Tuesday, November 10, 2020

Argument Preview: Court Again Considers Affordable Care Act, this time the entire thing

The Supreme Court hears arguments today in the latest challenge to the Affordable Care Act--a case that could take down the entire Act. Here's my preview, from the ABA Preview of United States Supreme Court cases, with permission:

INTRODUCTION

The universal coverage provision is once again at the Supreme Court. This time, challengers argue that the provision is not a valid exercise of Congress’s taxing authority, because the provision lacks a critical feature of a “tax”: it cannot raise revenue for the government. (After all, the penalty for noncompliance is zero.) Moreover, challengers argue that because the universal coverage provision is so integrated with the rest of the Act, the provision’s invalidity also means that the rest of the Act must fall, too. But before we even get to these issues, the Court will first consider whether the challengers even have standing to bring their claims.

ISSUES

  1. Do individual and state plaintiffs have standing to challenge the minimum-coverage provision in the Affordable Care Act?
  2. Did Congress render the minimal-coverage provision unconstitutional by setting the tax penalty for individuals who lack health insurance to zero?
  3. If the minimal-coverage provision is unconstitutional, is the rest of the Affordable Care Act unconstitutional, too?

FACTS

In 2010, Congress enacted the Patient Protection and Affordable Care Act (ACA). The central goal of the Act was to extend quality and affordable health insurance to all Americans. In order to achieve this goal, the ACA included a host of new policies and regulations of the health-insurance market.

Three of those policies stand out. First, the “guaranteed-issue provision” prohibits health-insurance companies from denying coverage for pre-existing conditions. Second, the “community-rating provision” bars health-insurance companies from charging individuals higher premiums because of their health conditions. And third, the “universal coverage provision” (or “individual mandate”) requires all individuals to obtain health insurance, or to pay a tax penalty. 26 U.S.C. § 5000A.

The three provisions complement each other in order to achieve the goals of the Act. The guaranteed-issue provision ensures that all individuals have access to health insurance. The community-rating provision ensures that no individuals pay an outsized rate based on their health conditions. And the universal-coverage provision helps to ensure that health-insurance rates are affordable, by expanding the pool of insured individuals who pay into the health-insurance system, including healthy, but previously uninsured, individuals. These provisions form a “three-legged stool” that sits at the center of the Act.

But the ACA contains a web of other reforms and regulations, too, all designed to help extend quality and affordable health insurance to all Americans. Most notably, the Act provides federal financial incentives to states to expand their Medicaid programs; it expands access to employer-based health insurance; it creates health-insurance marketplaces ( “exchanges”) where individuals can shop for insurance; it provides subsidies to insurance companies and individuals to help keep rates affordable; it requires health-insurance plans to provide certain minimal benefits; it allows young adults to stay on their parents’ health insurance plans until age 26; and more. The ACA also contains a number of provisions that are designed to expand access to quality and affordable healthcare and improve public health outcomes, even if they are not directly related to the health-insurance market.

Opponents of the ACA immediately sued to stop the Act. They argued, among other things, that Congress lacked authority to enact the universal-coverage provision, and that the provision was therefore unconstitutional.

The Supreme Court disagreed. A sharply divided five-to-four Court ruled that while Congress could not enact the provision under its Commerce Clause authority, Congress could enact the provision under its taxing authority. NFIB v. Sebelius, 567 U.S. 519 (2012). In other words, the Court held that Congress could not require individuals to purchase health insurance as a free-standing regulatory mandate. But it said that Congress could impose a tax penalty against individuals who failed to comply with the provision.

In explaining why Congress could enact the universal coverage provision under its taxing authority, Chief Justice John Roberts, writing for the Court, noted that the tax penalty for noncompliance with the universal coverage had all the indicia of valid tax. He observed that the provision was located in the Internal Revenue Code, and that the amount of the penalty was “determined by such familiar factors as taxable income, number of dependents, and joint filing status.” Most importantly, he noted that the provision “yield[ed] the essential feature of any tax: It produce[d] at least some revenue for the Government.” As a tax, Chief Justice Roberts observed, the provision “is not a legal command to buy insurance,” but instead “a condition—not owning health insurance—that triggers a tax.”

Before and after the ruling, opponents of the ACA waged several attempts to revoke the Act through legislation. These efforts failed. But in 2017, in direct response to the ruling, opponents in Congress, through the Tax Cuts and Jobs Act (TCJA), succeeded in undermining the universal-coverage provision indirectly, by setting the tax penalty for noncompliance at zero dollars.

After Congress enacted the TCJA, two private individuals and a group of states sued the government, arguing that the TCJA rendered the universal-coverage provision unconstitutional. They claimed that by zeroing out the tax penalty for noncompliance, Congress transformed the universal-coverage provision from a valid tax (under NFIB) to an unconstitutional direct requirement to buy health insurance (also under NFIB). Moreover, they argued that because the universal-coverage provision worked in concert with the many other provisions of the ACA, the universal-coverage provision was not “severable” from the rest of the Act, and the rest of the Act must necessarily fall, too.

The government sided with the plaintiffs on the universal-coverage provision, but adopted a somewhat more nuanced position on severability. In particular, the government maintained that the universal-coverage provision was inseverable only as to the guaranteed-issue and community-rating provisions, and so only those two additional components of the ACA must fall. Because the government sided with the plaintiffs, a group of states and the District of Columbia, and later the U.S. House of Representatives, intervened to defend the Act.

The district court ruled for the plaintiffs. The court held that the universal-coverage provision was no longer valid as a tax, and that it was inseverable from the rest of the Act. The court struck the entire ACA, but stayed the ruling pending appeal.

The Fifth Circuit agreed that the universal-coverage provision was no longer valid as a tax, and therefore exceeded Congress’s authority. But it remanded the case to the district court for further consideration of the severability question. The appeals court instructed the lower court to give more attention to the legislative intent behind the TCJA, and to more carefully consider how particular portions of the ACA were linked to the universal-coverage provision.

This appeal followed.

CASE ANALYSIS

The case includes three distinct issues. Let’s take a look, one at a time. (The individual and state plaintiffs briefed a fourth issue—that the Court should uphold the district court’s nationwide injunction against the ACA—but the Court did not certify that question for appeal. We’ll refer to the parties defending the ACA, the states, the District of Columbia, and the U.S. House of Representative, together as the “petitioners.”)

Standing

In order to sue in federal court, plaintiffs must demonstrate that they have “standing.” This requires a plaintiff to show (1) that the plaintiff suffered a direct and concrete harm (2) that was caused by the defendant’s actions and (3) that would be redressed by the plaintiff’s requested relief in court. Only one plaintiff needs to demonstrate standing for a case to move forward, so this case could proceed if any of the individual plaintiffs or the states have standing.

The petitioners argue that the plaintiffs (now the respondents) lack standing. As to the individual plaintiffs, the petitioners claim that the universal-coverage provision, as altered by the TCJA, does not harm the plaintiffs, because it doesn’t require them to do anything, and because it doesn’t penalize them if they don’t buy insurance. The petitioners say that the zeroed-out universal-coverage provision simply gives individuals a choice—buy insurance or don’t—but that it doesn’t impose any consequence. They say that any harm is therefore self-inflicted, and doesn’t count for standing purposes. As to the states, the petitioners point out that the universal-coverage provision doesn’t even apply to them. Moreover, the petitioners maintain that they simply have failed to introduce any evidence that the zeroed-out universal-coverage provision itself inflicts any injury on them at all (even if other provisions of the ACA may increase their costs).

The plaintiffs argue that they have standing. The individual plaintiffs contend that they have standing, because the universal-coverage provision, even without a penalty, still requires them to purchase insurance—an actual harm for standing purposes. The states claim that the universal-coverage provision, even without a penalty, imposes several costs on them: increased enrollment in their Medicaid programs (because some individuals will enroll in Medicaid to comply with the universal-coverage provision); increased reporting and regulatory requirements under other provisions in the ACA; and increased costs in providing state employees with health insurance in order to comply with the ACA’s employer mandate. The states say that all of these costs count toward standing, notwithstanding the petitioners’ unduly narrow focus on the lack of particular harms that derive from the universal-coverage provision.

The government argues that the individual plaintiffs have standing. (The government does not make an argument one way or another about the states’ standing.) The government claims that the individual plaintiffs are injured by the ACA’s provisions that regulate health-insurance plans (the government calls these “insurance reform provisions”), because these provisions limit the individual plaintiffs’ choices and increase their costs in the health-insurance market. The government says that the individual plaintiffs can leverage this harm to challenge the universal-coverage provision, because the insurance reform provisions are inseverable from the universal-coverage provision, and all other portions of the ACA, because they, too, are inseverable. But the government maintains that the Court can only grant relief with regard to those provisions that actually injure the individual plaintiffs—relief that would redress only the individual plaintiffs’ harms. The government urges the Court to rule the entire Act unconstitutional, but then to remand the case “for consideration of the scope of appropriate relief redressing the plaintiffs’ injuries.”

Constitutionality of the Universal-Coverage Provision

The petitioners argue that the universal-coverage provision is still constitutional, even after Congress reduced the tax penalty to zero. They say that while the provision may encourage individuals to buy insurance, it doesn’t require anyone to do anything. They contend that this kind of action is well within Congress’s authority, either as a precatory statement, or as a suspended exercise of its taxing power (a placeholder provision in the law that is currently dormant, but that Congress could reactivate in the future). And they note that Congress did not revoke the provision; it simply zeroed out the penalty. The petitioners claim that the Fifth Circuit’s ruling to the contrary—that Congress transformed the universal-coverage provision into an invalid exercise of its Commerce Clause authority—flies in the face of NFIB itself, which says that the courts must “construe a statute to save it, if fairly possible.”

The plaintiffs and the government respond that the universal-coverage provision is no longer constitutional under Congress’s taxing authority, because it no longer raises revenue. As the government says, “Under NFIB’s functional approach, a statute that imposes no tax liability on anyone cannot be sustained as a tax.” The plaintiffs and the government say that the provision now reads most naturally to directly require individuals to buy insurance. They contend that this is exactly what the Court in NFIB ruled that Congress could not do.

