Mid-Term Roundup

With the Corporate Court halfway through its 2011-2012 term, we take this opportunity to look back at the opinions that it has issued so far. The Court’s less tendentious rulings tend to be released before the more closely divided ones, so it is unsurprising that all of these cases were decided 9-0 or 8-1. However, the Corporate Court’s unanimity aside, four of these holdings spell bad news for everyday Americans, while two go against corporate interests, and the implications of a final decision remain to be seen.

First, the bad news.

In Hosanna-Tabor Evangelical Lutheran Church and School v. EEOC, the Court held 9-0 that a “ministerial exception” shields religious institutions from liability for discriminatory or retaliatory employment actions.  The Court applied a totality of the circumstances test to conclude that the employee in this case – a teacher of primarily secular subjects at a religious school – was a “minister,” and that therefore the ministerial exception applies and her suit is barred. This holding will make it difficult for teachers to speak out against misdeeds within religious institutions for fear of retaliation, and will allow religious institutions to discriminate with impunity.

In Minneci v. Pollard, the Court held 8-1 that employees of a private corporation operating a federal prison may not be held liable under federal law for committing constitutional violations. The plaintiff sued for damages under Bivens v. Six Unknown Federal Narcotics Agents, claiming that his Eighth Amendment right not to be cruelly punished had been violated. The Corporate Court held that there is no reason to imply a Bivens remedy because Pollard has an adequate remedy in state tort law. Pollard would clearly have had a Bivens remedy if he were incarcerated in a prison run by the government. Yet because he was placed in a prison run by a private contractor, he is denied that remedy.

In National Meat Association v. Harris, the Corporate Court decided in favor of an industry trade group, holding 9-0 that a California state law designed to protect consumers from contaminated meat and to ensure humane treatment of animals is preempted by the Federal Meat Inspection Act. As a result of the Court’s decision, it will be easier for potentially contaminated meat to get into California grocery stores, and more difficult for all states to protect public health and humane treatment of animals.

In Perry v. Perez, the Supreme Court rejected a district court’s attempts to draw interim electoral maps for the upcoming elections, ordering it to give greater deference to the legislature’s racially gerrymandered maps. With pending lawsuits challenging the maps, the San Antonio court designed interim maps to be used during the 2012 electoral season. The Supreme Court rejected the court-drawn maps for failing to defer adequately to the legislature’s choices, and remanded with the instruction to modify the legislature’s maps only where there are alleged legal problems that have a likelihood of success on the merits. The Court’s ruling will likely have the effect of diluting minority voting rights in the 2012 elections.

Now, the good news.

In Mims v. Arrow Financial Services, the Court held that the Telephone Consumer Protection Act allows a consumer claiming harassment to sue in federal court, reversing the lower courts’ holding that Congress intended to limit jurisdiction to state courts. By siding with Mims, the Supreme Court has provided consumers with the ability to hold companies accountable for unlawful telephone harassment in federal court, where they might receive greater relief than they would in the courts of states with weaker consumer protections.

In a case with narrower application, the Court held in Pacific Operations Offshore v. Valladolid that the Outer Continental Shelf Lands Act extends workers’ compensation coverage to workers who can show a “substantial nexus” between their injury and their work on the Outer Continental Shelf.  As a result, workers in the offshore extractive industries who are injured or killed while working onshore may still receive benefits under the OCSLA if they can show a “substantial nexus” between their injury and operations on the Outer Continental Shelf.

Finally, in the ambiguous category is United States v. Jones, in which the Court addressed the right of individuals to be free from warrantless government tracking of their vehicles’ locations through GPS technology. Although the Court technically ruled against the government, it delivered only a limited victory for privacy rights, holding that the installation and use of a GPS tracker on an automobile constitutes a “search.” Whether or not a warrant is required for such a search remains an open question, and one that will undoubtedly trouble privacy advocates.

The Court returns from its mid-term recess on Tuesday, February 21, when it will hear oral argument in Freeman v. Quicken Loans.

Supreme Court Rules for Consumer in Robocall Case

The Supreme Court yesterday issued its decision in the case of Mims v. Arrow Financial Services, holding that state and federal courts have concurrent jurisdiction to hear civil suits brought by consumers who have fallen victim to illegal and harassing robocalls.

Arrow Financial Services (“Arrow”) is an originator, servicer, and collector of private student loans. Marcus Mims claims that Arrow harassed him about student loan payments by repeatedly calling his cell phone with an automated dialing system and leaving prerecorded voicemails. Mims sued in federal district court and argued that Arrow’s activity violated the Telephone Consumer Protection Act (“the Act”), a statute passed by Congress to restrict the ability of companies to harass consumers over the phone. The district court dismissed the complaint and the Eleventh Circuit upheld (.pdf download) the dismissal, reasoning that Congress intended to limit jurisdiction over lawsuits under the Act to state courts.

