Six Flags Syndrome: Price Discrimination In Plea Bargaining

Six Flags.jpg Price discrimination occurs when any seller charges two different buyers a different price for the same product. Coupons are one obvious method of price discrimination. Airline advance purchase requirements are another. The term sounds ugly, but it’s basic marketing. One major area of price discrimination occurs between sophisticated and unsophisticated consumers. Uninformed car buyers often pay more for their autos than those who arrive with the newest pricing data from Edmunds. And while many web buyers routinely pay full price, others of us consult Coupon Cabin, Mom’s View, or XP Bargains before ordering online. We don’t do anything special for the discount; we just know enough to check for coupons.

In a blunt admission of price discrimination based on consumer sophistication, Six Flags’ VP for ticketing, Steve Brown, stated) “any guest paying full pirce at our parks is probably not doing their homework.”

Perhaps all is fair in love and sales, but what about plea bargaining? Would we feel OK if US Attorney Patrick Fitzgerald announced that “anyone pleading to ten years on a marijuana charge probably didn’t do his homework”? As a public defender, I often discovered that a DA’s “best” offer wasn’t on the table initially. I had to request it. Sometimes I provided good reasons for a better deal – I cast the client in a new light, for example, or discussed an extenuating circumstance. But often I simply scrunched up my face and said “come on, you can do better than that”…and he or she would serve up a better offer. I understood the game; as a public defender, I played it every single day.

But it turns out that clients – and more importantly lawyers – are often surprisingly unsophisticated in the negotiation process and will not demand the best posible offer. I’m reminded of a friend who was handling his first serious felony. His client faced a mandatory 6 year bid for the gunpoint robbery, but the DA was offering 10 years. My friend planned to ask for seven years. After we talked, I explained that in my jurisdiction (we were in different states), a first time offender facing these charges would usually receive the mandatory minimum. I encouraged him to ask for six years. And that’s exactly what his client got. But if he’d asked for seven years – his initial plan – the client would have served an extra year.

So should prosecutors “take advantage” of unsophisticated opponents by jacking up offers?

Intuitively, it seems to me that it is unfair and inappropriate for a person to serve extra time in prison simply because his or her attorney didn’t realize he or she could get a better deal just by asking. My instinct is that DA’s should offer the minimum sentence they consider fair, in light of the charges, the costs of proceeding, and the strength of the case. That doesn’t mean they shouldn’t be open to lowering their offer. But the offer shouldn’t drop simply because a lawyer bothers to ask. Instead, prosecutors should soften their offers if they receive new information about the crime, the defendant, or the evidence.

As is probably obvious, there are serious limits to my analysis. No matter how much people like me squawk, DA’s will base offers, at least in part, on the quality of defense counsel. When a DA confronts a top defense lawyer, the “price” of settlement will probably drop. It is clearly more efficient for the DA to attempt to engineer a deal in these cases, even if the defendant gets a shorter sentence solely because he or she hired a great attorney. But is efficiency is enough to justify this disparate treatment based on lawyer quality? And is there a difference between making a higher (but non-negotiable) offer to a lousy trial lawyer and making a higher offer to an unsophisticated lawyer, knowing full well you’d improve the deal if the lawyer bothered to press you?

Maybe, at the end of the day, all we have is a prosecutor’s eithical duty to seek justice. Can others think of a rules – aspirational, even if not enforceable – that could help avoid what we might call Six Flags Syndrome: defendants taking worse deals because their lawyers didn’t bother to seek out a better pirce?

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7 Responses

  1. Kate Litvak says:

    I have no view on the crim part, but you seem to be mistaken on the Six Flags part. The thing about customers “doing their homework” isn’t about consumer sophistication at all. Clipping coupons doesn’t exactly require much sophistication. That homework thing is about the consumer’s willingness to spend time and effort looking for relevant coupons. That is, it’s about the consumer’s opportunity cost of time, which is a very good predictor of the willingness to pay, which is what price discriminators are trying to estimate. Totally harmless.

  2. The prosecuter asking for longer terms is part of our advisarial process. Far from perfect but what we have.

    However, doing research on sentences should be easier. Right now the only way to get that information is through experience or asking a friend.

  3. Jason Mazzone says:

    I have proposed using “plea juries” to review plea bargains and guilty pleas for, among other things, fairness. See “The Waiver Paradox,” 97 Nw. U.L. Rev. 801, 872-878 (2003). Amazingly, nobody has adopted my proposal (yet).

  4. Liz L says:

    It sounds like this topic could be explored in a practical public law course: the ins and outs of DA/PD practice, beyond first year criminal procedure/law courses. The negotiation course where I attend law school is focused on civil cases (transactional and dispute resolution contexts). Maybe it’s covered in externships??

    Law students entering this area should have some practical background in negotiating sentences. This would (ideally) reduce the chance that a defendant will serve extra time b/c their attorney’s negotiation skills were not up to snuff.

  5. Christopher Cooke says:

    The problem that you highlight is that we treat criminal law cases like civil law cases, and use the same negotiating tactics, when criminal law should also be about ensuring justice is served.

    Perhaps we should try to require, via state bar ethics changes, or state or local law changes, that all felony plea bargains are reviewed for “fairness” by a supervising prosecutor not associated with the case. Or, we could have a judge (not the sentencing judge), do the same thing.

    At first blush, my reaction is that I would not be in favor of plea “juries” as one poster suggested, because (1) they are not sophisticated enough to know whether one defendant is pleading guilty and accepting a much worse sentence, than what other defendants typically receive; and (2) it would drastically increase the use of juries, at a time when we already have trouble convincing people to serve on them, due to the costs imposed.

  6. Scott Moss says:

    I agree with Kate on Six Flags practicing textbook “price discrimination” to charge less to those willing to spend time finding/clipping coupons. That’s an effort to get a premium price (i.e., “full” price) from customers who are more affluent, busier, or otherwise less willing to condition their amusement park attendance on their finding coupons.

    I’d say plea bargaining is not the same phenomenon, but almost the exact opposite. Whereas coupon-clipping gives the LESS affluent a price break (not for moral reasons, just because they’ll pay above cost but not full price), plea bargaining gives a break to the MORE affluent (i.e., those who can afford top defense lawyers and/or are more personally sophisticated).

    This is why I’m untroubled by retail price discrim but very troubled by plea bargaining disparities.

  7. Paul Gowder says:

    I kind of wonder, about retail price discrimination, why it doesn’t always lead to market entry by people competing on price. Sometimes it does: consider the Saturn marketing strategy, which explicitly trumpets the fact that it won’t come down on price. Presumably, these prices are lower (for a given quality) than the equivalent opening offer for another car.

    Similarly, there are discount stores that refuse to hold sales, on the claim that their prices are always low (honest), etc. They seem to be successful.

    Yet (as far as I know) this doesn’t happen in all markets. For example, I know of no “no sale/coupon” consumer electronics retailer, and have never heard of a “real price” competitor to six flags. Why is that?

    The absence of a competitive check is perhaps another reason why we should be worried about criminal price discrimination. It’s not as if the prosecutor next door can jump in and say “here’s my REAL price!”