Severability

The petitioners argue that even if the universal-coverage provision is no longer constitutional, it is severable from the rest of the Act. They note that when Congress zeroed-out the tax penalty in the TCJA, it left the rest of the Act in place. According to the petitioners, this shows that Congress intended only to remove the enforcement mechanism for the universal-coverage provision, but not to undermine the rest of the ACA. (Importantly, the petitioners focus on congressional intent in 2017, when it enacted the TCJA, and not 2010, when it enacted the ACA.) The petitioners maintain that, as a practical matter, the rest of the ACA has continued to operate since 2017, even without the tax penalty.

The individual and state plaintiffs and the government counter that the universal-coverage provision is inseverable from the rest of the ACA, because Congress enacted the provision as an essential part of the larger Act. They say that the universal-coverage provision is an indispensable part of the “three-legged stool” (along with the guaranteed-issue and community-rating provisions), and that the many and myriad other provisions in the Act cannot operate without the Act’s core three-legged stool. (In contrast to the petitioners, the individual and state plaintiffs emphasize congressional intent in 2010 and before the TCJA. They note, however, that the TCJA retained statutory findings as to how these provisions work together to achieve the goals of the Act.)

SIGNIFICANCE

This case is easily one of the most important cases of the Term. That’s because it tests the entire ACA—a sweeping piece of legislation that comprehensively restructured the health insurance market in the United States and brought quality and affordable health insurance to millions of individuals. A ruling for the challengers could mean the end for many or all of the ACA’s reforms, and could result in millions of individuals losing health insurance and other protections and benefits under the Act. Given that Congress has not offered a viable alternative to the ACA, a ruling for the challengers would likely return the health-insurance market to its pre-ACA status.

This is all the more significant in the middle of a pandemic, with an illness, Covid-19, that has infected millions of Americans and killed over 200,000. Infected individuals require various levels of health care, often quite significant, paid at least in part by their health insurance. Many previously infected individuals continue to show signs of longer-lasting, even chronic, conditions that will require future health care and health insurance. A ruling for the plaintiffs could affect these individuals’ health-insurance policies, and their ability to obtain quality and affordable health care for treatment. At the same time, lingering Covid-19-related conditions could drive up insurance rates or even prevent some previously infected individuals from obtaining new health insurance without the community-rating and guaranteed-issue provisions in the ACA.

But that’s only if the Court rules for opponents on each of the three issues in the case. Such a ruling is not at all certain. For starters, the Court could dismiss the case for lack of standing, vacate the lower courts’ rulings, and leave the ACA in place, exactly as it is. Despite the plaintiffs’ and the government’s arguments, and despite the lower courts’ rulings, the plaintiffs’ standing is tenuous. The universal-coverage provision doesn’t require any of the individual or state plaintiffs to do anything, and the states’ theory of standing hinges on other provisions of the ACA. It’s not at all clear that the Court will rule for the plaintiffs on standing. That said, the Court’s rulings on standing often seem to turn on the underlying merits. That may be true here, too: if a majority wishes to address the merits, the Court will likely find standing.

As to the universal-coverage provision, the Court seems primed to rule this unconstitutional. Remember that Chief Justice Roberts wrote for a bare majority in NFIB that the universal-coverage provision fell within congressional authority to tax, because it could raise revenue. But with the provision now zeroed-out, it is not at all clear that Chief Justice Roberts would vote to uphold it. Even if the other current justices who joined this portion of the NFIB ruling (Justices Breyer, Sotomayor, and Kagan) voted to uphold the provision, there may now be a five-justice majority against the provision. Since Justice Ruth Bader Ginsburg’s death, the Court has only eight justices. (More on this below.) A four-four tie would affirm the Fifth Circuit’s ruling striking the universal-coverage provision, but without setting a Supreme Court precedent.

As to severability, we just don’t know. To be sure, there is language in NFIB that suggests that the universal-coverage provision is inextricably linked to other provisions of the Act, particularly the guaranteed-issue and community-rating provisions. But that language does not necessarily foretell the Court’s ruling on severability. (The inextricability of the universal-coverage provision as a matter of policy may be different than the inseverablity of the provision as a matter of constitutional law.) If the Court were to strike the universal-coverage provision, it could (1) rule all of the Act severable (and strike only the universal-coverage provision), (2) rule only the guaranteed-issue and community-rating provisions inseverable (and strike only the three provisions), (3) rule certain other provisions of the ACA also inseverable (and strike only those provisions), or (4) rule the entire ACA inseverable (and strike the whole Act). Because the Fifth Circuit did not rule on the severability of specific ACA provisions—remember that the Fifth Circuit remanded the case for further consideration of severability—the Court may similarly kick the question back to the lower courts. (As described above, in standing, the government urges the Court to rule the entire Act unconstitutional, but to remand the case for a determination of which provisions harm the individual plaintiffs.)

The timing of the case, just a week after the 2020 presidential election, is critical. As this piece goes to print, President Trump has nominated Judge Amy Coney Barrett to replace Justice Ruth Bader Ginsburg on the Court. Justice Ginsburg voted to uphold the universal-coverage provision in NFIB, and has consistently voted against other challenges to the Act. Judge Barrett, in stark contrast, is on the record opposing the Court’s holding in NFIB that Congress validly enacted the universal-coverage provision under its taxing authority. A Justice Barrett would almost certainly tilt the Court—with possibly a six-justice majority—further against the universal-coverage provision. We probably don’t have enough information to predict the way a Justice Barrett might rule on severability.

At publication, the Senate just began confirmation hearings. If the Senate confirms Judge Barrett before November 10, as now seems likely, she will sit for oral arguments and participate in the case. If the Senate does not confirm Judge Barrett before November 10, under ordinary practice, she won’t—unless the Court orders a reargument in order to include her. With the current eight-justice Court, a tie would simply leave the Fifth Circuit ruling in place.

One final point. Even if the Court were to rule for the plaintiffs on all the issues, Congress could probably restore much or all of the ACA, if it had the votes. Remember that the Court in NFIB held that Congress could enact the universal-coverage provision with a tax penalty under its taxing authority. That ruling still stands, for now, at least. Again, a Justice Amy Coney Barrett could move the Court against it.

November 10, 2020 in Cases and Case Materials, Congressional Authority, News, Taxing Clause | Permalink | Comments (0)

Wednesday, November 4, 2020

Supreme Court Tests LBGTQ Rights Against Free Exercise Claim

The Supreme Court will hear oral arguments today in Fulton v. City of Philadelphia, the case testing whether the city's enforcement of a clause in its foster-care contracts that prohibits discrimination by sexual orientation violates Catholic Social Service's Free Exercise rights. Here's my preview, from the ABA Preview of United States Supreme Court Cases, with permission:

FACTS

The City of Philadelphia’s Department of Human Services (DHS) operates the City’s foster-care program. DHS takes legal custody of children whom courts have removed from their homes, and places the children in a foster home or facility that is appropriate to each child’s interests and needs.

In order to help operate the program, DHS contracts with private-sector social-service providers. Some of these providers serve as “Community Umbrella Agencies” (CUAs), which provide social services to foster children. Some operate congregate-care facilities, which provide group housing for children. And some operate as “Foster Family Care Agencies” (FFCAs), which conduct home studies of potential foster parents, issue certifications for families that meet state criteria, and, upon referral from DHS, place children with foster parents that the FFCAs have certified. State law delegates authority to FFCAs, so that FFCAs exercise state power when they evaluate and certify foster parents. Private agencies have no authority to place children with foster parents without an FFCA contract. Still, DHS’s standard contract says that a contracting agency “is an independent contractor,” and not “an employee or agent of the City.”

DHS contracts include a standard nondiscrimination clause. The clause says that FFCAs must comply with the City’s Fair Practices Ordinance, which prohibits discrimination based on any protected characteristic, including sexual orientation. The contracts also say that contractors “shall not discriminate” in any “public accommodations practices” on the basis of sexual orientation.

Catholic Social Services (CSS) is a faith-based social-service organization that has long contracted with DHS to provide services in the City’s foster-care program. On March 13, 2018, the Philadelphia Inquirer ran a piece titled “Two foster agencies in Philly won’t place kids with LGBTQ people.” The story reported that CSS and another social-service organization would not certify same-sex couples for foster-care placements. In the article, the Archdiocese’s spokesperson confirmed CSS’s longstanding religion-based policy against providing foster-care certification for unmarried couples and for same-sex married couples, but emphasized that CSS had received no inquiries from same-sex couples. (CSS maintains that if it received such an inquiry, it would refer the couple to another agency.) 

Two days after the story ran, the City Council passed a resolution condemning “discrimination that occurs under the guise of religious freedom.” Around the same time, the Philadelphia Commission on Human Relations (PCHR), at the request of the Mayor, sent a letter to the Auxiliary Bishop who oversees CSS. The letter asked the Bishop to answer questions about CSS’s policies, including whether “you have authority as a local affiliate/branch of a larger organiz[ation] to create or follow your own policies.” (CSS maintains that the Mayor previously said that he “could care less about the people of the Archdiocese,” called the Archbishop’s actions “not Christian,” and called on Pope Francis “to kick some ass here!”)

The Mayor also contacted DHS Commissioner Cynthia Figueroa. Figueroa met with CSS representatives “to find a mutually agreeable solution.” During the meeting, she urged CSS representatives to follow “the teachings of Pope Francis,” and told them that “times have changed,” “attitudes have changed,” and that CSS should change its policy because it was “not 100 years ago.” CSS maintained its position, however, and DHS then halted its referrals to CSS for the rest of its contractual term, through the City’s Fiscal Year 2018.

CSS’s FY 2018 FFCA contract expired on June 30, 2018. DHS repeatedly expressed its “strong desire to keep CSS as a foster care agency,” and offered CSS FFCA contracts on the same terms as other agencies. In FYs 2019 and 2020, DHS offered CSS a choice between the same contract it offered to other FFCA agencies and a “maintenance contract” to provide foster-care services for families that CSS was already supporting. CSS chose the maintenance contract. (Although CSS declined to enter into an FFCA contract, the agency nevertheless continued to contract with DHS to provide CUA and a congregate-care services.)

In May 2018, while its FY 2018 FFCA contract was still in force, CSS sued DHS. CSS argued that DHS’s move to halt referrals violated the Free Exercise Clause, the Establishment Clause, the Free Speech Clause, and the Pennsylvania Religious Freedom Protection Act. The district court denied CSS’s motion for a preliminary injunction, and the Third Circuit and the Supreme Court denied CSS’s motion for an injunction pending appeal. Fulton v. City of Philadelphia, 139 S. Ct. 49 (2018). (Justices Clarence Thomas, Samuel Alito, and Neil Gorsuch noted their dissent.) The Third Circuit affirmed the district court’s ruling. This appeal followed.

