Opinion analysis: Supreme Court protects defined-benefit plan fiduciaries from lawsuits

Opinion analysis: Supreme Court protects defined-benefit plan fiduciaries from lawsuits

In a 5-4 decision, the Supreme Court held in Thole v. U.S. Bank that participants and beneficiaries in defined-benefit plans do not have the legal right, known as standing, to assert fiduciary breach claims, at least in the absence of catastrophic plan and sponsor failure. James Thole and Sherry Smith, retirees from U.S. Bank, alleged that plan fiduciaries breached their duties of loyalty and care, which caused the plan to lose more than $748 million. After the district court held that Thole and Smith had Article III standing to sue the fiduciaries, U.S. Bank made a substantial contribution to the plan, which increased the plan’s assets above the statutory minimum. The U.S. Court of Appeals for the 8th Circuit held that Thole and Smith lacked standing because they had received all the benefits to which they were entitled.

Justice Brett Kavanaugh, in a relatively short opinion joined by Chief Justice John Roberts and Justices Clarence Thomas, Samuel Alito and Neil Gorsuch, agreed with the court of appeals that Thole and Smith lack Article III standing. The majority held that Thole and Smith do not have a sufficient stake in the outcome of the lawsuit because, win or lose, they would receive the same amount of monthly pension benefits from the plan.

First, the majority opinion distinguished defined-benefit plans, such as the one at issue, from defined-contribution plans and grantor trusts. In defined-contribution plans, participants and beneficiaries are entitled to the funds they accumulate in their plan accounts. The majority wrote that the rights in a defined-benefit plan are “more in the nature of … contract” rights than the trust-based equitable or property rights that flow from defined-contribution plans and grantor trusts. Therefore, Thole and Smith did not have any equitable or property interests in the U.S. Bank plan.

Second, the majority determined that Thole and Smith do not have standing as representatives of the plan itself because they have not suffered any injury in fact. Nor have Thole and Smith received any assignment of the plan’s potential fiduciary claims.

Third, Thole and Smith had pointed to language in the Employee Retirement Income Security Act that explicitly provides a cause of action for participants and beneficiaries, in addition to the Secretary of Labor or a fiduciary, to bring a claim for fiduciary breach. Here the majority looked to precedent establishing that the grant of a statutory right is not alone sufficient to establish Article III standing. A concrete injury is required. Because Thole and Smith have not suffered any financial injury, they do not meet that requirement. In a footnote, the majority recognized that the current case does not involve an alleged breach of the duty to provide plan information.

Finally, the majority rejected Thole and Smith’s contention that plaintiffs and beneficiaries need to be able to bring fiduciary breach claims because otherwise there would be insufficient constraints on fiduciary misconduct. According to the majority, employers and shareholders have an interest in ensuring fiduciary loyalty and prudence because, in defined-benefit plans, employers are obligated to make up for any deficit in plan funding. The Department of Labor has both the power and the incentive to enforce ERISA’s fiduciary obligations. The majority left open the question, raised in amicus briefs, whether standing would exist when “the mismanagement of the plan was so egregious that it substantially increased the risk that the plan and the employer would fail and be unable to pay the participants’ future pension benefits.”

Thomas, joined by Gorsuch, concurred in the outcome and in the majority’s application of the court’s precedent. The concurrence, however, raised an argument that Thomas has made dating back at least to his 1995 dissent (joined by Justices Sandra Day O’Connor and Antonin Scalia) in Varity Corp v. Howe. His view, repeated in subsequent cases addressing the scope of ERISA remedies, is that the Supreme Court’s heavy reliance on the common law of trusts in ERISA cases is misplaced.

Justice Sonia Sotomayor authored a lengthy dissent, which Justices Ruth Bader Ginsburg, Stephen Breyer and Elena Kagan joined. The dissent disagreed with the majority’s decision to distinguish the rights of defined-benefit plan participants and beneficiaries from the rights of those entitled to benefits from defined-contribution plans or grantor trusts. ERISA requires that plan assets be held in trust. If, as the majority held, plan participants and beneficiaries are not entitled to the “equitable title in the plan’s assets, then no one would” hold that title. The dissent found the majority’s distinctions between defined-benefit trusts and grantor trusts unpersuasive. Most notably, the majority made much of the fact that employers must ensure that plans are funded sufficiently to pay full benefits. The dissent pointed out that traditional trust law recognizes that one need not hold the residual risk in order to possess an equitable interest in the trust.

