Another busy, routine week for the Nine. The Justices decided two, admittedly-soporific cases. One concerned the statute of limitations in the Fair Debt Collection Practices Act, and the other required interpreting the attorney’s fees provision in the federal Patent Act. The Court concluded its December sitting by hearing oral argument in six cases, including a momentous Affordable Care Act case with nearly $12 billion at stake. The Justices also granted all three of President Trump’s tax returns cases, and Justice Sotomayor penned two opinions relating to denials of cert. Here’s your recap for the week of December 9.
Opinions Relating to Orders: 2
Oral Arguments: 6
Cert. Grants: 5
Cases Decided: 3
Cases Remaining: 60
Weeks Left in Term: 28
First, the Justices released a list of orders from their conference last week. They didn’t grant any new cases. The Justices issued a CVSG (a “call for the views of the U.S. Solicitor General”) in HSBC Holdings v. Picard, a bankruptcy law case sporting a circuit split.
Justice Sotomayor penned two statements respecting denials of cert, the first of which was in Schexnayder v. Vannoy. In 2007, allegations came forward that the Fifth Circuit Court of Appeals in New Orleans, LA had been summarily and secretly denying federal inmates’ pro se appeals over the past thirteen years and change. To fix this, the Lousiana state Supreme Court set up a special panel that would “re-review” each denial of a pro se appeal. Who staffed the panel? Three judges selected from the Fifth Circuit—the pool of judges who were involved in this quasi-conspiracy to begin with. Seems concerning, doesn’t it? How can any judge involved in this sort of scheme partake in the remedying phase? This was Sotomayor’s point. “The re-review procedure adopted by the Louisiana courts . . . raises serious due process concerns,” she wrote.
Her other opinion came in Cottier v. United States. The case involves alleged prosecutorial misconduct during the murder trial of Calmer Cottier. Two of Cottier’s accomplices accepted plea deals in which they signed “factual-basis statements,” affidavits that implicated Cottier in the murder. The same federal prosecutor that negotiated those plea deals also prosecuted Cottier’s trial. The prosecutor presented the two factual-basis statements as evidence and sent them into the jury room. When Cottier appealed his conviction, the Eighth Circuit found that this was a common occurrence for this particular prosecutor. This is “not a favored practice,” Sotomayor wrote, since what the prosecutor is doing is giving a “personal . . . stamp of approval, an assurance from the Government itself, that the witness is to be believed.”
Next, the Court heard oral arguments in two cases. First was Guerrero-Lasprilla v. Barr, a case that concerns the process by which immigration cases are adjudicated. In Mata v. Lynch (2015), the Supreme Court held that when an immigrant is ordered to leave the country, he/she has the right to file a motion to “reopen” his/her removal proceedings under federal immigration law. If an immigration judge denies the motion, the immigrant can petition a federal appeals court for review. Generally, there is a specific window in which the immigrant can file a motion to reopen, but that window can be extended in certain circumstances; in the legal lingo, we say that the limitations period for the motion to reopen is “equitably tolled.” An immigrant must demonstrate to the immigration judge that he has met the requirements for equitable tolling, and thus that he can file his motion to reopen past the deadline.
What prompted this case is what happens after an immigration judge determines that an immigrant has not met the requirements to toll his motion to reopen. Can the immigrant appeal the “equitable tolling” finding to a federal circuit court of appeals? The Fourth and Fifth Circuits have answered “no,” holding that to review a request for equitable tolling is a “question of fact” which strips appeals courts of jurisdiction. However, the Ninth Circuit has answered “yes,” holding that to review a request for equitable tolling is a “question of law” which does not strip appeals courts of jurisdiction. The Court will resolve this circuit split and decide whether a request for equitable tolling of an immigrant’s motion to reopen is a non-reviewable question of fact, or a reviewable question of law. The oral argument in Guerrero-Lasprilla is available via audio and transcript.
