On Monday the Court will convene to begin hearing its final sets of arguments for this term. Nevertheless, the Court’s hard work may just be beginning.
Although a few opinions have been released recently, such as a decision in Encino Motorcars v. Navarro, the Court has been conspicuously silent with respect to some of the more hotly contested cases on its docket. That, it seems, will likely change soon.
As if the pressure of those undecided cases were not enough, the Court also has to contend with a full slate of arguments this month, some of which concern very controversial topics. Chief among these newsworthy cases is Trump v. Hawaii, in which the Court may opine on the constitutionality of President Trump’s second attempt to restrict travel from a handful of countries whose inhabitants are predominantly Muslim.
This, however, is just one of several hot-button issues that will be before the Court this month. Indeed, the rest of the calendar is teeming with challenging questions of law and policy. South Dakota v. Wayfair, for example, compels the Court to wrestle with the question of whether it should reverse one of its previous holdings and open the door to tax laws that could send shockwaves through the online retail industry. Also on the Court’s April calendar are issues of gerrymandering (again), immigration, patents, and the Constitution’s Appointments Clause.
Needless to say, the Court’s April calendar provides no shortage of entertainment even for the most casual of legal observers. As always, we at On the Docket are here to help you stay on top of it all. With that goal in mind, we are pleased to present our case previews for the month of April, each of which can be found below. If these previews only intensify your craving for all things SCOTUS (we sure hope they do!), be sure to also stay tuned for thoughtful responses to the decisions that will be handed down in the coming weeks. Happy reading!
April 16
Wisconsin Central Ltd. v. United States
No. 17-530, 7th Cir.
In Wisconsin Central the Court will confront the question of whether railroad employees are required by the Railroad Retirement Tax Act (“RRTA”) to pay taxes on stock options given by their employers.
The case began when a number of railroad company employees demanded refunds for the taxes they paid on their realized stock options, claiming that the stock options were not taxable under the RRTA. When the IRS refused to issue the refunds, the employees appealed to the Seventh Circuit. The Seventh Circuit ruled in favor of the Government and deemed the stock options taxable.
The central issue in the case is what constitutes “compensation” according to the RRTA. See 26 U.S.C. § 3201(a), (b) (2012). In the RRTA, compensation means “any form of money remuneration paid to an individual for services rendered as an employee.” § 3231(e)(1).
Petitioners contend that this definition does not reach stock options, asserting simply that “[s]tock is not money.” Brief for Petitioners at 2, Wis. Cent. Ltd. v. United States, No. 17-530 (U.S. filed Feb. 16, 2018). In response, the Government points to the numerous exceptions that the statute delineates for the definition of “compensation.” If Congress wanted stock options to be excepted from the definition, the Government argues, it would have said so explicitly, as it did with respect to a wide range of benefits, including certain stock options. See, e.g., § 3231(e)(12)(A).
The Court’s ruling in this case promises to resolve a circuit split. The Seventh Circuit’s conclusion in this case aligns with that of the Fifth Circuit, which considered the question in 2015. See BNSF Ry. Co. v. United States, 775 F.3d 743 (5th Cir. 2015). Subsequently, the Eighth Circuit took the opposite view, holding in 2017 that the stock options at issue here are not subject to taxation under the RRTA. See Union Pac. R.R. Co. v. United States, 865 F.3d 1045 (8th Cir. 2017).
WesternGeco LLC v. ION Geophysical Corp.
No. 16-1011, Fed. Cir.
When patent infringement is proved, the patent holder is entitled to damages. However, when an infringer builds and sells a patented product outside of the United States, the remedy is less clear.
Section 271 of the Patent Act describes acts within the United States that impose liability for infringement. Prior to the Supreme Court’s decision in Deepsouth Packing Co. v. Laitram Corp., 406 U.S. 518 (1972), products could be partially manufactured in the United States, shipped abroad, and assembled into infringing products. Because the acts that would normally constitute infringement did not occur within the United States, there was no patent infringement liability under § 271. This ruling created a loophole that was later closed when Congress enacted § 271(f) in 1984. This subsection creates liability for patent infringement when anyone “supplies or causes to be supplied in or from the United States any component of a patented invention” in a way that induces infringement or with the intent that the components be combined outside of the United States in an infringing way. 35 U.S.C. § 271(f)(2) (2012). Effectively, if patent infringement would occur when components are combined in the United States, there is patent infringement if this occurs abroad when the component parts come from the United States.
