Justia U.S. Supreme Court Opinion Summaries

Taggart owned an interest in an Oregon company. That company and its other owners (respondents) sued, claiming that Taggart had breached the company’s operating agreement. Before trial, Taggart filed for Chapter 7 bankruptcy. The Bankruptcy Court issued a discharge order that released Taggart from liability for most pre-bankruptcy debts. The Oregon state court subsequently entered judgment against Taggart in the pre-bankruptcy suit and awarded attorney’s fees to respondents. The Bankruptcy Court found respondents in civil contempt for collecting attorney’s fees in violation of the discharge order. The Bankruptcy Appellate Panel and the Ninth Circuit applied a subjective standard to hold that a “creditor’s good faith belief” that the discharge order does not apply to the claim precludes a finding of contempt, even if that belief was unreasonable. The Supreme Court vacated. Neither a standard akin to strict liability nor a purely subjective standard is appropriate. A court may hold a creditor in civil contempt for violating a discharge order if there is no fair ground of doubt as to whether the order barred the creditor’s conduct. Civil contempt principles apply to the bankruptcy statutes, which specify that a discharge order “operates as an injunction,” 11 U.S.C. 524(a)(2), and that a court may issue any “order” or “judgment” that is “necessary or appropriate” to “carry out” other bankruptcy provisions. A party’s subjective belief that she was complying with an order ordinarily will not insulate her from civil contempt if that belief was objectively unreasonable. The Court remanded, noting that subjective intent is not always irrelevant. Civil contempt sanctions may be warranted when a party acts in bad faith, and a party’s good faith may help to determine an appropriate sanction. View "Taggart v. Lorenzen" on Justia Law

The Social Security Act permits judicial review of “any final decision . . . after a hearing” by the Social Security Administration (SSA), 42 U.S.C. 405(g). Claimants for Title XVI supplemental security income disability benefits must generally proceed through a four-step process before federal-court review: seek an initial determination of eligibility; seek reconsideration; request a hearing before an administrative law judge (ALJ); and seek review of the ALJ’s decision by the Appeals Council within 60 days of receiving the ALJ’s ruling. If the claimant misses that deadline and cannot show good cause for doing so, the Appeals Council dismisses the request. Smith’s claim for disability benefits was denied on initial determination, upon reconsideration, and on the merits by an ALJ. The Appeals Council dismissed Smith’s request for review as untimely. Smith sought judicial review of the dismissal. The Sixth Circuit affirmed dismissal for lack of jurisdiction, holding that the Appeals Council’s dismissal of an untimely petition is not a “final decision.”A unanimous Supreme Court reversed. An Appeals Council dismissal on timeliness grounds after a claimant has had an ALJ hearing on the merits qualifies as a “final decision . . . made after a hearing” under section 405(g). The Appeals Council’s dismissal is the final stage of review, 20 CFR 416.1472; Smith obtained the kind of hearing that section 405(g) most naturally suggests. The dismissal is not merely collateral but an end to a proceeding in which a substantial factual record has been developed. The Court noted that “Congress designed [the statute as a whole] to be ‘unusually protective’ of claimants” and “the strong presumption that Congress intends judicial review of administrative action.” View "Smith v. Berryhill" on Justia Law

Citibank filed a state court debt-collection action, alleging that Jackson was liable for charges incurred on a Home Depot credit card. Jackson responded by filing third-party class-action claims against Home Depot and another, alleging that they had engaged in unlawful referral sales and deceptive and unfair trade practices under state law. Home Depot filed a notice to remove the case from state to federal court. The district court remanded, finding that controlling precedent barred removal by a third-party counterclaim defendant.The Fourth Circuit and the Supreme Court affirmed. The general removal provision, 28 U.S.C. 1441(a) does not permit removal by a third-party counterclaim defendant; the section refers to “civil action[s],” not “claims.” In other removal provisions, Congress has clearly extended removal authority to parties other than the original defendant but has not done so here. The Class Action Fairness Act, section 1453(b), does not alter section 1441(a)’s limitation on who can remove, suggesting that Congress intended to leave that limit in place. Section 1453(b) and 1441(a) both rely on the procedures for removal in section 1446, which also employs the term “defendant.” Interpreting that term to have different meanings in different sections would render the removal provisions incoherent. View "Home Depot U.S.A., Inc. v. Jackson" on Justia Law

