THL Update: Externality and the Data Practices Act: Addressing Obstacles to Police Accountability

by Michael Friedman | Aug 13, 2020

Shortly after becoming the Executive Director of the Legal Rights Center in 2006, Hennepin Lawyer published an article I’d authored – Externality and the Data Practices Act: Addressing Obstacles to Police Accountability (July, Vol 75 #7) – which had been primarily informed by my then recent experience as the chair of the Minneapolis Civilian Police Review Authority. 

Fifteen years later, I have just ended my long term as executive director, with much of the last few months having been deeply occupied by our organization’s multiple responses to the horrific killing of George Floyd. The failure for police accountability to have been improved during the past 15 years is deeply disappointing, and the article I wrote in 2006 about key obstacles is just as relevant today. Accordingly, I suggested that Hennepin Lawyer share it again, bookends for my leadership at the Legal Rights Center.

Here then, is the original article reprinted, to be followed by a few final notes.

Even in large urban centers like Minneapolis where one political party dominates among elected officials, one may find a substantial diversity of opinion when it comes to the topic of police misconduct tort actions.

On one end of the spectrum are elected officials who consider police misconduct to be a non-issue beyond a few unusual incidents, and who begrudge trial lawyers for big misconduct payouts.

On the other end are elected officials who consider police misconduct a problem to some degree, and who lay blame for lawsuit payouts on either a vaguely defined police culture, an uncooperative police union, poor police management—or, most commonly, a few rogue officers.

By decrying rogue officers or demonizing police unions, elected officials might appease advocates of accountable policing, but they are shifting responsibility away from themselves as lawmakers and placing it elsewhere, in hard to prove or solve arenas. Yet elected officials have more power than they realize, both on a state and local level, to create the basis for better police accountability, which in turn could lower the payouts from adverse tort judgments and settlements. True police reform efforts will require not blame but taking steps that create a systemic incentive to change.

The first critical step is to address misguided risk management by negotiating changes to union contracts, diminishing the externality (defined below) that now exists so that officers themselves have a financial stake in their own behavior.1 The second critical step is for the Legislature to amend section 13.43 of the Minnesota Data Practices Act to eliminate the conflict of interest it creates for all government department heads, including police chiefs, who would otherwise feel freer to take steps against problem supervisees.

Externality

Tort actions are commonly understood as the means for an aggrieved party to receive compensation from a liable party. However, in the face of all the politically based attacks on plaintiff rights in recent years, a secondary facet of torts has come center stage: torts provide a better incentive than anything government willingly does to address issues of safety and encourage responsible parties to act with due diligence. The desire to avoid being adjudicated as negligent (and required to pay damages) drives product development; safety warnings and other disclosures; employee training and education; and a host of other private and public sector measures. Perhaps the best analogy is that of the threat of medical malpractice that encourages physicians to be diligent in how they practice given all that is at stake if a careless error occurs.

Losing or settling a police misconduct lawsuit might be professionally unpleasant, or even humiliating for a police officer, but the liable party in the tort is not the officer or the department. Instead, responsibility shifts to the municipal employer due to legal mechanisms such as the indemnification requirements of section 466 of the Minnesota Statutes. This is an example of the economic concept of externality as applied to lawsuits, in which the cost created by one entity is borne by another entity, thereby negating the natural tort incentive to take special care not to be negligent. In the case of police misconduct, the cost the officer bears is collateral and relatively insignificant in comparison to the cost borne by the municipality.

In other professional fields in which it is routine for some of the members to find themselves as defendants in tort actions, an insurance company may agree to risk a portion of externality for a fee. However, as professional risk managers, insurance companies continuously monitor and assess individualized risk among those they insure. They provide strong incentives to partner with the insured in avoiding negligence. A physician who has lost or had to settle one malpractice case will have to pay additional for subsequent coverage, if such coverage will be made available at all. If that physician is not self-employed, an employer might consider a higher premium cost as an impediment to remaining in the practice or use the fact as justification for paying a lower salary. A more common example is seen in higher premiums for those with traffic tickets as opposed to those of drivers with good driving records. Even though there are elements of externality when an insurer pays large amounts because a high-risk driver causes an accident, the effect is blunted over time by risk management measures available to the insurer. There’s a substantial financial incentive to drive safely beyond the incentive of one’s physical well-being.

In police departments, the externality is near total; there are no methods of assigning internal risk and providing individualized financial incentives to act with due diligence. Municipalities pay the bills and monitor their employees’ performance with little consideration given to risk management principles.

Section 466, however, provides no bar to imposing risk-management-based, internal mechanisms to control the potential impact of required indemnification. It may be true that police union contracts represent a short-term impediment to introducing risk-management-based supervision, but contracts expire, and new ones are negotiated. While the limits of this author’s expertise do not allow suggestions for specific contract terms, it is true that solutions for externality do not have to exclusively take the reactive form of penalties. Instead, solutions might also include incentives for those who do not receive filed civilian review or internal affairs complaints and who are not named in court actions over a period of time.

