Einer Elhauge (Harvard Law School) has posted Contrived Threats v. Uncontrived Warnings: A General Solution to the Puzzles of Contractual Duress, Unconstitutional Conditions, and Blackmail on SSRN. Here is the abstract:
Inducing agreement to a contract or condition by using threats to engage in otherwise lawful action is sometimes lawful, but sometimes unlawful, under the doctrines of contractual duress, unconstitutional conditions, and blackmail. The persistent puzzle has been to figure out when and why this is. This article provides a general solution to this puzzle. Such threats are unlawfully coercive only when they are contrived, meaning the threatened action would not have occurred if no threat could be made. I show that such contrived threats can be credible because making the threat strongly influences whether the threatened action occurs. When such threats are uncontrived warnings, meaning the threatened action would have occurred even if no threat could be made, they are not coercive and can only benefit the agreeing parties. However, sometimes (as with blackmail) agreements produced by uncontrived warnings are also unlawful on the different grounds that they harm third parties. The contrived-threat test explains why the Medicaid defunding threat in Obamacare was unconstitutional and why Obamacare cannot be interpreted to constitutionally threaten to withhold tax credits from States that do not create insurance exchanges.
Recommended!
On this topic, may I also recommend Coercion by Alan Wertheimer, a classic and illuminating treatment.