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Gatekeepers: The Anatomy of a Third-Party Enforcement Strategy
By Reinier H. Kraakman
journal article

Year 1986
Publisher Journal of Law, Economics, and Organization
Volume 2
Page Range 53 - 104
Description When should we impose liability on parties who, although not the primary authors or beneficiaries of misconduct, might nonetheless be able to prevent it? This question -varioulsy labeled as the problem of collateral, third-party, or secondary liability - arises in numerous legal contexts, ranging from the responsibility of accountants and lawyers for the frauds of their clients (jennings and Marsh: 1162-66, 1209-12) to legislative proposals for sanctioning employers who hire illegal aliens (C. Schwartz). In most of these settings, collateral liability supplements efforts to deter primary wrongdoers directly by enlisting their associates and market contacts as de facto cops on the beat. As such, it raises the same issues of practicality and cost that attend any enforcement device. In this article, I examine these issues for one important genre of collateral liability that I term gatekeeper liability: liability imposed on private parties who are able to disrupt misconduct by withholdign their cooperation from wrongdoers. (Description from Source)