Cases by Issue - Supreme Court Jurisdiction from Federal Courts

Unitherm Food Systems v. Swift Eckrich - Oral Argument

Fri, 09 Jan 2009 14:48:56 +0000

Case:

Unitherm Food Systems v. Swift Eckrich

Media File:

04-597_20051102-argument.mp3

Related Transcript:

transcript.xml

Transcript:

Argument of Burck Bailey

Chief Justice Roberts: We'll hear argument first today in Unitherm Food Systems versus Swift Eckrich.

Mr. Bailey.

Mr. Bailey: Mr. Chief Justice, and may it please the Court:

In 1947, this Court stated, in Cone versus West Virginia Pulp & Paper Company, 330 U.S. at 216, quote,

"Determination of whether a new trial should be granted, or a judgment entered under Rule 50(b), calls for the judgment in the first instance of the judge who saw and heard the witnesses and has the feel of the case, which no appellate printed transcript can impart. "

That language was repeated verbatim the following year in Globe Liquor versus San Roman.

And, in the year after that, both Cone and Globe Liquor were cited for the same proposition in Fountain versus Filson.

And, in 1952, in Johnson versus New York Railway, this Court again reiterated the requirement... is the word the Court used... of submitting a post verdict motion, or JNOV, to preserve sufficiency of the evidence for appellate review.

Justice O'Connor: Now, was there a Rule 59 motion made here after the verdict?

Mr. Bailey: No, Your Honor.

There was a motion for a remittitur--

Justice O'Connor: Right.

Mr. Bailey: --of damages.

Justice O'Connor: Had a Rule 59 motion been made, would it preserve a sufficiency of the evidence argument in connection with the motion for new trial?

Mr. Bailey: Not a sufficiency of the evidence argument, Your Honor.

And that... this Court spoke to that in footnote 9 of the Weisgram opinion.

But a Rule 59 motion contesting the weight of the evidence would have been appropriate.

No such motion was filed.

Eight of the Circuit Courts of Appeals have held that in the absence of a post verdict Rule 50(b) motion, the appellate court cannot review for sufficiency of the evidence.

And that language is in black letter law in the standard treatises on Federal practice, in Moore's and in Wright & Miller, that it is absolutely required.

Here--

Justice Stevens: Do any of those circuits allow an exception for plain error?

Mr. Bailey: --Several of them do--

Justice Stevens: Yeah.

Mr. Bailey: --Your Honor.

Some do not, but most, I think it would be accurate to say, do.

And, Your Honor, we feel that those cases are mistakenly decided, because the court's ruling on a 50(a) motion... that is, a pre verdict motion... is always interlocutory.

I mean, indeed, the trial court is encouraged to deny that motion, pending the jury verdict, because if the jury comes back, obviously, with a defendant's verdict, that's the end of the case.

And if the Court, on the other hand, grants it, and the appellate court concludes that there was a jury question, then it has to go back for a whole new trial.

So--

Justice Kennedy: Just while I have you, I'm... just while I have you here... it's not--

Mr. Bailey: --Yes.

Justice Kennedy: --probably, directly relevant to this case.

On that one point, when I was in practice, it used to irritate me sometimes that the judge should grant the motion and then he'd just sit on it.

But I see the wisdom for the rule now, and the judge reserving it, in the event the jury comes out the right... the, quote, "right way", anyway.

What if there's a very long trial?

What if, after the plaintiff rests, there's a good grounds for granting the motion for judgment as a matter of law, the judge doesn't do it, and then there's a 3-month trial?

Do the judges ever take that into account?

Mr. Bailey: Your--

Justice Kennedy: Three more months for the defense to--

Mr. Bailey: --Yes.

Your Honor, I think my answer to that is, not infrequently holes in the plaintiff's case are filled when the defendant's case is put on.

That happens, as I say, rather frequently, through cross examination and... and it's just extremely iffy to say that won't occur.

And, in any event, Your Honor, it raises the specter of this problem that we've just talked about, that that long trial that you... that you envisioned in your hypothetical would have to... if the appellate court finds that there is a jury question there--

Justice Kennedy: --Yes.

