The blog in a nutshell

The blog in a nutshell

Friday, October 30, 2015

Torres, the Canons, and Holistic Interpretation

The Supreme Court will also be hearing Torres v. Lynch on Tuesday.  Torres asks a different statutory question.  In that case, the question is whether a mandatory immigration penalty applies, when the mandatory penalty must be based on an "offense described in” 18 U.S.C. § 844(i)," which is the federal crime of committing or attempting arson, when that statute necessarily requires (for federalism purposes) that the crime involves property "used in interstate commerce," when a person is convicted of the state-law equivalent, and that state-law equivalent obviously does not have that same "interstate commerce" requirement (we lawyers call this a "jurisdictional hook").

Here, the canons come out again.  The big canon here is the rule that "when the legislature uses certain language in one-part of the statute and different language in another, the court assumes different meanings were intended."  Like all canons, it is not absolute because it is not actually true; the Supreme Court has itself recognized that “Congress sometimes uses slightly different language to convey the same message,” so that it "must be careful not to place too much emphasis" on the canon.   Here, the list of mandatory penalties includes both the phrases "described in" and "defined in," and, the government argues, we can't limit the meaning of "described in" to a hard definition or the two phrases would be given the same meaning.

Against that canon we have the "rule of lenity," which, as I noted in my Lockhart analysis, is not really a "canon" in the sense used in this post (both parties in Torres unfortunately call it that, confusing my pet issue).* Under the rule of lenity, we should read the rule leniently, so that the ambiguity helps Torres.  

Although it appears most people here are predicting a 9-0 reversal in favor of Torres, I think the government has the better of the arguments here.  Again, the result is not because of a canon, but because this is the rule that makes the best sense of the statute.  

The government's canon does not make sense because there's no reason to treat the "defined in" violations any differently than the "described in" violations.  The "defined in" crimes relate to illicit trafficking in drugs, firearms, and certain other weapons.  The government's better argument-which I will get to in a minute-is why would Congress care about the interstate aspect of arson when deciding whether someone is suitable for entry into the US?  But  once you accept that, why would they care about it for guns or weapons, either?**  After all, the statute also includes other trafficking statutes, and uses the "described in" language.  So this distinction between "defined in" and "described in" seems haphazard, not intentional.

Nor do I think the rule of lenity applies decisively, either.  For the most part, the law doesn't change what is criminal versus what is not, it merely exacerbates the penalty for committing an act (attempted or actual arson) that we all know is criminal already.  I suppose it tells certain people not to come to the country who might otherwise come, such as Torres himself; but I think in today's day and age the better way to deal with the "crime" of unlawful presence is through prosecutorial discretion.  Indeed, while Torres is being deported, he's not being criminally charged with violating the immigration laws.  Torres also argues that the rule of lenity also applies to immigration statutes broadly, but I think the rule is weak in that situation, a mere tiebreaker.

Instead, what makes sense under the statute?  Congress does not care about the interstate nature of crime; indeed, Congress included language making clear that the penalty would apply "whether in violation of Federal or State law and applies to such an offense in violation of the law of a foreign country for which the term of imprisonment was completed within the previous 15 years."  What Congress cares about is that dangerous or "bad" people foreigners don't come into our country .  

Torres has two responses.  The first is that federal crimes indicate more seriousness than state law crimes.  From a practical standpoint, this is kind of true; the feds don't tend to waste their time on low-level stuff.  But it seems unlikely that Congress made such a designation out of a reflection of differing standards of prosecutorial discretion.  A lot of state crimes are very serious.  Indeed, it seems like there would be an easier way to limit the penalty to only serious crimes, i.e., by requiring a particular sentence.  Indeed, that's what Congress did for other crimes.

The second is that most of the serious state crimes will end up being covered under the statute anyway.  And this is the best argument Torres has.  If the statutory scheme makes sense in requiring jurisdictional hooks, then we should follow Congress's lead.  If not, we should ignore the hooks.  So does it?  The best way is to look at how the statute would divide:

Here are the crimes which would require a jurisdictional hook, generally:  (B) drug trafficking; (C) arms trafficking; (D) money laundering, (E) general explosives and firearms offenses (including arson, with a jurisdictional hook), but mostly trafficking violations of some sort, or other crimes involving federal property, airports, etc., in which the jurisdictional hook appears to be a substantive element) (H) the ransoming part of kidnapping (but not the "kidnapping" part); (I) child pornography; (J) racketeering or gambling if a felony; (K) slave or prostitution trafficking; (L) treason or espionage; (M) tax fraud; (N) alien smuggling; (O) illegal immigration; (P) counterfeiting a passport (sometimes); 

Here are the ones that would not:  (A) murder, rape, or sexual abuse of a minor; (F) a crime of violence (the meaning of violence is provided under federal law, but there's no jurisdictional hook) for which the term of imprisonment was at least one year, (G) a theft or burglary offense  for which the term of imprisonment was at least one year, (K) pimping (even though it ain't easy); (M) fraud or deceit involving over $10,000; (Q) failure to appear for serving a 5-year jail sentence, (R) bribery, conterfeiting, forgery, or trafficking in stolen vehicles (1-year min. sentence); (S) obstruction of justice (again, one year min.); (T) failure to appear to defend against a criminal charge that could lead to a 2+ year sentence, or (U) attempt/conspiracy of any of the crimes on the above list.

