies often voluntarily invest. One way to think about the employee relationship is in terms of contracts. Customers and suppliers exchange resources for the products and services of the firm and in return receive the benefits of the products and services. As with financiers and employees, the customer and supplier relationships are enmeshed in ethics. Companies make promises to customers via their advertising, and when products or services don’t deliver on these promises, then management has a responsibility to rectify the situation. It is also important to have suppliers who are committed to making a company better. If suppliers find a better, faster, and cheaper way of making critical parts or services, then both supplier and company can win. Of course, some suppliers simply compete on price, but even so, there is a moral element of fairness and transparency to the supplier relationship. Finally, the local community grants the firm the right to build facilities, and in turn, it benefits from the tax base and economic and social contributions of the firm. Companies have a real impact on communities, and being located in a welcoming community helps a company create value for its other stakeholders. In return for the provision of local services, companies are expected to be good citizens, as is any individual person. It should not expose the community to unreasonable hazards in the form of pollution, toxic waste, etc. It should keep whatever commitments it makes to the community, and operate in a transparent manner as far as possible. Of course, companies don’t have perfect knowledge, but when management discovers some danger or runs afoul of new competition, it is expected to inform and work with local communities to mitigate any negative effects, as far as possible. While any business must consist of financiers, customers, suppliers, employees, and communities, it is possible to think about The Purpose of the Corporation other stakeholders as well. We can define “stakeholder” in a number of ways. First of all, we could define the term fairly narrowly to capture the idea that any business, large or small, is about creating value for “those groups without whose support, the business would cease to be viable.” The inner circle of Figure 1 depicts this view. Almost every business is concerned at some level with relationships among financiers, customers, suppliers, employees, and communities. We might call these groups “primary” or “definitional.” However, it should be noted that as a business starts up, sometimes one particular stakeholder is more important than another. In a new business start-up, sometimes there are no suppliers, and paying lots of attention to one or two key customers, as well as to the venture capitalist (financier), is the right approach. There is also a somewhat broader definition that captures the idea that if a group or individual can affect a business, then the executives must take that group into consideration in thinking about how to create value. Or, a stakeholder is any group or individual that can affect or be affected by the realization of an organization’s purpose. At a minimum some groups affect primary stakeholders and we might see these as stakeholders in the outer ring of Figure 1 and call them “secondary” or “instrumental.” There are other definitions that have emerged during the last 30 years, some based on risks and rewards, some based on mutuality of interests. And, the debate over finding the one “true definition” of “stakeholder” is not likely to end. We prefer a more pragmatic approach of being clear of the purpose of using any of the proposed definitions. Business is a fascinating field of study. There are very few principles and definitions that apply to all businesses all over the world. Furthermore, there are many different ways to run a successful business, or if you like, many different flavors of 63 “managing for stakeholders.” We see limited usefulness in trying to define one model of business, either based on the shareholder or stakeholder view, that works for all businesses everywhere. We see much value to be gained in examining how the stakes work in the value creation process, and the role of the executive. THE RESPONSIBILITY OF THE EXECUTIVE IN MANAGING FOR STAKEHOLDERS Executives play a special role in the activity of the business enterprise. On the one hand, they have a stake like every other employee in terms of an actual or implied employment contract. And, that stake is linked to the stakes of financiers, customers, suppliers, communities, and other employees. In addition, executives are expected to look after the health of the overall enterprise, to keep the varied stakes moving in roughly the same direction, and to keep them in balance. 