Mr. Bailey: --has to try it all over again.

Not a... not a very good consequence.

Justice Ginsburg: On the issue that's before us now, I can understand why, if the, what we used to call, JNOV is not requested after the jury verdict, the appellate court could not then enter judgment... direct the entry of judgment as a matter of law.

But I don't see why it couldn't say, just as we would be reluctant to affirm a decision when there was no claim for relief, so, if there's insufficient evidence, we can remand for a new trial.

But you would say that that is not possible either.

Mr. Bailey: I would, Your Honor.

That's not authorized.

There's no way to ask for a new trial in a 50(a) motion.

I mean, it doesn't provide for that.

The trial is still going on.

By definition, you can't seek a new trial until the trial is--

Justice Ginsburg: But--

Mr. Bailey: --concluded.

Justice Ginsburg: --you haven't asked for it, but the appellate court said,

"We don't want to affirm a judgment when there was insufficient evidence, so we are going to. "

--there was... the judge was tipped off by the... by the directed verdict motion, that the... who turned out to be... the one who turned out to be the verdict loser thinks the evidence is insufficient.

That's enough at least to say that the Court of Appeals could grant a new trial.

Mr. Bailey: Your Honor, it's our position that you can never ask for... move for a new trial for... on the ground that the evidence is against... the weight--

Justice Ginsburg: No, I'm not--

Mr. Bailey: --of the evidence--

Justice Ginsburg: --talking about "against the weight", because a trial judge would rarely be... if it... if a trial judge said,

"It's against the weight of the evidence. "

it would go back for a new trial, and you couldn't raise that issue, at least not til you go through the whole second trial.

But why isn't it like... I think there are decisions that said there was a judgment, but the Court of Appeals determines there was never a claim for relief to begin with, even though a motion wasn't made to that effect.

The idea of a court affirming a judgment that is without sufficient legal basis is troubling.

Mr. Bailey: --Well, Your Honor, I... my response to that is that these matters, pursuant to this Court's jurisprudence in Cone and Johnson and other cases, simply mandates that the trial court be asked to pass in the first instance on this issue of sufficiency of the evidence.

Justice Ginsburg: But, it... but it was asked by the... by the pre verdict motion.

What... the only thing that wasn't done is, it... the request wasn't repeated after the verdict.

I can see your point if there had never been a motion for directed verdict at the close of all of the evidence.

But there was that.

And so, all that we're missing is a repetition of the same words after the jury comes in.

Mr. Bailey: Well, Your Honor, the... if I may, the standard of review is radically different.

I mean, if motion for a JNOV is asked for and granted/denied, the review is de novo.

The issue about a new trial, under 59, is an abuse of discretion.

Justice Ginsburg: Well, that's... the new trial comes in, by the courts that have said this, only... they'd say,

"We would direct the entry of judgment for the verdict loser, but we're powerless to do that. "

And that is all wrapped up in the Seventh Amendment.

So, the next best thing is, we grant a new trial.

Mr. Bailey: Well, that's certainly what the Tenth Circuit jurisprudence provides, Your Honor.

And the Federal Circuit adopted that.

Justice Ginsburg: Yes.

Mr. Bailey: And we think that that's totally at odds with this Court's rule in Cone and Johnson, that it is out of step with the law in eight Federal Circuits, that it simply is illogical to say, someone who never asked for a new trial... Your Honor, if they had... if ConAgra had sought a new trial on sufficiency of the evidence in Federal Circuit, presumably, the Federal Circuit said,

"You didn't ask for that below. "

"It's gone. "

It's waived.

What's your next argument?

"By not asking, they say, in effect. "

Since you didn't ask for it, that's what we're going to give you.

"And that simply is, Your Honor-- "

Justice Ginsburg: Well, couldn't one regard a new trial as, sort of, subsumed under the request for judgment as a matter of law?

That is, that's the larger thing, but at least a new trial.

Don't let... the judgment as a matter of law says, "Don't let this verdict stand".