The lower court in this case determined that Petitioner incurred reasonably foreseeable harms, namely $90 million in lost profits. Respondent made more than $3 billion for itself and its customers by using the infringing product. Petitioner was awarded both lost profits and reasonable royalties.
The Federal Circuit found that if foreign profits could not be recovered under § 271(a), then foreign profits cannot be recovered under § 271(f) due to the presumption against extraterritoriality. With this ruling, Petitioner’s $93 million award for lost profits was eliminated.
Petitioner alleges that because § 271(f) was expressly created to impose liability for infringing acts outside of the United States for acts that would constitute infringement if they had occurred in the United States, lost profits from foreign sales should still be available because the patent “damages provision does not distinguish among types of infringement.” Brief for Petitioner at 9, WesternGeco LLC v. ION Geophysical Corp., No. 16-1011 (U.S. filed Feb. 23, 2018). Respondent, however, claims that lost profits due to competition from foreign third-party purchasers of the infringing product are unavailable as “an impermissible extraterritorial application of [U.S. patent law].” Brief for the Respondent at 24, WesternGeco LLC v. ION Geophysical Corp., No. 16-1011 (U.S. filed Mar. 26, 2018).
If the Court sides with Petitioners, infringers who are found liable under § 271(f) will be subject to damages for foreign profits and patentees will be able to be made whole. If the Court sides with Respondent, however, infringement under § 271(f) will result in remedies that may be inadequate to fully compensate the patentee.
The American Intellectual Property Law Association filed an amicus brief supporting neither party, but arguing that foreign profits should not be unavailable when there is infringement under § 271(f).
April 17
South Dakota v. Wayfair
No. 17-494, S.D.
South Dakota v. Wayfair presents the Court with an opportunity to reexamine its decision in Quill Corp. v. North Dakota, 504 U.S. 298 (1992). The issue comes before the Court as a result of efforts in South Dakota (“the State”) to pass and enforce sales tax obligations on online retailers who engage in high volumes of transactions each year, but nevertheless have no physical presence in the State. As part of these efforts, the State filed suit against several online retailers (“Respondents”) with the understanding that the suit would need to make it all the way to the Supreme Court and succeed in overturning Quill.
In Quill, the Court struck down a North Dakota statute similar to the one that the State enacted here. In Quill, the Court held that although the North Dakota statute did not violate the Due Process Clause, it did violate the Constitution’s so-called “dormant” Commerce Clause. See Quill, 504 U.S. at 301–19. In so doing, the Court affirmed the rule that it established in National Bellas Hess, Inc. v. Department of Revenue of Illinois, 386 U.S. 753 (1967), which mandates that sales tax obligations be imposed only on entities that have a physical presence in the state.
In its appeal to the Court, the State asserts that the economic landscape has changed so much since Quill that a different approach is now warranted. Pointing to some of the Court’s other Commerce Clause jurisprudence, the State also argues that such a reconsideration is permissible because the Bellas Hess rule was already on unsure footing when Quill was decided.
In response, Respondents assert that Quill remains a viable, firmly-rooted precedent. Respondents further contend that turning away from Quill is not only unnecessary as a precedential matter, but also unwise as a policy matter. They argue that the State’s argument fails to appreciate the policy challenges that would be involved with such a tax law, recent economic and technological advancements notwithstanding. Respondents also argue that the substantial reliance interests at stake counsel against abandoning the typical stare decisis approach.
The potential impact of this case certainly is substantial. A decision to overturn Quill and uphold the State’s legislation could give way to similar legislation in other states. This could cause the tax burdens on online retailers to increase significantly. It is clear that key players throughout the retail industry, as well as state and local governments, are keenly aware of the import of this case, as many have filed amicus briefs with the Court.
Lamar, Archer & Cofrin, LLP v. Appling
No. 16-1215, 11th Cir.