The dissent also chided the majority for implying that a financial injury is necessary to establish Article III standing. The majority emphasized that Thole and Smith had received all of the pension benefits to which they are entitled and will continue to receive their benefits whether they win or lose the case. But, as noted above, the majority took pains in a footnote to distinguish this case from one alleging a failure to provide plan information. The dissent pointed out that it is well established in trust law that trust beneficiaries have standing to bring claims for a breach of loyalty even in the absence of any loss to the trust. Further, monetary injury is not required for standing. The dissent would find that participants in a plan have a right to loyal and prudent fiduciaries.

Even assuming that the majority were correct to characterize the defined-benefit plan as primarily contractual, the dissent went on to raise two contract-based arguments for standing. First, the plan document, which the majority did not analyze, creates a trust. Second, even under a contract analysis, Thole and Smith should have standing to bring a breach of contract claim for the fiduciaries’ alleged actions.

Finally, the dissent argued that Thole and Smith have standing as representatives of the plan. A plan cannot act on its own; like a corporation, it requires a person to act on its behalf. ERISA explicitly provides that a fiduciary, the Secretary of Labor, or participants and beneficiaries may assert a claim for fiduciary breach. In the circumstances of this case, the fiduciaries are unlikely to bring a claim against themselves, and the federal government in its amicus brief stated that the Secretary of Labor cannot ensure compliance by all ERISA fiduciaries. The dissent argued that the court’s existing precedent on representational standing supports standing for Thole and Smith in this suit. For example, trust law permits a beneficiary to sue as a trust representative when the trustee will not or cannot bring the claim.

Today’s decision illustrates the tension often seen in ERISA cases. The dissent emphasizes the protective purposes of the statute and worries that the risk of fiduciary misbehavior could imperil the benefits of the approximately 35 million people who have defined-benefit plans. In contrast, the majority views rights to defined-benefit plan pensions as largely contractual. In their view, participants and beneficiaries who receive their full benefits do not suffer any cognizable injury from fiduciary breaches that affect the plan’s assets.

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Opinion analysis: Federal courts can review factual findings of a Convention Against Torture claim raised as a defense to crime-based removal

Opinion analysis: Federal courts can review factual findings of a Convention Against Torture claim raised as a defense to crime-based removal

In a narrow, textualist decision, the Supreme Court today agreed with Nidal Khalid Nasrallah that a federal court of appeals has jurisdiction to review, albeit deferentially, the factual basis of the Board of Immigration Appeals’ denial of his claim that he qualifies for protection under the Convention Against Torture.

Nasrallah sought the United States’ protection under CAT, which prohibits removal of a noncitizen to a country where the noncitizen likely would be tortured. An immigration judge found that Nasrallah qualified for deferral of removal under CAT because he likely would be tortured if returned to his native country of Lebanon. Nasrallah remained eligible for this form of relief even though the immigration judge also found that he had committed an offense that qualified as a crime involving moral turpitude, rendering him otherwise removable. The Board of Immigration Appeals agreed with the immigration judge’s finding that Nasrallah had committed a crime involving moral turpitude, but disagreed that he qualified for deferral of removal under CAT. When Nasrallah appealed to the U.S. Court of Appeals for the 11th Circuit, that court determined that it lacked jurisdiction to hear his appeal because 8 U.S.C. § 1252(a)(2)(C) prohibits courts from reviewing questions of fact in “any final order of removal against” a noncitizen “removable by reason of having committed” certain criminal offenses.

Nasrallah maintained that the federal court of appeals did have jurisdiction to review his claim because 8 U.S.C. § Section 1252(a)(4) allows for judicial review of “any cause or claim under the United Nations Convention Against Torture.” In an opinion authored by Justice Brett Kavanaugh, and joined by Chief Justice John Roberts as well as Justices Ruth Bader Ginsburg, Stephen Breyer, Sonia Sotomayor, Elena Kagan and Neil Gorsuch, the court held that “the court of appeals should review factual challenges to the CAT order deferentially.”

The decision will alter the legal landscape for two reasons. First, the courts of appeals have split on this question, with most courts embracing the government’s more restrictive interpretation of the relevant statute. Aside from the U.S. Courts of Appeals for the 7th and 9th Circuits, all other circuit courts have sided with the government’s contention that factual review of a CAT claim is barred by Sections 1252(a)(2)(C) and (D). So the opinion will change practices in most courts of appeals, though whether it will change outcomes in individual cases under the deferential standard of review remains to be seen. Second, the decision may imply the availability of judicial review for factual claims in cases involving other forms of relief from removal – most notably, statutory withholding of removal under 8 U.S.C. § 1231(b)(3)(A).