14 No stakeholder stands alone in the process of value creation. The stakes of each stakeholder group are multifaceted, and inherendy connected to each other. How could a bondholder recognize any returns without management’s paying attention to the stakes of customers or employees? How could customers get the products and services they need without employees and suppliers? How could employees have a decent place to live without communities? Many thinkers see the dominant problem of “managing for stakeholders” as how to solve the priority problem, or “which stakeholders are more important,” or “how do we make trade-offs among stakeholders.” We see this as a secondary issue. First and foremost, we need to see stakeholder interests as joint, as inherently tied together. Seeing stakeholder interests as “joint” 64 The Purpose of the Corporation rather t h a n “opposed” is difficult. It is n o t always easy to find a way to a c c o m m o d a t e all stakeholder interests. It is easier to trade off o n e versus another. Why n o t delay s p e n d i n g o n new p r o d u c t s for c u s t o m e r s in o r d e r to keep earnings a bit higher? Why n o t cut employee medical benefits in o r d e r to invest in a new inventory control system? Managing for stakeholders suggests that executives try to reframe the questions. How can we invest in new p r o d u c t s a n d create h i g h e r earnings? How can we b e sure o u r employees are healthy a n d h a p p y a n d are able to work creatively so that we can capture the benefits of new information technology such as inventory control systems? In a r e c e n t b o o k reflecting o n his experience as C E O of Medtronic, Bill G e o r g e s u m m a r i z e d t h e m a n a g i n g for stakeholders mindset: 1 5 Serving all your stakeholders is the best way to produce long term results and create a growing, prosperous company . . . Let me be very clear about this: there is no conflict between serving all your stakeholders and providing excellent returns for shareholders. In the long term it is impossible to have one without the other. However, serving all these stakeholder groups requires discipline, vision, and committed leadership. T h e primary responsibility of the executive is to create as m u c h value as possible for stakeholders. 1 6 Where stakeholder interests conflict, the executive must find a way to r e t h i n k the p r o b l e m s so t h a t t h e s e interests c a n go together, so that even m o r e value can be created for each. If trade-offs have to b e made, as often h a p p e n s in the real world, t h e n the executive m u s t figure o u t h o w to m a k e t h e trade-offs, a n d immediately begin improving the tradeoffs for all sides. Managing for stakeholders is about creating as much value as possible for stakeholders, without resorting to trade-offs. We believe that this task is m o r e easily accomplished when a business has a sense of purpose. F u r t h e r m o r e , there are few limits o n the kinds of purpose that can drive a business. WalMart may stand for “everyday low price.” Merck can stand for “alleviating h u m a n suffering.” T h e p o i n t is t h a t if a n e n t r e p r e n e u r or a n executive can find a purpose that speaks to the hearts a n d minds of key stakeholders, it is more likely that there will b e sustained success. Purpose is complex a n d inspirational. T h e G r a m e e n B a n k wants to e l i m i n a t e poverty. F a n n i e Mae wants to m a k e h o u s i n g affordable to every i n c o m e level in society. Tastings (a local restaurant) wants to b r i n g the taste of really g o o d food a n d wine to lots of people in the community. And, all of these organizations have to generate profits, or else they c a n n o t p u r s u e t h e i r p u r p o s e s . Capitalism works b e c a u s e we can p u r s u e o u r p u r p o s e with others. W h e n we coalesce a r o u n d a big idea, or a j o i n t p u r p o s e evolves from o u r dayto-day activities with e a c h other, t h e n g r e a t things can h a p p e n . To create value for stakeholders, executives must understand that business is fully situated in the realm of humanity. Businesses are h u m a n institutions p o p u l a t e d by real live c o m p l e x h u m a n beings. Stakeholders have names a n d faces a n d children. They are n o t m e r e placeh o l d e r s for social roles. As such, matters of ethics are routine when o n e takes a managing for stakeholders a p p r o a c h . Of course this should go without saying, but a part of the dominant story about business is that business people are only in it for their own narrowly defined self-interest. O n e main assumption of the managerial view with