Respondent R. Scott Appling hired the law firm of Lamar, Archer, and Cofrin (“the Firm”) to represent him in a business dispute. He represented to his lawyers that he was getting a large tax return that would be sufficient to cover his legal fees. The Firm continued to represent him based on these statements. In reality, Appling’s tax return did not cover his legal fees and the Firm took action to collect. Appling then filed for bankruptcy.
At issue in this case is a specific portion of the Bankruptcy Code. The Code prohibits the discharge of “any debt . . . for money, property, [or] services . . . to the extent obtained by . . . false pretenses, a false representation, or actual fraud, other than a statement respecting the debtor’s . . . financial condition” 11 U.S.C. § 523(a)(2) (2012). This provision is intended to protect collectors from dishonest debtors. But, notice that the provision includes an exception. In 1960, Congress added the language “other than a statement respecting the debtor’s . . . financial condition” because of the common practice of consumer finance companies convincing loan applicants to submit false financial statements to insulate the companies’ debts from future discharges. Congress added § 523(a)(2)(B), which addresses false or misleading statements made in writing. Here, the question is whether the exception in § 523(a)(2)(A) applies to an oral statement about a single asset or a debtor’s financial condition generally.
The bankruptcy and district courts rejected Appling’s arguments that his statements fell into the exception, but the Eleventh Circuit reversed and unanimously held that discharge would not be prohibited because the addition of the word “respecting” before “financial condition” covers any statement about a debtor’s financial condition, including Appling’s oral statements. The Fourth Circuit also follows this holding. The Fifth, Eighth, and Tenth Circuits have held that only statements about a debtor’s financial condition as a whole apply. Under this standard, Appling’s debts would not have been discharged and he would remain individually liable for his misleading or false statements.
The Firm argues that the Eleventh Circuit’s reading of the statute undermines Congress’s desire to protect honest debtors who are misled by creditors to submit false financial statements for the creditors’ own protection. Appling argues that the Firm’s interpretation does not give the word “respecting” the weight it deserves, and that the Eleventh and Fourth Circuit’s interpretation fulfills Congress’s desire to provide efficient and effective dispute resolution through the use of written statements rather than oral statements. The Solicitor General filed a brief supporting the Eleventh Circuit’s decision, using the canon against superfluity to argue that “respecting” must have a purpose in the statute.
By answering the question raised in this case, the Supreme Court will resolve a circuit split that has great import to debtors and creditors alike. The Firm, as well as the Solicitor General, note that uniformity is crucial, especially in the context of the complex bankruptcy system.
April 18
Washington v. United States
No. 17-269, 9th Cir.
In the 1850s, the United States entered into treaties with several Indian tribes in the Pacific Northwest regarding the right for the tribes to take fish “at all usual and accustomed grounds and stations . . . in common with all citizens.” Indian Treaties, 10 Stat. 1132, 1133 (1854). In Washington v. Washington State Commercial Passenger Fishing Vessel Association, 443 U.S. 658 (1979), the Supreme Court interpreted this treaty provision to guarantee that tribes get a fair share of available fish, and that a fair share was 50% of the fish, or revised downward based on tribal need.
In 2001, the federal government and tribes sued Washington, claiming that the treaties also required Washington to replace any culverts under state roads that were restricting fish passage—namely, those that blocked salmon from traveling to certain areas to spawn. The Ninth Circuit agreed, and held that the treaties should be interpreted as guaranteeing an amount of fish sufficient to provide the tribes with a moderate living, and ordered Washington to replace culverts that restricted salmon passage.
Washington argues that the rejection of Washington’s equitable defenses of waiver and estoppel regarding the culverts goes against Supreme Court precedent. Washington further argues that such a ruling is especially unfair here where the federal government, which told the State for decades how to design the culverts and approved the permitting, is now telling Washington that it is in violation of the treaty. Washington also argues that the replacement of the culverts will cost billions of dollars and will not benefit salmon because of other non-State-owned barriers.
The United States argues that the Ninth Circuit correctly interpreted the treaties by looking at the express words, treaty negotiations, and other Supreme Court decisions on this subject. The Government also argues that the Ninth Circuit did not create a new right not mentioned in the treaty, and argues that the canon governing Indian treaty interpretation directs courts to broadly interpret these treaties in the tribes’ favor.
