Challenge to Wisconsin’s Diploma Privilege Continues

Yesterday the Seventh Circuit reversed the dismissal of the class action challenging Wisconsin’s diploma privilege as a violation of the commerce clause.  (I previously posted about the case here. ) A few thoughts about this latest development:

1.  I remain baffled about what benefit the plaintiffs (graduates of out-of-state law schools)  expect to receive from this suit.  They have asked for an injunctive order striking a few words from the Wisconsin Supreme Court rule on bar admission.  The result of this proposed edit is that Wisconsin would offer the diploma privilege to all graduates of ABA-accredited law schools.  But as Judge Posner pointed out in his opinion, the state could also remedy a commerce clause violation by requiring graduates of Wisconsin law schools to take the bar exam.  Does anyone really believe that Wisconsin would do anything other than what Judge Posner has suggested?  Talk about the potential for a quick race to the bottom!  Even if they are victorious, the plaintiffs will be in the same position as when they started:  they will have to take a bar exam to practice in Wisconsin (or practice in another state for five years).

2. Judge Posner referred to the diploma privilege as favoring the economic interests of Wisconsin law schools, because prospective students who want to practice in Wisconsin have an incentive to attend the University of Wisconsin-Madison or Marquette.  This is undoubtedly true in theory, but I wonder how many applicants this incentive actually yields.   First, how many people dream of practicing law in Wisconsin who don’t already have a connection to the state?  I suspect that most people who plan to practice in Wisconsin are already living there or grew up there and would like to return.  This would make an application to Madison or Marquette likely in any event (particularly an application to Madison, which offers an in-state tuition discount).   Second, prospective law students tend to be extraordinarily optimistic about their potential for academic success and, by extension, their ability to pass a bar exam.  The exam is also more than three years removed from the decision about where to attend law school.  While the diploma privilege may occasionally tip the scale, I suspect most applicants make their decision based on more immediate factors:  prestige, physical plant, cost,  location, etc.  I doubt that the diploma privilege attracts many additional applicants to Wisconsin law schools or discourages many applicants who would like to eventually practice in Wisconsin from attending an out-of-state school.

3.  As the case returns to the district court, the most important question is whether the state can prove that Madison and Marquette offer courses that teach Wisconsin law and are therefore different than courses offered at other ABA-approved law schools.  At oral argument, Judges Posner and Wood were quite skeptical that the state would be able to offer this proof.  (Gordon Smith, a former Madison professor, blogged about this here.)  While I cannot speak about Marquette or about the current state of affairs at Madison, I am confident that 12 years ago (when I was a law student) Madison would have been able to satisfy the court.  Were my antitrust or federal courts courses different than what was offered at other schools?  No.  But in the courses that were necessary to qualify for the diploma privilege, I learned a lot of Wisconsin law, even when my professors chose to use national textbooks instead of their own materials.  Gordon Smith wrote that the faculty at Madison have “an unusually strong attachment to the home state’s law.”  When I was a student, I would have described it a bit differently:  I thought the faculty perceived itself as having an obligation to teach Wisconsin law because it knew that students who remained in the state would not take the bar exam.

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9 Responses

  1. Anon says:

    I think you have #2 backward, at least in your first argument. It’s not that a Texan who wants to practice in Wisconsin reluctantly applies to Marquette for the diploma privilege, it’s that someone in Milwaukee chooses Marquette over DePaul or some other similarly situated school in Chicago because the diploma privilege breaks the tie. Your last sentence at least acknowledges this argument, but I think you are sadly mistaken if you don’t think it enters the mind of a prospective law student residing in Wisconsin. Trust me, Marquette would have a lot more competition if the Chicago private law schools (or schools in other close metro areas) were able to compete on equal footing.

  2. Matthew Reid Krell says:

    So my first attempt to post this got me an “internal server error,” so if it posts twice, my apologies.