Does a jurisdictional hook matter?  To be honest, before I put this list up, I was pretty sure the government had the better argument.  (I now have to edit the already-written conclusion now, don't I?)  But now, while I think it is close, I think Torres should win.  The crimes that apply universally regardless of this case are all generally-applicable crimes.  But the crimes on the top are mostly crimes that, when they occur, will always violate federal law in the first place, including laws which by their nature have an "interstate commerce" hook (at least if one assumes, as many do in American law, that all commerce is interstate).  The only exceptions are child pornography (an area where federal prosecutions make up the vast majority of prosecutions in any event), the tax fraud statute, and the arson provision.  The tax fraud provision is the best evidence the government has at a lack of distinguishing between "federal crimes," and "any crimes," but it still involves a fraud on the *federal* government, which may be treated as a bigger problem to the federal government than fraud on a *different* government.  Then there's the arson statute.  If the government is right, then arson is included only as a subset of what is otherwise a series of crimes in which the jurisdictional "hook" is actually a significant substantive element of the crime, when all other "common" crimes are treated without reference to a federal statute. To top it off, most of those "common" crimes require a one-year sentence.  Arson seems to be treated quite differently under the government's view, than any other crime.  It makes no sense.  

And for that reason, I think, Torres should prevail.  I do think it is a close question, though.  The list lacks a fully-coherent explanation as to what Congress intended.  But whether Torres should win or not should not turn on the differences between "defined in" and "described in."  The canons distract from the real arguments.

The government also argues that legislative history supports them, focusing on drug trafficking.  The main argument is that the legislative history indicates that the statute be read to support the result of a particular case.  But a reading of the underlying case they rely on shows that the "interstate commerce" issue was not before the immigration court in that case, either because it was not a necessary element or because "interstate commerce" should be presumed as an inherent part of "drug trafficking," i.e., "drug commerce."  The only issue in the underlying case was whether a state law conviction that did meet all the elements was included.  So, I think, the government's legislative history argument is weak even if it were put before a Court that valued such history. 

Torres, incidentally, has a wonderful personal story.  He's been here, lawfully, since he was nine years old.  His attempted arson conviction led to a one day jail sentence.  Since then, he's been long employed as a carpenter and electrician, has stayed out of trouble, owns his own home in the U.S., and is taking college classes in civil engineering.  He's engaged as well, to a woman who lives in the U.S., unclear if she is a citizen or not from the briefs.  By any sense of what the law should be, he should be allowed to stay.  The statute is bad even under Torres's view, and Congress should amend it.  But the statute is not so bad as to cover Torres himself.

*There's a third "canon" (again, not a canon in terms of describing how to interpret language) at play here, which is the deference we give to agencies interpreting their own statutes.  This is known as Chevron deference.  It's application is dubious here, although for a different reason then argued by the parties (who debate whether it can apply when a statute has criminal applications as well).  Instead, based on the King v. Burwell case, deference is only appropriate when intended, and while I don't want to make too much of this rule (it is hotly contested between the Justices), it's missing the point.  If "described in" means "kinda-sorta-like," then maybe  there'd be ambiguity, but Torres loses in any event.  On the other hand, if "described in" means "meets the  requirements of," Torres wins in any event.  This is a "Chevron Step 1" question off the bat.  Congress did not delegate the question of whether the list of penalties was ambiguous in the first place.  Since the Court is not going to want to revisit this dispute here, Chevron shouldn't come into play. 

** I suspect I'm being uncharitable here.  It's at least possible that either the two "defined in" statutes did not have these jurisdictional hooks (or at least were allowed to presume them, prior to certain federalism decisions starting in the 1990s).  If so, then what may have happened is that Congress added the jurisdictional hooks in the criminal statutes, but forgot to amend the immigration statute language from "defined in" to "described in."  If you know whether this is right or wrong, feel free to leave a comment.  But, it is unclear whether that "hard" legislative history would be relevant to a canonical textualist in any event. 

Lockhart: The Canon of Reading Statutes to Make Sense

This is a post about canons, and why, although lawyers should know them, they should not really rely on them to interpret text.