CASE ANALYSIS

The case includes three distinct issues. We’ll review them one by one.

Free Exercise Clause

Under the Free Exercise Clause, a government action that targets religion or a religious practice must be narrowly tailored, or necessary, to meet a compelling government interest. This test, “strict scrutiny,” is the most rigorous test known to constitutional law; under strict scrutiny, the challenged government action almost always fails. Church of the Lukumi Babalu Aye, Inc. v. City of Hialeah, 508 U.S. 520 (1993).

On the other hand, a government action that is generally applicable and neutral with regard to religion, but that nevertheless has an “incidental” effect on religion, must only be rationally related to a legitimate government interest. This test, “rational basis review,” is one of the more lenient tests known to constitutional law, and the challenged government action almost always passes. Employment Division v. Smith, 494 U.S. 872 (1990).

In this case, CSS argues that DHS’s nondiscrimination policy targets the agency’s religious exercise, that it is not generally applicable, and that it fails strict scrutiny. CSS claims that “[t]he City has repeatedly shifted policies,” developed post hoc rationalizations for its nondiscrimination policy, and “changed the rules in response to CSS”—all proving that the City targeted CSS’s religious exercise. Moreover, CSS contends that the actions and statements of the City Council, the Mayor, the PCHR, and DHS all reflect hostility toward CSS’s religious beliefs. CSS asserts that the City’s nondiscrimination policy is not generally applicable, because it allows for exemptions by a “Waiver/Exemption Committee” for “constitutional issues” and by “the Commissioner or the Commissioner’s designee, in his/her sole discretion.” CSS contends that the City’s exemptions undermine its own interests, and that the City does not even apply nondiscrimination to its own actions.

CSS argues that the City’s nondiscrimination policy cannot satisfy strict scrutiny. CSS says that the City’s “hostility towards CSS’s religious exercise” and the policy’s many exemptions both show that the City’s interest cannot be compelling. And it claims that the City’s categorical freeze on CSS referrals was not narrowly tailored to meet any City interest, because the move meant that CSS could not place children in already-certified homes, and because the City could instead simply require CSS to refer same-sex couples to another FFCA. (CSS maintains that it already has a policy to do this.)

(The government weighs in to support CSS on this point, and this point only. It argues that the City’s policy targets CSS’s exercise of religion and fails strict scrutiny for many of the same reasons. Notably, the government does not argue that the Court should overrule Smith. It also does not argue that the City violated CSS’s free speech.)

The City responds that its nondiscrimination policy is a neutral law of general applicability, and that it easily satisfies Smith’s rational basis review. The City starts by claiming that it has “significantly greater leeway” in directing its own employees and contractors than when it regulates private individuals. It says that this “extra power” applies with full force to this case, and that the Court should “be especially hesitant to infer anti-religious animus from stray remarks of government officials.”

The City argues that its nondiscrimination requirement is generally applicable and neutral with regard to religion. It says that every FFCA contract contains an identical nondiscrimination requirement, and (contrary to CSS’s understanding) that DHS has no authority to make exceptions and, indeed, has never done so. The City contends that the policy contains “no trace of religious hostility,” and that CSS wrongly infers hostility “from the statements of persons who played no role in the decisionmaking process and from events far removed from the relevant decisions.”

Finally, the City argues that its nondiscrimination requirement does not require CSS to do anything contrary to its religious beliefs. In particular, the City says that neither the policy nor state law requires CSS “to endorse a couple’s relationship when certifying them as qualified foster parents.”

Free Speech

CSS argues that the City compels it to support nondiscrimination in violation of its right to free speech. CSS says that the City requires CSS, as a condition of participation in the foster care system, to issue written certifications of potential foster parents that “evaluat[e] and endors[e] same-sex and unmarried cohabitating relationships.” CSS maintains that this is “private speech,” based on Commissioner Figueroa’s testimony that the City has “nothing to do with” home studies, and does not control their content. CSS claims that the City violated its free speech by revoking its contract and attempting to “leverage a program it pays for to compel speech it does not pay for.” CSS claims that the City cannot justify these violations under strict scrutiny, for the same reasons that it cannot justify its violation of the Free Exercise Clause under strict scrutiny, above.

The City counters that its nondiscrimination policy simply does not compel CSS to say anything about the validity of same-sex relationships. Instead, the City claims that the policy simply regulates CSS’s conduct—not to discriminate against foster parents based on their sexual orientation.

Overruling Smith

CSS argues that the Court should overrule Smith and its rational basis review test. CSS claims that the Court designed the Smith test to apply when “legislatures make general laws and courts apply them.” But it says that government officials “often infringe religious exercise with non-neutral, non-general laws, and courts mistakenly apply Smith anyway.” (CSS contends that this is exactly what the City and the Third Circuit, respectively, did in this case.) CSS claims that the Smith test is therefore not an administrable standard, and that none of its predictions about its administrability came true. Moreover, CSS asserts that the Smith test lacks support in the text, history, and tradition of the Free Exercise Clause. It says that courts have done much better applying a higher level of scrutiny under the Religious Freedom Restoration Act, the Religious Land Use and Institutionalized Persons Act, and similar state laws, and it argues that the Court should replace the Smith test with strict scrutiny, or at least a more rigorous test based on the “purpose and history” of the Free Exercise Clause. CSS maintains that under a proper heightened standard, the City’s move to freeze its contract would fail.

The City counters that the Court should not overrule Smith. The City says that this case is “an extremely poor vehicle to reconsider Smith,” because it involves government contracting (not direct government regulation) and because the City’s nondiscrimination policy satisfies strict scrutiny, anyway. (The City and intervenor Support Center for Child Advocates and Philadelphia Family Pride say that banning discrimination in its FFCA contracts is narrowly tailored to achieve the compelling government interests of eliminating discrimination based on sexual orientation and ensuring that children in foster care have access to all qualified families.) Moreover, it claims that the Smith test “has firm support” in the original meaning of the Constitution, and that it “has served as the predicate for three decades of precedents and legislative enactments.”

 

 

SIGNIFICANCE

This case pits a plaintiff’s right to free exercise of religion against the government’s power to ban discrimination by sexual orientation—a tension that is increasingly familiar in today’s politics and constitutional law. Under existing free-exercise law, in Smith, a plaintiff’s religious rights would almost certainly give way to a government’s categorical ban on discrimination. But if a plaintiff can demonstrate that a government’s ban is not generally applicable or neutral with regard to religion, or that a government official targeted or exhibited hostility toward the plaintiff’s religion, then a plaintiff’s free-exercise claim would almost surely prevail.

The Court last addressed this tension just three Terms ago, in Masterpiece Cakeshop, Ltd. v. Colorado Civil Rights Commission, 138 S. Ct. 1719 (2018). In that case, a baker claimed that Colorado’s ban on discrimination would require him to bake a wedding cake for a same-sex couple in violation of his right to free exercise. The Court, in a seven-to-two ruling, held that members of the Colorado Civil Rights Commission exhibited hostility toward the baker’s religion in considering his case, and that the Commission therefore violated his free-exercise rights. The Court, however, did not say whether Colorado’s anti-discrimination law would violate the baker’s religious rights without that kind of hostility, under the Smith test. (We expected to see other similar challenges like this, especially in the wake of Obergefell v. Hodges, 135 S. Ct. 2071 (2015), where the Court struck state laws that banned same-sex marriage. But the Court has not (yet) taken these cases. In fact, the Court earlier this month declined to take up the appeal of Kim Davis, the Kentucky clerk who refused to issue marriage licenses to same-sex couples because of her religious beliefs. Justices Clarence Thomas and Samuel Alito issued a strong statement on the Court’s denial of certiorari that took aim at Obergefell and elevated Davis’s religious claim. Davis v. Ermold, 2020 WL 5881537 (Oct. 5, 2020).)

Masterpiece Cakeshop and Fulton well illustrate the increasingly familiar tension between nondiscrimination by sexual orientation and free exercise. Fulton now gives the Court another shot to reckon with it.

The parties in Fulton frame at least some of their free-exercise arguments around Masterpiece Cakeshop. CSS says that the City exhibited exactly the same kind of hostility toward religion that members of the Colorado Civil Rights Commission exhibited against the baker in that case. The City, for its part, contends that its officers did not exhibit this kind of hostility, and that, in any event, those officers weren’t in the decisionmaking loop. The City also says that the Court should grant greater leeway to the City in regulating its contractors than the Court granted the Colorado Civil Rights Commission in regulating a private person (the baker).

If the Court sees Fulton through the lens of Masterpiece Cakeshop, these similarities and differences will matter. A ruling for CSS could continue the Court’s trend toward increasing free-exercise rights, while a ruling for the City could provide an important backstop to Masterpiece Cakeshop. Either way, though, if the Court sees Fulton through the lens of Masterpiece Cakeshop, it could retain the Smith test.

But if the Court also tackles the Smith issue, the case could be even more important. Smith was a hotly controversial ruling from the start, provoking legislative responses from the federal government (in the Religious Freedom Restoration Act and the Religious Land Use and Institutionalized Persons Act) and states (in “mini-RFRAs”). The case remains controversial today. Moreover, the issue comes to the Court as it has moved steadily in recent years to privilege the right to free exercise of religion. For these reasons, the issue seems well teed-up for the Court. If so, Fulton could accelerate the Court’s trend toward greater and greater religious rights, and even provide a capstone to the Court’s cases in this area by overruling Smith. At the same time, Fulton could restrict, at least to some degree, governments at all levels from enacting and enforcing generally applicable laws, like the nondiscrimination policy at issue in this case. But on the other hand, as the City points out, this may not be the right case for the Court to take such a significant step.

As to CSS’s free speech claim: don’t look for the Court to hang its hat here. The claim itself is weak; it’s overshadowed by the free-exercise issues; and the parties did not heavily brief it. Free speech may have been an obligatory adjunct to CSS’s claims (as it was in the baker’s case in Masterpiece Cakeshop), but this case is much more likely to be significant for what it’ll say about free exercise.

