A brief overview of the important cases that you may have overlooked from the 2021 Supreme Court Term.
We all know that there have been some major rulings from the United States Supreme Court in recent months. Depending on your point of view, these rulings might be considered controversial. There are many other rulings, however, that have not received as much attention from the press but are equally as important.
The goal of this article is not to pick sides. I simply want to keep my clients and referral partners abreast of a few major decisions handed down by the Supreme Court this last term. There are three cases I want to focus on: Egbert v. Boule, FEC v. Ted Cruz for Senate, and West Virginia v. Environmental Protection Agency. As you will see, each case will be broken down by a summary of the facts, an explanation of the law, and the impact of the case going forward.
Robert Boule owns a bed-and-breakfast—known as the “Smuggler’s Inn”—in Washington state. The Inn sits near the Canadian border. Boule appears to be a colorful character, as he would oftentimes provide transportation and lodging to illegal border crossers, while simultaneously working with federal agents to identify and apprehend those who crossed illegally. It didn’t help Boule’s case that he had a license plate which read “SMUGLER.”
Border Patrol agents, including Erik Egbert, the Petitioner in the case, had Boule on their radar and had a feeling that Boule was providing transport to illegal immigrants. When Agent Egbert got wind that Boule had a guest coming to stay at his inn from Turkey, Egbert grew suspicious. He entered Boule’s property without a warrant, to which Boule told Egbert to leave his property. Egbert refused since he wanted to check the Turkish guest’s immigration papers. Boule claims that Egbert threw Boule to the ground, injuring him. Boule filed a lawsuit under the Federal Tort Claims Act claiming that Egbert used excessive force and caused personal injury to him.
The case which Boule cited in his briefing, Bivens v. Six Unknown Fed. Narcotics Agents (1971), which held that a plaintiff could sue a federal agent for damages where the agent violated his Fourth Amendment rights to unlawful search and seizure.
The Court held that the Bivens case should only be applied in very narrow circumstances, and that Congress—the political branch—and not the courts, should determine whether or not a person has the right to bring claims for damages when Constitutional rights are involved.
To better understand this ruling, it might be good to refresh your memory on how our legal system works. Laws in the American system can be created in two ways: (1) by the legislative branch, and (2) by court-created legal doctrines. The legislative branch is easy. Congress simply passes a law, the president signs it, and the law is valid. Courts can also create laws. Because the courts interpret the laws and the Constitution, they can carve out special rules which are typically followed as precedent.
Here, the Court is not necessarily throwing out the precedent found in Bivens, but it is limiting it so that it is applied as rarely as possible. The Court determined that Boule’s Fourth Amendment claims (i.e., that his rights were violated when Egbert searched his property without probable cause), did not allow for a Bivens claim in this context. Instead, because the case involved a federal agent in the border-security context, the Court decided that Congress was better equipped to make laws relating to overreach by federal agents, not the courts. Thus, Boule’s cause of action against Agent Egbert had no legs to stand on.
The immediate impact of this case is not completely certain. What we do know, however, is that the border zone extends 100-miles from any border crossing under statute. This means that federal agents within 100-milies of the border may be immune from lawsuits filed against them—even by American citizens—if they use excessive force, violate a person’s right to unreasonable searches and seizures, and conduct warrantless searches and arrests with limited repercussion.
The primary purpose of lawsuits is to hold violating parties accountable. Please don’t take this as an argument against policing, but if private citizens are not allowed to hold law enforcement officials accountable for wrongful actions, certain bad actors may have license to violate the rights of otherwise upstanding people, a concern that we should all have.
Fortunately, this case doesn’t really apply to us sitting in Missouri. We do not live within 100 miles of a border crossing. But, Congress, if it wants to, will have to provide clarity with regard to these types of cases now that the Court has severely limited occasions in which citizens can bring suits against federal border agents for excessive force and personal injury.
Take your opinions of Ted Cruz out of this for a minute. This decision has huge ramifications in the world of campaign finance, one on par with the Citizens United decision from 2010 and could create some frustrating (and nefarious) realities going forward.