As Kavanaugh’s opinion makes clear, all parties agreed that Section 1252(a)(1) authorizes noncitizens to obtain direct “review of a final order of removal” in a court of appeals. The parties also agreed that all challenges to the “final order of removal” had to be consolidated in a single petition for review under Section 1252(b)(9). At the same time, the Foreign Affairs Reform and Restructuring Act of 1998 provides for judicial review of CAT claims “as part of the review of a final order of removal pursuant to section 242 of the Immigration and Nationality Act (8 U. S. C. § 1252).” The majority opinion also notes that under the REAL ID Act of 2005, codified at 8 U.S.C. §1252(a)(4), “CAT orders … may not be reviewed in district courts, even via habeas corpus, and may be reviewed only in the courts of appeals.”

Although the resulting statutory text appears to contemplate federal appellate review of the factual findings of a CAT claim, the government argued that such review is constrained in cases like Nasrallah’s, in which the final order of removal is based on criminal conduct covered by Section 1252(a)(2)(C). In such cases, courts of appeals may review constitutional or legal challenges to a final order of removal, but not factual challenges to that order. The government argued that this bar to judicial review of factual challenges applied to Nasrallah’s CAT claim as well as other aspects of his removal order.

The Supreme Court disagreed. Kavanaugh’s opinion reasons:

A CAT order leaves a final removal order in place. It simply defers the order’s execution. It does not prevent the government from executing the removal order when country conditions change or prohibit removal to a third country. Nor does the CAT order merge into the final order of removal for purposes of judicial review. Kavanaugh writes, “[f]or purposes of this statute, final orders of removal encompass only the rulings made by the immigration judge or Board of Immigration Appeals that affect the validity of the final order of removal.”

After interpreting CAT relief as separate from, although reviewed with, the underlying removal order, the majority concludes that the appropriate standard of review for challenges to the factual findings on a CAT claim is the substantial-evidence standard: “The agency’s ‘findings of fact are conclusive unless any reasonable adjudicator would be compelled to conclude to the contrary.’”

In concluding that factual CAT claims are reviewable by courts of appeals, the court addresses five arguments raised by the government in support of its position. First, it rejects the government’s reliance on the broad definition of “final orders of deportation” articulated in Foti v. INS, noting that Foti was decided before Congress substantially revised the definition and content of final removal orders in 1996. Second, the court rejects the government’s claim that, because Section 1252(b) only allows for review of “final orders of removal,” placing review of a CAT claim outside the jurisdictional limits of the statute would deprive the appellate courts of any power to review CAT decisions. The majority notes that both FARRA and the REAL ID Act expressly provide for judicial review of CAT claims. Third, the court dismisses the government’s argument that congressional intent favors streamlining judicial review of removal orders for noncitizens convicted of crimes, requiring a different result. The court finds such an interpretation of congressional intent contrary to the statute, and reasons that even if Congress wanted to streamline review of straightforward questions regarding noncitizens’ previously litigated criminal conduct, such reasoning would not apply to CAT claims, which have never been reviewed by any court. Fourth, the court disagrees with the government’s claim that a decision in Nasrallah’s favor would “unduly delay removal proceedings,” because the review of CAT claims does not add any new layers of review. The court also points to the government’s failure to inform the court of “any significant problems stemming from” the review of factual determinations in CAT claims in the two circuits that already allow it.

Finally, the court rejects the government’s “slippery slope” argument that allowing review of factual findings in CAT claims might also require such review for a variety of claims for relief. Addressing this concern, the court concludes that “another jurisdiction-stripping provision, §1252(a)(2)(B), states that a noncitizen may not bring a factual challenge to orders denying discretionary relief, including cancellation of removal, voluntary departure, adjustment of status, certain inadmissibility waivers, and other determinations ‘made discretionary by statute.’” Such determinations are therefore not affected by this decision. The court also adds in a footnote that its decision does not mean that CAT claims raised in expedited removal proceedings are entitled to judicial review, because those claims are governed by distinct statutory provisions. The dissent argues that nevertheless, these limits do not confine the effects of today’s decision to the CAT context.

Justice Clarence Thomas dissented, joined by Justice Samuel Alito. Pursuing a line of reasoning articulated by Alito during oral argument, Thomas looks to the “zipper clause,” 8 U.S.C. § 1252(b)(9), which states that “all questions of law and fact … arising from any action taken or proceeding brought to remove an alien … shall be available only in judicial review of a final order under this section.” Thomas reasons that this applies to the CAT claims “arising from” the relevant removal proceedings. Under this interpretation, CAT claims are limited by the bars on factual review set forth in Sections 1252(a)(2)(C) and(D).