So, one could say,

"We won't give you a judgment, but we will order a new trial. "

Mr. Bailey: --And, Your Honor, I... my response is simply that those are two very different motions and call for two very different standards of review, and it cannot, I respectfully submit, logically be administered, when there's been no request for a new trial.

There's no authority to request a new trial in a 50(a) motion.

It leads to the kind of confusion that, I submit--

Justice Stevens: Would you refresh my recollection?

In the cases you cited at the outset of your argument, where the judgments were reversed, am I wrong in thinking, in those cases, there was, in fact, a new trial afterwards?

Mr. Bailey: --There... Your Honor, they had moved for a new trial in those cases.

That is, the defendant moved for a new trial.

And that... and this Court--

Justice Stevens: But the judgment of this Court was simply reverse, wasn't it?

Mr. Bailey: --It was reverse.

Justice Stevens: There were--

Mr. Bailey: Of the appellate court--

Justice Stevens: --Yes.

Mr. Bailey: --of the Eighth Circuit.

Yes, Your Honor, that's right.

It was... this Court simply reversed, in Cone and Johnson.

Those cases went back for retrial.

Yes.

Justice Ginsburg: I don't understand your response to me about vastly different standards of review.

I would think it would be harder for a verdict loser to get judgment as a matter of law than to get a new trial.

Mr. Bailey: At the trial or the appellate level, either one--

Justice Ginsburg: Yes.

Mr. Bailey: --Your Honor?

Yes.

Well, one would... I quite agree.

Justice Ginsburg: That's why--

Mr. Bailey: But--

Justice Ginsburg: --I'm suggesting--

Mr. Bailey: --but the--

Justice Ginsburg: --that one is kind of a lesser included.

Mr. Bailey: --Yes, Your Honor.

And the response I have to make is that the reviewing court would determine the issue of new trial on an abuse of discretion standard, not on a de novo review of sufficiency of the evidence.

Chief Justice Roberts: They go to different things, don't they?

I mean, if you... you get a new trial when there are... you know, evidence is admitted that shouldn't have been admitted, or something like that.

I mean, they're... they're, sort of, different grounds.

They're not overlapping, are they?

Mr. Bailey: They... very different grounds most... most commonly, Your Honor.

That is, you can... there can be completely sufficient evidence to support the jury winner's verdict--

Chief Justice Roberts: Well--

Mr. Bailey: --but the Court can still--

Chief Justice Roberts: --this is a--

Mr. Bailey: --grant a new trial.

Chief Justice Roberts: --Right.

I mean... I'm not sure.

I mean, is it a... is insufficient evidence a typical ground for asking for a new trial?

Mr. Bailey: Well, not insufficient evidence, but the--

Chief Justice Roberts: No.

Mr. Bailey: --the verdict is against the weight of the evidence.

That is the distinction that this Court pointed out in footnote 9 of Weisgram, that if you're talking about the weight of the evidence... the verdict is against the weight of the evidence; very subjective proposition, but that it is... then you proceed under Rule 59.

Justice Scalia: And that determination of what was the weight of the evidence is typically left to the trial judge, rather than to the Court of Appeals.

It would be--

Mr. Bailey: Well, you can--

Justice Scalia: --somewhat novel for the Court of Appeals to be reviewing a trial judge on the basis of what it thought the weight of the evidence was.

It's one thing to say,

"If he's denied or granted a motion for a new trial on that basis, we'll look for abuse of discretion. "

but for the appellate court to do that de novo and assess the weight of the evidence, it seems, to me, quite unusual.

Justice Ginsburg: That's--

Mr. Bailey: --I--

Justice Ginsburg: --I don't think any appellate court has claimed that authority.

We're talking about a new trial in lieu of J... a judgment as a matter of law.

And the... one of the whole rationales in Cone and Globe and all of the others was... saying you should make the post verdict motion... is that then the trial judge would have the option.

The trial judge might think,

"Well, technically, you deserve JMOL, but maybe there was a witness who was out to sea, so I want to exercise my discretion to grant a new trial. "

Those two are closely linked.