In a case to be argued Tuesday, Lockhart v. United States, the question presented is basically this.  When a statute says, regarding a mandatory minimum provision in a child pornography statute:

....or under the laws of any State relating to aggravated sexual abuse, sexual abuse, or abusive sexual conduct involving a minor or ward, or the production, possession, receipt, mailing, sale, distribution, shipment, or transportation of child pornography....

are the three mandatory categories "aggravated sexual abuse," "sexual abuse," or "abusive sexual conduct involving a minor or ward," or aggravated sexual abuse (involving a minor or ward)," "sexual abuse (involving a minor or ward)" or "abusive sexual conduct involving (a minor or ward)?"  I think the answer is the latter, and I will explain why.  But first I want to take a shot at the canons themselves, as most recently celebrated by Bryan Garner and Antonin Scalia in their book Reading Law: The Interpretation of Legal Texts.

In their book, Scalia and Garner argue that statutory interpretation can always be gleamed from the text (which I generally dispute but am not taking issue with here, exactly).  More specifically, they point to 57(!) canons of interpretation which can be used to discern the meaning of any statute, and posit that even when the Court gets to the right result in interpreting statutes by looking outside of the text, the canons would produce the same result.

Judge Posner has already done a remarkable job eviscerating this book.  But I want to make a somewhat different criticism of canons.  

While the canons appear to capture how we actually interpret law (really, how we interpret language), they aren't prescriptive, but descriptive.  That is, they are just an attempt to try and break down how we actually use language into a series of rules.  And that this is ultimately descriptive rather the prescriptive makes sense, because language itself is descriptive rather then prescriptive.  Or, in plain English, language is how people use and understand it, not a set of unbending rules.  Ain't isn't a word, until people use it and understand what it means.  And then it is!

And so using a set of descriptive rules that approximate how we understand language, in place of how we actually use language, is never going to be as good as just actually trying to understand the language directly.  Tests are sometimes necessary, sure.  But they should never prevail over the real thing, when they fail to accomplish their intent.  And Posner hits on this, if indirectly, in his criticism:  if the meaning of something is obvious, like a "No dogs, cats, and other animals allowed," sign in a shop that would obviously include bears, a a canon that says "no, it must be an animal like a dog or a cat, i.e., a pet, to be prohibited," should be avoided.*

In other words, in easy cases, you don't need the canons, and occasionally the canons will lead you astray.  And in hard cases, the canons are of no help, either.  This is for two reasons, both of which I think Lockhart illustrates.

The first reason is that some of the canons are wrong.  That is, they are not descriptive of how people write or read at all.  The most famously wrong canon is the canon against surplusage.  This canon is probably the most cited of all the canons!  It holds that we must give each word, phrase, or clause independent meaning.  But, as the Supreme Court reminded us in King v. Burwell, the “preference for avoiding surplusage constructions is not absolute."  And the reason for this is because it is wrong as a descriptive manner:  People repeat themselves all the time.  Even people, like lawyers  (especially lawyers!), who draft legislation knowing the rules upon which people interpret them fail to live up to these rules.  Lockhart is a good example.  Regardless of whether "minor or ward" modifies all three terms or just "abusive sexual conduct," the first two terms are " "aggravated sexual abuse" and "sexual abuse."  But any "aggravated sexual abuse" will also be "sexual abuse," rendering it surplusage.  

The other reason is that hard cases are hard for a reason.  The fifty-seven canons describe how we interpret language, and in cases where it is difficult to interpret language, the canons don't help, usually because they contradict.  As two other blogs posting on the subject have already well-documented, the two canons at issue here, contradicting themselves, are the "series qualifier" canon and the "last antecedent" qualifier.  And, in fact, there's nothing special about these canons contradicting themselves, as they are almost entirely opposite rules.  (This is a famous critique.)  Many textualists argue that, when they contradict each other, you can use context and other interpretive guides to figure out the meaning.  But what good is that advice?  In easy cases, you don't need the canons.  In hard cases, they're not helpful.**  The canons should be left for law reviews and linguistics classes.  They provide no real help to drafters and judges who are trying to do the serious work of interpreting statutes based either on their intent or their commonly-understood meaning.  (I am not wading into that debate here.)  

So let's get rid of them.  Once we get rid of them, Lockhart is an easy case.  The statute at issue is a child pornography statute; the code section title is "Certain activities relating to material involving the sexual exploitation of minors."  The reasonable interpretation is that the enhancement should relate to minors and wards.  For this reason, the better interpretation is to include the qualifier for all three listed crimes.

I will discuss another case about statutory interpretation, canons, and a holistic make-sense-of-the-statute in another post.  That case, Torres v. Lynch, it turns out, is much closer.  And again, canons do not help.