shareholders at the center is that shareholders only care about returns, a n d therefore their agents, managers, should only care a b o u t returns. However, this does n o t fit either o u r experiences or our aspirations. In the words of o n e CEO, “The only assets I manage go u p a n d down the elevators everyday.” Most h u m a n beings are complicated. Most of us d o w h a t we d o b e c a u s e we a r e selfinterested a n d interested in others. Business works in p a r t because of o u r u r g e to create The Purpose of the Corporation things with others a n d for others. Working o n a team, or creating a new p r o d u c t or delivery mechanism that makes customer’s lives better o r h a p p i e r o r m o r e p l e a s u r a b l e , all can b e contributing factors to why we go to work each day. And, this is n o t to deny t h e e c o n o m i c incentive of getting a pay check. T h e assumption of n a r r o w self-interest is e x t r e m e l y limiting, a n d can be self-reinforcing—people can begin to act in a n a r r o w self-interested way if they believe that is what is e x p e c t e d of t h e m , as some of the scandals such as E n r o n , have shown. We n e e d to b e o p e n to a m o r e c o m p l e x psychology—one any p a r e n t finds familiar as they have s h e p h e r d e d the growth a n d d e v e l o p m e n t of their children. SOME ARGUMENTS FOR MANAGING FOR STAKEHOLDERS O n c e you say stakeholders are persons t h e n the ideas of ethics are automatically applicable. However you i n t e r p r e t t h e i d e a of “stakeholders,” you must pay attention to the effects of your actions o n others. And, something like the Responsibility Principle suggests that this is a cornerstone of any adequate ethical theory. T h e r e are at least t h r e e m a i n a r g u m e n t s for a d o p t i n g a m a n a g i n g for s t a k e h o l d e r s app r o a c h . P h i l o s o p h e r s will see these as connected to the three main approaches to ethical t h e o r y t h a t have d e v e l o p e d historically. We shall briefly set forth sketches of these arguments, a n d t h e n suggest that t h e r e is a m o r e powerful fourth argument. 17 T h e Argument f r o m C o n s e q u e n c e s A n u m b e r of theorists have a r g u e d that the main reason that the d o m i n a n t m o d e l of managing for shareholders is a good idea is that it leads to the best consequences for all. Typically these arguments invoke Adam Smith’s idea of 65 the invisible hand, whereby each business actor pursues h e r own self-interest a n d the greatest good of all actually emerges. T h e problem with this argument is that we now know with m o d e r n general equilibrium economics that the argum e n t only works u n d e r very specialized conditions that seldom describe the real world. And further, we know that if the economic conditions get very close to those n e e d e d to produce the greatest good, there is n o guarantee that the greatest good will actually result. Managing for stakeholders may actually produce better consequences for all stakeholders because it recognizes that stakeholder interests are joint. If o n e stakeholder pursues its interests at the expense of all the others, t h e n the others will either withdraw their support, or look to create another network of stakeholder value creation. This is n o t to say that there are n o t times when one stakeholder will benefit at the expense of others, but if this happens continuously over time, then in a relatively free society, stakeholders will either (1) exit to form a new stakeholder network that satisfies their needs; (2) use the political process to constrain the offending stakeholder; or (3) invent some other form of activity to satisfy their particular needs. 1 8 Alternatively, if we think a b o u t stakeholders e n g a g e d in a series of b a r g a i n s a m o n g themselves, t h e n we would expect that as individual stakeholders recognized their j o i n t interests, a n d m a d e good decisions based o n these interests, better consequences would result t h a n if they each narrowly p u r s u e d their individual self-interests. 