Washington worries that an affirmation of the Ninth Circuit’s new interpretation of the treaty will open the floodgates for challenges to dams or other parts of Washington’s infrastructure, and that this new interpretation could have an impact on other states with a similar treaty, such as Idaho, Montana, and Oregon. The Government rejects this concern by noting that any future disagreements concerning treaty interpretations will be adjudicated on a case-by-case basis with heavy dependence on the facts presented by the particular dispute.
Lagos v. United States
No. 16-1519, 5th Cir.
The Mandatory Victims Restitution Act (“MVRA”) requires defendants convicted of certain crimes to reimburse the victims of those crimes. Reimbursable expenses under the MVRA include “lost income and necessary child care, transportation, and other expenses incurred during participation in the investigation or prosecution of the offense or attendance at proceedings related to the offense.” 18 U.S.C. § 3663A(b)(4) (2012).
Petitioner committed wire fraud by misleading General Electric Capital Corporation (“GECC”) to increase the amount of a revolving loan for businesses owned by Petitioner and his co-conspirators. After discovering the fraud, GECC hired a variety of outside consultants to fully investigate. Eventually, Petitioner’s businesses filed for bankruptcy, and GECC incurred additional expenses as a result of participating in the bankruptcy proceedings.
As a “victim” under the MVRA, GECC was awarded restitution of more than $4.1 million for investigative fees and more than $780,000 for costs related to Petitioner’s bankruptcy proceedings. This restitution was affirmed by the Fifth Circuit, which found that both the investigative expenses and the bankruptcy resulted from the wire fraud.
Petitioner claims that expenses from the internal investigation and bankruptcy proceedings do not fall within the scope of the MVRA because “participation in the investigation or prosecution of the offense” is limited to government—not private—investigations or prosecutions. Further, Petitioner claims that expenses incurred before the investigation or prosecution do not fall under the purview of the MVRA, either. The D.C. Circuit adopts this narrow construction, while several other circuits interpret the statute more broadly.
Respondent asserts that the expenses are recoverable through the MVRA because the consultants hired were necessary to preserve evidence and fully uncover Petitioner’s scheme. Further, Respondent argues, the expenses from participation in the bankruptcy proceedings are proper restitution because the statute expressly includes “proceedings,” not “criminal proceedings.” Respondent also argues that legal and professional expenses are restitution under the MVRA because these expenses stem from Petitioner’s fraud. The Supreme Court’s ruling in this case may resolve the circuit split. The Court may align with the D.C. Circuit’s narrow interpretation, adopt the broad interpretation of other circuits, or find that an entirely distinct reading of the MVRA is warranted.
April 23
Lucia v. SEC
No. 17-130, D.C. Cir.
Lucia v. SEC comes to the Court on an appeal from the D.C. Circuit and presents the question of whether the Administrative Law Judges (“ALJs”) who preside at SEC proceedings are “Officers of the United States” according to the Constitution. U.S. Const. Art. II, § 2, cl. 2.
The case began with an allegation by the SEC that components of Petitioner Raymond Lucia’s financial seminar were in conflict with a handful of different securities statutes. The charges largely concerned slides that Lucia used to describe his investment plan, which he dubbed “Buckets of Money.” The slides contained information about how the plan might have fared throughout various periods of history. The SEC asserted that these scenarios were misleading. Lucia, on the other hand, claimed that the examples in the slides were merely hypothetical, and that they were clearly presented as such.
The ensuing adjudication was referred to one of the SEC’s ALJs. At the end of the proceeding, the ALJ ruled against Lucia. Thereafter, the ALJ was instructed “to make additional factual findings.” Brief for the Respondent at 6, Lucia v. SEC, No 17-130 (U.S. filed Nov. 29, 2017). Subsequently, the ALJ again ruled against Lucia.
In his appeal of the decision, Lucia claimed that the ALJ who decided his case was subject to the requirements of the Constitution’s Appointments Clause, which empowers the President to “appoint . . . all . . . Officers of the United States,” subject to Senate approval. U.S. Const. Art. II, § 2, cl.2. The SEC declined to accept this argument. Lucia appealed to the D.C. Circuit, but was unsuccessful.