Returning to slippery slope concerns, Thomas’ opinion notes that the court’s reasoning regarding CAT claims applies equally well to statutory claims for withholding of removal, which are available if “the alien’s life or freedom would be threatened … because of the alien’s race, religion, nationality, membership in a particular social group, or political opinion.” Like CAT relief, statutory withholding leaves the underlying removal order in place and simply prevents the removal of the noncitizen unless and until other conditions are satisfied. Thomas notes that this is a “frequently sought form of relief.” He therefore predicts that this decision will bring about a “sea change” in immigration law because courts of appeals will now be able to review factual challenges to denials of statutory withholding of removal.

Interestingly, the majority opinion does not refute this possibility. “That question,” Kavanaugh writes, “is not presented in this case, and we therefore leave its resolution for another day.” Ultimately, then, this decision allows for federal appellate court review of administrative factual findings in CAT claims, but it also may invite such challenges in statutory withholding of removal claims.

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Event announcement: Supreme Court Draws to a Big Close

Event announcement: Supreme Court Draws to a Big Close

This Thursday, June 4, at 1:30 p.m. EDT, the Committee for Justice will host a panel to discuss a number of high-profile cases still awaiting decision this term at the Supreme Court. Panelists John Malcolm of the Heritage Foundation, Amy Howe of Howe on the Court, and John Eastman of Chapman University Law will preview big decisions pending on abortion, DACA, religious school funding, LGBTQ discrimination, and more. Committee for Justice President Curt Levey will moderate.

Click here for more information and to register.

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Opinion analysis: Justices reject limitations on enforcement of arbitration agreements by nonsignatory businesses

Opinion analysis: Justices reject limitations on enforcement of arbitration agreements by nonsignatory businesses

GE Energy Power Conversion France SAS v Outokumpu Stainless USA is a bit different from the typical Supreme Court arbitration case. Most of those cases involve a predispute arbitration agreement between a consumer and a business, in which a lower court has found some reason to allow the consumer to evade arbitration and the Supreme Court considers whether the Federal Arbitration Act justifies compelling arbitration. This case, by contrast, involves a dispute between two businesses over an international contract. The relevant body of law for that dispute is the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, commonly known as the New York Convention. That treaty (to which the United States and about 160 other nations are signatories) obligates nations to enforce arbitration agreements between businesses of member states.

The specific question before the court was whether it is consistent with the obligations of the United States under the New York Convention for federal courts to apply traditional doctrines of equitable estoppel that permit the enforcement of an arbitration agreement by a business that did not sign the agreement.

The factual background starts with contracts between the predecessor of respondent Outokumpu Stainless USA (the U.S. subsidiary of a large Finnish stainless-steel producer) and F. L. Industries (an affiliate of a French engineering group) to construct steel mills at a plant in Alabama. When motors failed at the Alabama facility, F. L. Industries disclaimed responsibility, arguing that any fault lay with its subcontractor, petitioner GE Energy Power Conversion France (a French subsidiary of General Electric that had built and installed the motors). Outokumpu and its insurers responded by suing GE France in Alabama. Because Outokumpu had agreed to arbitrate any disputes with F. L. Industries, GE France argued that the common law doctrine of equitable estoppel should compel Outokumpu and its insurers to present their claims in arbitration, even though GE France had not signed the contracts that contained the arbitration agreement.

The equitable estoppel doctrine is notoriously malleable, so the court of appeals might have held that GE France’s role in performing the original contracts on behalf of F. L. Industries, the French company that signed the contracts, should allow GE France to claim the benefit of the arbitration clause. Instead, however, the court of appeals held that the New York Convention categorically prohibits application of any doctrine that would permit a nonsignatory to a cross-border commercial arbitration agreement to use the Convention to compel arbitration. On that narrow question, the justices unanimously reversed the court of appeals.

Writing for the court, Justice Clarence Thomas explained that the New York Convention “focuses almost entirely on arbitral awards” and “contains only three provisions, each one sentence long,” that “addres[s] arbitration agreements.” Those three sentences, Thomas explained, obligate courts to “recognize” written arbitration agreements, including arbitral clauses in longer contracts, and then refer the parties to those agreements to arbitration upon request.

With so little of the New York Convention focused on the problem of arbitration agreements, it was easy for Thomas to conclude that the “text of the New York Convention does not address whether nonsignatories may enforce arbitration agreements [because t]he Convention is simply silent on the issue.” Thomas pointed out that the Convention’s only substantive statement that relates to agreements requires courts to “refer the parties to arbitration.” For him, that “provision, however, does not restrict contracting states from applying domestic law to refer parties to arbitration in other circumstances.” Rephrasing, he explained: “[The Convention] provides that arbitration agreements must be enforced in certain circumstances, but it does not prevent the application of domestic laws that are more generous in enforcing arbitration agreements.”