I mean, lawyers usually, as a... just a matter of... just automatically ask for JNOV or, in the alternative, a new trial.

Mr. Bailey: --Your Honor, I think it shows respect to the trial judge to require that the trial judge be required, in the first instance, to review this evidence that the trial judge saw, heard, and has the same opportunity, as this Court has observed in cases going back over a century, to see, just like the jurors saw, and provides a perspective on it that is available to the trial judge, alone.

Justice Scalia: Well--

Mr. Bailey: Your Honors, if--

Justice Scalia: --it seems--

Mr. Bailey: --I may, I'd--

Justice Scalia: --it seems to me that if the Court of Appeals is going to grant a new trial, it must say one of two things.

It must say either, number one,

"There was not sufficient evidence to go to the jury, but the conclusion of that determination ought to be... and, therefore, you know, the case is over. "

but to say that and then say,

"And, therefore, we give a new trial. "

it seems very strange.

Or else, the Court of Appeals has to say, you know,

"The weight of the evidence was not in the plaintiff's favor. "

And if it says that, it's making the kind of a determination that I find unusual for a Court of Appeals.

Mr. Bailey: --Yes, Your Honor.

But circumventing the application to the trial judge--

Justice Ginsburg: But--

Mr. Bailey: --in the first instance--

Justice Ginsburg: --in fact, that's not what the Courts of Appeals have said.

They have all said,

"We would grant judgment as a matter of law, but we're powerless to do that under this case... Court's case law. "

"We think the evidence is insufficient, not that it's against the weight of the evidence. "

"We think it's insufficient. "

"If we had the power to do it, we would direct the entry of judgment. "

"We can't do that, so we do the next best thing. "

But in all of the... including the Tenth Circuit, whose law is relevant here... the Court of Appeals is saying,

"We think the judgment... there was insufficient evidence to support that judgment. "

"And if we had the power, we would instruct the entry of judgment. "

"We don't have that power. "

Mr. Bailey: --That's exactly what they said, Your Honor.

And we say they had no authority to do that.

In the absence of taking it in the first instance before the trial court--

Justice Scalia: I suppose they could make the same... if... I mean, if that follows, they should be able to do the same thing when there has been no motion made, neither before nor after, right?

They could say,

"Well, there's no motion made. "

"We really have no authority to reverse this judgment. "

Mr. Bailey: --That's--

Justice Scalia: "But"--

Mr. Bailey: --that's certainly--

Justice Scalia: --you know,

"we certainly think there was not enough evidence, and, therefore, we grant a new trial. "

Does any court do that?

Mr. Bailey: --I may have missed, Your Honor--

Justice Scalia: Where no motion has been made--

Mr. Bailey: --Yes.

Justice Scalia: --neither before the verdict nor after the verdict, does any appellate court say,

"Since no motion was made, we have... we have no power to reverse the judgment here, but our examination of the case indicates that there was really not sufficient evidence to go to the jury. "

"And, therefore, we will do the lesser thing and grant a new trial? "

Does any court of... appellate court do that?

Mr. Bailey: Your Honor, I know of no case where an appellate court would do such a thing when there's no motion of any kind that's ever been made contesting the--

Justice Stevens: No, but the trial court could do that, pursuant to Rule 59(d), couldn't it?

Mr. Bailey: --I'm sorry.

Justice Stevens: I say, the trial court could have done that pursuant to Rule 59(d) without a motion being filed.

Mr. Bailey: I quite agree, Your Honor.

Yes.

Chief Justice Roberts: Thank you--

Mr. Bailey: May I reserve the rest of my time?

Argument of Malcolm L. Stewart

Chief Justice Roberts: --Thank you, Mr. Bailey.

Mr. Stewart.

Mr. Stewart: Thank you, Mr. Chief Justice, and may it please the Court:

It's a well established principle of Federal appellate practice that the litigant must adequately preserve a claim in the trial court in order to raise it on appeal.