*This reminds me of a case I recently litigated in which the other side argued that something should be classified as a regulatory taking instead of a per se taking.  (If you don't know or care about takings law, feel free to ignore this footnote - it isn't necessary for understanding the post.)  The other side argued that, sure, it was *just like* a taking substantively, but because they used a different process, it should be treated as a regulatory taking, and then proceeded to argue it was not a taking under the regulatory takings test.  But the regulatory takings test is specifically designed to determine when a regulation is substantively the same as a taking, so there was no point in actually going through the test.

** People also refer to the "rule of lenity" as a canon.  The rule of lenity says we should interpret criminal statutes narrowly.  While substantively it has the effect of canon, it is less about how we interpret language and more about fairness.  Fairness dictates that people should be aware of the acts which will subject them to criminal consequences, and so we should not interpret statutes in a way that people might not have understood, because that's not fair.  (There are criticisms of the rule, such as the factually correct criticism that most people don't actually read these laws and so the basis does not make sense, and the more philosophical question of whether the criminal code is a guide, or instead is the real guide "don't be bad," with the code simply a way of breaking that down bureaucratically.  I won't go into these criticisms except to note that this debate pales to the problem of overcriminalization.)     

Tuesday, October 27, 2015

Article III and the Patent Act: Into Obscurity

I want to turn to a case currently pending on petition for certiorari (this means the Court hasn't decided whether they will hear it), specifically, an important prescription drug patent case involving similar issues, Mylan Pharmaceuticals vs. Apotex.  The case there involves a curiousness in the way generic drugs are regulated.  

Here is the situation, as simplified as I can, based on my not-quite-expert knowledge (so I apologize if I get anything wrong here): if a party has a valid patent on a drug, then they have an exclusive right to market that drug for the life of the patent.  At any point, a generic can essentially challenge the patent by registering its own drug for marketing.  Or, a generic can challenge the patent in federal court - up to the challenger.  At that point, the patent-owner maintains exclusivity untill the FDA approves the generic, and then once the FDA ultimately approves the drug (which it will do since the patent-owner has disclaimed its validity), the patent-owner and the generic get shared exclusivity for 180 days from when the generic markets the drug, and then it is a free-for-all.  The 180 days is the reward for challenging the patent. 

The problem is that once the patent is registered with the FDA in something called the "orange book," they can't just disclaim the patent.  Once that happens, if someone wants to prove the patent invalid to the FDA, it still has to challenge the patent by the Paragraph IV or in federal court.  Normally, that's not quite a big deal, since people don't generally disclaim their patents when there's value to them - even delay is good, because they continue to have exclusivity while litigation is ongoing.  (The non-disclaimer rule, a friend tells me, is so that it can't be disclaimed even after a loss in a way that would void the generic's 180-day period.  Sure, makes sense in most circumstances: even though doing so would hurt both the patent owner and the challenger, such a hurt-yourself-to-spite-your-opponents makes sense as a credible challenge to repeat players, much like the class action defender increasing everyone's costs before forcing a low-level payout in Campbell-Ewald.)

But here, there's a huge wrinkle.  In the Mylan-Daiichi dispute, Mylan (the first generic) had to challenge two patents to market the drug.  Daichii (the patent owner) disclaimed one patent, and won the other.  Strangely - Congress should fix/clarify this - while Mylan lost the only meaningful dispute - it still has a successful Paragraph IV claim because of the disclaimed patent. It gets its 180 days - but only after the valid patent expires (the disclaimed patent would last longer; I assume but am not sure that the result would be different if the bad patent expired first).  A win for Mylan, and another for Daiichi.   

Apotex (another generic) - who wants to market as soon as the patent expires, filed a Paragraph IV challenge of their own, on the disclaimed patent only.  Under the law, if Apotex's challenge succeeds (which it must), that would give Mylan 75 days to market its drug or lose its rights.  Since Apotex's claim will be resolved more than 75 days before Daiichi's valid patent expires, Mylan's rights will be forfeit.  Defeat snatched from the jaws of victory!  But Mylan and Daichii came up with a solution, and argued that Apotex's challenge can't succeed because Daichii doesn't dispute that the patent is invalid, and thus there is no case or controversy.  (The Federal Circuit rejected this, and this is the issue on petition for cert.)

Now, again, we have a "case" that "arises" out of the laws of the United States (the Patent Act).  And while the parties don't agree, there's certainly something in controversy - the extremely valuable exclusive rights to market the (invalidly) patented drug.  Under my theory, that's all you need, and Mylan's petition should be denied.  Nor was the issue "mooted" by the disclaimer.  Saying it was would be like saying that an expired offer "mooted" the claim in Genesis Healthcare or Campbell-Ewald, when Plaintiffs obtained no relief on their claim.

