Universally quantified effects are a very rarely used feature in our benchmark
set, and nontrivial type hierarchies are not that all that common either.
I think this one place (the only place, I think?) where our grounding
algorithm's implementation differs a bit from how it is described in the paper.
In the long run, it may be a good idea to change it to the way it's described in
the paper, which is conceptually cleaner and should be no less efficient. Can
you add a TODO to the code?
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