November 4, 2020 in Cases and Case Materials, First Amendment, Free Exercise Clause, News | Permalink | Comments (0)

Thursday, October 8, 2020

Government Seeks Stay of Census Order at Supreme Court

The Trump Administration yesterday filed a motion at the Supreme Court to stay, pending appeal, a district court's order directing the government to continue census operations until October 31. The filing is just the latest in the ongoing efforts of the Trump Administration to rush census operations amid a pandemic. The Administration says that it needs to speed efforts in order to meet the December 31 statutory deadline for reporting census data to the President.

The case is important, because congressional apportionment, legislative districts, and federal funds are all tied to census data. The numbers that come from the 2020 census will lock these in for the next ten years. Moreover, the Trump Administration seems set on the December 31 deadline so that President Trump (and not a potential President Biden) would certify the census numbers to Congress--and possibly try not to include unauthorized noncitizens in the count.

The case arose when the Trump Administration reversed course on a revised census plan that would extend census data collection through October 31 in light of data-collection delays resulting from Covid-19.

The Census Bureau adopted the plan after it lost 47 days of data-collection efforts, and anticipated additional difficulties in collecting data, due to the Covid-19 pandemic. The plan set the end of collection efforts at October 31, 2020. But this would mean that the Bureau would likely not meet the December 31 statutory deadline for reporting data to the President. 

So on August 3, the Administration abruptly issued a "Replan," which set the end of data-collection efforts at September 30. The Replan condensed the total time to conduct the census to 49.5 weeks--4.5 weeks shy of the pre-Covid schedule of 54 weeks, and 22 weeks shy of the extended Covid schedule. 

A group of organizations, cities, counties, and tribal groups sued to stop the Replan, arguing that it violated the Administrative Procedure Act and the Enumeration Clause. The district court ordered the Replan halted, order data-collection efforts to extend to October 31, and enjoined the Administration from implementing the September 30 and December 31 deadlines. 

The Ninth Circuit denied an administrative stay, and, yesterday, partially stayed the district court's order pending appeal. The Ninth Circuit stayed the district court's order enjoining the Administration from complying with the statutory December 31 deadline--the Ninth Circuit said that a court shouldn't order the government to ignore a statutory deadline--but denied a stay of the order enjoining the September 30 stop date. This meant that the Administration would have to continue census data-collection through October 31.

Soon after the Ninth Circuit ruled, the Administration filed for a stay with the Supreme Court. The Administration argued that the APA didn't apply, that in any event the plaintiffs didn't prove a violation of the APA, and that the Administration couldn't meet the December 31 statutory deadline if data collection extended through October 31.

In other words, the Administration says that it couldn't have been arbitrary and capricious (and therefore in violation of the APA) for the Administration to halt data-collection efforts at an earlier date in order to meet the statutory deadline of December 31.

October 8, 2020 in Cases and Case Materials, Courts and Judging, Executive Authority, News | Permalink | Comments (0)

Wednesday, October 7, 2020

Second Circuit Rebuffs Trump's Case Against NY Grand Jury Subpoena

The Second Circuit today flatly rejected President Trump's case challenging the NY grand jury subpoena for his financial records. The ruling follows a summer Supreme Court decision saying that the grand jury was not categorically (and constitutionally) barred from seeking the President's financial records.

The ruling in Trump v. Vance deals a serious blow to President Trump and his efforts to keep his financial records under wraps. (The subpoena goes to far more than President Trump's taxes.) But the President will surely seek to appeal.

The ruling says that President Trump failed even to plausibly plead (under the Iqbal and Twombly pleading standard) that the grand jury subpoena was overbroad or issued in bad faith. At the same time, it noted that going forward the President might need some accommodations in state criminal proceedings in order to avoid intruding on the President's Article II responsibilities. (The President didn't raise categorical constitutional claims in this round--the Supreme Court already rejected those claims in its ruling this summer--and did not specifically claim that complying with this subpoena would interfere with his Article II responsibilities.)

The court's decision was issued per curiam (without naming the judges involved), suggesting that the case was easy and that the ruling was perfunctory. 

October 7, 2020 in Cases and Case Materials, Executive Authority, Executive Privilege, Federalism, News, Opinion Analysis | Permalink | Comments (0)

Sunday, October 4, 2020

Supreme Court to Hear First Amendment Challenge to Political Balancing Requirements for State Courts

The Supreme Court will hear oral arguments tomorrow, the opening day of October Term 2020, in Carney v. Adams. The case tests whether Delaware's "political balancing" requirements for its courts violate the First Amendment. A ruling on the merits could have implications for a variety of state and federal commissions that have similar balancing requirements. But first the Court'll need to address the plaintiff's standing . . . .

Here's my Preview of the case, from the ABA Preview of United States Supreme Court Cases, with permission:

Case at a Glance

Delaware attorney James Adams, a registered Independent, considered applying for a judicial position on the state courts. Despite his interest, however, Adams did not apply, because he believed that, as an Independent, he would not qualify. Adams pointed to a state constitutional provision that capped the number of judges from a political party to no more than a bare majority on the courts (the “bare-majority” requirement) and that, for some courts, required that the other judges come from the other major political party (the “major-party” requirement). Instead of applying for judicial vacancies on these courts, Adams sued, arguing that the provision violated the First Amendment.

INTRODUCTION

According to the Supreme Court, the First Amendment permits the government to use a person’s political affiliation as a qualification for “policymaking” positions, but generally not for lower-level government jobs. This case tests how that principle applies to Delaware’s political balancing provision for judges. But before we get to the merits, the case raises a significant question whether Adams even has standing to sue.

ISSUES

  1. Does Adams have standing to sue, given that he declined to apply for judicial vacancies, and given that he would have qualified for vacancies on two of Delaware’s courts?
  2. Does the First Amendment prohibit a state from specifying and defining the composition of its courts by reference to the judges’ political parties?
  3. Is the provision of Delaware’s constitution that caps the judges from one political party on three of the state’s courts severable from the provision that requires that all judges on those courts are members of a major political party?

FACTS

Delaware’s “Bare Majority” and “Major Party” Political Balancing Requirements

In 1897, delegates to the Delaware constitutional convention sought to reduce the influence of politics on the state’s judiciary. In order to achieve this goal, delegates recommended a political balancing requirement for the state’s principal courts. Under the requirement, these courts could not have more than a single-judge majority from any one political party. The state adopted the bare-majority proposal, and Delaware has had some form of a bare-majority requirement for its principal courts ever since.

In 1951, the state modified the political balancing requirements to exclude third party and unaffiliated voters from applying to serve as judges on the Supreme Court, the Superior Court, and the Chancery Court, the so-called “business courts.” The change retained the existing bare-majority requirement, but it added a major-party requirement that limited service on these courts only to members of a major political party, Republican or Democrat. The major-party requirement helped to ensure that a governor could not side-step the bare-majority requirement by appointing a nominal third-party or independent judge to a seat reserved for the other side. The change stuck through several amendment processes, including in 2005.

Today, Article IV, Section 3, of the Delaware Constitution specifies that these three courts shall include no more than a single-judge majority from one major political party, and that all other judges shall be from the other major political party. (If one of these courts has an even number of judges, the provision specifies that the judges on that court shall be equally divided, Republican and Democrat.)

The same section also specifies that the Family Court and the Court of Common Pleas shall include no more than a single-judge majority of the same political party. (If one of these courts has an even number of judges, the provision specifies that no more than one-half of the judges shall be of the same political party.) But in contrast to the provision for the business courts, the provision for these two courts does not include a major-party requirement. As a result, members of non-major political parties, including independents, may serve on these two courts, so long as these courts satisfy their bare-majority requirement.

Delaware’s Judicial Nominations

Since 1978, Delaware governors have relied on recommendations from a judicial nominating commission to identify candidates to appoint to judicial vacancies. Under this practice, the commission, which is politically balanced and comprised of both lawyers and non-lawyers, recommends three candidates for each judicial vacancy. The governor then selects one of the three nominees for appointment. If the governor is not satisfied with the commission’s recommendations, the commission may generate another list of recommendations.

When a judicial position becomes available, the commission provides public notice of the position, the salary, and the job requirements, including the party membership, in order to comply with the bare-majority and major-party requirements, discussed above.

James Adams’s Non-Application for a Judicial Position

In December 2015, Delaware attorney James Adams retired and went on “emeritus” status with the Delaware state bar. Sometime in late 2016 or early 2017, Adams decided to explore judicial vacancies. He reactivated his full state bar membership and changed his party affiliation from Democrat to Independent. Adams said that he would have considered and applied for any available positions on any of the state’s courts. (Adams said he changed his party affiliation because he grew disenchanted with the Delaware Democratic Party and considered himself “more of a Bernie [Sanders] independent.” The state, in contrast, suggests that he changed his party only to bring this suit. Adams also claims that he declined to apply for judicial vacancies in the past, because he would not have qualified as a Democrat. The state disputes this and says that he would have qualified for at least ten judgeships.)

Rather than applying for any vacancies, however, Adams brought this suit. He claimed that the political balancing requirements rendered him ineligible for available vacancies based on his Independent political status, and argued that the requirements violated the First Amendment. The district court agreed and struck both the bare-majority requirement and the major-party requirement as they applied to all five courts.

The Third Circuit affirmed in part and reversed in part. The court ruled that Adams lacked standing to challenge the bare-majority requirements for the Family Court and the Court of Common Pleas, because the bare-majority requirements did not bar his appointment as an Independent to those courts. The court also accepted that Adams lacked standing to challenge the bare-majority requirement for the business courts for the same reason. On the merits, the court held that the major-party requirement for the business courts violated the First Amendment. It ruled that the bare-majority requirement failed, too, because (notwithstanding Adams’s lack of standing to challenge it) the bare-majority requirement was not severable from the major-party requirement. This appeal followed.

CASE ANALYSIS

There are three issues in this case. Let’s take them one at a time.

Standing

In order to sue in federal court,  plaintiffs must establish that they have suffered, or imminently will suffer, a concrete and particularized injury that was caused by the challenged law. Here, the state argues that Adams failed to establish a sufficient injury to challenge the political balancing requirements. The state says that the bare-majority requirement could not possibly injure Adams, because he does not belong to either political party. Moreover, the state contends that Adams failed to establish that he suffered past injuries based on the bare-majority requirement, because he would have qualified “for at least ten judgeships.” The state asserts that Adams failed to establish that he will suffer future harms based on the major-party requirement, because he cannot say with certainty that the major-party requirement will disqualify him from future consideration. Finally, the state notes that Adam declined to apply for any positions as an Independent, and that any harm he suffered is therefore “self-inflicted” and non-cognizable.