If the Court takes this case and reverses, it will turn Article III jurisprudence into a game lawyers play to cheat others.  The Supreme Court should get out of this business by making clear that Article III jurisdiction exists whenever there is a claim brought under a federal law, where the Court has the ability to enter in a meaningful order on that claim.  That's all a "case" should require.

And what makes this all the more amusing is that Mylan wants to prevent Apotex from bringing a dispute because there was no real dispute.  But Mylan obtains its rights over something there was no real dispute, either!  And while Mylan raises the concern that courts shouldn't litigate "disputes" when the parties don't disagree, as that may lead to collusion, that's no less true if Mylan's challenge succeeds.  Then, a generic could collude with a patent owner who owns "a good patent" and "a bad patent" to challenge two patents, disclaim one, have the generic roll over on the other, and then both get an extra 180 days from the expiration of the good patent.  

Even without such collusion, Mylan's results could have the unforeseen impact of having people challenge good patents along with bad patents as a way to "cheat" and file early, thereby securing priority.  Of course, that might be preferable to the alternative, which is to have patent owners file bad patents after good ones in order to use the litigation period to extend their monopoly.

There could be downsides to having Apotex win at all.  There may be cases in which a party actually succeeds in eliminating some but not debatably-viable patents necessary to market a drug.  And in that case, we may want to reward the generic for doing that - though perhaps without having to simultaneously challenge "good" patents as well.

But, aside from getting rid of the drug patent system entirely, the solution is Congress substantively drafting the rules so they make sense, and making more clear what we want to reward generics for and what we do not.  Article III should have nothing to do with it.  If Congress wants an 180-day reward for knocking out one, but not two, of the patents, it should have said so.

Monday, October 26, 2015

Spokeo, Reading Policy into Article III, and Campbell-Ewald

Next Monday, the Court will hear Spokeo v. Robins.  This case involves the question - there, under the Fair Credit Reporting Act - of whether the Court has jurisdiction to hear a federal claim when the federal claim establishes a remedy as a matter of law without proof of injury.  It is unclear at this point whether any Article III limitation extends only to cases where the plaintiff also in fact does not allege injury, or (because the allegation would be extraneous to the claim) whether all such statutes fail to satisfy Article III jurisdiction.

(As an aside, the former seems a somewhat less revolutionary rule, as the latter would "invalidate" a number of statutes.  But the former leads to its own peculiarities, including  what would likely be a requirement to prove injury in a mini-trial before the judge, even while actual liability remains a question for later.)

The case has been well-briefed by the Mayer Brown team for Petitioner-Defendant and by an interesting odd couple of liberal appellate guru Deepak Gupta and conservative appellate guru William Consovoy for Respondent-Plaintiff and I don't want to restate their arguments.  But I do want to make two points about why a pro-Spokeo ruling here, if applied consistently to the text of Article III, would be revolutionary in its breadth,  and also why such a ruling will create dual sovereignty problems.  (The latter point you may recognize from my post on Campbell-Ewald.)  


Here is the text of Article III:

The judicial power shall extend to all cases, in law and equity, arising under this Constitution, the laws of the United States, and treaties made, or which shall be made, under their authority;--to all cases affecting ambassadors, other public ministers and consuls;--to all cases of admiralty and maritime jurisdiction;--to controversies to which the United States shall be a party;--to controversies between two or more states;--between a state and citizens of another state;--between citizens of different states;--between citizens of the same state claiming lands under grants of different states, and between a state, or the citizens thereof, and foreign states, citizens or subjects.

This language chosen by the Founders is incredibly broad.  It applies to "all cases ... arising under ... the laws of the United States."  (Law and equity basically were the only two types of cases back then, so those words just make clear that it isn't limited to just one type of case or the other).  It also applies to "controversies to which the United States shall be a party,""to controversies between two or more states," and to "controversies .... between citizens of different states."

It's first worth noting that jurisdiction applies separately to "cases" and to "controversies."  The requirement is one or the other.  If it were not, then diversity jurisdiction would end, since those cases do not arise under the Constitution or the laws of the United States.  And it is unquestioned-full stop-that a claim under a federal law arises under the laws of the United States.  There is no "separate"" controversy requirement, at least as the plain text dictates. And, although lawyers like to use the phrase "case or controversy," the words "case" and "controversy" modify different possible grounds for jurisdiction.  If we follow the text, then, it should mean that the existence of injury is required by the use of the word "case" itself

Next, if a "case" requires injury (or, contrary to above, requires a "controversy" that in turn requires injury) the effect should logically go way beyond mere private causes of action.  The injury requirement would also apply to claims in which the United States is a party unless a "case" requires injury but a "controversy" does not.  Such a ruling does not make any sense from my end regarding the different usage of the two words, and if it did, it would have the peculiar effect of requiring "cases"

Thus, enforcing a pro-Spokeo rule could mean that the United States would have to prove injury for jurisdiction.  This could create significant difficulties for the United States in building civil enforcement claims, particularly if it wants to get in front of conduct early.  