19 Now it may b e objected t h a t such a n approach ignores “social consequences” or “consequences to society” and, hence, that we need a c o n c e p t of “corporate social responsibility” to mitigate these effects. This objection is a vestigial limb of the d o m i n a n t m o d e l . Since t h e only effects, o n that view, were e c o n o m i c effects, t h e n we n e e d to think a b o u t “social consequences” or “corporate social responsibility.” However, if stakeholder relationships 66 The Purpose of the Corporation a r e u n d e r s t o o d to b e fully e m b e d d e d i n morality, t h e n t h e r e is n o n e e d for a n idea like corporate social responsibility. We can replace it with “corporate stakeholder responsibility,” which is a d o m i n a n t f e a t u r e of m a n a g i n g for stakeholders. T h e Argument from Rights T h e dominant story gives property rights in the corporation exclusively to shareholders, a n d the natural question arises about the rights of other stakeholders who are affected. O n e way to understand managing for stakeholders is that it takes this question of rights seriously. If you believe that rights make sense, and further that if o n e person has a right to X t h e n all persons have a right to X, it is j u s t m u c h easier to think a b o u t these issues using a s t a k e h o l d e r approach. For instance, while shareholders may well have property rights, these rights are not absolute, a n d should n o t be seen as such. Shareholders may n o t use their property to abridge the rights of others. For instance, shareholders a n d their agents, managers, may n o t use corp o r a t e property to violate the right to life of others. O n e way to u n d e r s t a n d managing for stakeholders is that it assumes that stakeholders have some rights. Now, it is notoriously difficult to parse the idea of “rights.” But, if executives take managing for stakeholders seriously, they will automatically think about what is owed to customers, suppliers, employees, financiers, and communities, in virtue of their stake, a n d in virtue of their basic humanity. T h e Argument f r o m Character O n e of the strongest arguments for managing for stakeholders is that it asks executives a n d entrepreneurs to consider the question of what kind of company they want to create and build. T h e answer to this question will b e in large p a r t a n issue of character. Aspiration matters. T h e business virtues of efficiency, fairness, respect, integrity, keeping c o m m i t m e n t s , a n d others are all critical in b e i n g successful at creating value for stakeholders. These virtues are simply absent when we think only a b o u t the d o m i n a n t model a n d its sole reliance o n a narrow e c o n o m i c logic. If we frame t h e central q u e s t i o n of m a n a g e m e n t as “how d o we create value for shareholders,” t h e n the only virtue t h a t emerges is o n e of loyalty to the interests of shareholders. However if we frame the central question more broadly as “how d o we create a n d sustain the creation of value for stakeholders” or “how do we get stakeholder interests all g o i n g in t h e same direction,” then it is easy to see how many of the other virtues are relevant. Taking a stakeholder approach helps people decide how companies can contribute to their well-being a n d t h e kinds of lives they w a n t to lead. By making ethics explicit a n d building it into the basic way we think about business, we avoid a situation of b a d faith a n d self-deception. T h e Pragmatist’s Argument T h e previous t h r e e a r g u m e n t s p o i n t o u t imp o r t a n t r e a s o n s for a d o p t i n g a n e w story about business. Pragmatists want to know how we can live better, h o w we can create b o t h ourselves a n d o u r communities in ways where values such as freedom a n d solidarity are prese n t in o u r everyday lives to the maximal ext e n t . W h i l e it is s o m e t i m e s useful to t h i n k a b o u t consequences, rights, a n d character in isolation, in reality o u r lives are r i c h e r if we can have a conversation a b o u t how to live tog e t h e r b e t t e r . T h e r e is a l o n g t r a d i t i o n of pragmatist ethics dating to philosophers such as William J a m e s a n d J o h n Dewey. M o r e recently p h i l o s o p h e r R i c h a r d Rorty has expressed t h e pragmatist ideal: 2 0 pragmatists . . . hope instead that human beings will come to enjoy more money, more free time, The Purpose of the Corporation and greater social equality, and also that they will develop more empathy, more ability to put themselves in the shoes of others. We hope that human beings will behave more decently toward one another as their standard of living improves. By building into the very conceptual framework we use to think about business a concern with freedom, equality, consequences, decency, shared purpose, and paying attention to all of the effects of howwe create value for each other, we can make business a h u m a n institution, a n d perhaps remake it in a way that sustains us. For the pragmatist, business ( a n d capitalism) has evolved as a social practice, an imp o r t a n t o n e that we use to create value a n d t r a d e with each other. O n this view, first a n d foremost, business is a b o u t collaboration. Of