Turning from the text, Thomas next considered whether three aspects of the Convention’s history and context shed any light on the question before the court. The first is the negotiation and drafting history of the treaty, an “interpretive aid” that federal courts often have employed. For Thomas, that history “shows only that the drafters sought to impose baseline [enforcement] requirements on contracting states,” not “that the Convention sought to prevent contracting states from applying domestic law that permits nonsignatories to enforce arbitration agreements.”

Second, he turned to the “post-ratification understanding” of other countries, noting that the Supreme Court previously has looked to the decisions of other nations’ courts when interpreting treaties. On that point, Thomas noted that “numerous contracting states permit enforcement of arbitration agreements by entities who did not sign an agreement” and that “at least one contracting state” had adopted legislation to that effect. Thomas acknowledged that the post-ratification materials are “not without their faults,” in part because they “occurred decades after the finalization of the New York Convention’s text in 1958,” which “diminishes the value of these sources as evidence of the original shared understanding of the treaty’s meaning.” But the weakness of the materials did not change his view that “any weight” at all given to those materials tended to “confir[m] our understanding.”

Third and finally, Thomas turned to the question whether the lower courts should have given “great weight” to the amicus brief filed by the United States. Thomas disposed of that point quickly, noting that because the court’s “textual analysis aligns with the Executive’s … there is no need to determine whether the Executive’s understanding is entitled to ‘weight’ or ‘deference.’”

The opinion closed by emphasizing that the lower courts are free on remand to consider whether any estoppel doctrine in fact would permit GE France to enforce the arbitration agreement. That closing passage might hold the key to the unanimity of the decision. I noted in my post on the argument that the justices seemed divided about the propriety of enforcing arbitration here, with Chief Justice John Roberts and Justice Ruth Bader Ginsburg quite dubious about GE France’s estoppel claim and Justice Sonia Sotomayor quite receptive to it. By leaving that question to the lower courts and deciding the case on the narrow basis that the Convention permits the application of estoppel doctrines (whatever those might say), Thomas seems to have brought all nine votes together.

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Opinion analysis: After a long wait, a unanimous court upholds Puerto Rico oversight board

Opinion analysis: After a long wait, a unanimous court upholds Puerto Rico oversight board

In 2016, Congress passed the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA). The law created a seven-member board tasked with bringing financial stability back to the island. But when the board began proceedings in federal court to restructure Puerto Rico’s massive debt, a hedge fund that had invested in distressed Puerto Rico bonds and a local labor union went to court to challenge the method by which the board’s members had been appointed. They argued that under the Constitution’s appointments clause, the board members should have been nominated by the president and confirmed by the Senate. Because they were not, the challengers contended, the board’s actions could not be valid.

Today the Supreme Court unanimously rejected that argument. In an opinion by Justice Stephen Breyer, the court agreed that the appointments clause applies to all “Officers of the United States,” including high-level officials whose duties relate to Puerto Rico. But, the court continued, the clause’s use of the phrase “of the United States” indicates that the drafters of the Constitution intended to distinguish between federal officials, on the one hand, and officials exercising state or local power, on the other. Moreover, the court noted, two provisions of the Constitution give Congress authority to legislate for the District of Columbia and U.S. territories; both the text and structure of the Constitution and history indicate that when Congress has created local offices using this power, those officials have been regarded as exercising local government power, rather than federal power. “Indeed,” the court observed, “to read Appointments Clause constraints as binding Puerto Rican officials with primarily local duties would work havoc with Puerto Rico’s (federally ratified) democratic methods for selecting many of its officials.” Therefore, the court concluded, the appointments clause “does not restrict the appointment of local officers that Congress vests with primarily local duties.”

The next question for the court, then, was whether members of the oversight board have “primarily local powers and duties.” The answer, the court said, is yes. Although the board has “broad investigatory powers,” the court reasoned, those powers “are backed by Puerto Rican, not federal, law.” The board’s other powers – developing Puerto Rico’s budget and issuing new debt – are also “quintessentially local.” And the board’s power to initiate bankruptcy proceedings, the court explained, is an authority that it has “on behalf of, and in the interests of, Puerto Rico” – even if those proceedings may have nationwide consequences.

