Cross-posted at Forbes.com’s “On the Docket”
Emerging from its summer recess and Monday’s “Long Conference,” the U.S. Supreme Court granted review to 14 cases this morning. Eight of them involve business litigants or implicate issues that affect our free enterprise system. The Court accepted cases featuring one law on which it has ruled very frequently of late — the False Claims Act – and another law — the Freedom of Information Act — on which it rarely comments. One case explores a first-year law school civil procedure issue, while another gets deeply into the weeds of bankruptcy jurisprudence, thanks to a three-decade estate battle involving the late Anna Nicole Smith. Some details:
1. Astra USA Inc et al. v. Santa Clara County et al. Astra USA, along with numerous big pharmaceutical companies, were sued by public hospitals and private clinics for allegedly overcharging for outpatient drugs. The critical issue here, which certainly transcends Big Pharma, is whether under federal common law, third-party beneficiaries can sue government contractors to enforce the statutory requirements with which those businesses contractually pledged to comply. The plaintiffs and the U.S. Court of Appeals for the Ninth Circuit (from which the Court granted cert) had to rely on federal common law because no statute specifically granted third parties the right to sue on the government’s behalf. Six courts of appeal have ruled that a private right of action exists, while three have ruled such a right cannot be found in common law.
2. Goodyear Luxembourg Tires v. Brown and J. McIntyre Machinery Ltd. v. Nicastro. Both cases address the fundamental civil procedure issue of when a plaintiff has jurisdiction to file a lawsuit. As the U.S. Chamber of Commerce’s amicus brief in support of cert in Goodyear noted, “No issue is more basic to determining a company’s litigation risk than were it can be sued.” In Goodyear, the petitioner was sued in North Carolina for alleged injuries that occurred in France caused by a product that is produced and distributed only in Europe. The supposed “contact” that allowed Goodyear Luxembourg to be haled into the Tar Heel state?: A Goodyear affiliate’s limited sale of other products in North Carolina that are unrelated to the products that supposedly caused the injury. The Court’s ruling in Morrison last term could foreshadow a disappointing result for the plaintiffs in this case.
3. Schindler Elevator Co. v. U.S. ex rel Kirk. The “ex rel” has shown up in numerous Supreme Court cases names lately, owing to its ongoing interest in False Claims Act cases. There is an added bonus with this case, as it also implicates the Freedom of Information Act (FOIA). The Justices will decide whether the FCA’s “public disclosure bar” preventing qui tam plaintiffs from using certain information as the basis for a FCA suit includes government responses to requests for documents under FOIA. The federal appeals courts are split 4-3 on the issue.
4. FCC v. AT&T. This second case involving FOIA will test whether a corporation is a “person” who can invoke the protection of FOIA’s 7(C) exemption, the so-called “law enforcement” exemption. In the case, the FCC obtained documents from AT&T, which were in turn requested by a third party through FOIA. AT&T claimed that FCC’s production of the documents would violate their “personal privacy,” and so were exempt from disclosure under 7(C). After the Third Circuit’s ruling for AT&T last year, WLF released a Legal Opinion Letter on the case authored by Akin Gump Strauss Hauer & Feld’s David Blonder, available here.
5. General Dynamics v. U.S. and Boeing v. U.S. The Court will consider whether the government’s claim of “state secrets” when refusing to share information about land-based stealth bombers with two government contractors during procurement litigation denied those contractors their due process right to defend themselves.
6. Stern v. Marshall. Last and certainly not least is the return to the Court of a case involving the late Anna Nicole Smith’s efforts to claim a substantial chunk of the estate of her ex-husband, J. Howard Marshall (also deceased). In 2006, the Court first heard this case (then called Marshall v. Marshall), and remanded it back to the trial court in California after ruling for Ms. Smith on a technical issue. On remand, the trial court ruled in Mr. Marshall’s favor and because of the important federal bankruptcy vs. state probate issues in the case, WLF filed in support of Mr. Marshall in the Ninth Circuit. The appeals court refused to allow Ms. Smith executor, Howard K. Stern, to use federal bankruptcy law to subvert a state probate court’s ruling. WLF focused a Web Seminar program to the Ninth Circuit’s ruling, which can be viewed here. The Supreme Court will now determine what is considered a “core proceeding” under bankruptcy law.
Our thanks to and appreciation for the yeoman’s work of SCOTUSblog for providing ready and easy access to documents for all these cases.