Adams counters that he only has to allege that the political balancing requirements chilled his exercise of his First Amendment right to affiliate (or not) with a political party (and not that the state actually denied his application). He says he easily meets this standard, because he alleged that he would have applied for judicial vacancies but for the balancing requirements’ political discrimination. He claims that the requirements force him “to choose between the right to seek a judgeship and violating his political conscience by re-registering as a Democrat or a Republican in order to be considered.” And he contends that a decision striking the political balancing requirements would allow him to submit an application as an Independent and have it “accepted and considered on its own merit.”

The Political Balancing Requirements

The state argues that it may consider party affiliation of state judges consistent with the First Amendment. It contends that under Supreme Court precedent, the First Amendment only limits a state from considering political affiliation for “low-level public employees,” not for “policymaking” jobs. The state asserts that the “ultimate inquiry” is “whether the hiring authority can demonstrate that party affiliation is an appropriate requirement for the effective performance of the public office involved.” Branti v. Finkel, 445 U.S. 508 (1980).

The state says that its use of party affiliation for judges easily meets these tests. It contends that judges occupy “policymaking” positions, because, among other things, they “develop the common law.” And it claims that party affiliation is “an appropriate requirement” for the job, “[b]ecause party affiliation is a proxy for how would-be judges might understand their role,” and because it helps to ensure bipartisan decisionmaking on the bench. The state asserts that the Third Circuit adopted an unduly narrow definition of “policymaking”—one that does not square with Supreme Court precedent.

Finally, the state argues that even if its political balancing requirements are subject to heightened First Amendment scrutiny (because judgeships are not “policymaking” positions), they pass muster. The state says that they are narrowly tailored to ensure a politically balanced judiciary, and that this, in turn, serves its compelling interest of preserving “public confidence in judicial integrity.”

Adams counters that the balancing requirements violate the First Amendment, because “[p]olitical affiliation is not only not necessary for the work of a judge, it also is inconsistent with the role of a judge.” Adams claims that judges only make “policy” insofar as they rule on the immediate cases before them, and so are not policymakers under Supreme Court precedent. Moreover, he says that judges are supposed to render their decisions without consideration of politics, and so their political affiliation is not “an appropriate requirement” for their office. In short, he contends that the state’s balancing requirements run exactly against the state’s own interests in a politically neutral judiciary.

Severability

The state argues that the bare-majority requirement is severable from the major-party requirement, and that the Court can therefore strike the major-party requirement (if it must) without also striking the bare-majority requirement. As an initial matter, the state asserts again that Adams lacks standing to challenge the bare-majority provision, and argues that he cannot use its non-severability from the major-party requirement to create standing to challenge it. Such a rule, the state contends, “would allow parties to obtain sweeping relief against whole statutory schemes even if injured by only part of them.” Moreover, the state claims that the bare-majority requirement can stand alone, independent of the major-party requirement, as it stood for 54 years before the state adopted the major-party requirement, and as it currently stands for the state’s Family Court and Court of Common Pleas. According to the state, “[t]here is simply no evidence that the Delaware Constitution’s framers would have preferred no political balance provisions at all to a system with just the bare majority provision.”

Adams counters that the state failed to raise the severability argument before the lower courts, and so waived it. But if the Court rules on severability, Adams argues that the major-party requirement is not severable from the bare-majority requirement, because the two provisions “are textually intertwined” and necessarily work together. He says that the history of the bare-majority requirement reveals that “the Legislature had only Democrats and Republicans in mind.” Moreover, he claims that the major-party requirement is necessary for the bare-majority requirement to achieve its goals. He contends that the major-party requirement “has no independent justification for its existence,” and so the two are not severable. According to Adams, this means that when the Court strikes the major-party requirement, it must also strike the bare-majority requirement.

SIGNIFICANCE

First and foremost, there is a circuit split on an issue central to the merits question in this case, whether judges are “policymakers.” The Third Circuit said no, but the Second, Sixth, and Seventh Circuits (and, according to the state, “every other court to address the issue”) has said yes. Under Court precedent, if judges are “policymakers,” then the state can use their political affiliation as a qualification without violating the First Amendment. If they are not, then the state must show that its use of political affiliation is necessary to achieve a compelling government interest. This is a high standard, but one that the state argues, in the alternative, that it can satisfy. If the Court reaches the central merits question in this case, it may resolve the circuit split and determine whether judges are “policymakers” that fall under this exception to the First Amendment.

I say “may,” because it’s not entirely obvious that the Court’s precedents establishing the “policymakers” standard apply here. Those precedents deal more directly with the problem of political patronage, that is, when the government doles out jobs to politically friendly allies. But Delaware’s stated interest is very different here, to reduce the influence of politics in the judiciary by mandating a non-partisan, or, in this case, a bi-partisan, process. According to the State and Local Government Associations, as amicus in support of the state, merely applying the Court’s patronage precedents could threaten similar state and local government balancing requirements far beyond the judiciary. According to amicus, this could affect state and local governments’ efforts to reduce the influence of politics in a variety of policy areas.

But all that’s only if the Court reaches the central merits question, whether Delaware’s balancing provision violates the First Amendment. Before the Court can address this issue, it must determine that Adams has standing to sue. Given that Adams declined to apply for several positions for which he apparently qualified (either as a Democrat, in the past, or as an Independent, in the present and future), it seems likely that the Court may simply dismiss the case for lack of standing, vacate the Third Circuit’s ruling, and wait for a more appropriate case to address the hard question of whether Delaware’s political balancing provision violates the First Amendment.

October 4, 2020 in Cases and Case Materials, Courts and Judging, First Amendment, News | Permalink | Comments (0)

Wednesday, September 30, 2020

Seventh Circuit Rebuffs Appeal by Republicans, State Legislation in Wisconsin Voting Case

The Seventh Circuit flatly rejected an appeal by the Wisconsin legislature and the state and national Republican Party of a lower court's order that the state extend voting deadlines in light of Covid-19. The ruling leaves the extended deadlines in place and ends the case, unless the intervenors can persuade the full Seventh Circuit or the Supreme Court to step in.

The case arose when the Democratic National Committee and others sued the state, arguing that its statutory voting deadlines violated the right to vote. The district court agreed, and ordered extended deadlines.

State executive officials declined to appeal. But the RNC, state Republicans, and the state legislature moved to intervene to defend the state's statutory deadlines (and to oppose the district court's order extending them), and brought this appeal.

The Seventh Circuit's ruling says that these parties don't have standing to appeal. The court said that the state and national Republican parties don't have standing, because neither group contended that the district court's ruling would affect their members, and because neither group suffered an injury itself.

Legislative standing was a little different. The court acknowledged that a legislature can litigate in federal court when it seeks to vindicate a legislative interest. But here the court said there was none. "All the legislators' votes were counted; all of the statutes they passed appear in the state's code."

The legislature argued that state law authorized it to defend against challenges to state statutes. But the court observed that the state supreme court previously ruled that this provision violated the state constitution, which "commits to the executive branch of government [and not the legislative branch] the protection of the state's interest in litigation."

The court gave the putative appellants a week to show cause why the court shouldn't dismiss the case.

September 30, 2020 in Cases and Case Materials, Elections and Voting, News, Standing | Permalink | Comments (0)

How Could a Justice Amy Coney Barrett Affect the Affordable Care Act?

Looking for a plain-English explainer on how a Justice Amy Coney Barrett could affect the Affordable Care Act, or Obamacare, in a case scheduled for oral argument on November 10? Here you go:

 



 

September 30, 2020 in Cases and Case Materials, Courts and Judging, News, Taxing Clause | Permalink | Comments (0)

Saturday, September 26, 2020

District Court Halts Administration's Plan to Rush Census

Judge Lucy H. Koh (N.D. Cal.) ruled this week that the Trump Administration's late summer plan to rush census data collection likely violated the Administrative Procedure Act. The ruling halts the implementation of the plan.

The ruling is a blow to the Trump Administration and its latest effort to alter or manipulate census data.

The case arose when the Census Bureau first suspended census operations and then pushed back internal deadlines for census data collection and analysis because of collection problems related to COVID-19. (For one, the Bureau couldn't keep census data doorknockers on the payroll: they kept quitting out of fear of contracting COVID.) The Bureau also announced that it wouldn't be able to meet statutory deadlines for reporting census data. The Bureau said that under its regular deadlines the census would be incomplete and inaccurate.

But then in early August, the Bureau abruptly reversed course and issued the "Replan." The Replan "accelerate[d] the completion of data collection and apportionment counts by our statutory deadline of December 31, 2020 . . . ."

The problem was that the Bureau itself--and the Bureau's unanimous Scientific Advisory Committee, and the GAO, and the Commerce Department's Inspector General--concluded that the Replan increased the risks of an incomplete and inaccurate 2020 census.

Plaintiff organizations and local jurisdictions sued, arguing that the Replan violated the APA and the Enumeration Clause and sought to halt its implementation. The court ruled that the case was justiciable, that the plaintiffs had standing, and that the Replan likely violated the APA. (It did not rule on the Enumeration Clause, because it didn't have to. The APA ruling was enough to say that it likely violated the law.) As to the APA claim, the court wrote:

[T]he Court agreed that Plaintiffs are likely to succeed on the merits of their APA arbitrary and capricious claim for five reasons: (1) Defendants failed to consider important aspects of the problem, including their constitutional and statutory obligations to produce an accurate census; (2) Defendants offered an explanation that runs counter to the evidence before them; (3) Defendants failed to consider alternatives; (4) Defendants failed to articulate a satisfactory explanation for the Replan; and (5) Defendants failed to consider reliance interests.

 

September 26, 2020 in Cases and Case Materials, Congressional Authority, Executive Authority, News, Separation of Powers | Permalink | Comments (0)

Friday, September 25, 2020

D.C. Circuit Says House Has Standing to Challenge Trump's Reprogramming Funds for Wall

The D.C. Circuit ruled today that the House of Representatives has standing to challenge President Trump's reprogramming of federal funds to build a border wall.