Next, the Justices heard arguments in Thryv, Inc. v. Click-to-Call Technologies, LP, a patent law case. In 2011, the Leahy-Smith America Invents Act (AIA) created a special administrative process by which earlier decisions to grant a patent can be reviewed. The AIA directs the U.S. Patent Trial and Appeal Board (PTAB) to review a challenge to a previously-issued patent and decide whether to institute “inter partes review,” a special, internal, litigation-like process for reviewing challenges to previously-issued patents. This decision is at the discretion of the Director of the U.S. Patent and Trademark Office, and the AIA says it shall be “final and nonappealable.” However, during litigation in this case, the U.S. Court of Appeals for the Federal Circuit determined that a party can appeal the PTAB’s decision to institute inter partes review. The Supreme Court will now review that decision. The oral argument in Thryv, Inc. is available via audio and transcript.
Tuesday morning, the Justices released their first decision of the term in an argued case: Rotkiske v. Klemm, which concerns the limitations provision of the Fair Debt Collection Practices Act (FDCPA). Justice Thomas wrote the Court’s opinion for an 8:1 majority, Justice Sotomayor wrote a short concurrence, and Justice Ginsburg was the lone dissenter.
The FDCPA allows debtors to file private civil suits against creditors for certain illegitimate debt collection practices. Such a suit must be brought “within one year from the date on which the [debt collection] violation occurs” (15 U.S.C. §1692(k)(d)). The question in this case is when that one-year clock begins ticking. Is it when the violation occurs, or is it when the debtor discovers the violation?
To make this clearer, let’s look at the underlying facts. In March 2008, Paul Klemm sued Kevin Rotkiske for unpaid credit card debt. Klemm attempted service at an address at which Rotkiske no longer lived. Klemm withdrew the suit temporarily, then refiled it in January 2009—again at the same, incorrect address. Rotkiske failed to respond to the suit, and Klemm won by default. In June 2015—six years after Klemm’s second attempted service—Rotkiske sued Klemm under the FDCPA, claiming that Klemm had purposely attempted service at the incorrect address. When asked about why the FDCPA’s statute of limitations did not bar his suit, Rotkiske replied that he didn’t become aware of Klemm’s alleged violation until September 2014, when Rotkiske was denied a mortgage because of the default.
Let’s go back to the question. The (alleged) violation occurred in January 2009. Rotkiske claims he did not discover the violation until September 2014. So, here, would the FDCPA’s limitations provision start running in January 2009 or September 2014? More broadly, does the FDCPA’s statute of limitations begin to run when the violation is discovered, or, instead, does it begin to run when the violation actually occurs?
Justice Thomas’ answer is that it begins to run when the violation occurs, not when the violation is discovered (a win for Klemm). In cases past, the Court has always begun its interpretation of limitations provisions by analyzing the statutory language. “If the words of a statute are unambiguous,” Thomas writes, this first step “is our last.” And, indeed, §1692(k)(d)’s language is quite clear: an FDPCA suit “may be brought . . . within one year from the date on which the violation occurs.” These words “unambiguously” set the date of the violation as the point in time at which the one-year clock starts. In addition, ordinary dictionary definitions around the time Congress enacted the FDCPA yield the same conclusion. Finally, the Court is not at liberty to read in a “discovery” provision that delays the limitations period until the uncovering of the violation. Thomas writes that this approach is a “bad wine of recent vintage” (quoting the late Justice Scalia in TRW Inc. v. Andrews (2001)), and it’s something Congress could have—and has—done numerous times in other laws. The fact that Congress declined to do so in the FDCPA speaks volumes. Therefore, Thomas holds that the limitations provision of the FDCPA begins to run when the alleged violation actually occurs. Chief Justice Roberts and Justices Breyer, Alito, Sotomayor, Kagan, Gorsuch, and Kavanaugh all agreed in full.
Justice Sotomayor penned a brief concurrence. She fully agreed with the majority’s holding re the beginning of the FDCPA’s statute of limitations. She notes, however, that there is a recognized, procedural exception to this kind of limitation. It’s dubbed the “equitable, fraud-specific discovery rule,” and it is “not the ‘bad wine of recent vintage'” that the majority mentioned. That said, Rotkiske decided not to appeal on this ground, so Sotomayor sees no need to consider this special doctrine here.