Moreover, the statute technically does not differentiate between civil damages actions, injunctive relief cases, and criminal cases.  So if the federal government moves to enjoin certain activity, it may have to prove the potential injury in every case.  (Libertarians may not find this a bad result, but I do want to point out that it would be a sweeping change from government-brought civil actions today.)  What about criminal cases?  If criminal cases have to follow the same rule, what would that mean about "attempt" crimes in which there was no actual injury (yet)?  Can they be prosecuted?

One of the amicus briefs in favor of Spokeo, put forth by the Washington Legal Foundation, argues that Spokeo should win because only sovereigns should be allowed to bring claims merely to enforce laws, without injury, and private individuals should bring claims merely to redress injuries.  (So much for qui tam suits?)  Article III, however, does not make this distinction.  It provides jurisdiction for "cases" arising under the laws of the United States and "controversies" between citizens of different states just as much as it does "controversies to which the United States shall be a party."  If WLF is right, then it must be right because of a limitation entirely separate from any in the text of Article III.

To be fair, Spokeo's argument rests mostly on the types of claims that existed under English law in the past, which likely provides distinctions necessary to avoid these problems.  Spokeo argues that *because* claims where injury was not presumed by statute did not exist at common law, the founders did not intend them to be permitted to be brought under Article III.  (Robins rebuts that even some common law claims, such as assault, did not require injury and/or allowed it to be presumed.)  This, to me, is a sort of logical fallacy, one we see often in the law, related to but not quite the post hoc ergo proctor hoc fallacy ("after this, therefore because of this," essentially assuming causation because of correlation).  Just because something did not exist prior to the passage of the Constitution, does not mean that the Constitution intended to ban it.  Indeed, one could make the opposite assumption - if it did not exist prior to the Constitution, how could our founders intended to have prohibited it?  The reality is usually they did not consider it one way or another, and so we shouldn't take any stock in it either way.  Instead, we should focus on the contours the founders did consider relevant in determining whether it would be permitted or prohibited.  

Which is why we should rely on the words.  The founders did not use language indicating an injury requirement, or even a "mootness" requirement.  The founders thus did not assume that jurisdiction would turn on that ground.  While that does not mean Courts should never find a lack of jurisdiction for standing, either due to "mootness" or lack of injury, it should be important to focus on what the standing inquiry is really trying to get at, i.e., whether there really is a live dispute between the parties that the court can resolve, or instead a waste of judicial resources.  Given the existence of 17 amicus briefs in favor of Spokeo (10 just asking the Court to hear the case) and 16 in favor of Robins (including the federal government), it's pretty clear that whatever one thinks of the policy behind allowing private causes of actions absent a showing of injury, these cases are hardly foolish wastes of judicial resources.  Real money is at stake, and the parties really are in conflict about an entitlement to the money.  That's all that Article III should require.


And then, again, there is the same problem I mentioned in Campbell-Ewald.  The lack of Article III jurisdiction does not mean no jurisdiction at all, but instead simply no federal jurisdiction.  These cases can proceed in state courts so long as those states allow it.  Some states adopt a "case or controversy" requirement a la the federal government, some do it only on an informal level, and some have no requirement at all.  For those cases with a requirement, some might follow a pro-Spokeo decision, and some might not.  Thus, in some states these cases can be brought in state court, with federal review restricted to the Supreme Court level.  In other cases, they may not be brought at all.  This lack of uniformity and supervision in federal law makes no sense, but that would be the result.  And, contrary to the WLF brief discussed above, that makes it less likely that the purpose of an Article III limitation was so that only the executive would bring cases merely to enforce the law.  Such results should indicate strongly that Article III should not be used as a "tool" to avoid actual disputes between real parties.

In my next post, I want to discuss another Article III challenge, this in the patent act, that should also fail under this theory.

Saturday, October 17, 2015

Another problem with Campbell-Ewald: Dual Sovereignty

I want to point out another problem with a complete victory for the Defendant-Petitioner in Campbell-Ewald.  Before I do, let me be clear:  I think such a result is unlikely.  I do not think the Court will get it “correct” (to me, correct is either to accept the Kagan dissent wholesale in Genesis Healthcare, or at least to rule that the existence of a claim for attorneys’ fees eliminates any possibility of mootness).  But I think either Gomez will win on lesser grounds, or Campbell-Ewald will win on the basis of the concession he may or may not have made.