The False Claims Act permits a private person (relator) to bring a qui tam civil action in the name of the Federal] Government, 31 U.S.C. 3730(b), against any person who “knowingly presents . . . a false or fraudulent claim for payment” to the Government or to certain third parties acting on the Government’s behalf. The Government may choose to intervene. An action must be brought within either six years after the statutory violation occurred or three years after the “the official of the United States charged with responsibility to act in the circumstances” knew or should have known the relevant facts, but not more than 10 years after the violation, section 3731(b)(2). The later date starts the limitations period. In November 2013, Hunt filed suit alleging that defense contractors (Cochise) defrauded the Government by submitting false payment claims for providing security services in Iraq until early 2007. Hunt claims that he revealed Cochise’s allegedly fraudulent scheme during a November 30, 2010, interview with federal officials about his role in an unrelated contracting fraud. The United States declined to intervene. The Eleventh Circuit reversed the dismissal of the case.A unanimous Supreme Court affirmed. Section 3731(b)(2) applies in a relator-initiated suit in which the Government has declined to intervene. Both Government-initiated suits and relator-initiated suits are “civil action[s] under section 3730,” so the plain text of the statute makes the two limitations periods applicable in both types of suits. The relator in a non-intervened suit is not “the official of the United States” whose knowledge triggers section 3731(b)(2)’s three-year limitations period. A private relator is neither appointed as an officer of nor employed by the United States; private relators are not “charged with responsibility to act.” View "Cochise Consultancy, Inc. v. United States" on Justia Law

Biestek, a former construction worker, applied for social security disability benefits, claiming he could no longer work due to physical and mental disabilities. To determine whether Biestek could successfully transition to less physically demanding work, the ALJ heard testimony from a vocational expert regarding the types of jobs Biestek could still perform and the number of such jobs that existed in the national economy. The statistics came from her own market surveys. The expert refused Biestek’s attorney's request to turn over the surveys. The ALJ denied Biestek benefits. An ALJ’s factual findings are “conclusive” if supported by “substantial evidence,” 42 U.S.C. 405(g).The Sixth Circuit and the Supreme Court upheld the ALJ’s determination. A vocational expert’s refusal to provide private market-survey data upon the applicant’s request does not categorically preclude the testimony from counting as “substantial evidence.” In some cases, the refusal to disclose data, considered along with other shortcomings, will undercut an expert’s credibility and prevent a court from finding that “a reasonable mind” could accept the expert’s testimony; the refusal will sometimes interfere with effective cross-examination, which a reviewing court may consider in deciding how to credit an expert’s opinion. In other cases, even without supporting data, an applicant will be able to probe the expert’s testimony on cross-examination. The Court declined to establish a categorical rule, applying to every case in which a vocational expert refuses a request for underlying data. The inquiry remains case-by-case, taking into account all features of the expert’s testimony, with the rest of the record, and defers to the presiding ALJ. View "Biestek v. Berryhill" on Justia Law

The Foreign Sovereign Immunities Act generally immunizes foreign states from suit in the United States unless an exception applies, 28 U.S.C. 1604. If an exception applies, the Act provides subject-matter jurisdiction in federal district court and personal jurisdiction “where service has been made under section 1608.” Section 1608(a) provides four methods of serving civil process, including service “by any form of mail requiring a signed receipt, to be addressed and dispatched . . . to the head of the ministry of foreign affairs of the foreign state.” Victims of the USS Cole bombing filed suit, alleging that Sudan provided material support to al Qaeda for the bombing. The court clerk addressed the service packet to Sudan’s Minister of Foreign Affairs at the Sudanese Embassy in the United States and later certified that a signed receipt had been returned. Sudan failed to appear. The Second Circuit affirmed default judgment.The Supreme Court reversed. Section 1608(a)(3) requires a mailing to be sent directly to the foreign minister’s office in the foreign state. A mailing is “addressed” to an intended recipient when his name and address are placed on the outside; “address” means “a residence or place of business.” A nation’s embassy in the United States is neither the residence nor the usual place of business of that nation’s foreign minister. Interpreting 1608(a)(3) to require that a service packet be sent to a foreign minister’s own office rather than to a mailroom employee in a foreign embassy harmonizes the rules for determining when service occurs and avoids tension with the Federal Rules of Civil Procedure and the Vienna Convention on Diplomatic Relations. “In cases with sensitive diplomatic implications, the rule of law demands adherence to strict rules, even when the equities seem to point in the opposite direction.” View "Republic of Sudan v. Harrison" on Justia Law

Plaintiffs brought class action claims against Google, claiming violations of the Stored Communications Act; they alleged that when an Internet user conducted a Google search and clicked on a hyperlink listed on the search results, Google transmitted information (referrer header) including the terms of the search to the server that hosted the selected webpage. The Act prohibits “a person or entity providing an electronic communication service to the public” from “knowingly divulg[ing] to any person or entity the contents of a communication while in electronic storage by that service” and creates a private right of action. The district court denied a motion to dismiss, citing a Ninth Circuit holding (Edwards) that an Article III injury exists whenever a statute gives an individual a statutory cause of action and the plaintiff claims that the defendant violated the statute.The parties negotiated a classwide settlement that allowed the continued transmission of referrer headers but required Google to include disclosures on three of its webpages and to pay $8.5 million. None of those funds would be distributed to absent class members; most of the money would be distributed to cy pres recipients. In a class action, cy pres refers to distributing settlement funds not amenable to individual claims or meaningful pro rata distribution to nonprofit organizations whose work indirectly benefits class members. The balance would be used for administrative costs, given to the named plaintiffs, and awarded as attorney’s fees. In the meantime, the Supreme Court (Spokeo) held that “Article III standing requires a concrete injury even in the context of a statutory violation,” rejecting the "Edwards" premise. The Ninth Circuit affirmed approval of the settlement without addressing Spokeo.The Supreme Court vacated. Although the Court granted certiorari to decide whether a class action settlement that provides a cy pres award but no direct relief to class members is “fair, reasonable, and adequate,” Fed. Rule Civ. Proc. 23(e)(2), the Court concluded that there is a substantial open question about whether any named plaintiff had standing. A court cannot approve a proposed class settlement if it lacks jurisdiction over the dispute, and federal courts lack jurisdiction if no named plaintiff has standing. When the district court ruled on the motion to dismiss, it relied on precedent that was subsequently abrogated in Spokeo. View "Frank v. Gaos" on Justia Law