Justice Ginsburg filed a lone dissent, focusing principally on that “equitable, fraud-specific discovery” exception. She argues that “when fraud on the creditor’s part accounts for the debtor’s failure to sue” within the one-year window, “the ordinary applicable time trigger does not apply.” She quotes the Supreme Court’s decision in Holmberg v. Armbrecht (1946): “[T]his Court long ago adopted as its own the old chancery rule that where a plaintiff has been injured by fraud and remains in ignorance of it without any fault or want of diligence or care on his part, the bar of the statute [of limitations] does not begin to run until the fraud is discovered.” Plus, Holmberg also noted that “[t]his equitable doctrine is read into every federal statute of limitation.” Turning to the case at hand, Ginsburg doesn’t agree that Rotkiske failed to appeal on this ground. “Generously read,” she says, Rotkiske’s petition “asked whether a discovery rule of any kind applies to the FDCPA’s one-year statute of limitations” (emphasis added). And if the Court were to consider this question, Ginsburg would hold that Rotkiske’s FDCPA complaint “falls comfortably within the fraud-based discovery rule as an equitable doctrine.” Thus, she dissents from the Court’s majority opinion.
Next, the Court heard oral argument in two cases, the first of which was Maine Community Health Options v. United States. This case concerns a specific clause (42 U.S.C. §18062) of the 2010 Affordable Care Act, popularly known as “Obamacare.” While extremely technical, Maine Comm. Health Options poses enormous consequences for U.S. healthcare policy.
The clause at issue sought to mitigate the risk that private insurers face when they take on healthcare customers who are uninsured. In 2013, the clause established three-year “risk corridors” that orchestrated the exchange of money between the federal government and private insurance companies. Specifically, if a private insurer at the end of the fiscal year experienced higher-than-expected costs associated with bringing on uninsured customers, some of that excess cost was lifted from the private insurer’s accounts and paid for by the federal government. Conversely, if the private insurer experienced lower-than-expected costs, some of its excess savings was rerouted to the federal government. These payments to and from the federal government were to be funneled through the Department of Health and Human Services (HHS). Finally, at end of the three-year program, HHS would promulgate the official tally of the full collections due to the government and the full payments due to private insurers.
In December 2014, Congress enacted its appropriations law for FY 2015. The statute included a rider that directed HHS to limit the payments it gives out to under-cost insurers to the payments it brings in from over-cost insurers. In other words, if HHS brings in a total of $100 million from under-cost insurers, it can only give out up to, but no more than, $100 million to over-cost insurers for that FY. However, there was a significant problem with the appropriations statute and this rider: the amount of money the government owed over-cost private insurers for FY 2014 greatly exceeded the amount of money the government collected from under-cost insurers. By “greatly exceeded,” I mean enormously exceeded, in the form of $2.5 billion. Limited by the appropriations rider, HHS was able to pay private insurers only 12.6% of what it owed in FY 2014.
Analogous riders followed in Congress’ appropriations bills for FYs 2016 and 2017. HHS used its collections in 2015–2016 to pay down what it still owed from FY 2014; none of it was devoted to payments owed for the 2015 and 2016 FYs. At the end of the three-year period, HHS announced the official tally of what it owed private insurers for the entire program: nearly $12 billion. As of this year, Congress has not appropriated any funds to HHS for the “risk corridor” program, and HHS has not paid private insurers any of the one-dozen billion dollars it still owes them.
Scores of private insurers sued the federal government, and a collection of these suits have been consolidated under this case. In decisions below, the federal appeals courts ruled for the government. They acknowledged that the clause at issue, when it was enacted, placed an obligation on the government to pay private insurers what is owed. But the appeals courts reasoned that Congress’ appropriations laws in the years since have “repealed or suspended” that obligation. The Supreme Court will now decide whether that is so. The oral argument in Maine Comm. Health Options is available via audio and transcript.