When faced with the same issue, the Tenth Circuit reached the opposite conclusion, ruling that the SEC’s ALJs must be selected according to the procedures of the Appointments Clause. Subsequently, the D.C. Circuit, sitting en banc, affirmed its previous holding, thus creating a circuit split.
This case comes before the Court in an interesting posture, as the SEC has changed its own position on the issue over the course of the litigation and now agrees with Lucia that ALJs should be required to adhere to all the requirements of the Appointments Clause. See generally Brief for Respondent Supporting Petitioners, Lucia v. SEC, No. 17-130 (U.S. filed Feb. 21, 2018). For this reason, the Court has appointed an amicus curiae to argue in favor of the D.C. Circuit’s holding.
The outcome in this case may depend on the Court’s ability to distinguish SEC ALJ’s from the “special trial judges” of the U.S. Tax Court who were at issue in Freytag v. Commissioner, 501 U.S. 868 (1991). In that case, the Court held that the special trial judges were not properly considered mere “employees” because “the degree of [their] authority” was “significant.” Freytag, 501 U.S. at 881 (some internal quotation marks omitted). The outcome of the case promises to be significant, as it could have major effects on how and, most importantly, by whom the SEC’s ALJs are selected.
Pereira v. Sessions
No. 17-459, 1st Cir.
Under 8 U.S.C. § 1229b(a) and (b), which is available to “person[s] of good moral character,” the Attorney General may cancel the removal of certain immigrants whose removal would cause “exceptional and extremely unusual hardship” for family members who are U.S. citizens. 8 U.S.C. § 1229b(b) (2012). This relief is available to immigrants who have been physically present in the United States for a continuous period of ten years or more immediately preceding the date of the application. The continuous residence period ends when an immigrant is served a notice to appear under 8 U.S.C. § 1229(a). This section says that the notice to appear “shall be given in person to the alien . . . specifying . . . [t]he time and place at which the proceedings will be held.” This is called the “stop-time rule.”
Congress added the stop-time rule to disincentivize immigrants who slowed removal proceedings so that they could satisfy the residence requirement because the continuous residence period continued to run during removal proceedings. The Board of Immigration Appeals interprets the stop-time rule to only require notice, even if that notice does not include the time and place where the hearings will be held. The First Circuit and five other circuits have interpreted the stop-time rule in the same manner. The Third Circuit requires time and place to be included for the stop-time rule to take effect.
Wescley Pereira is the father and primary breadwinner for his two young children, both of whom are U.S. citizens. He resides in Martha’s Vineyard, where he has been a respected member of the community for more than a decade. Pereira came to the United States on a tourist visa in 2000. In 2006, the Department of Homeland Security (“DHS”) served him with a notice to appear that did not include the time and place of his hearing. Over a year later, his notice to appear was filed with the immigration court. The court attempted to deliver the notice by mail, but had the wrong mailing address. Mr. Pereira did not attend the hearing. The proceedings went forward and he was ordered to be removed, although he was not aware of this decision. In 2013, Pereira was pulled over for a minor traffic violation and ended up being detained by DHS. He then applied for cancellation, arguing that he satisfied the ten-year continuous presence requirement.
The question for the Court will be whether to defer to the Board of Immigration Appeals, or take a textual approach to interpreting the statute and examine why Congress included time and place in the notice if they did not intend time and place to be of any importance. During this trying time for immigrants in the United States, a rejection of the Board of Immigration Appeals’ interpretation will be an acceptance of the contributions of hardworking immigrants.
Chavez-Meza v. United States
No. 17-5639, 10th Cir.
In Chavez-Meza v. United States, the Court will yet again confront an interpretive question relating to changes in the Federal Sentencing Guidelines.
Petitioner Adaucto Chavez-Meza was sentenced to 135 months in prison after he pled guilty on federal drug charges. When rendering the sentence, the district court consulted the 2012 iteration of the Federal Sentencing Guidelines, which recommended a sentence of 135 to 168 months for the relevant crime. Thereafter, in 2014, the guidelines were adjusted. According to the new guidelines, Petitioner’s recommended sentence was 108 to 135 months.