A jury awarded Oracle damages after finding that Rimini had infringed Oracle copyrights. The court awarded Oracle fees and costs, including $12.8 million for litigation expenses such as expert witnesses, e-discovery, and jury consulting. The Ninth Circuit affirmed, acknowledging that the award covered expenses not included within the six categories of costs identified in 28 U.S.C. 1821 and 1920, and citing the Copyright Act, which gives district courts discretion to award “full costs” to a party in copyright litigation, 17 U.S.C. 505. A unanimous Supreme Court reversed in part. The term “full costs” in the Copyright Act means costs specified in the general costs statute (sections 1821 and 1920), which defines what the term “costs” encompasses in subject-specific federal statutes such as section 505. Courts may not award litigation expenses that are not specified in sections 1821 and 1920 absent explicit authority. The Copyright Act does not explicitly authorize the award of litigation expenses beyond the six categories; the six categories do not authorize an award for expenses such as expert witness fees, e-discovery expenses, and jury consultant fees. Oracle has not shown that the phrase “full costs” had an established legal meaning that covered more than the full amount of the costs listed in the applicable costs schedule. View "Rimini Street, Inc. v. Oracle USA, Inc." on Justia Law

Fourth Estate, a news organization that licensed works to Wall-Street.com, a news website. sued Wall-Street for copyright infringement of articles that Wall-Street failed to remove from its website after canceling the license agreement. Fourth Estate had applied to register the articles with the Copyright Office, but the Register had not acted on those applications. No civil infringement action “shall be instituted until . . . registration of the copyright claim has been made,” 17 U.S.C. 411(a). The Eleventh Circuit and a unanimous Supreme Court affirmed the dismissal of the suit. Registration occurs, and a copyright claimant may commence an infringement suit, upon registration; a copyright owner can then recover for infringement that occurred both before and after registration. In limited circumstances, copyright owners may file suit before undertaking registration. For example, an owner who is preparing to distribute a work that is vulnerable to predistribution infringement—e.g., a movie or musical composition—may apply for preregistration; an owner may also sue for infringement of a live broadcast before registration. The Court rejected Fourth Estate’s “application approach” argument that registration occurs when a copyright owner submits a proper application. In 1976 revisions to the Copyright Act, Congress both reaffirmed that registration must precede an infringement suit. The Act safeguards copyright owners by vesting them with exclusive rights upon creation of their works and prohibiting infringement from that point forward. To recover for such infringement, copyright owners must apply for registration and await the Register’s decision. An administrative lag in processing applications does not allow revision of section 411(a)’s congressionally-composed text. View "Fourth Estate Public Benefit Corp. v. Wall-Street.com, LLC" on Justia Law

Lambert filed a class action, alleging that Nutraceutical’s marketing of a dietary supplement violated California consumer-protection law. On February 20, 2015, the district court decertified the class. Under Federal Rule of Civil Procedure 23(f), Lambert had 14 days to ask for permission to appeal the order. Instead, he moved for reconsideration more than 14 days later, on March 12. The district court denied the motion on June 24. Fourteen days later, Lambert petitioned the Ninth Circuit for permission to appeal the decertification order. The Ninth Circuit held that Rule 23(f)’s deadline should be tolled because Lambert had “acted diligently” and reversed the decertification order. A unanimous Supreme Court reversed. Rule 23(f), “a nonjurisdictional claim-processing rule,” is not subject to equitable tolling. Whether a rule precludes equitable tolling turns not on its jurisdictional character but on whether its text leaves room for such flexibility. Rule 26(b), which generally authorizes extensions of time, states that a court of appeals “may not extend the time to file . . . a petition for permission to appeal.” The Rules express a clear intent to compel rigorous enforcement of Rule 23(f)’s deadline, even where good cause for equitable tolling might otherwise exist. A timely motion for reconsideration would affect the when the 14-day limit begins to run, not the availability of tolling. View "Nutraceutical Corp. v. Lambert" on Justia Law