The second case argued on Tuesday is far less consequential (at least for most people), but no less technical. In Holguin-Hernandez v. United States, the Justices are confronting some doctrinal confusion vis-à-vis federal criminal sentencing procedure. Gonzalo Holguin-Hernandez was on supervised release when he was arrested for the second time in 2017 on charges of possessing marijuana with intent to distribute. He pleaded guilty, and a petition to revoke his supervised-release term was filed. A federal district court handed down a 60-month prison sentence for his guilty plea. In addition, it ordered a consecutive 12-month prison sentence for his violation of the conditions of his supervised-release program. Holguin-Hernandez appealed the latter sentence, arguing that the consecutive 12-months’ time was unreasonable under federal sentencing laws. But the appeals court waved his claim away. The court ruled that it was procedurally barred from determining whether the 12-month sentence was reasonable because Holguin-Hernandez failed to raise this kind of an objection in the district court first. So, the reasoning goes, the appeals court could only determine whether there was “plain error” in the district court’s reasoning for the 12-month sentence. Since Holguin-Hernandez appealed not on “plain error” grounds but on “reasonableness” grounds, his appeal ought to be dismissed for lack of jurisdiction. The Justices will now decide whether Holguin-Hernandez is required under the Federal Rules of Criminal Procedure to raise a formal objection to the pronouncement of a sentence with a district court before seeking reasonableness review with an appellate court. The oral argument in Holguin-Hernandez is available via audio and transcript.
Wednesday’s proceedings mirrored Tuesday’s: first an opinion, then two oral arguments.
The Justices issued a unanimous decision in Peter v. NantKwest, Inc. If the U.S. Patent and Trademark Office (USPTO) denies an applicant a patent, the federal Patent Act allows the applicant to appeal. One way of doing so is to file a civil suit against the director of the USPTO in a federal district court (35 U.S.C. §145). If the applicant chooses this method, then the applicant must pay “[a]ll the expenses of the proceedings” under §145. But if the USPTO incurs expenses when its own employees (including its in-house counsel) defend the agency in this kind of a civil suit, does the applicant have to pay these attorney’s fees too?
Justice Sotomayor, with every other Justice in tow, answers “no.” In these cases, the Court has always started by applying the longstanding “American Rule”: “Each litigant pays his own attorney’s fees, win or lose, unless a statute or contract provides otherwise” (Hardt v. Reliance Standard Life Insurance Co. (2010)). This doctrine has roots as far back as 1796. The federal government (on behalf of the USPTO) argued first that the “American Rule” presumption is most often overcome by statutes that award attorney’s fees to the “prevailing party”; next, that §145 is a “prevailing party” statute; and thus that §145 was exempt from the American Rule presumption. But Sotomayor reminds them that the Court “has never suggested that any statute is exempt from the [American Rule] presumption.” Furthermore, many of the Court’s cases have addressed statutes that stray from the American Rule and yet still don’t award attorney’s fees to the “prevailing party.”
Having now established that the American Rule is, in fact, this case’s starting-point, Sotomayor turns to whether Congress meant to depart from the American Rule in §145. In short, she concludes that Congress did not. Looking at the plain wording of §145 (“[a]ll the expenses of the proceedings”), §145 does not invoke fee-switching with the kind of “clarity we have required to deviate from the American Rule” (Baker Botts LLP v. ASARCO LLC (2015)), Sotomayor writes. §145’s use of “expenses” in relation to other words in the statute “supports a conclusion excluding [attorney’s] fees from the scope of §145.” The phrase “expenses of the proceedings” is strikingly similar to the Latin expensæ litis, or “expenses of the litigation.” And this latter phrase, Sotomayor says, has long denoted the sort of litigation expenses “to which attorney’s fees did not traditionally belong.” Plus, adding the adjective “all” to “the expenses of the proceedings” does “not expand §145’s reach to include attorney’s fees.” Further, numerous other federal statutes lend more support for why “the term ‘expenses’ alone” does not authorize departure from the American Rule. Finally, the history of both the Patent Act itself and the operations of the USPTO “reinforces that Congress did not intend to shift fees in §145 actions.” Therefore, the Court concludes 9:0 that the USPTO cannot force a §145 patent-applicant litigant to pay the USPTO’s attorney’s fees.