The disputed issue in this case is whether a claim of insufficient evidence is adequately preserved for appeal through the filing of a pre verdict Rule 50(a) motion or whether a renewed post verdict motion under Rule 50(b) must be filed, as well.

The text of Rule 50, the practical considerations that underlie contemporaneous objection rules, and this Court's decisions construing Rule 50 all indicate that a post verdict motion is necessary for adequate preservation of the claim.

I think it may be--

Justice Scalia: What is the usual practice with regard to the pre verdict motions?

Are... is the initial one made at the close of the plaintiff's case--

Mr. Stewart: --It often is.

It can be made--

Justice Scalia: --and then renewed at the... at the end of all of the evidence?

Mr. Stewart: --I think that's a very typical practice.

Justice Scalia: Yes.

Mr. Stewart: It doesn't... it doesn't have to be made at the close of the plaintiff case, but it can be made at any time after the opposing party has had an adequate opportunity to be heard.

And so--

Justice Scalia: But they're really different things to be reviewed at those two times.

I mean, at the end of all the evidence, there may be some matter that the defendant inadvertently puts in that makes up the deficiency in the plaintiff's case.

So, it's really a different motion, isn't it?

Mr. Stewart: --It is requesting the same sort of--

Justice Scalia: Of relief.

Mr. Stewart: --relief, but it... different considerations would affect the trial judge's decision whether to grant the motion.

And I think... in a sense, this goes to Justice Kennedy's question... that is, one of the reasons that, at least with respect to the motion that's filed at the conclusion of all the evidence, that these motions are almost uniformly not granted, the case is almost always submitted to the jury, because the thought is, very little is lost by submitting the case to the jury, because the suit has been tried already, and there may be substantial gains in efficiency from pursuing that course.

I think if a motion was made at the conclusion of the plaintiff's case, and the judge thought it clearly had merit and thought that a substantial savings in cost and time would ensue from granting the motion, the trial judge could take that into account in deciding whether the motion should be granted or not.

But I think... I think it's important to look at the text of Rule 50.

And it's reprinted, among other places, at page 57(a) of the appendix to the certiorari petition.

And in... at the beginning of Rule 50(a)(1), it says,

"If, during a trial by jury, a party has been fully heard on an issue and there is no legally sufficient evidentiary basis for a reasonable jury to find for that party on that issue, the Court may determine the issue against that party. "

Again, the word "may" is permissive.

So, while the judge may take into account potential savings in time and expense, the judge is never required to grant a Rule 50(a) motion, even if the judge is firmly persuaded that the evidence on the other side is insufficient.

And then, at the very bottom of the page, the first sentence of Rule 50(b) says,

"If, for any reason, the Court does not grant a motion for judgment as a matter of law made at the close of all the evidence, the Court is considered to have submitted the action to the jury, subject to the Court's later deciding the legal questions raised by the motion. "

And the significance of that sentence is that it says,

"No matter what stated rationale the District Court gives. "

--whether the District Court simply says, "I'm reserving the motion", or says,

"I'm denying it, because the evidence is, in my view, clearly sufficient... whatever stated rationale the Court gives, the action will be treated as a reservation of the legal questions. "

And I think one of the reasons that it would be inappropriate to allow appeal of a sufficiency claim without a renewed post verdict motion is that in order attain reversal on appeal, regardless of whether the remedy is entry of judgment or a new trial, the Court of Appeals has to be able to point to an erroneous ruling by the District Court.

And the reservation of a ruling on the 50(a) motion, by its nature, can't be erroneous.

That is, the judge is specifically authorized to submit the case to the jury--

Justice Stevens: But, Mr. Stewart, just let me clear up one thing of confusion.

Is it not true that if the District judge denies the motion before submitting the case to the jury, within 10 days after the jury verdict, if no further motion is made, he would still... the judge would still have authority to change his mind and grant the motion?

Mr. Stewart: --We don't believe that that's the case.

That is, at this point, the rule has been amended so that the time for filing a post verdict motion is 10 days after entry of judgment, rather than 10 days after verdict, as it used to be.