The ruling is a setback for the Trump Administration and its efforts to build the wall (or at least more of it than Congress authorized through federal funding). But the ruling only says that the House has standing--not that it wins. The case now goes back to the district court for further proceedings, unless the administration seeks en banc or Supreme Court review.

The court said that the House has standing to challenge the reprogramming under the Appropriations Clause, but not under the Administrative Procedure Act. That shouldn't matter much to the future of the case, though: the lower court will still rule whether the Trump administration violated the law (the Constitution) in reprogramming funds.

Aside from allowing this case to move forward, the ruling is also significant because it says that a single house of Congress has standing to challenge executive action in violation of the Appropriations Clause. Appropriations, of course, require both houses of Congress. But the court said that a single house nevertheless suffered sufficient injury to satisfy Article III standing requirements when the executive branch reprograms federal funds in alleged violation of the Appropriations Clause. Here's what the court wrote on that point:

More specifically, by spending funds that the House refused to allow, the Executive Branch has defied an express constitutional prohibition that protects each congressional chamber's unilateral authority to prevent expenditures. It is therefore "an institutional plaintiff asserting an institutional injury" that is both concrete and particularized, belonging to the House and the House alone.

To put it simply, the Appropriations Clause requires two keys to unlock the Treasury, and the House holds one of those keys. The Executive Branch has, in a word, snatched the House's key out of its hands. That is the injury over which the House is suing.

. . . 

[U]nder the defendants' standing paradigm [requiring Congress to sue, not just a single house], the Executive Branch can freely spend Treasury funds as it wishes unless and until a veto-proof majority of both houses of Congress forbids it. Even that might not be enough: Under defendants' standing theory, if the Executive Branch ignored that congressional override, the House would remain just as disabled to sue to protect its own institutional interests. That turns the constitutional order upside down.

 

September 25, 2020 in Cases and Case Materials, Congressional Authority, Courts and Judging, Executive Authority, News, Opinion Analysis, Separation of Powers, Standing | Permalink | Comments (0)

Thursday, July 9, 2020

Court Say State Grand Jury Can Subpoena President's Taxes, Financial Records

The Supreme Court ruled today that a state grand jury is not categorically prohibited from issuing a subpoena for the President's taxes and financial records. But the ruling leaves open the possibility that the President could argue that the subpoena violates state law, or that a particular subpoena, including this one, violates the separation of powers.

Because of that last bit, the ruling means that the grand jury probably won't get its hands on President Trump's taxes anytime soon. That's because the President is almost sure to pitch these arguments in state or federal court, and the litigation will likely take some time. That means that the ruling is likely a short-term win for the President.

But at the same time, the ruling is a dramatic loss for the presidency. That's because the Court unconditionally rejected the President's sweeping and categorical claim of absolute immunity against state criminal processes. President Trump overargued this, as did the DOJ, and the Court reined him in.

Here's our oral argument preview; here's the review.

Chief Justice Roberts wrote the opinion, joined by Justices Ginsburg, Breyer, Sotomayor, and Kagan. Justice Kavanaugh wrote an opinion concurring in the judgment, joined by Justice Gorsuch. Justice Thomas dissented, and Justice Alito dissented.

The Court held that Presidents long lacked immunity from federal criminal subpoenas, going all the way back to the Burr trial. It ruled that there's nothing different about a state criminal subpoena that would categorically immunize the President (as the president argued), or even raise the bar for a presidential subpoena (as DOJ argued). In particular, the Court rejected the President's claims that a state grand jury subpoena could divert the President's attention, stigmatize the President (and undermine his leadership), and harass the President in violation of federalism principles. It similarly rejected DOJ's similar reasons for a higher bar for presidential subpoenas.

The Court nevertheless left open the possibility that the President (like anybody else) could challenge a state grand jury subpoena under state law, like law that bans bad faith subpoenas or those that create an undue burden. It also left open the possibility that the President could challenge a specific subpoena on the basis that a particular subpoena unduly interfered with his duties as President. (The problem in this case was that the President claimed a categorical immunity from state subpoenas.) The President will probably take up these claims now, leading to yet another round of litigation, and probably preventing the grand jury from getting the documents and records anytime soon.

Justice Kavanaugh, joined by Justice Gorsuch, concurred in the judgment but wrote separately to underscore that there may be state law or constitutional problems with this particular subpoena, depending on how the courts balance out the competing interests of the state courts and the President.

Justice Thomas dissented, agreeing with the majority that the President isn't categorically immune from the grand jury's issuance of the subpoena, but that he might be immune from the enforcement of it.

Justice Alito dissented, too, agreeing that the President isn't categorically immune, but arguing for a heightened standard, given the nature of the Presidency and the federalism system.

 

July 9, 2020 in Cases and Case Materials, Executive Authority, Federalism, News, Opinion Analysis | Permalink | Comments (0)

Wednesday, July 8, 2020

Court Upholds Administration's Religious, Moral Exemptions to ACA's Contraception Guarantee

The Supreme Court today upheld the Trump Administration's rules substantially broadening the religious exemption and expanding it to those with a "moral" objection to the Affordable Care Act's contraception guarantee.

Our argument preview of the case is here.

The ruling in Little Sisters v. Pennsylvania means that a dramatically expanded group of employers--those with a religious objection or moral objection to contraception--get an automatic free pass on the requirement that employers provide their female employees with health-insurance coverage that includes contraceptives. Covered employers need not file for an self-certified exemption or accommodation; they just have to, well, not provide coverage.

This could mean that between 70,500 and 126,400 women would lose access to contraceptive services under their employer-provided health insurance plans. (This is the Administration's estimate.)

The Court's ruling leaves open another challenge to the rules, however, and the plaintiffs could raise the argument on remand, that is, that the rules are arbitrary and capricious under the Administrative Procedure Act.

Justice Thomas wrote for the Court, joined by Chief Justice Roberts, Alito, Gorsuch, and Kavanaugh. The Court ruled that the Departments had statutory authority to adopt the rules under 42 U.S.C. Sec. 300gg-13(a)(4), which provides that "with respect to women," group health plans must "at a minimum, provide . . . such additional preventive care and screenings not described in paragraph (1) as provided for in comprehensive guidelines supported by [HRSA]." The Court said that the "as provided for" clause "grants sweeping authority to HRSA to craft a set of standards defining the preventive care that applicable health plans must cover," leaving the HRSA with "virtually unbridled discretion to decide what counts as preventive care and screenings." The Court held that this authority included the power "to identify and create exemptions" like the ones in the challenged rules.

The Court also held that the Departments complied with the procedural requirements in the Administrative Procedure Act in adopting the rules.

The Court expressly declined to say whether RFRA compelled the exemptions in the rules, as the Administration argued. Still, the Court did say that the Departments were within their powers to consider RFRA in writing the rules, and even that "[i]t is clear from the face of the statute that the contraceptive mandate is capable of violating RFRA."

Justice Alito concurred in full, joined by Justice Gorsuch. Justice Alito argued that the Court should have resolved the RFRA question in favor of the Administration--that is, that RFRA compelled the rules. According to Justice Alito, this would have meant that the rules were not impermissibly arbitrary and capricious under the APA, and thus foreclosed that argument on remand.

Justice Kagan, joined by Justice Breyer, concurred in the judgment. Justice Kagan argued that HRSA had statutory authority to exempt certain employers from the contraceptive guarantee, but (different than the Court) because the HRSA was entitled to Chevron deference in its interpretation of the ambiguous statutory language. She also argued that the rules could be arbitrary and capricious--an issue for the lower court on remand.

Justice Ginsburg dissented, joined by Justice Sotomayor. Justice Ginsburg pointed to an earlier provision in the Act that specifies that group health plans and health insurance issuers "shall" cover specified services. She argued that this provision mandates who is required to provide specified services--and that it doesn't include any exemptions. (She argued that the section that the Court relied on only went to what services must be provided, not who must provide them. And yet the rules provide exemptions for who must provide services.) She also argued that the rules weren't compelled by the Free Exercise Clause or RFRA.

 

July 8, 2020 in Cases and Case Materials, Executive Authority, News, Opinion Analysis, Religion, Separation of Powers | Permalink | Comments (0)

Monday, July 6, 2020

Supreme Court Says States Can Punish Faithless Electors

A unanimous Supreme Court today upheld a state law that punishes "faithless electors." The ruling means that states can continue to impose fines on individuals appointed to vote in the Electoral College who pledge their vote to one candidate, but actually vote for another. In a companion case (in a brief per curiam opinion), the Court held that a state could remove and replace a faithless elector with an elector who would vote for the winner of the state's popular vote.

The case, Chiafalo v. Washington, arose when three Washington electors who pledged to support Hillary Clinton in the 2016 presidential election actually voted for someone else. (They hoped that they could encourage other electors to do the same, and deny Donald Trump the presidency.) The state imposed a $1000 fine for each "faithless elector" for violating their pledge to support the candidate who won the state's popular vote.

The pledge wasn't a problem. The Court in 1952 upheld a pledge requirement, and a state's power to appoint only those electors who would vote for the candidate of the winning political party. But that case, Ray v. Blair, didn't answer the question whether a state could punish a faithless elector.

Today's ruling says yes.

Justice Kagan wrote for the Court. She noted first that the appointment power in Article II, Section 1, authorizes each state to appoint electors "in such Manner as the Legislature thereof may direct." This power to appoint "includes a power to condition [the] appointment--that is, to say what the elector must do for the appointment to take effect," including requiring the elector to pledge to cast a vote in the Electoral College that reflects the popular vote in the state. Then: "And nothing in the Constitution expressly prohibits States from taking away presidential electors' voting discretion as Washington does." In short, "a law penalizing faithless voting (like a law merely barring that practice) is an exercise of the State's power to impose conditions on the appointment of electors."

The Court also wrote that the practice of punishing a faithless elector is consistent with "long settled and established practice." "Washington's law, penalizing a pledge's breach, is only another in the same vein. It reflects a tradition more than two centuries old. In that practice, electors are not free agents; they are to vote for the candidate whom the State's voters have chosen."

Justice Thomas concurred, joined by Justice Gorsuch. Justice Thomas argued that the question isn't answered by Article II (or anything else in the Constitution), and so gets its answer from the federalism formula in the Tenth Amendment: "The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people."