After the reformed guidelines took effect, Petitioner requested that his sentence be lowered to 108 months to reflect the district court’s previous finding that Petitioner’s sentence should be at the lower end of the range. The district court reduced Petitioner’s sentence to 114 months. The court issued a form order (which merely stated that the court analyzed all the relevant factors listed in the governing statute), but did not give any detailed reasoning as to how it reached this conclusion. Here, Petitioner contends that such an unexplained decision is an abuse of discretion.
The key statutory provision in this case is 18 U.S.C. § 3582(c)(2) (2012), which allows courts to decrease an inmate’s sentence if it was “based on a sentencing range that has subsequently been lowered by the Sentencing Commission.” (Loyal readers will remember that this provision was also at issue in Hughes v. United States and Koons v. United States, which were argued last month.) The text of the statute only asks judges to “consider[] the factors set forth in [18 U.S.C. § 3553(a)],” but does not expressly require them to explain their decisions. Meanwhile, the provision makes no reference to § 3353(c), which requires district courts to explain their findings when they issue an initial sentencing decision. In light of these statutory characteristics, the Tenth Circuit affirmed the district court’s ruling on appeal.
Petitioner contends that the district court is still required to explain itself even if the statute does not expressly say so, citing United States v. Taylor, 487 U.S. 326 (1988) to support this proposition. As a practical matter, Petitioner contends, decisions like that of the district court lead to complications for reviewing courts, as they make it “impossible to determine which factors the district court had considered and whether it relied on impermissible factors.” Brief of Petitioner at 6, Chavez-Meza v. United States, No. 17-5639 (U.S. filed Feb. 26, 2018).
Seven Circuits have already addressed the question at issue here. The Sixth, Eighth, Ninth, and Eleventh Circuits have taken Petitioner’s position, while the Fourth and Fifth Circuits have joined the Tenth Circuit in holding that the issuance of a form order is sufficient when ruling on sentence reduction requests under § 3582(c)(2).
April 24
Abbott v. Perez
No. 17-586, W.D. Tex.
Gerrymandering is trending: Back in October, the Supreme Court heard arguments in Gill v. Whitford about redistricting in Wisconsin, and just last month, the Court heard oral arguments in Benisek v. Lamone, which concerned the gerrymandering of Maryland’s Sixth Congressional District. Now we move to gerrymandering in Texas.
In 2012, a three-judge district court selected redistricting plans as a result of litigation that made its way to the Supreme Court in Perry v. Perez, 565 U.S. 388 (2012). The Texas Legislature subsequently adopted those interim maps and made them permanent. Instead of dismissing the initial complaint as moot, the district court granted appellees leave to amend their complaint and respond to the newly enacted court-drawn maps.
Appellees allege that these new redistricting maps, as drawn by the district court, illegally discriminate against minority voters and violate the Voting Rights Act as well as the Fourteenth Amendment. Specifically, Appellees claim that the legislature engaged in racial gerrymandering and intentional vote dilution because the new maps incorporate districts in three counties that are the same as those in the illegally gerrymandered maps at issue in 2012. Appellants, however, claim that the legislature could not have intentionally discriminated when it enacted the new redistricting maps because those maps were drawn by the district court, and were found by that court to comply with the Voting Rights Act and the Constitution.
Two district courts found the court-drawn maps to be invalid, and the courts’ orders required the Governor of Texas, one of the Appellants, to order a special session of the Legislature to draw a new map. If this failed to happen within three days, Appellees could propose a new map. The Supreme Court blocked the courts’ orders and put the redistricting on hold to determine whether there is merit to the Appellants’ argument.
Appellees also claim that the Supreme Court does not have jurisdiction to hear this appeal because the Supreme Court has jurisdiction to hear direct appeals from decisions of three-judge district courts only when there was “an order granting or denying, after notice and hearing, an interlocutory or permanent injunction in any civil action, suit, or proceeding.” 28 U.S.C. § 1253 (2012). Appellants, however, claim that jurisdiction is proper because the court’s orders have “the ‘practical effect’ of an injunction.” Brief of Appellants at 15, Abbott v. Perez, No. 17-586 (U.S. filed Feb. 26, 2018) (quoting Carson v. Am. Brands, Inc., 450 U.S. 79, 83 (1981)). If the Supreme Court finds that it does have jurisdiction to hear the appeal, other states will need to pay close attention to how these gerrymandering cases are resolved in order to avoid future constitutional challenges to their own redistricting endeavors.
