Sonia Sotomayor: Where She Stands On Business

Here's what seems to be the consensus opinion about whether or not Sonia Sotomayor will be good for business: Um, maybe?

When it comes to small businesses, law prof Richard Epstein points to one case that he says should have business owners shaking in their boots. It has to do with an entrepreneur who had bought land to build a CVS franchise, and then ran into trouble:

The case involved about as naked an abuse of government power as could be imagined. Bart Didden came up with an idea to build a pharmacy on land he owned in a redevelopment district in Port Chester over which the town of Port Chester had given Greg Wasser control. Wasser told Didden that he would approve the project only if Didden paid him $800,000 or gave him a partnership interest. The "or else" was that the land would be promptly condemned by the village, and Wasser would put up a pharmacy himself. Just that came to pass. But the Second Circuit panel on which Sotomayor sat did not raise an eyebrow. Its entire analysis reads as follows: "We agree with the district court that [Wasser's] voluntary attempt to resolve appellants' demands was neither an unconstitutional exaction in the form of extortion nor an equal protection violation."

Whether or not one agrees with Epstein that this decision means that Sotomayor is "bad for business" depends on one's view of the Supreme Court to which she was deferring--Kelo v. City of New London. One could argue that by expanding local governments' use of eminent domain for redevelopment, Kelo might help small businesses by creating new commercial developments that otherwise wouldn't exist. On the other hand, it seems that eminent domain will more often be used to benefit large, wealthier more connected firms--for example, the proposed development in the actual Kelo case was favored by pharma giant Pfizer.

At the Atlantic, David Indiviglio points to some cases where Sotomayer, he says, was "not pro-business, but not anti-business either."

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