Okay, let’s say that the Court rules that an offer of complete relief moots Gomez’s claim.  That means there’s no “case or controversy” and thus no jurisdiction.  The case must be dismissed…..

….from federal court.  But state courts can hear federal claims too.  There is no “case or controversy” requirement in *state* courts.  Now, granted, some states hold there is an equivalent requirement for access to their own state courts.  And yet, some states don’t.  Even for those states that do, they are not required to follow the Campbell-Ewald decision, and may hold the offer did not moot anything.  So, at least in some states, the case can proceed in state court – even in a case based solely on a federal statute such as the one in Campbell-Ewald.

Right?  Maybe.  The Class Action Fairness Act provides statutory jurisdiction for most class actions, and the federal question jurisdiction statute provides statutory jurisdiction for any case with a federal claim.  But statutory jurisdiction is invalid if there is no Article III jurisdiction, and these statutes are irrelevant.  However, the CAFA and the general laws also provides “removal” from a state court in the same circumstances.  The federal question jurisdiction removal statute requires “original jurisdiction,” so that likely means the case stays in state court (for now.  See below.)  The CAFA is a little more vague, and it is possible to read it as requiring removal regardless of jurisdiction, in which it is possible the cases may just disappear and cannot be brought anywhere.  I do think that reading is a little strained, and, in any event, not all class actions – even ones with federal questions – will be covered by CAFA itself.  (The drafters of CAFA probably did not consider the possibility of a federal claim that did not have federal jurisdiction!)

So, the claim is brought in state court.  It can be removed at any time to federal court…until there’s a Campbell-Ewald offer.  Then the claim must go back to state court, which can proceed with it as it likes.  But if the case is still proceeding, is there now a case or controversy? Who knows!  If there is, does the case get stuck in a permanent loop?  The case starts in state court, gets removed to federal court, gets remanded due to lack of case or controversy, then goes back to state court, where it proceeds and is thus removed to federal court, where it gets remanded due to lack of case or controversy….it’s a bad computer programming loop.

And certainly once the case gets certified, there’s now other claims that have not been “settled,” so there’s a case and controversy.  The case can be removed again, right?  Can the federal Court review the certification question?  And if it reverses, does the case go back to state court due to a lack of case or controversy…who can then re-certify…so it gets removed to federal court, who de-certifies, and thus remands to state court….who can then re-certify….

There are two potential "solutions" the Court may take to resolve this problem.

The first is essentially to ignore it.  In Genesis Healthcare, the District Court dismissed that case "with prejudice."  There's no independent rule here.  This is simply shorthand, an informal way to say "you can't bring the case again."  But, for some reason, courts tend to treat this as a legal category instead of shorthand.

It makes sense to dismiss a claim for mootness "with prejudice" only to the extent that means "don't come back to federal court claiming federal jurisdiction again."  But that decision should not be given any weight as "res judicata" (settled) in state court, for the reasons I mention above.  After all, the case was not actually decided by the Court, indeed, they have no jurisdiction to decide the case, and therefore to affect the parties' rights in any way whatsover.   Still, there's a concern-one with no actual legal basis, as far as I can tell-that federal courts will dismiss "with prejudice" and state courts will abide by the "result" of the federal litigation.

The second solution was actually discussed at oral argument, and I think that if the Court is going to rule for Campbell-Ewald without relying on the concession theory, this will be it.  This solution is, instead of dismissing the case for lack of jurisdiction, to grant judgment for the plaintiff.  That solves the dual sovereignty problem, since the Court takes jurisdiction of the case and resolves it on the merits (sort of).  The problem with this result is that granting judgment is not a constitutionally mandated obligation of the Court.  It is, instead, based on statutory-ish requirements (the Federal Rules of Civil Procedure), and the Court's own discretion (which, presumably, can be trumped by Congress's will),

And this poses three concerns.  The first is that the relevant precedents the Court is relying on, and have discussed this and similar problems with, focused on mootness, not judgment.  Such an abrupt switch in the source of claim avoidance exposes the process-oriented nature of what the Court would be doing.  That's not to say they haven't been this nakedly outcome-oriented in the past, but the Court tries to hide what it is doing in legalese, and switching the basis makes this considerably harder.  The second is that the Federal Rules don't appear to contemplate these forced "settlement" judgments.   (Kagan discussed this in detail in her Genesis dissent). The third is that, while prudential reasons should be read to require judgment to be granted to the plaintiff when he indeed gets everything he asked for, and only continues for illogical or unethical reasons, prudential grounds really feel inappropriate when they have the effect of overturning the will of Congress that parties can bring these class actions.  