But this Court said, in Johnson, that, in the absence of a renewed verdict post... a renewed motion post verdict, neither the District Court nor the Court of Appeals may order entry of judgment in the favor of the verdict loser.

And I think that the text of Rule 50(b) bears that out.

If you look farther down that paragraph, on page 58(a), the rule says,

"Submission of the case to the jury is to be treated... or considered to be a reservation of the legal question. "

And then it said,

"The movant may renew the request. "

And then that sentence says,

"In ruling on a renewed motion, the Court may, if a verdict was returned, allow the judgment to stand or grant a new trail or order entry of judgment. "

And I think that phrase,

"in ruling on a new... renewed motion. "

is significant, because the only express authority that the District Court has, post verdict, to grant judgment as a matter of law is that the court may do so in ruling on a renewed motion.

The rule doesn't contemplate a situation--

Justice Stevens: So, you're saying that if the judge wants to do what I... what I hypothesized, the judge should say to the losing party,

"Renew your motion, and I'll grant it. "

Mr. Stewart: --That's correct.

And the judge could do that, either pre or post verdict.

That is, pre verdict, the judge could say,

"I think your motion may very well have merit, but, in the interest of overall efficiency, I'm going to submit the case to the jury. "

"But, in the event that the jury comes back against you, I would encourage you to renew that motion. "

There's nothing wrong with the judge encouraging the litigant to file something like that, or signaling that the judge has doubts about the sufficiency of the evidence.

But the rule makes the renewed post verdict motion a prerequisite to entry of judgment as a matter of law, post verdict.

And it--

Justice Kennedy: Can you tell me, if we adopt your position, what should a trial court do if he, alternatively, would grant a new trial?

Should he go ahead and make that determination?

He grants judgment NOV.

And then he really is thinking,

"Well, I would have granted a new trial. "

Should he go ahead and cover himself against reversal by granting the new trial in the alternative, or--

Mr. Stewart: --He should.

And, indeed, this Court, in... as early as Montgomery Ward, have said that was the better practice, and that requirement has since been codified in what is now Rule 50(c), which says that if the Court grants the motion for judgment as... the renewed motion for judgment as a matter of law, and there is also an alternative motion for a new trial, the judge should rule on that, as well, and should basically say,

"In the event that my ruling on the JNOV... or the JMOL-- "

Justice Kennedy: --"Shall".

It does say "shall".

Mr. Stewart: --Yeah, "shall".

Justice Kennedy: It says "shall".

Thank you.

Mr. Stewart: So,

"In the event that my ruling on the sufficiency question is reversed on appeal, the Court of Appeals will know how I would have ruled on the new trial motion, and the processing of the case can be expedited. "

Justice Ginsburg: It's a... it's a conditional ruling on the new trial motion.

Mr. Stewart: That's correct.

Justice Ginsburg: Because if it were a ruling on the new trial motion, you would never get up to the Court of Appeals.

Mr. Stewart: That's correct.

But the Court... this Court, in Montgomery Ward, noted that there may be inefficiencies if the District Court rules on the JNOV motion, but doesn't rule on the conditional motion for new trial, because if the JNOV... if the ruling on the JNOV motion is reversed on appeal, then there's a need for remand for further proceedings, and it's inefficient.

But to return to the point about taking an appeal from a Rule 50(a) motion, I think it would put a District Court in an untenable position to say,

"You can reserve ruling on the 50(a) motion, even if you think the evidence is insufficient. "

and, indeed, it's usually the better practice to do so, but, if you do that, and the jury comes back against the movant, the movant can take an immediate appeal, and you can be reversed on the ground that your ruling on the Rule 50(a) motion was erroneous.

There's simply no... by its... by the terms of the rule itself, the submission of the case to the jury, in the face of a Rule 50(a) motion, is considered to be a reservation of the sufficiency question.

Justice Scalia: Yes, well, I don't know that you have to read it that way.

I mean, you can say that the... when the... when the rule says that it... that it is deemed to have been reserved, it also implies that the question that was reserved is implicitly resolved when the court does not... does, later, not act.