course, in a free society, stakeholders are free to form c o m p e t i n g networks. But the fuel for capitalism is o u r desire to create s o m e t h i n g of value, a n d to create it for ourselves a n d others. T h e spirit of capitalism is the spirit of i n d i v i d u a l a c h i e v e m e n t t o g e t h e r with t h e spirit of accomplishing great tasks in collabo r a t i o n with o t h e r s . M a n a g i n g for stakeh o l d e r s makes this plain so t h a t we can get a b o u t the business of c r e a t i n g b e t t e r selves and better communities. NOTES 1. The ideas in this paper have had a long development time. The ideas here have been reworked from: R. Edward Freeman, Strategic Management: A Stakeholder Approach (Boston: Pitman, 1984); R. Edward Freeman, “A Stakeholder Theory of the Modern Corporation,” in T. Beauchamp and N. Bowie (eds.) Ethical Theory and Business (Englewood Cliffs: Prentice Hall, 7th edition, 2005), also in earlier editions coauthored with William Evan; Andrew Wicks, R. Edward Freeman, Patricia Werhane, Kirsten Martin, Business Ethics: A Managerial Approach (Englewood Cliffs: Prentice Hall, forthcoming in 2008); and R. Edward Freeman, Jeffrey Harrison, and Andrew Wicks, Managing for Stakeholders (New Haven: Yale University Press, 2007). 2. 3. 4. 5. 67 I am grateful to editors and coauthors for permission to rework these ideas here. It has been called a variety of things: “stakeholder management,” “stakeholder capitalism,” “a stakeholder theory of the modern corporation,” and so on. Our reasons for choosing “managing for stakeholders” will become clearer as we proceed. Many others have worked on these ideas, and should not be held accountable for the rather idiosyncratic view oudined here. For a stylized history of the idea see R. Edward Freeman, “The Development of Stakeholder Theory: An Idiosyncratic Approach” in K. Smith and M. Hitt (eds.), Great Minds in Management (Oxford: Oxford University Press, 2005). One doesn’t manage “for” these benefits (and harms). The difference between managerial and shareholder capitalism is large. However, the existence of agency theory lets us treat the two identically for our purposes here. Both agree on the view that the modern firm is characterized by the separation of decision making and residual risk bearing. The resulting agency problem is the subject of a vast literature. 6. Alfred Chandler’s brilliant book Strategy and Structure (Boston: MIT Press, 1970) chronicles the rise of the divisionalized corporation. For a not-so-flattering account of General Motors during the same time period see Peter Drucker’s classic work The Concept of the Corporation (New York: Transaction Publishers, reprint ed., 1993). 7. Executives can take little comfort in the nostrum that in the long run things work out and the most efficient companies survive. Some market dieorists suggest that finance theory acts like “universal acid” cutting through every possible management decision, whether or not, actual managers are aware of it. Perhaps the real difference between the dominant model and the “managing for stakeholders” model proposed here is that they are simply “about” different things. The dominant model is about the strict and narrow economic logic of markets, and the “managing for stakeholders” model is about how human beings create value for each other. 8. Often the flavor of the response of finance theorists sounds like this. The world would be better off if, despite all of the imperfections, executives tried to maximize shareholder value. It is difficult to see how any rational being could accept such a view in the face of the 68 T h e Purpose of the C o r p o r a t i o n r e c e n t scandals, w h e r e it could be a r g u e d dtat the worst offenders were the most ideologically p u r e , a n d t h e result was the actual destruction of shareholder value (see Breaking the Short Term Cycle, Charlottesville, VA: Business Roundtable Institute for C o r p o r a t e Ethics/CFA C e n t e r for Financial Market Integrity, 2006). Perhaps we have a version of Aristotle’s i d e a t h a t h a p p i ness is n o t a result of trying to be happy, o r Mill’s idea t h a t it does n o t maximize utility to try a n d m a x i m i z e utility. Collins a n d Porras have suggested that even if executives want to maximize shareholder value, they should focus o n p u r p o s e instead, t h a t trying to maximize s h a r e h o l d e r value does n o t lead to m a x i m u m value, see J. Collins a n d J. Porras, Built To Last (NewYork: H a r p e r Collins, 2002). 9. See R. Edward Freeman, “The Politics of Stakeholder Theory: Some Future Directions,” Business Ethics Quarterly 4:409-22. 