Animal Science Products, Inc. v. Hebei Welcome Pharmaceutical Co. Ltd.
No. 16-1220, 2d Cir.
Federal courts obviously have the authority to interpret U.S. law, but are federal courts required defer to a foreign sovereign’s interpretation of its own law when that foreign sovereign appears as amicus curiae? Some circuit courts have held that a court must defer to a foreign sovereign’s interpretation of its own law, while other circuits have found that there is no legal basis for mandatory deference.
Petitioners allege, on behalf of two classes of Vitamin C purchasers, that Respondent conspired to fix prices and restrict supply to the United States in violation of the Sherman Act, which prohibits unreasonable restraints on trade. Respondent, a China-based company, defended itself only by asserting that Chinese trade law compelled them to fix prices and restrict the supply.
In the district court, the Ministry of Commerce of the People’s Republic of China (“the Ministry”) appeared as amicus curiae to explain its regulatory system. The district court, however, found that the Ministry’s statements were in conflict with statements made to the World Trade Organization on a related issue. The Second Circuit found that the Ministry’s participation as amicus curiae and its explanation of the regulatory system were reasonable in light of the circumstances, and therefore the court is “bound to defer.” Animal Sci. Prods. v. Hebei Welcome Pharm. Co., 837 F.3d 175, 189 (2d Cir. 2016). No matter how the Supreme Court rules, there may be longstanding impacts on foreign trade, particularly amidst the recent trade tariffs and a looming trade war with China.
April 25
Trump v. Hawaii
No. 17-965, 9th Cir.
The Court takes up one of the most anticipated cases this term: President Trump’s travel ban. This second iteration of the travel ban limits travel from eight countries. Hawaii challenged both this and the first order, arguing that each constitutes a violation of federal law and the Constitution. The Ninth Circuit agreed and imposed an injunction on the enforceability of the Executive Order. The Government is asking the Supreme Court to stay the injunction.
First, the Court will deal with justiciability. The Government argues that the statutory claims are not justiciable, saying that the Constitution gives the President wide latitude to limit the entry of immigrants to the United States when it is determined to be in the national interest. The Government relies on Supreme Court precedent stating that it is not within any court’s power to review determinations of the political branch to exclude aliens, unless Congress allows for review, which it has not done. Hawaii argues that the order is justiciable because its resident, Dr. Elshikh, has standing through the injury to his ability to practice his religion, and that Hawaii has standing because the Order injures its ability to recruit and retain faculty for its universities and accept refugees. Additionally, Hawaii argues that this is reviewable because the challenge concerns policies that injure American citizens and states, and not an individual consular decision, which would not normally be reviewable.
Second, the Court will deal with whether the order violates the Establishment Clause. The rationale behind the ban, the Government says, is that the countries named do not share enough information with the United States to make a determination about the risks that their nationals pose. Hawaii argues that the rationale behind the ban is to fulfill President Trump’s campaign promise to enact a ban on Muslims, and argues that this makes the Executive Order unconstitutional under the Establishment Clause. Hawaii says that implementation of the Order would have separated families, disturbed business and research opportunities, and prevented refugees from finding safety in the United States. Specifically, Hawaii argues that its Muslim residents would be separated from their loved ones and Hawaii’s welcoming and diverse reputation would be hurt due to the order’s animus toward a religious group.
The Government relies heavily on separation-of-powers arguments, while Hawaii relies on the discriminatory nature of President Trump’s tweets and speeches both on the campaign trail and during his presidency. Will the Court defer to the Executive Branch and determine that a president has unreviewable power to exclude aliens, even if based on religion? Or will the Court take a First Amendment approach and determine that the order was unconstitutional because it was enacted based on religious animus? This decision will certainly impact the other immigration issues that could be on the Court’s plate, such as the termination of the DACA program and funding to sanctuary cities.
