Tuesday, May 21, 2019

SCOTUS Discusses Mootness in Yesterday’s Mission Product Holdings Decision

The main issue in yesterday’s Supreme Court decision in Mission Product Holdings, Inc. v. Tempnology, LLC involved the provision of the bankruptcy code regarding a debtor’s rejection of an executory contract. But there was an interesting exchange regarding mootness.

From Justice Kagan’s majority opinion:

Mission has presented a claim for money damages—essentially lost profits—arising from its inability to use the Coolcore trademarks between the time Tempnology rejected the licensing agreement and its scheduled expiration date. See Reply Brief 22, and n. 8. Such claims, if at all plausible, ensure a live controversy. See Memphis Light, Gas & Water Div. v. Craft, 436 U. S. 1, 8–9 (1978). For better or worse, nothing so shows a continuing stake in a dispute’s outcome as a demand for dollars and cents. See 13C C. Wright, A. Miller & E. Cooper, Federal Practice and Procedure §3533.3, p. 2 (3d ed. 2008) (Wright & Miller) (“[A] case is not moot so long as a claim for monetary relief survives”). Ultimate recovery on that demand may be uncertain or even unlikely for any number of reasons, in this case as in others. But that is of no moment. If there is any chance of money changing hands, Mission’s suit remains live. See Chafin, 568 U. S., at 172.

Tempnology makes a flurry of arguments about why Mission is not entitled to damages, but none so clearly precludes recovery as to make this case moot.

Justice Gorsuch, in dissent, was more sympathetic to the mootness argument:

A damages claim “suffices to avoid mootness only if viable,” which means damages must at least be “legally available for [the alleged] wrong.” 13C C. Wright, A. Miller, & E. Cooper, Federal Practice and Procedure §3533.3, p. 22 (3d ed. 2008). Yet, as far as Mission has told us, Tempnology did nothing that could lawfully give rise to a damages claim. After all, when Tempnology asked the bankruptcy court to issue a declaratory ruling on a question of law, it was exercising its protected “First Amendment right to petition the Government for redress of grievances.” Bill Johnson’s Restaurants, Inc. v. NLRB, 461 U. S. 731, 741 (1983). And petitioning a court normally isn’t an actionable wrong that can give rise to a claim for damages. Absent a claim of malice (which Mission hasn’t suggested would have any basis here), the ordinary rule is that “‘no action lies against a party for resort to civil courts’” or for “the assertion of a legal argument.” Lucsik v. Board of Ed. of Brunswick City School Dist., 621 F. 2d 841, 842 (CA6 1980) (per curiam); see, e.g., W. R. Grace & Co. v. Rubber Workers, 461 U. S. 757, 770, n. 14 (1983); Russell v. Farley, 105 U. S. 433, 437–438 (1882).

Maybe Mission’s able lawyers will conjure something better on remand. But, so far at least, the company hasn’t come close to articulating a viable legal theory on which a claim for damages could succeed. And where our jurisdiction is so much in doubt, I would decline to proceed to the merits.





Federal Courts, Recent Decisions, Subject Matter Jurisdiction, Supreme Court Cases | Permalink


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