This wouldn't be the first time, or even the most obvious time, the Supreme Court came up with policy reasons to ignore or trump the will of Congress, ahem, Shelby County, but usually the Supreme Court tries to tie their analysis to a constitutional provision (or instead claims that it is just faithfully doing Congress's expressed will, a concept that does not really work here, since this prudential discretion isn't based on statute).  But it can't do that here unless it sticks to a jurisdictional concept such as mootness.  (Such a decision might also, of course, be subject to reversal by Congress, who *might* be able to statutorily require the Court to not enter judgment in this way.  In any event, I do not think Congress would pass such legislation anytime soon.)

Our multi-sovereign system simply is not programmed to receive a decision in favor of the Defendant-Petitioners in Campbell-Ewald.  That should be a good hint that such a decision is incorrect.

Wednesday, October 14, 2015

Campbell-Ewald v. Gomez: Why the fee request matters

Remember when I quoted Justice Kagan as saying a case will never come up again?  Well, it has.

What Justice Kagan was saying in Genesis HealthCare was that the result was based on a concession that the party was offered the relief it was seeking.  In Campbell-Ewald v. Gomez, one of the principal questions before the Court is whether Justice Kagan was right that this concession was the determinant factor.

Critical to the oral argument* in this case was the question of whether the plaintiff-Respondent indeed got all they requested.  In this case, Gomez asked for attorneys' fees (which he might not have been entitled to) and injunctive relief.  The settlement offer did not include these things.  The district court ruled that Gomez conceded that the offer gave him complete individual relief.  Gomez contested this before the Ninth Circuit, which did not have to rule on the issue because it was going to rule for Gomez either way.  Now it is before the Supreme Court.

Here is why this matters, in particular the fees.  The reason this issue is relevant is because the Defendant-Respondent, Campbell-Ewald, is taking a strategy that can be very effective in avoiding class liability when you have a lot of claims, particularly when they aren't worth that much.  What you do is you allow yourself to be sued.  Make the guy file a complaint, because you don't want to pay off everyone who asks.  You can even file a motion to dismiss, engage in some discovery, whatever.  Raise the costs to bringing the claim.  Then, before certification can be addressed by the Court, you offer to settle the one individual claim for everything *that individual* is asking for.  The case goes away.

But remember, this is a class action.  These cases are brought because it is really only efficient to resolve them en masse.  This strategy is terribly inefficient!  But that's actually good for you, because your plaintiff won't be able to find any attorneys who will be willing to take the case.  They aren't going to put the time and effort into a case for hours unless they get paid.  And unless a plaintiff is paying them by the hour, they won't get paid unless a class gets certified.  No lawyers, no case, no liability for Evald-Campbell.

Or unless the Court orders the defense to pay their fees!  If Plaintiffs' counsel gets paid *anyway*, these cases will still proceed, and Campbell-Evald avoids nothing by their strategy.

And so the claim for fees is really important.  If the Court rules that a fee claim doesn't count for purposes of whether an offer is complete, and then finds such an offer is binding even in the class situation, then Campbell-Evald's strategy is vindicated.  But if the Court rules that it does not, then Plaintiffs will simply make sure to include their claim for fees in every case, even when they aren't entitled to it, to avoid mootness.**  And, in doing so, the Court will never have to resolve the question of whether mootness doctrine can be a magic talisman to avoid class actions.

And if it rules - as Chief Justice Roberts suggests - that it should accept the finding of a concession?  Then it has just wasted everyone's time again.  But, I think, it must be very careful should it decide this.  It cannot merely, as Chief Justice Roberts suggested, accept that the district court found this and the Ninth Circuit did not affirmatively disagree.  If so, then the Chief will have waived Gomez's right to challenge this particular factual finding, and he'll never get a substantive opportunity *merely because the 9th Circuit ruled for him on other grounds.*  The Court should instead remand to hear that part of the case.  But if they're going to do that anyway, then why bother hearing the case in the first instance?

In other words, this case should have been DIGged (basically a shorthand way of saying the Court never should have taken the case in the first place) from the start.

* There's quite a confounding error in the transcript, at least as of the time I read it.  Both the respondent and the United States had their own attorneys argue for reversal.  The opinion randomly switches between purporting to quote the respondent's attorney (Mitchell) and the Government's attorney (Yang).   I think the error is typographical, and Mitchell spoke first, then Yang.  But it would be funny if Yang just started interrupting Mitchell's oral argument, and then Mitchell did the same to Yang.  Har har.

**Of course, in every battle there's a volley and a riposte.  Can a party move to dismiss or for summary judgment on the fee claim *before* certification?  Is such an order final and appealable?  Can a case with an appealable final order actually be moot?  These questions, fascinating as they may be, simply prove that Kagan is right and Scalia is wrong here.