    Interestingly enough, I’m a Mississippian (or at least I was when I applied to law schools), and I applied to Madison PRECISELY because of degree privilege. It’s my understanding that many wannabe JAGs do the same, since the military doesn’t care where you’re licensed, only that you be licensed.

    That said, I am aware that one datum does not a curve fair, and I don’t propose to suggest that I am, by myself, a refutation of Prof. Waldeck’s argument. But it’s certainly a fun story, right?

  3. Chris says:

    With every dormant commerce clause challenge it could be argued that the state would be free to turn around and impose the burden, as opposed to the benefit, on everyone, so long as they do it to everyone. that possibility hasn’t seemed to stop any other dormant commerce clause case.

    By the way, Posner mis-identified the releif sought, It is not just the words “in this state” at issue, the complaint clealry seeks relief barring any discrimination against interstare commerce in bar admission, with the specifics to be worked out later. I honestly don’t expect even the great Judge Posner to know the record as well as the plaintiffs’ lawyer.

    Just wait and see how this plays out.

  4. Howard Wasserman says:

    But is it every case that we know to a virtual certainty how the state would respond to a judgment? The State of Wisconsin is not going to eliminate the Bar Exam; it is going to make everyone (including the plaintiffs) take the Bar Exam. The State has no incentive to do anything else.

  5. Dan Culley says:

    First, I don’t think your point about the relief is correct, although I hesitate here a bit because I don’t know the ins and outs of Wisconsin bar admission. Doesn’t this privilege allow the students automatic admission to the bar as soon as they graduate? Assuming the plaintiffs have graduated, they should then be entitled to immediate admission to the bar. Wisconsin would have to retroactively strip licenses from an entire year of people. That seems unlikely, even if they change it for the next class. So the plaintiffs would get their relief.

    Second, despite your confusion, the relief the plaintiffs hope to get is just to be treated the same as anyone else. Imagine you are a law firm in Wisconsin. Two otherwise equally qualified and desirable law students apply for a job at your firm. One goes to a Wisconsin school, one does not. One can start as an attorney right away, with pretty much 100% certainty; one will take the entire summer off to study for an exam, which he may or may not pass, leaving you without an employee. Who would you pick?

    This is the primary harm the plaintiffs are suffering: they have to compete in the Wisconsin legal market on disadvantaged terms. Now, either way the state comes out—dropping the geographic restriction or dropping the bar exam—the plaintiffs will be competing on even terms with in-state students. So, even if the state chooses to impose a bar exam on all entrants, the plaintiffs are not “in the same position as when they started.”

    You also leave out an entirely plausible response, that Wisconsin will change the diploma privilege to apply to any school that teaches the law of Wisconsin. Schools in bordering states, such as Illinois, might be willing to adjust their curricula accordingly. Commenter #1 had it exactly right: this is a barrier to entry to protect those schools from competitors in bordering states. It is exactly what the DCC is directed against.

    Also, I love the incentive your rule creates. If you want to enact a protectionist state law, just commit openly that, if it is struck down, you will take the benefit away from everyone. Then kick them out for no case or controversy, because no prospect of relief.

    (And I can just hear the Jim Crow fans lining up behind it: Hey! This could work for equal protection too! Sorry minorities, we don’t like you so much that we’d just rather not have restaurants, hotels, trains, or any other public education. Totally willing to go Amish to preserve segregation. We win!)

  6. Sarah Waldeck says:


    As to your first point, a graduate who qualifies for the diploma privilege is not a member of the bar until she is sworn in. Wisconsin would not have to strip a year’s worth of graduates of their licenses. Rather, Wisconsin would not swear in anyone who had not taken the bar exam.

    As to your second point about disadvantages when job-seeking, I’m not sure. The Seventh Circuit didn’t seem too concerned about this and I don’t know if the plaintiffs argued this point. I would think that if a law firm hires an applicant, whether from a WI school or elsewhere, the firm believes the applicant has the ability to pass a bar. In my own experience I’ve never had reason to suspect this sort of discrimination, but as a previous comment pointed out, one person does not make a data set.