When a candidate runs for federal office, he or she does not do so under their own name. Instead, they form a campaign committee (in this case, Ted Cruz for Senate) where they can have their campaign contributions deposited. Because of fears of corruption, or the appearance of corruption, Congress passed the Bipartisan Campaign Reform Act of 2002 (more commonly known as “McCain-Feingold” for the senators who sponsored the legislation).
Under Section 304of McCain-Feingold, candidates for federal office who loaned their own money to their campaign committees could not be repaid more than $250,000 from their campaign committees. This premise makes sense. The law wants to deter donors from paying, or repaying, candidates directly instead of through their campaign committees, otherwise there could be a corrupting influence in the election.
In this case, Ted Cruz loaned $260,000 of his personal money to his campaign committee. At the end of election day, his campaign was in the red by approximately $340,000. It eventually began to repay Cruz’s loan up to $250,000, leaving $10,000 of his personal loan unpaid. Because of Cruz’s, and many other politician’s, anathema to campaign finance regulations, Cruz and his campaign committee filed suit against the Federal Elections Commission (“FEC”) stating that the $250,000 repayment limit under McCain-Feingold violated their First Amendment rights.
In the seminal campaign finance case, Buckley v. Valeo (1976), the Supreme Court ruled that money is equivalent to speech. In essence, when a person spends money, particularly in the campaign finance arena, it is an expression of free speech. Of course, as with other First Amendment matters, there are limitations to this speech. For instance, the court has upheld individual contribution limitations to campaign committees (although not for political action committees, which are another animal).
The Court in this case contends that by precluding a candidate from being repaid for personal loans to his campaign in excess of $250,000, McCain-Feingold limits the free speech rights of those candidates. Chief Justice Roberts on behalf of the conservative majority writes, “By restricting the sources of funds that campaigns may use to repay candidate loans, Section 304 increases the risk that such loans will not be repaid. That in turn inhibits candidates from loaning money to their campaigns in the first place, burdening core speech.” For that reason, the Court struck down the $250,000 limit so that campaign committees can repay unlimited sums in candidate loans.
In a strange way, the Court justifies its striking down of Section 304 by stating that more and more candidates are lending their own money in excess of $250,000 to their own campaigns. Why is this strange justification? Well, in recent years we have seen more and more millionaires elected to Congress. While not inherently a bad thing, one could argue that Congress is not representative of America since its members are not diverse in terms of wealth. If a multi-millionaire wants to spend their own money to get elected to Congress, does it really seem fair that they can pay themselves back with money from campaigns given by ordinary Americans? It certainly doesn’t seem like a good legal justification for throwing out Section 304.
Moreover, the Court reasons that the limitations imposed by Section 304 are not permissible grounds to restrict political speech under the First Amendment because the section does not prevent quid pro quo corruption or its appearance. Even though use of campaign contributions to repay a candidate’s personal loans might look inappropriate at first glance, the Court reasons that there are other safeguards in place to prevent corruption (i.e., capping individual campaign contributions to $2,900 per candidate per election). Of course, only a select few people can afford to donate $2,900 to a candidate without second thought, but that doesn’t seem to bother the Court: money (free speech) is more important.
As with all cases this term, the immediate impact of this case is not known. What we can expect, however, is that wealthy people who run for Congress will be able to repay themselves back with money from hard-working Americans. Whether this is a good approach or not is in the eye of the beholder. At the end of the day, it really does require one to weigh what they value more, at least in this Court’s view: First Amendment rights or anti-corruption efforts.
We all know that laws are passed by Congress and signed by the president. That’s basic stuff. But how are regulations made? To have a better understanding of this case, we need to answer that question.
Under Article I of the Constitution, all legislative powers (i.e., the power to create laws) are vested in Congress. Thus, members of Congress (or, more truthfully, their staffers or think tanks) are tasked, by the Constitution, with writing laws. The executive branch under Article II is granted the authority to execute the laws, which has been interpreted not only as signing bills into law, but also determining, to some extent, how laws are interpreted. The interpretation of these laws is often left to federal bureaucratic institutions—like the Department of the Treasury, the Department of State, etc.—which are technically institutions within the Executive Branch.