July 6, 2020 in Cases and Case Materials, Elections and Voting, Federalism, News, Opinion Analysis | Permalink | Comments (0)

Monday, June 29, 2020

Court Strikes CFPB Director's Independence

The Supreme Court today struck the statutory independence of the Director of the Consumer Financial Protection Bureau, even as it declined to rule the entire CFPB unconstitutional. This means that the CFPB stays in place, Director and all, but that the President can terminate the Director at will. (As to the particular case before the Court, which challenged a CFPB enforcement demand, the ruling invalidates the demand. But the CFPB could reissue it and re-commence enforcement, but without protections for the Director.)

More broadly, the ruling in Seila Law v. CFPB says that Congress lacks authority to create an Executive Branch "independent" principal office, unless that office is part of a larger board or commission, and probably without significant executive power.

The ruling is a victory for the Trump Administration, which opposed independence for the CFPB Director. But at the same time, it sharply restricts Congress's power to create an independent principal office within the Executive Branch.

Under the Dodd-Frank Act, the CFPB has authority to implement and enforce a variety of consumer financial protection laws to "ensur[e] that all consumers have access to markets for consumer financial products and services and that markets for consumer financial products and services are fair, transparent, and competitive."

The Director is nominated by the President and confirmed by the Senate. In creating an independent Director, Congress legislated that the Director would be appointed for five years and can be removed only for "inefficiency, neglect of duty, or malfeasance in office." It's that "independence" that was at stake in the case.

The Court ruled that this independence violated the separation of powers. Pointing to the Article II Vesting Clause, the Court wrote that "[t]he entire 'executive Power' belongs to the President alone." It held that statutory independence for a principal executive officer who is not a part of a board of commission impermissibly restricts the President's executive power.

The Court distinguished Humphrey's Executor, holding that Humphrey's upheld the independence of a multi-member board, the FTC, whereas the CFPB has a single head. According to the Court, unlike the FTC (at the time), the CFPB's single Director is not a "body of experts," is not "non-partisan," and does not have staggered terms that "prevent[] complete turnover in leadership." Moreover, the CFPB Director has greater responsibilities than the old FTC did, including the "quintessentially executive power" to seek monetary penalties in federal court.

The Court distinguished Morrison v. Olson, holding that Congress may create an independent inferior officer. The Court said that the CFPB Director was a principal office, and had more wide-ranging authority than the independent counsel in Morrison, and that the independent counsel's prosecutorial authority looked inward, to Executive Branch officials on specified matters, whereas the CFPB Director has authority over "millions of private citizens and businesses, imposing even billion-dollar penalties through administrative adjudications and civil actions."

The Court declined to "extend" those cases to cover the "new situation" of the CFPB Director's independence. The Court said that there was no precedent for this kind of office, and that it "is incompatible with our constitutional structure." "The . . . constitutional strategy is straightforward: divide power everywhere except for the Presidency, and render the President directly accountable to the people through regular elections. In that scheme, individual executive officials will still wield significant authority, but that authority remains subject to the ongoing supervision and control of the elected President."

But even as the Court struck statutory independence for the Director, it declined to take down the entire CFPB. The Court ruled that the independence provision was severable from the rest of the Act, and therefore that the CFPB could remain, Director and all, but without the independence protection.

Justice Kagan, dissenting on independence but concurred on severability, and joined by Justices Ginsburg, Breyer, and Sotomayor, wrote:

If a removal provision violates the separation of powers, it is because the measure so deprives the President of control over an official as to impede his own constitutional functions. But with or without a for-cause removal provision, the President has at least as much control over an individual as over a commission--and possibly more. That means the constitutional concern is, if anything, ameliorated when the agency has a single head. . . .

In second-guessing the political branches, the majority second-guesses as well the wisdom of the Framers and the judgment of history. It writes in rules to the Constitution that the drafters knew well enough not to put there. It repudiates the lessons of American experience, from the 18th century to the present day. And it commits the Nation to a new static version of governance, incapable of responding to new conditions and challenges.

June 29, 2020 in Appointment and Removal Powers, Cases and Case Materials, Congressional Authority, Executive Authority, News, Opinion Analysis, Separation of Powers | Permalink | Comments (0)

Friday, June 26, 2020

Ninth Circuit Says President Can't Reprogram Funds for Border Wall

In a pair of rulings today, here and here, the Ninth Circuit held that President Trump exceeded his authority under federal law and violated the Appropriations Clause in reprogramming funds to build portions of a border wall between the U.S. and Mexico.

The rulings are a sharp set-back to President Trump's efforts to make good on his promise to build the wall.

Today's rulings come after the case has already been to the Supreme Court. Recall that the Court earlier granted the Administration's motion for a stay of the district court's earlier injunction, affirmed by the Ninth Circuit. The Court's stay meant that the injunction would not remain in place as the case moved forward on the merits. So the case moved forward on the merits, sans injunction. But then the district court ruled in favor of the plaintiffs and granted a new injunction. That's why we got today's rulings.

(There's some weirdness here. The Supreme Court granted the stay, stating, "Among the reasons is that the Government has made a sufficient showing at this stage that the plaintiffs have no cause of action to obtain review of the Acting Secretary's compliance with Section 8005." Despite this language, the court today ruled that the plaintiffs in both cases did have causes of action.)

The rulings say that President Trump exceeded his authority under the 2019 Defense Department Appropriations Act and violated the Appropriations Clause, and affirmed a permanent injunction.

The court held that in order to reprogram under Sections 8005 and 9002 of the 2019 Defense Department Appropriations Act, (1) there must be for an unforeseen military requirement and (2) Congress must not have previously denied funding. The court said that President Trump's reprogramming violated both requirements.

As to the first, the court said that the border wall was no "unforeseen military requirement." Among other things, the court noted that President Trump had long advocated for the wall, suggesting that it couldn't have been "unforeseen."

As to the second, the court noted that Congress had previously denied the Administration's request for full funding.

Judge Collins dissented in both cases. Judge Collins argued that the plaintiffs didn't have a cause of action (see the weirdness parenthetical, above), and that even if they did they'd lose on the merits.

June 26, 2020 in Cases and Case Materials, Congressional Authority, Executive Authority, News, Opinion Analysis, Separation of Powers | Permalink | Comments (0)

Wednesday, June 24, 2020

D.C. Circuit Orders District Judge to Dismiss Flynn Prosecution

A sharply divided three-judge panel of the D.C. Circuit today ordered Judge Emmet Sullivan to dismiss the criminal case against Michael Flynn for lying to the FBI. This is hardly the final word, though: the extraordinary ruling is sure to go to the full circuit, and perhaps even the Supreme Court.

Flynn was charged with lying to the FBI as part of the FBI's investigation into connections between the Trump campaign and Russia in the 2016 election. He pleaded guilty--twice, before two different federal judges--and agreed to cooperate with the government in its ongoing investigation. The court deferred sentencing to allow Flynn to continue to cooperate.

Flynn then moved to withdraw his plea, arguing that the government failed to produce exculpatory evidence. Most recently, DOJ came across material that, according to the government, means that the prosecution can no longer prove the charge. So the government moved to dismiss the case.

Judge Sullivan appointed an amicus to represent the no-dismissal side, invited other amici to weigh in, and set a hearing date on the motions--all to determine whether he should grant "leave of court" to dismiss. (That's the standard under a Rule 48(a) motion to dismiss a criminal charge.) (Judge Sullivan had serious concerns about the government's motion, given the many, many irregularities in the case.)

Then Flynn filed a writ of mandamus in the D.C. Circuit, and the government weighed in to support it. Note that Judge Sullivan had not yet even held the hearing on the motion to dismiss, much less denied it.

(Just gotta say it: Wow. Not your usual federal prosecution.)

Today the D.C. Circuit ruled for Flynn and ordered the prosecution dismissed. Judge Rao wrote the majority opinion, which concluded that Judge Sullivan committed clear legal error. Moreover, by ordering dismissal without a hearing or further consideration by the lower court, the court said that the district court had no role under the Rule 48(a) "with-leave-of-court" standard.

Judge Rao started by noting that a prosecution's motion to dismiss is entitled to a presumption of regularity. But the court wrote that Judge Sullivan raised nothing to challenge this presumption, or to show that this was the kind of case that warranted a hearing or further judicial inquiry into the motion. As such, the court concluded that Judge Sullivan went beyond his authority in appointing an amicus and scheduling a hearing. Again: All this before Judge Sullivan even held the hearing, much less ruled against dismissal.

Judge Rao explained in separation-of-powers terms:

In this case, the district court's actions will result in specific harms to the exercise of the Executive Branch's exclusive prosecutorial power. The contemplated proceedings would likely require the Executive to reveal the internal deliberative process behind its exercise of prosecutorial discretion, interfering with the Article II charging authority. Thus, the district court's appointment of the amicus and demonstrated intent to scrutinize the reasoning and motives of the Department of Justice constitute irreparable harms that cannot be remedied on appeal.

Judge Rao seemed to try to leave open some room for a district court to determine whether to grant "leave of court" on a Rule 48(a) motion to dismiss. But if this case doesn't fit the bill (again, with all its irregularities), it's not clear what would.

Judge Wilkins dissented. In short:

This appears to be the first time that we have issued a writ of mandamus to compel a district court to rule in a particular manner on a motion without first giving the lower court a reasonable opportunity to issue its own ruling; the first time any court has held that a district court must grant "leave of court" pursuant to Federal Rule of Criminal Procedure 48(a) without even holding a hearing on the merits of the motion; and the first time we have issued the writ even though the petitioner has an adequate alternative remedy [that is, appeal after a denial of the motion to dismiss], on the theory that another party [the government] would not have had an adequate alternative remedy if it had filed a petition as well. Any one of these is sufficient reason to exercise our discretion to deny the petition; together they compel its rejection.

 

June 24, 2020 in Cases and Case Materials, Courts and Judging, Executive Authority, News, Opinion Analysis, Separation of Powers | Permalink | Comments (2)

Tuesday, June 2, 2020

SCOTUS Upholds Appointments to Puerto Rico's Financial Oversight Board

A unanimous Supreme Court yesterday ruled in Financial Oversight and Management Board for Puerto Rico v. Auerelius Investment, LLC, that the President's appointment of members to the Financial Oversight Board, without Senate advice and consent, didn't violate (or even implicate) the Appointments Clause.

The ruling is a win for the Board and its authority to carry Puerto Rico through bankruptcy.