    You are right that the Supreme Court could extend the privilege to out-of-state schools that teach as much WI law as Madison and Marquette. (This response was suggested by an argument the state made about standing.) I am skeptical that nearby law schools (say, DePaul, Loyola and the University of Minnesota) would want to teach as much WI law as I had at Madison. But whether nearby schools actually adopted a WI curriculum would be a great measure of how many actually felt a competitive disadvantage.

  7. Dan Culley says:

    I appreciate the reply, although I think you missed my first point. Even if the students have to be sworn in, it is a purely ministerial act. Wisconsin cannot just refuse to swear a group of students who meet the legal requirements for admission to the bar, however modified by court order. Now, either the Wisconsin students who benefited from this privilege have been sworn in yet, or they have not. If they have, the plaintiffs should have been sworn at the same time, and they are entitled to be sworn immediately. (Hence Wisconsin would have to strip licenses from all diploma privilege students to remove theirs.) If they have not, then Wisconsin would have to put every student who relied on the diploma privilege this year out of practice until the next exam, as, by the time this decision is out, they will have missed the bar exam. I doubt Wisconsin will do that lightly.

    On the second, I don’t see your confusion. People do fail the bar exam, even at big law firms. Granted, it does not happen extremely often, but it does happen. When they do, the firm loses that attorney for another several months while they study to take the exam again. But even beyond that, a student with the diploma privilege does not even have to study once. They can start working immediately upon graduation. That’s a big difference. (Even if they are sworn later, they can start as law clerks; they don’t need the time to study.)

    I take your point that you have never seen explicit examples of this discrimination, but as someone who has never been responsible for hiring attorneys for private practice, that’s not very surprising.

    There is, of course, also the possibility that the diploma privilege is intended as an export restraint and not an import barrier, keeping more Wisconsin students practicing in Wisconsin (and so increasing the competition the plaintiffs face in seeking a job in Wisconsin) than would choose to do so in a freer market. That would produce a different pattern of harm, but still harm nonetheless.

    What really baffles me about this case is that it was sent on remand. In a gender discrimination case against, say, fire houses not hiring female firefighters, this would be equivalent to remanding for a determination of whether men are generally stronger than women. Whether Wisconsin law schools actually teach more Wisconsin law is irrelevant, because the law is discriminatory even if it is true. No other school even has the opportunity to meet whatever requirement Wisconsin wants to create. (And it would have to create one, because the statute I see doesn’t say anything about objective requirements for teaching Wisconsin law.) The constitution forbids the state from discriminating on the basis of geography, even if geography is correlated with some other desirable trait, when Wisconsin can test for that trait directly. So if Wisconsin really wants Wisconsin law taught, it better make up some standards, the same way we’d make people pick up a firehose.

  8. Mike Zimmer says:

    This case raises an important point: What is the function of the bar exam in general? Looking at it from the viewpoint of the dormant commerce clause suggests that important economic values are at stake. That has to be true. But the deeper question is not about discrimination against out of state economic interests but as discrimination by those already admitted against those who have not yet been admitted. In other words, is the general system just protectionism by those on the “inside” to raise a bar to entry by anyone on the “outside.”

    Why not get the American Bar Foundation, or some other social science oriented entity, to study the practice of law in Wisconsin and any other state similar to Wisconsin but for requiring pasage of the bar exam by law school graduates, in state or out. Being a Marquette grad myself and having practices some in Wisconsin and observed practice elsewhere since I entered academia, my hunch is that no discernible difference would be found between the level of practice in Wisconsin and its comparator. I may, of course, be wrong, but, if I am right, doesn’t this suggest that the whole bar exam regime is unrelated to the practice of law generally?

  9. Anon says:

    I’ll make this short and quick. I agree with the first post. I recently chose Marquette over five out-of-state schools because I know I’ll be back to practice in Wisconsin.