The court explained that the cases on which the lower court relied in determining that the board members’ appointments violated the appointments clause all involved duties “that were indisputably federal or national in nature” – involving members of the Federal Election Commission and federal judges on tax courts, for example. Although the law creating the board and its duties is a federal law, the court emphasized, it is also important to look at the nature of the board members’ duties – that is, “whether they are primarily local versus primarily federal.” Otherwise, the court cautioned, courts could interfere with democratic elections or local appointment processes in the District of Columbia or U.S. territories, such as the election of the mayor of Washington or the governor of Guam.

Because it concluded that the board members were not required to be nominated by the president and confirmed by the Senate, the court explained, it did not need to consider whether the “de facto officer” doctrine, which blesses an official’s actions even when his appointment is later determined to be invalid, applies to the board’s decisions. It also declined to weigh in on the request to overrule the “Insular Cases,” a series of cases dating back to the early 20th century in which the court ruled that U.S. territories do not automatically receive all of the protections of the Constitution.

Justice Clarence Thomas filed an opinion in which he agreed with the court’s conclusion that the board members’ appointment did not violate the Constitution, but he rejected what he described as the “ill-defined path that the Court takes to reach this result.” Instead, he argued, the court should look simply to the meaning of the phrase “Officers of the United States”: Officials, like the board members, who are performing territorial duties do not fall within this definition.

Thomas criticized the court’s “amorphous” test to distinguish between “officers with ‘primarily local versus primarily federal’ duties,” noting that the court “fails to provide any explanation for what makes an officer’s duties ‘primarily local.’” Moreover, he added, the court’s focus on whether an officer’s duties are “primarily local” creates a loophole for Congress to circumvent the appointments clause “by supplementing an officer’s federal duties with sufficient” local duties.

Justice Sonia Sotomayor, whose parents were both born in Puerto Rico, also agreed with the court’s judgment but wrote separately to emphasize the extent to which “Puerto Rico, like a State, is an autonomous political entity.” Despite that autonomous status, she continued, the board has “wide-ranging, veto-free authority over Puerto Rico,” with Puerto Rico’s governor limited to a nonvoting role on the board. As a result, she concluded, the court’s ruling “seems anomalous”: The board exists “in a twilight zone of accountability, neither selected by Puerto Rico itself nor subject to the strictures of the Appointments Clause.” Sotomayor wrote that she is “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,” but – stressing that “these issues are not properly presented in these cases” – she “reluctantly” concurred in the court’s judgment.

Today’s ruling sends the case back to the lower court for further proceedings, but it is a decisive victory for the board and a defeat for the hedge fund and labor union that had challenged the appointments.

This post was originally published at Howe on the Court.

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Justices will not review challenge to mandatory bar dues

Justices will not review challenge to mandatory bar dues

This morning the Supreme Court issued orders from the justices’ private conference last Thursday. The justices did not add any new cases to their merits docket for the fall. They did not act on the group of cases challenging federal and state gun restrictions or the group of cases asking the justices to reconsider immunity for government officials (including police officers) accused of violating the constitutional rights of others.

The justices declined to review a challenge to the constitutionality of laws requiring lawyers who want to practice law in a state to join the state’s bar association and pay dues. The lawsuit was filed by two Wisconsin lawyers who argue that compelling them to do so violates the First Amendment.

Two years ago, in Janus v. American Federation of State, County, and Municipal Employees, the Supreme Court ruled that government employees who are represented by a union but do not belong to that union cannot be required to pay a fee to cover the costs of contract negotiations. The decision in Janus overruled the Supreme Court’s earlier decision in Abood v. Detroit Board of Education. In the wake of the Janus decision, Adam Jarchow and Michael Dean went to federal court in Wisconsin. Jarchow and Dean are licensed attorneys in Wisconsin but they disagree with the Wisconsin bar association’s advocacy on issues like the death penalty, immigration law, the free exercise of religion and campaign finance, and they object to having to join the bar association and support it with their dues. They argued that Janus “knocked the legs out from under” the Supreme Court’s prior rulings upholding compulsory bar membership and dues. The lower courts turned them down, on the ground that only the Supreme Court can overturn its earlier cases; Jarchow and Dean then went to the Supreme Court last winter, asking the justices to take up their case.

Justice Clarence Thomas, joined by Justice Neil Gorsuch, dissented from today’s denial of review, writing that he would “grant certiorari to address this important question.” The court’s “decision to overrule Abood,” Thomas argued, “casts significant doubt on” the court’s prior ruling involving bar dues, Keller v. State Bar of California. As a result, he concluded, “we should reexamine whether” Keller “is sound precedent.”

The justices’ next conference is scheduled for Thursday, June 4. We expect orders from that conference on Monday, June 8, at 9:30 a.m.