The Justices wrapped up their December sitting with two cases Wednesday. The former was Monasky v. Taglieri, the first international law case to make its way to the Court in at least a few years. The Hague Convention on the Civil Aspects of International Child Abduction says that when a child is wrongfully removed from his/her country of “habitual residence,” the child must be returned to that country. In this case, Michelle Monasky alleged that she was a victim of domestic violence. Leaving Italy for Ohio, she fled from her husband, Domenico Taglieri, and took her two-year-old daughter, A.M.T., with her (initials only, for sake of privacy). Taglieri filed a petition under the Hague Convention seeking to have A.M.T. returned to him. A federal district court ruled that Italy was A.M.T.’s “habitual residence” and ordered her given back to Taglieri in Italy. Monasky appealed, but the Sixth Circuit affirmed (albeit in a splintered, 10:8 decision). The majority first determined that the district court had not made any “clear error” in its reasoning—a different standard than what other appeals courts have used in similar cases. It also concluded that when a child is too young to decide his/her “habitual residence” alone, the child’s parents do not need to draw up a “subjective agreement” explicitly stating the child’s “habitual residence”—again differing from other courts of appeals. The Justices will now review the Sixth Circuit’s decision. They will answer (1) whether the Sixth Circuit’s “clear error” standard is the correct standard of review in cases like this, and (2) whether a “subjective agreement” is necessary under the Hague Convention to establish a child’s “habitual residence” when the child is too young to decide for him-/herself. The oral argument in Monasky is available via audio and transcript.
The final case of the decade to be argued was McKinney v. Arizona. In 1993, James Erin McKinney was convicted of capital murder in Arizona and sentenced to death. Over two decades later, the Ninth Circuit Court of Appeals found that the Arizona courts had refused to consider some types of mitigating evidence in death-penalty cases over a 15-year period. In McKinney’s case, the Arizona court failed to consider medical records indicating that McKinney suffers from PTSD, and the Ninth Circuit determined that this evidence would have been a mitigating factor in McKinney’s sentencing had it been taken into account. After the ruling, however, Arizona appealed to the state’s Supreme Court, seeking de novo review of McKinney’s sentence (that is, seeking to have him sentenced “anew”). McKinney objected, arguing that recent U.S. Supreme Court decisions gave him the right to be resentenced by a jury, not by a judge (Ring v. Arizona (2002) and Hurst v. Florida (2016)). The Arizona Supreme Court sided with the state, ruling that it had to apply the law in force at the time at which McKinney was originally sentenced, and thus Ring and Hurst were inapplicable. It then held that McKinney’s aggravating factors still outweighed his mitigating factors and affirmed his death sentence. McKinney appealed to the U.S. Supreme Court, which will now decide two questions: First, whether the Arizona Supreme Court should have applied current law and thus applied Ring and Hurst, a question on which federal appeals courts have given opposite answers. And second, whether the Arizona Supreme Court’s decision not to remand McKinney’s sentencing back to the trial court violated the U.S. Supreme Court’s decision in Eddings v. Oklahoma (1982). The oral argument in McKinney is available via audio and transcript.
The Supreme Court held no proceedings on Thursday.
The Justices met for their weekly private conference Friday afternoon and thereafter decided to grant five new cases. In McGirt v. Oklahoma, the Court will decide whether land in eastern Oklahoma that was set up in the early 1800s as the Creek Indian Reservation is still an “Indian reservation” today for the purposes of federal criminal law. A nearly identical case in Carpenter v. Murphy was actually on the Court’s docket and argued last year, but the Justices evidently ran into a thicket while attempting to decide that case and ordered it restored to this term’s calendar to give them more time to think.
