• July 3, 2014
    Guest Post

    by Allan B. Diamond, Partner, Diamond McCarthy LLP and Daniel W. Meyler, Associate, Diamond McCarthy LLP

    Last week the Supreme Court decided Erica P. John Fund v. Halliburton, 573 U.S. ___ (2014), its latest securities law decision.  For those who worried that the Court would eliminate Basic v. Levinson’s fraud on the market presumption, Halliburton is a victory.  Halliburton means private plaintiffs can continue to have a role in enforcing the federal securities laws, in stark contrast to the Court’s more hostile approach to consumer class actions.  But the effect of Halliburton’s second holding, that a defendant may rebut evidence of “price impact” at the class certification stage, is less clear.  Expanding the scope of litigation at the class certification stage will front-load securities class actions, essentially creating a mini-trial early in the case, and will change the calculus for plaintiffs and their lawyers in deciding whether to bring cases.  It will almost certainly drive down the settlement value of securities class actions and will probably result in some otherwise meritorious lawsuits not being brought. 

    Halliburton is important, first and foremost, because it reaffirms the Basic v. Levinson presumption of reliance.  Basic says that in a public market like the New York Stock Exchange, a stock’s price incorporates all publicly available information about the stock.  A purchaser of that stock, relying on the integrity of the stock price, is thus deemed to rely on all public information, including any misstatements.  Halliburton holds that despite evidence that public markets do not always perfectly incorporate information into a stock’s price, plaintiffs may still make use of the Basic presumption to certify a securities class action.  573 U.S. ___ (slip op. at 11-13).  Without Basic, securities class actions would not be viable because plaintiffs would always need to show actual individual reliance on the alleged misstatements, making it impossible to meet Rule 23’s requirements for class certification.  For that reason, Halliburton is a good outcome for those who think investors should be able to bring class actions to right wrongs under the federal securities laws.     

  • July 2, 2014
    Guest Post

    by Brandon L. Garrett, Roy L. and Rosamund Woodruff Morgan Professor of Law, University of Virginia School of Law

    Now a corporation can have sincere religious beliefs of legal significance.  Was yesterday’s long-awaited ruling in the Hobby Lobby case, a “narrow” ruling?  The Supreme Court majority did suggest that perhaps just “closely-held” for-profit companies, as believers, would be exempt from contraceptive coverage under the Affordable Care Act of 2010. And the Court said it would not address whether a company could have First Amendment free exercise rights.  Was that notable restraint?  Even if so, the Court utterly lacked restraint in silently dodging a larger constitutional question: whether a company has standing under Article III of the Constitution to sue based on the religious beliefs of its separate owners.  

    Article III of the Constitution requires that there be a “Case or Controversy” and that a plaintiff suffer a “concrete injury” in order to sue.  To be sure, the parties did not push the issue, although lower courts considered and bitterly divided over the question.  None other than John G. Roberts, as a practicing lawyer, pointed out that just because Congress passes a law entitling someone to sue, does not mean they can constitutionally sue absent a concrete injury; he then called it a crucial principle of “judicial restraint.”  And yet in Hobby Lobby, the Court never directly addressed Article III standing.  The Court suggested that since the Religious Freedom Restoration Act (RFRA) of 1993, used the word “person,” and that the federal “Dictionary Act” statute defines persons to include all manner of corporations, this was somehow enough.  Just saying that a corporation is a “person” though is not enough to allow it to sue on behalf of the beliefs of others.  

    After all, corporate persons have “no beliefs,” as Justice John Paul Stevens put it well, to no avail, in his dissent in Citizens United.  The best Justice Samuel Alito could come up with in the majority opinion in Hobby Lobby was a shaky 1961 decision including individual sole proprietor merchants – who all lost their religious exercise claim because the Court said it was not enough that a law made things “more expensive” for them.  As Justice Ruth Bader Ginsburg put it in her dissent, there is no discussion or suggestion in that case or in a similar 1961 case, that corporations have standing; “the exercise of religion is characteristic of natural persons, not artificial legal entities.”  

  • July 2, 2014
    Guest Post

    By David Menschel, Criminal Defense Lawyer; President, Vital Projects Fund

    As the Supreme Court ends its October Term 2013 and heads off for summer recess, it is worth taking a closer look at one of the sleeper cases of the term, Hall v. Florida, a case about intellectual disability and the death penalty. Though Hall received only moderate attention in the press and was depicted as having limited practical reach, it contains significant new avenues for those who oppose the death penalty. The opinion, written by Justice Anthony Kennedy, contains small but important analytical shifts that, considering Kennedy’s role not only as the Court’s swing justice but also as the Court’s most vocal interpreter of the Eighth Amendment, could ultimately make it far easier for death penalty opponents to abolish the death penalty entirely.