This post was originally published at Howe on the Court.

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Tuesday round-up

Tuesday round-up

Yesterday the court stepped up its opinion output for the term considerably, releasing decisions in five cases. In Financial Oversight Board for Puerto Rico v. Aurelius Investment, LLC, the justices unanimously upheld the structure of Puerto Rico’s Financial Oversight and Management Board, ruling that the board’s members do not have to be appointed by the president and confirmed by the Senate because its duties are primarily local. Amy Howe analyzes the opinion for this blog, in a post that first appeared at Howe on the Court. For USA Today, Richard Wolf and Kristine Phillips report that the decision “enables Puerto Rico to continue its slow progress under a financial oversight and management board named in 2016 as part of a federal law but later challenged by investors.” John Kruzel reports at The Hill that “[a] ruling against the board would have created more fiscal turmoil for Puerto Rico as it continues to recover from a financial crisis that began in 2014 and proved to be the worst in its history.” For The Wall Street Journal (subscription required), Jess Bravin and Andrew Scurria report that “[l]urking behind the decision—and made explicit in a concurring opinion by Justice Sonia Sotomayor—was the broader question of Puerto Rico’s political status.” Additional coverage comes from Pamela King at Greenwire (subscription required) and Mark Walsh at Education Week’s School Law Blog. At Slate, Kyla Eastling, Danny Li and Neil Weare regret that the court declined the opportunity to overrule “the Insular Cases, a series of controversial decisions from the era of Plessy v. Ferguson that … has justified denying basic constitutional rights and protections to the nearly 4 million Americans living in Puerto Rico and other U.S. territories.”

In Nasrallah v. Barr, the court ruled 7-2 that courts can review an immigrant’s factual challenge to a denial of an application to stay deportation under the Convention Against Torture. Jennifer Chacon has this blog’s argument analysis. In Banister v. Davis, another 7-2 decision, the court held that a prisoner’s motion under Federal Rule of Civil Procedure 59(e), which sets out the procedures for a motion to alter or amend a judgment, should not be treated as a second or successive petition for habeas corpus. At Crime & Consequences, Kent Scheidegger laments that in Banister the court “took a small step further down a road it has already traveled too far–bogging down federal habeas corpus cases by making them more like regular civil litigation in federal courts.”

In GE Energy Power Conversion v. Outokumpu Stainless, the court held 9-0 that, under an international convention governing the enforcement of foreign arbitral awards, a business that did not sign an arbitration agreement can still compel arbitration based on equitable estoppel. At the CPR Institute blog, Russ Bleemer writes that the court saw “no conflict between key international arbitration enforcement law implemented by the Federal Arbitration Act and state laws.” And in Thole v. U.S. Bank, the court held 5-4 that a participant in a defined-benefit pension fund that meets minimum-funding criteria cannot sue the fund managers when he has not actually suffered any financial injury. Dana Muir analyzes the opinion for this blog. For The Wall Street Journal (subscription required), Brent Kendall and Jess Bravin report that “the court ruled … along ideological lines that participants in U.S. Bancorp’s retirement plan couldn’t proceed with a putative class-action lawsuit alleging the bank’s pension managers violated their legal duties by making poor investment decisions.”

The justices also released orders yesterday from last week’s conference. They did not add any new cases to their merits docket, and they declined to review Jarchow v. State Bar of Wisconsin, a First Amendment challenge to Wisconsin’s mandatory bar membership and dues system. This blog’s coverage comes from Amy Howe, in a post that first appeared at Howe on the Court. At The Washington Free Beacon, Kevin Daley reports that Jarchow was “one of several petitions pending before the justices that follow the 2018 decision that struck down mandatory government union dues on First Amendment grounds.” At the Cato Institute’s Unlawful Shield blog, Jay Schweikert writes that several pending cert petitions involving qualified immunity, which shields police officers from liability for official actions that do not violate clearly established law, offer the justices “a critical opportunity now to take the first steps toward correcting the legal and moral perversities” of the doctrine.

At The National Law Review, Evan Seeman looks at the court’s order late last week in South Bay United Pentecostal Church v. Newsom, denying a California church’s request that the court block enforcement of the governor’s restrictions on attendance at religious services. At Fox News (via How Appealing), Ronn Blitzer writes that the 5-4 order, in which Chief Justice John Roberts wrote an opinion explaining his decision to deny relief, shows that “Roberts continues to position himself as the high court’s swing vote — siding with both his conservative and liberal colleagues in close decisions.” At National Review (via How Appealing), Carrie Severino argues that “Roberts blatantly mischaracterizes the issue[:] The test of discrimination isn’t whether any comparable secular activity is treated as badly as religious activity, it is whether any comparable secular activity is treated better than religious activity.”