Because law writing is complicated, especially in an ever-changing, fast-paced world like ours, Congress often passes laws that give federal bureaucratic agencies (like the EPA) the authority to issue regulations—which can oftentimes exceed the scope of the written law to cover things not necessarily written within the law—to provide clarity and set certain regulatory standards. Courts may sometimes interfere by striking down regulations created by the federal bureaucracy, but the Supreme Court has long held that so long as the bureaucratic interpretation to an ambiguous law was rational and within the scope of the agency’s authority, courts cannot not strike down the regulation. This is known as Chevron deference in the legal community because this concept came about from a case involving Chevron in the 1980s. This doctrine is incredibly important, however, in precluding courts from acting as legislators or regulators. Without Chevron deference, almost any regulation could be thrown out and be considered unenforceable by a court.
In 2015, the EPA issued the Clean Power Rule. The Rule is complicated and way outside the purview of this articles, but in essence the EPA claimed that it had authority (which was derived from the Clean Air Act) to regulate and limit carbon emissions for existing coal and natural gas power plants. West Virginia filed suit against the EPA claiming that the EPA did not have authority under the Clean Air Act to issue any such regulations. The Supreme Court took the case in order to answer the simple question of whether the EPA’s authority to limit carbon emissions from existing power plants is within the power granted it by the Clean Air Act.
The first thing that the Court looks at in a case like this is whether there is “standing” to bring the case in the first place. Standing simply means that a party has an immediate controversy or claim that can be adjudicated by a court. If the claim no longer exists, or is considered “moot” by the court, then there is no standing. Even though the current EPA did not plan to follow the 2015 Clean Power Rule and, instead, planned to issue a new one, the Court found that there was standing in this case because the government did not do a good enough job of arguing that the case was actually moot. This is a bunch of legal jargon that is of no importance really to the case, just an interested little tidbit I thought to throw in here.
The meat of the Court’s ruling is that Congress did not grant the EPA authority under the Clean Air Act to issue the Clean Power Rule. The Court reasons that there was no clear congressional authorization to regulate emissions in the way proposed by the Clean Power Rule under the Clean Air Act since the authority for its regulatory power was derived from a rarely used provision of the Clean Air Act. And because the government could not point to a clear congressional authority to regulate the matter, the Court sided against the EPA.
I know that I’ve glossed over some important details of this case for the sake of clarity and conciseness, but its impact cannot be overstated. The regulatory authority of bureaucratic institutions is on thin ice.
Unless you area lawyer or a nerd interested in this sort of stuff, you don’t spend your day thinking about what a federal agency like the EPA is authorized to do or whether a court will throw out such regulations. You just presume that they have authority todo whatever they want. And for a while, you might have been right. The Supreme Court has long held that where a law passed by Congress is ambiguous, regulatory agencies can fill the gaps. This makes a lot of sense. Like I said at the beginning, lawmaking is complicated, and Congress cannot be expected to foresee every possible outcome of the law it writes. That’s why courts have often left this discretion up to the experts in the federal bureaucracy.
Many of the new justices to the Court, however, see this approach to regulation as a dereliction of Congress’ duties under the Constitution. According to them, Congress holds the supreme legislative power in the United States; thus, federal agencies, even when a statute is ambiguous, have no power to issue regulations (which they consider akin to laws and legislation). While many observers expected the Supreme Court to overturn the precedent of Chevron deference in this case, it elected not to. But that doesn’t mean that it might not change its mind in the coming years.
So, why is this case important? Well, if the Court eventually overturns Chevron, there will be a whole host of regulations that will be subject to adjudication in the courts. This includes regulations important to my clients, like recent regulations by the IRS relating to the SECURE Act passed in 2019. Under the SECURE Act, non-spouse beneficiaries of inherited IRAs must withdraw the entirety of the IRA within ten years of inheriting it. Within the past year, the IRS has issued rules and regulations surrounding the SECURE Act, especially with regard to minor beneficiaries of IRAs. Without the protection of the Chevron case, the IRS may not have any authority at all to interpret the SECURE Act, leaving me and many of my clients in the dark as to how the law is supposed to operate.
So, as you can see, there have been some really important and interesting cases this term, even beyond the more headline grabbing cases. I hope you’ve found this interesting. If not, no skin off my back.
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