MINNESOTA DATA PRACTICES ACT13.43

It would seem, however, that it is the job of the police chief to impose employee discipline and, if necessary, fire officers who take actions that lead to successful misconduct lawsuits or otherwise bring harm upon the department and the city who employs them.

In theory, this is true. In practice, expectations are low.

The literature about police accountability includes much discussion about the obstacles police chiefs face in controlling the actions of the officers they command. Obstacles have included the power of police unions, the political imperatives to have the ends of crime-fighting justify the means, police culture (usually left no less vague than political pronouncements despite the academic context), the unreasonable weight officers give to the credibility of each other, and the tendency for police chiefs to attain their jobs by starting from the bottom and working their way up—unlike other CEOs who might begin with a fundamentally different outlook on the criticality for making low-level employees strictly accountable to internal policy and outside laws and regulations.

This article is not written to address these viewpoints nor, more importantly, to suggest specific corrective actions. There is, however, something concrete and particular to accountability that Minnesota elected officials have within their power to address, and that is the conflict of interest for police chiefs created by the Data Practices Act.

Section 13.43 of the act defines public and private data for all government employees. The crux of the law is that in instances in which employees are subject to personnel investigation, all related data, except for the existence and status of the investigation, remains non-public unless discipline is imposed and the period when findings can be overturned has elapsed.

Police chiefs therefore have two choices when misconduct claims are valid. They can discipline an officer and allow the public to know of departmental failures or as reflected by the officer, or they can deny that misconduct occurred and keep any relevant data private, therefore denying accountability.

About two years ago, a Minneapolis government employee was accused of wrongdoing. That person was none other than the chief of police himself. He was alleged to have made inappropriate statements to the deputy chief, who just happened to have been passed over for the chief’s recent appointment in a bitterly contested campaign. The mayor, whom the chief reports to, reviewed the investigation and determined that the chief had not committed misconduct, with the result that all contents of the investigation would remain private.

While the mayor may have acted ethically, the fact remains that by his own admission he had taken a big political risk in appointing that particular person as chief. If that chief, only months into his new job, had been found to have spoken inappropriately against his prime competitor, and had the details been exposed to the media, the incident would have represented a huge political blow to the mayor.

It is very possible the mayor’s assessment was honest and correct, but there is no question that the Data Practices Act provided some level of incentives for the mayor to clear the chief of wrongdoing. Statistics for discipline on sustained civilian review complaints in Minneapolis (only 16 percent of officers over a two-year period according to one recent study) certainly support the incentive theory.

Perhaps at some point in the future a class action lawsuit against a police department will lead to a huge payout based on willful indifference as proven by the lack of employee discipline following prior lawsuits and investigated complaints. Both opponents and former allies of the responsible police chief (or chiefs) will unite in personalizing the problem with an alleged link to ineffective or corrupt leadership, but they will be missing the point. As long as it’s inherent within the Data Practices Act that a government department can suppress negative publicity by not disciplining employees, any police chief (or other department head) is going to be miles behind his or her private sector counterparts at vigilantly enforcing appropriate expectations among employees.

With police, the problem is more than compounded by the fact that externality means tort actions cannot take up the slack—as they do in other areas where government comes up short.

1 For introducing the concept of externality in the context of police misconduct, the writer is indebted to David A. Harris, Balk Professor of Law and Values at Toledo College of Law, and author of: Good Cops: The Case for Preventative Policing.

Author Notes

The one positive change since I wrote this article is that there is far more political consensus that police misconduct is indeed a critical problem. Whether this consensus can properly identify and address the obstacles described remains to be seen.

Some readers may recall that the Committee for Professional Policing, a local advocacy group, organized a ballot initiative in 2016 to advance a solution for the Externality component of the article: namely a plan to require individualized police officer insurance. That referendum never made it to election day, having been opposed by Minneapolis and its city attorneys which refused to support a legal and operating mechanism that could work in accordance with statute—an obstacle that other jurisdictions and the insurance industry appear to be on the threshold of resolving.  (See: Insurers Exploring ‘New World’ of Police Officer Professional Liability.) 

Regarding the data practices problem, I personally testified in the MN House about the need for change during a special session, in conjunction with a proposal to broaden public oversight councils. In particular, I highlighted the fact that the Minneapolis Police Department opts with great frequency for the non-disciplinary resolution of coaching precisely to preserve privacy, and that any oversight authority that could not make its own findings of misconduct public (i.e. irrespective of discipline chosen or avoided by police management) would be ineffective. The legislation which eventually passed included neither expanded oversight nor change to the data practices obstacle identified.
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PIC - MichaelFriedmanMichael Friedman was the Executive Director of the Legal Rights Center from April 2006 through July 2020. Prior to that, he spent 3 years as Chair of the Minneapolis Civilian Police Review Authority Board. He has written numerous StarTribune guest commentary articles relating to policing and justice and has also been published in the Mitchell Hamline Law Review. His support of the legal profession has included long stints on the LAD Committee (of the MSBA) and the District Ethics Committee in Hennepin. He currently is a Public member of the Lawyers Professional Responsibility Board.