The Court said first that the Appointments Clause applies to all officers of the United States, including officers who operate within territories. But it went on to say that Board members in this case aren't officers of the United States, and the Appointments Clause therefore doesn't restrict their appointment.

The Court looked functionally to the Board's powers and duties and concluded that they're local, not national. The Court said that Board members therefore aren't officers of the United States covered by the Appointments Clause.

Justice Thomas concurred. He argued that the Court should have looked to the original public meaning of the Appointments Clause, not the "ill-defined path" that it took, and come out with the same result.

Justice Sotomayor concurred, too. She argued that given Puerto Rico's history--and, in particular, the compact between Puerto Rico and the federal government that established home rule for the island--it wasn't clear that Congress could create the Board at all. But nevertheless concurred, because the parties hadn't raised that issue:

These cases raise serious questions about when, if ever, the Federal Government may constitutionally exercise authority to establish territorial officers in a Territory like Puerto Rico, where Congress seemingly ceded that authority long ago to Puerto Rico itself. . . .

The Board members, tasked with determining the financial fate of a self-governing Territory, exist in a twilight zone of accountability, neither selected by Puerto Rico itself nor subject to the strictures of the Appointments Clause. I am skeptical that the Constitution countenances this freewheeling exercise of control over a population that the Federal Government has explicitly agreed to recognize as operating under a government of their own choosing, pursuant to a constitution of their own choosing. . . . Nevertheless, because these issues are not properly presented in these cases, I reluctantly concur in the judgment.

 

June 2, 2020 in Appointment and Removal Powers, Cases and Case Materials, Executive Authority, Federalism, News, Opinion Analysis | Permalink | Comments (0)

Monday, June 1, 2020

SCOTUS Says no Standing for Retirement-Plan Participants to Sue for Mismanagement

A sharply divided Supreme Court ruled today in Thole v. U.S. Bank that retirement-plan participants can't sue their former employer for mismanagement of the plan, because they hadn't demonstrated sufficient direct and concrete harm.

The ruling deals a sharp blow to defined-benefit plan participants who seek to sue for plan mismanagement. Under the ruling, those participants have to wait until their actual benefits drop, or close to it. And even so, the Court's ruling may give employers an out. At the same time, the ruling shields employers from liability unless and until their mismanagement is so bad that it actually or imminently results in lowered benefits.

While the plaintiffs sued under the individual cause of action in ERISA, the Court's ruling is based on Article III standing. This means that Congress can't change the law to create more permissive standing.

The case arose when two retirees of U.S. Bank sued that Bank and others for mismanaging their retirement-plan assets. The plaintiffs sued under ERISA's individual cause of action.

The Court ruled that the plaintiffs lacked Article III standing because, in short, they didn't suffer a harm. Justice Kavanaugh wrote for the five conservatives that the plaintiffs' monthly defined benefits didn't drop, or wouldn't imminently drop, based on the mismanagement, and any court ruling wouldn't affect their monthly benefits under the plan.

The Court also noted that the plaintiffs' benefits wouldn't drop even if the retirement plan failed, because the Pension Benefit Guarantee Corporation backstops failed retirement plans. This raises the question whether the plaintiffs would have standing even if the plan's failing led to a reduction in the benefits that the plan pays out (because the plaintiffs, after all, would theoretically continue to receive the full measure of their defined-benefit plan, even if from the PBGC, and not the plan).

The ruling means that the plaintiffs have to wait to sue until the plan's failure actually or imminently results in a reduction in their own benefits. And even then, the Court might've written in an out for the employer by noting that the PBGC backstops failing plans.

Justice Sotomayor, joined by the three other progressives, dissented. She argued that the plaintiffs have an interest in their plan's integrity, just as private trust beneficiaries have an interest in protecting their trust; that breach of a fiduciary duty is a cognizable injury, even if it doesn't result in financial harm or increased risk of nonpayment; and that the plaintiffs have associational standing to sue on behalf of the plan.

She concluded:

It is hard to overstate the harmful consequences of the Court's conclusion. . . . After today's decision, about 35 million people with defined-benefits plans will be vulnerable to fiduciary misconduct. The Court's reasoning allows fiduciaries to misuse pension funds so long as the employer has a strong enough balance sheet during (or, as alleged here, because of) the misbehavior. Indeed, the Court holds that the Constitution forbids retirees to remedy or prevent fiduciary breaches in federal court until their retirement plan or employer is on the brink of financial ruin. This is a remarkable result, and not only because this case is bookended by two financial crises.

June 1, 2020 in Cases and Case Materials, Courts and Judging, Jurisdiction of Federal Courts, News, Opinion Analysis, Standing | Permalink | Comments (0)

Saturday, May 30, 2020

SCOTUS Denies Emergency Injunction by Church Challenging California COVID-19 Order

A closely divided Court in South Bay United Pentacostal Church v. Newsom denied the application for emergency injunction relief sought by the church from California Governor Newsom's Executive Order placing numerical restrictions on all gatherings to combat the spread of the highly infectious corona virus causing COVID-19. The Ninth Circuit panel and the district judge had similarly denied the church's motion for a preliminary injunction.

There is no opinion from the Court. Chief Justice Roberts, who joined the majority in rejecting the emergency application, filed a brief concurring opinion.  On the merits, Chief Justice Roberts wrote:

Although California’s guidelines place restrictions on places of worship, those restrictions appear consistent with the Free Exercise Clause of the First Amendment. Similar or more severe restrictions apply to comparable secular gatherings, including lectures, concerts, movie showings, spectator sports, and theatrical performances, where large groups of people gather in close proximity for extended periods of time. And the Order exempts or treats more leniently only dissimilar activities, such as operating grocery stores, banks, and laundromats, in which people neither congregate in large groups nor remain in close proximity for extended periods.

The precise question of when restrictions on particular social activities should be lifted during the pandemic is a dynamic and fact-intensive matter subject to reasonable disagreement. Our Constitution principally entrusts “[t]he safety and the health of the people” to the politically accountable officials of the States “to guard and protect.” Jacobson v. Massachusetts, 197 U. S. 11, 38 (1905). When those officials “undertake[ ] to act in areas fraught with medical and scientific uncertainties,” their latitude “must be especially broad.” Marshall v. United States, 414 U. S. 417, 427 (1974). Where those broad limits are not exceeded, they should not be subject to second-guessing by an “unelected federal judiciary,” which lacks the background, competence, and expertise to assess public health and is not accountable to the people. See Garcia v. San Antonio Metropolitan Transit Authority, 469 U. S. 528, 545 (1985).

That is especially true where, as here, a party seeks emergency relief in an interlocutory posture, while local officials are actively shaping their response to changing facts on the ground. The notion that it is “indisputably clear” that the Government’s limitations are unconstitutional seems quite improbable.

In short, religious gatherings were not being treated any differently under the California Order and the judiciary should defer to the politically accountable entities in health situations, especially when these are uncertain and changing.

Justice Bret Kavanaugh wrote a dissenting opinion, joined by Justices Thomas and Gorsuch — but interestingly not Justice Alito — concluding that the California Order did not treat the religious institutions the same as "comparable secular businesses" such as grocery stores. Kavanaugh argues that given this differential treatment, struct scrutiny should apply, and California has not advanced a sufficiently compelling reason to treat religious gatherings differently.

As the pandemic continues, there is certainly sure to be more litigation, but for a majority of the Court, gatherings including those that are religious can be limited in service to public health.

May 30, 2020 in Cases and Case Materials, Courts and Judging, First Amendment, Free Exercise Clause, Medical Decisions, Opinion Analysis, Religion, Science, Supreme Court (US) | Permalink | Comments (0)

Friday, May 15, 2020

Sixth Circuit Says Governor's Shut-Down Order Likely Violates Free Exercise

The Sixth Circuit ruled earlier this week that Kentucky Governor Beshear's business shut-down order likely violates the Free Exercise Clause as applied to religious services. The ruling prevents the government from enforcing the shut-down order against religious services while the case moves forward. At the same time, however, the ruling tells the Governor how to regulate religious services consistent with free exercise (simply impose social distancing requirements, e.g.).

The court recognized that religiously-neutral, generally-applicable laws are usually upheld (under rational basis review). But it said that the shut-down order wasn't generally applicable, as demonstrated by the many "life-sustaining" "exceptions" to shut-down:

Do the four pages of exceptions in the orders, and the kinds of group activities allowed, remove them from the safe harbor for generally applicable laws? We think so. As a rule of thumb, the more exceptions to a prohibition, the less likely it will count as a generally applicable, non-discriminatory law. "At some point, an exception-ridden policy takes on the appearance and reality of a system of individualized exemptions, the antithesis of a neutral and generally applicable policy and just the kind of state action that must run the gauntlet of strict scrutiny. . . .

The exception for "life-sustaining" businesses allows law firms, laundromats, liquor stores, gun shops, airlines, mining operations, funeral homes, and landscaping businesses to continue to operate so long as they follow social-distancing and other health-related precautions. But the orders do not permit soul-sustaining group services of faith organizations, even if the groups adhere to all the public health guidelines required of the other services.

The court went on to say that the Governor's order would likely fail strict scrutiny, because it wasn't narrowly tailored. "There are plenty of less restrictive ways to address these public-health issues," for example, "insist[ing] that the congregants adhere to social-distancing and other health requirements and leave it at that--just as the Governor has done for comparable secular activities[.]"

May 15, 2020 in Cases and Case Materials, Free Exercise Clause, News, Opinion Analysis | Permalink | Comments (1)

Thursday, May 14, 2020

Wisconsin High Court Strikes Isolation Order, Justices Debate Separation of Powers

A sharply divided Wisconsin Supreme Court struck the isolation order issued by the state Department of Health Services Secretary-Designee, effective immediately. The 4-3 ruling said that the order didn't go through administrative rule-making process and exceeded DHS's statutory authority.

The ruling says nothing about Governor Evers's emergency order. And nothing in the ruling restricts the state DHS from going back to the drawing board to tailor an administrative rule or order to the court's ruling.

The majority opinion focuses almost exclusively on administrative law and statutory authority.

But don't stop there: the lengthy concurring and dissenting opinions, and their back-and-forth on the separation of powers, are well worth a look--if only for the dramatically different ways that the Justices apply these principles.

May 14, 2020 in Cases and Case Materials, Comparative Constitutionalism, News, Opinion Analysis, Separation of Powers | Permalink | Comments (0)