  • In an op-ed at the Chicago Daily Law Bulletin, Daniel Cotter predicts a busy June for the Supreme Court.
  • At The World and Everything in It (podcast), Mary Reichard discusses two oral arguments in cases involving President Donald Trump’s efforts to shield his financial records, including his tax returns, from subpoenas issued to his accountant and lenders by a New York grand jury and three congressional committees.

We rely on our readers to send us links for our round-up. If you have or know of a recent (published in the last two or three days) article, post, podcast or op-ed relating to the Supreme Court that you’d like us to consider for inclusion in the round-up, please send it to roundup [at] scotusblog.com. Thank you!

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Live blog of orders and opinions (Update: Completed)

Live blog of orders and opinions (Update: Completed)

We live-blogged on Monday, June 1, as the court released orders from the May 28 conference and opinions in Thole v. U.S. Bank, Nasrallah v. Barr, Banister v. Davis, Financial Oversight and Management Board for Puerto Rico v. Aurelius Investment and GE Energy Power Conversion France v. Outokumpu Stainless USA. SCOTUSblog is sponsored by Casetext, the most intelligent way to search the law.

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This week at the court

This week at the court

On Monday, the court released orders from the May 28 conference. The justices did not add any new cases to next term’s merits docket. The court also released opinions in Thole v. U.S. Bank, Nasrallah v. Barr, Banister v. Davis, Financial Oversight and Management Board for Puerto Rico v. Aurelius Investment and GE Energy Power Conversion France v. Outokumpu Stainless USA.

On Thursday, the justices will hold their June 4 conference.

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Monday round-up

Monday round-up

As Amy Howe reports for this blog, on Friday “the Supreme Court declined to intervene in challenges by churches in southern California and the Chicago area to stay-at-home orders issued as a result of the COVID-19 crisis”: “[T]he justices were closely divided in the California case, [South Bay United Pentecostal Church v. Newsom], with Chief Justice John Roberts casting the deciding vote and writing a late-night opinion to explain his decision to deny relief.” At Education Week’s School Law Blog, Mark Walsh reports that “Roberts’ concurrence [in South Bay], only for himself, … emphasizes the gravity of the coronavirus pandemic.” For The Washington Post (subscription required), Robert Barnes reports that “[t]he … deeply divided order … still provides a guide for lower courts balancing government rules intended to preserve public health with parishioners’ constitutional religious rights.” At Vox, Ian Millhiser suggests that “Roberts’s vote in South Bay United suggests, at the very least, he recognizes that the Court must not afford so much special solicitude to religious conservatives that it endangers public health.” The editorial board of The Wall Street Journal (subscription required) finds it “disappointing to see the Chief late Friday join his liberal colleagues to uphold California’s discrimination against places of worship.”


  • At The Economist’s Espresso blog, Steven Mazie notes that “today a legal tussle over whether the House Judiciary Committee may see portions of the [Mueller] report that were redacted before its release in April 2019 comes to a head”: “[O]n May 8th the Supreme Court temporarily blocked the disclosure, allowing the Department of Justice a chance to request that the court take another look.”
  • At the ImmigrationProf Blog, Kevin Johnson and others weigh in on Department of Homeland Security v. Regents of the University of California, a challenge to the government’s decision to terminate the DACA program, which allowed immigrants brought to this country illegally as children to apply for protection from deportation; they argue that “[t]he Supreme Court should require the Department of Homeland Security to undertake [a] searching analysis of facts and policy impacts, and honestly proceed, playing by the rules.”
  • At the Duke Center for Firearms Law’s Second Thoughts blog, Robert Leider says “the constitutionality of restrictions on the public carry of firearms, whether open or concealed … is ripe for resolution”; he urges the court to review one of the pending cases from New Jersey that raises the issue, noting that New Jersey’s “justifiable need standard … is close to a blanket ban.”
  • The editorial board of The New York Times writes that “pleas from liberals and conservatives to narrow the doctrine of qualified immunity, and to make it easier to hold police and other officials accountable for obvious civil rights violations, have grown to a crescendo”; “[t]he Supreme Court is considering more than a dozen cases to hear next term that could do just that.”

We rely on our readers to send us links for our round-up. If you have or know of a recent (published in the last two or three days) article, post, podcast or op-ed relating to the Supreme Court that you’d like us to consider for inclusion in the round-up, please send it to roundup [at] scotusblog.com. Thank you!

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