The Supreme Court reversed this holding, allowing consumers to stand up for their rights under the Act in both state and federal court. The Court reasoned that the Act does not use the words “only” or “exclusively” in granting jurisdiction to state courts. Furthermore, the Court found that the Act created a federal right of action, and thus, federal courts retain concurrent jurisdiction over causes of action under the Act as an exercise of their general federal-question jurisdiction.

A brief (.pdf download) filed by the National Association of Consumer Advocates, an AFJ member organization, and the National Consumer Law Center states that, “[n]otwithstanding Congress’s clearly stated intentions, extensive non-compliance by national and international telemarketing and related industries under the Telephone Consumer Protection Act, 47 U.S.C. § 227 (TCPA) is not at all uncommon.”  The organizations added that “this unfortunate state of affairs is the failure of the Act’s private right of action, § 227(b)(3), to provide the vigorous enforcement and effective deterrence mechanism that Congress envisioned when it adopted this law.”

By siding with Mims, the Supreme Court has provided consumers with the ability to hold companies accountable for unlawful telephone harassment in federal court, where they might receive greater relief than they would in the courts of states with weaker consumer protections.

Corporate Court to Hear Argument in Robocall Case

On Monday, the Supreme Court will hear argument in the case of Mims v. Arrow Financial Services.  Arrow Financial Services (“Arrow”) is an originator, servicer, and collector of private student loans.  Marcus Mims claims that Arrow harassed him about student loan payments by repeatedly calling his cell phone with an automated dialing system and leaving prerecorded voicemails.  Mims sued in federal district court and argued that Arrow’s activity violated the Telephone Consumer Protection Act (TCPA), a statute passed by Congress to restrict the ability of companies to harass consumers over the phone.  The district court dismissed the complaint and the Eleventh Circuit upheld the dismissal on the grounds that Congress gave state courts exclusive jurisdiction over TCPA lawsuits and that, therefore, federal courts lack subject matter jurisdiction.  The Supreme Court granted Mims’ appeal.

A brief filed by the National Association of Consumer Advocates (an AFJ member organization) and the National Consumer Law Center states that, “[n]otwithstanding Congress’s clearly stated intentions, extensive non-compliance by national and international telemarketing and related industries under the Telephone Consumer Protection Act, 47 U.S.C. § 227 (TCPA) is not at all uncommon.”  The organizations added that “this unfortunate state of affairs is the failure of the TCPA’s private right of action, § 227(b)(3), to provide the vigorous enforcement and effective deterrence mechanism that Congress envisioned when it adopted this law.” 

The result of the Eleventh Circuit’s rule, according to the brief, is that differing state standards apply to the TCPA that unfairly disadvantage some state residents.  “Differences in degrees of federal consumer protection based on state residency are unacceptable; that the TCPA’s minimal standards of privacy are unenforceable now in at least two states – Maryland and Texas – is a result that should attain only with the explicit and unambiguous Congressional approval that is lacking here.” 

If the Supreme Court sides with Arrow, consumers will be far less capable of holding companies accountable for unlawful telephone harassment in federal court and might enjoy weaker consumer protections based on the state in which they live.

Supreme Court to Hear Case on Telephone Harassment by Businesses

This week, the Supreme Court agreed to hear Mims v. Arrow Financial Services. Arrow Financial Services (“Arrow”) is an originator, servicer, and collector of private student loans. Marcus Mims claims that Arrow harassed him about student loan payments by repeatedly calling his cell phone with an automated dialing system and leaving prerecorded voicemails. Mims sued in federal district court and argued that Arrow’s activity violated the Telephone Consumer Protection Act (TCPA), a statute passed by Congress to restrict the ability of companies to harass consumers over the phone. The district court dismissed the complaint and the Eleventh Circuit upheld the dismissal on the grounds that Congress gave state courts exclusive jurisdiction over TCPA lawsuits and that, therefore, federal courts lack subject matter jurisdiction. The Supreme Court granted Mims’ appeal.

A brief filed by the National Association of Consumer Advocates, an AFJ member organization, and the National Consumer Law Center states that, “[n]otwithstanding Congress’s clearly stated intentions, extensive non-compliance by national and international telemarketing and related industries under the Telephone Consumer Protection Act, 47 U.S.C. § 227 (TCPA) is not at all uncommon.” The organizations added that “this unfortunate state of affairs is the failure of the TCPA’s private right of action, § 227(b)(3), to provide the vigorous enforcement and effective deterrence mechanism that Congress envisioned when it adopted this law.” The result of the Eleventh Circuit’s rule, according to the brief, is that differing state standards apply to the TCPA that unfairly disadvantage some state residents. “Differences in degrees of federal consumer protection based on state residency are unacceptable; that the TCPA’s minimal standards of privacy are unenforceable now in at least two states – Maryland and Texas - is a result that should attain only with the explicit and unambiguous Congressional approval that is lacking here.”

If the Supreme Court sides with Arrow, consumers will be far less capable of holding companies accountable for unlawful telephone harassment in federal court and might enjoy weaker consumer protections based on the state in which they live.