Next, in United States Agency for Int’l Development v. Alliance for Open Society, Int’l, the Court will confront yet another First Amendment case. In Agency for Int’l Development v. Alliance for Open Society Int’l, Inc. (2013), the Court struck down a Congressional requirement that non-government organizations (NGOs) that receive federal funds for fighting HIV/AIDS abroad must “have a policy explicitly opposing prostitution and sex trafficking.” The Justices will now decide whether that bar further extends to overseas affiliates of U.S.–based NGOs.
Finally, in a move that garnered headlines around the Impeachment-swamped nation, the Court granted review for all three of President Trump’s tax returns cases. Two of them concern Congressional subpoenas, and these will be argued and decided together. In Trump v. Mazars, LLP, the House Committee on Oversight and Reform issued a subpoena to Mazars, LLP, a private, non-governmental accounting firm, ordering it to turn over Trump’s personal and corporate tax records. That case’s question is whether the Committee has the authority to issue its subpoena under either the Constitution or federal statutes. The consolidated case is Trump v. Deutsche Bank AG. Here, the House Financial Services and Intelligence Committees subpoenaed Capital One and Deutsche Bank for financial records related to Trump’s corporate holdings, his personal accounts, and the personal accounts of Donald Trump, Jr., Eric Trump, and Ivanka Trump. That case does not yet have a specific question, although it will likely get one soon that is analogous to that of Trump v. Mazars.
The third case concerns a subpoena issued to Mazars by the Manhattan District Attorney, Cyrus R. Vance. Similar to the House Oversight and Reform Committee’s subpoena, the one at issue here seeks Trump’s personal and corporate tax returns from Mazars, LLP. The question in Trump v. Vance is whether Vance’s subpoena violates Article II or the Supremacy Clause of the Constitution.
All three cases will be argued in March, and we can expect decisions by the end of June. I previewed Trump v. Mazars and Trump v. Vance (the Mazars subpoenas) in an article for the blog.
Finally, at the conference itself, the Justices reviewed the petitions on their docket and discussed whether to grant review for any of them. We can expect more news from this conference in the Court’s Orders list on Monday, December 16. Some high profile cases the Justices are considering include:
- Box v. Planned Parenthood of Indiana & Kentucky, Inc. This case challenges an Indiana state abortion law that requires women who seek an abortion to, among other things, undergo a fetal ultrasound eighteen hours before the abortion is performed. The question presented is whether such an ultrasound requirement violates a woman’s Fourteenth Amendment rights.
- United States v. California. This case involves the Trump administration’s challenge to California’s statewide “sanctuary” law that prohibits state law-enforcement officers from providing information about immigrants (both legal and illegal) to federal immigration officials. The question before the Court is whether federal immigration law preempts California’s sanctuary law—and others like it in cities and states around the country—under the Supremacy Clause of the Constitution.
- Chiafalo v. United States. This case concerns the constitutionality of “faithless electors,” or members of the Electoral College who vote for a different presidential candidate than the one whom a majority of the voters in a state chose. The questions presented are (1) whether a state can dictate how an elector casts his/her vote and (2) whether a law that penalizes an elector for voting “faithlessly” violates the elector’s First Amendment rights.
- Lilley v. New Hampshire. This case involves a challenge to a Laconia, NH city ordinance that prohibits a woman from publicly exposing her breast “with less than a fully opaque covering of any part of the nipple.” Three women charged with violating the ordinance challenged their convictions on the ground that, since the regulation applies to women but not to men, it violates the Fourteenth Amendment. The question before the Court is whether Laconia’s city ordinance violates the Equal Protection Clause of the Fourteenth Amendment.
- City of Boise, Idaho v. Martin. This case involves two Boise, ID city ordinances that make it a misdemeanor to camp or sleep in public places within city limits. The Ninth Circuit held that the ordinances violate the Eighth Amendment when the city enforces them against the homeless. The question before the Court is whether generally applicable laws that criminalize public camping and sleeping violate the Cruel and Unusual Punishment Clause of the Eighth Amendment.
The Week Ahead
The Justices are set to release more orders Monday morning. We may see more cert grants later in the week. There are no oral arguments scheduled, as the Court concluded its December sitting this past Wednesday.