    On the surface at least, Hall strikes little new ground. It mostly clarifies the Supreme Court’s 2002 decision, Atkins v. Virginia, in which the Court ruled that the Constitution forbids the execution of the “mentally retarded” – people we now refer to as “intellectually disabled.” Atkins had largely left it to the states to determine which defendants fall into this category and therefore are exempt from the death penalty. Hall tells certain wayward states like Florida that in order to comply with Atkins, they must determine which defendants are intellectually disabled in a robust, less rigid way and in a manner that is consistent with medicine and science.

    Practically speaking, Hall will likely have a modest effect. In the opinion itself, Justice Kennedy estimated that “at most nine states” had laws similar to Florida’s. The New York Times suggested that “only a small number” of death row inmates would qualify for a new hearing as a result of Hall, and the Times cited death penalty expert John Blume, a law professor at Cornell University, who said that the ruling might apply to “10 to 20” inmates. Another Times piece estimated that the ruling “affects roughly 30 death row inmates” about “15 to 20” of whom are in Florida. While it is too soon to know how broad Hall’s practical effect will be – it remains to be seen how it will be applied by lower courts – these estimates suggest that only a tiny fraction of America’s approximately 3,000 death row inmates are likely to be exempted from the death penalty because of Hall.

  • July 2, 2014

    by Jeremy Leaming

    Today we commemorate the 50th Anniversary of the Civil Rights Act of 1964. Signed into law by President Lyndon Johnson on July 2, 1964, it was and remains a landmark step forward. But we must not also forget that 50 years on, African American communities and other minorities still face many of the same onerous, often deadly, obstacles to equality that generations of African Americans before them suffered. 

    The Civil Rights Act sought to fight discrimination against African Americans and others and to desegregate public schools.

    The Civil Rights Act would not have made it to the president’s desk, were it not for Dr. Martin Luther King, Jr. and many other African American leaders' bold courage and great suffering to win steps toward civil rights. But the suffering continues. Morris Dees at the Southern Poverty Law Center remembers the signing of the Civil Rights Act of 1964 50 years ago and notes where we stand today.

    Let's be honest about the state of African-American lives in this country. As Peniel E. Joseph points out in The Root, "the glass is not only half-empty, but it’s losing water fast." Joseph notes that assaults on affirmative action, lax enforcement of civil rights and anti-discrimination laws by federal and state governments and the white public’s general fatigue over race matters has created the perfect storm of political retrenchment we are seeing today. African Americans are still disproportionately imprisoned, put on death row and face racial-profiling from coast to coast. They still face vast discrimination at the polling place. Lawmakers pass discriminatory and unjust laws to keep black men and women from exercising their right to vote. That's why you are seeing stringent voter ID laws and the slashing of early voting. And our country relies on an oppressive system of mass incarceration that is disproportionately destroying African American families and communities. (See this ACSblog Book Talk by Michelle Alexander, associate professor of law at Ohio State University Moritz College of Law, about this system in her book The New Jim Crow: Mass Incarceration in the Age of Colorblindness.)

    The African-American community and others who care for genuine equality and a more just and gentler society are continuing to fight. They have seen a conservative supreme court hobble the Voting Rights Act, but are working with a bipartisan group of lawmakers for passage of the Voting Rights Amendment Act. As The Nation editor Katrina Vanden Heuvel notes in a Washington Post editorial, ongoing action is needed, as Martin Luther King III recently said, we need "not just this moment of reflection, but also a year of action." 

    Today marks the 50th anniversary of the signing of the Civil Rights Act of 1964. This month also marks the 50th anniversary of Freedom Summer. During July, ACSblog will host a symposium commemorating the two anniversaries featuring some of the nation’s leading scholars and civil rights leaders.

  • July 1, 2014
    Guest Post

    by J. Chris Sanders, Attorney, Chris Sanders Law PLLC

    In a unionized workplace, one labor union has the sole and exclusive right to represent all those employees. The workers select one union, and the union handles workplace matters for everyone. That typically means collective bargaining–negotiating as a group to build better pay, better benefits, better hours, better treatment and respect on the job into a union contract. Despite these tough times for unions, the union advantage for workers is10-20 percent over the same workers in the same industries. It also means job protection, usually requiring representation by volunteer activists and paid staff at union expense. As lawyers will understand, representation is costly, and being in a union is financially worthwhile.

    Along with the right to represent people, the union has the duty to represent everyone alike. No picking and choosing between members and nonmembers. That’s right, members and nonmembers, because a worker doesn’t have to join the union in a unionized workplace to be represented. Choosing to join is and has been a First Amendment right, recognized for decades.

    Workers who don’t join weaken the union in bargaining, as the proverbial chain is only as strong as its weakest nonunion link. Contracts and benefits in states and industries where unions are weak are weaker, too. You get what you pay for. Nevertheless, letting people opt out isn’t a group decision, though it affects the group. It’s an individual choice.