1 0. T h e second part of the integration thesis is left for a n o t h e r occasion. Philosophers who r e a d this essay may n o t e the radical d e p a r t u r e from s t a n d a r d a c c o u n t s of p o l i t i c a l p h i l o s o p h y . S u p p o s e we b e g a n t h e inquiry into political philosophy with the question, How is value creation a n d trade sustainable over time? a n d suppose that the traditional b e g i n n i n g question, How is the state justified? was a subsidiary o n e . We m i g h t discover or create s o m e very differe n t answers from t h e s t a n d a r d a c c o u n t s of most political theory. See R. Edward F r e e m a n a n d R o b e r t Phillips, “Stakeholder Theory: A Libertarian Defense,” Business Ethics Quarterly 12, n o . 3 (2002): 33Iff. 11. Here we roughly follow the logic ofJ o h n Rawls in Political Liberalism (New York: Columbia University Press, 1995). 12. T h e r e a r e m a n y statements of this principle. O u r a r g u m e n t is that whatever t h e particular c o n c e p t i o n of responsibility t h e r e is s o m e underlying c o n c e p t that is c a p t u r e d like o u r willingness or o u r n e e d to justify o u r lives to others. Note the answer that the d o m i n a n t view of business m u s t give to q u e s t i o n s a b o u t responsibility. “Executives are responsible only for t h e effects of their actions o n shareholders, o r only insofar as their actions create o r destroy s h a r e h o l d e r value.” 13. T h e spirit of this d i a g r a m is from R. Phillips, Stakeholder Theory and Organizational Ethics (San Francisco: Berret-Koehler Publishers, 2003). 14. In earlier versions of this essay in this volume we suggested that the notion of a fiduciary duty to stockholders be e x t e n d e d to “fiduciary duty to stakeholders.” We believe that such a move c a n n o t be d e f e n d e d without d o i n g d a m a g e to t h e n o t i o n of “fiduciary.” T h e idea of having a special duty to either o n e o r a few stakeholders is n o t helpful. 15. Bill G e o r g e , Authentic leadership cisco: Jossey Bass, 2004). (San Fran- 16. This is at least as clear as t h e directive given by the d o m i n a n t m o d e l : create as m u c h value as possible for shareholders. 17. S o m e p h i l o s o p h e r s have a r g u e d t h a t t h e s t a k e h o l d e r a p p r o a c h is in n e e d of a “normative justification.” To t h e e x t e n t t h a t this p h r a s e has any m e a n i n g , we lake it as a call to c o n n e c t t h e logic of m a n a g i n g for stakeh o l d e r s with m o r e traditional ethical theory. As pragmatists we eschew t h e “descriptive vs. n o r m a t i v e vs. i n s t r u m e n t a l ” distinction t h a t so m a n y business t h i n k e r s ( a n d s t a k e h o l d e r theorists) have a d o p t e d . M a n a g i n g for stakeh o l d e r s is i n h e r e n t l y a narrative o r story t h a t is at o n c e descriptive of how s o m e businesses d o act; aspirational a n d normative a b o u t how t h e y c o u l d a n d s h o u l d act; instrumental in t e r m s of w h a t m e a n s lead to what e n d s ; a n d managerial in t h a t it m u s t b e c o h e r e n t o n all of t h e s e d i m e n s i o n s a n d actually g u i d e executive action. 18. See S. Venkataraman, “Stakeholder Value Equilibration and the Entrepreneurial Process,” Ethics andEntrepreneursiiip, T h e Ruffin Series, 3 (2002): 45-57; S. R. Velamuri, “Entrepreneurship, Altruism, and the Good Society,” Ethics and Entrepreneurship, T h e Ruffin Series 3 (2002): 125-43; and, T. Harting, S. Harmeling, and S. Venkataraman, “Innovative Stakeholder Relations: W h e n “Ethics Pays” (and W h e n it Doesn’t)” Business Ethics Quarterly 16 (2006): 43-68. 19. Sometimes t h e r e are trade-offs a n d situations t h a t e c o n o m i s t s w o u l d call ” p r i s o n e r ‘ s dil e m m a ” b u t these a r e n o t t h e p a r a d i g m a t i c cases, o r if they are, we s e e m to solve t h e m routinely, as Russell H a r d i n has suggested in Morality Within the Limits of Reason (Chicago: University of Chicago Press, 1998). 20. E. M e n d i e t a ( e d . ) , Take Care of Freedom and Truth Will Take Care of Itself: Intervieios with Richard Rorly (Stanford: Stanford University Press, 2006), 68. Argument Evaluation (AE) Note Instructions Each AE note involves three parts: Part 1: Syllogism: Present the primary argument of one of the assigned readings as a numbered syllogism. Some articles might have more than one argument; if so, present what you take to be the strongest argument in the paper. Be sure to present the argument in its most charitable form (hint: Would the author agree that the view you have presented is his or her view?). 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