It's an implicit denial.

Why can't you read the rule that way?

Mr. Stewart: I mean, conceivably you could have read the rule that way at the time of Johnson, but first we have this Court's decision in Johnson, which says the submission of a post verdict Rule 50(b) motion is an essential prerequisite even for the District Court to act on the motion.

And, therefore, if the motion is not renewed, the District Court is entitled to treat it as abandoned.

And, second, the rule, in its current form, limits the authority of the District Court to enter a judgment as a matter of law post verdict to the situation where the court is ruling on a renewed motion.

The rule doesn't contemplate a situation in which the motion is not renewed and yet the District Court purports to rule on the 50(a) motion that was left hanging by the submission of the case to the jury.

Chief Justice Roberts: What about the plain error question?

Mr. Stewart: I think we would say, for some of the same reasons that Mr. Bailey has identified, that plain error review would be inappropriate, because in order to have plain error, there has to be error.

And if the gravamen of the appeal is that denial of the pre verdict Rule 50(a) motion was plain error, it can't be right, because the pre verdict... the submission of the case to the jury is treated, as a matter of law, as a reservation of the legal questions, and it can't be plain error to reserve those questions for later decisions.

Justice Scalia: I'm not sure--

Chief Justice Roberts: Thank you Mr. Stewart.

Justice Scalia: --I understood.

Sorry.

Just... I'm not sure I understood.

Did you say that even when it's reserved, the judge cannot go back to the reserved motion and grant it unless the motion is renewed?

Mr. Stewart: That's correct.

That was... that was the fact--

Justice Scalia: Okay.

Mr. Stewart: --in Johnson, that the District Court expressly reserved its ruling, and the court, nevertheless, held renewal as essential.

Argument of Robert A. Schroeder

Chief Justice Roberts: Thank you, Mr. Stewart.

Mr. Schroeder.

Mr. Schroeder: Mr. Chief Justice, and may it please the Court:

Before getting to some of these questions that have been discussed this morning, I think it's helpful to ground ourselves a little bit in the fundamental decision made by the Federal Circuit that is not within this Court's grant of certiorari, and, therefore, is the foundation from which we proceed.

And, rather succinctly, the Federal Circuit said,

"Unitherm never presented any evidence that could possibly support critical factual elements of its claim. "

"In particular, Unitherm failed to present any facts that could allow a reasonable jury to accept either its proposed market definition or its demonstration of antitrust injury. "

Building on that foundation, Unitherm wants a judgment entered in its favor for $19 million for the injury that they have never proven.

And, to get there, they have to accomplish each of three things.

First--

Justice Ginsburg: May I just stop you with that point?

Because one of the things that Unitherm said about that argument... which, as you prefaced, is not before us... is, the Court of Appeals was looking to a truncated record to see whether there was sufficient evidence that, in fact, the record was much larger than the piece of it that the Federal Circuit examined, so that the Federal Circuit, when it says there was no evidence, was looking to the appendix that was before us, but that was not the whole picture.

Mr. Schroeder: --Your Honor, in the Federal Circuit, each party had the... had the ability to put any part of the record, or the entire record, before the court, and, under the Federal Circuit's own rule, they were also entitled to go back to the District Court record, whether it was in the appendix or not.

So, the entire record--

Chief Justice Roberts: Well, but if they had been on--

Mr. Schroeder: --was--

Chief Justice Roberts: --if they had been on notice that insufficiency of the evidence was going to be an issue, they might have put more in the record about the sufficiency of the evidence.

Mr. Schroeder: --When the case was appealed to the Federal Circuit, Your Honor, insufficiency of the evidence was presented as an issue at that time.

And so, that was--

Justice Ginsburg: But under this Federal Circuit's own law, it could not be, because there had not been the post verdict motion.

Mr. Schroeder: --Well, that--

Justice Ginsburg: The Federal Circuit is borrowing Tenth Circuit's law for this purpose, but the Tenth Circuit's law, as I understand it, has... is the position that was just presented to us by Mr. Stewart.

That is, if you don't make what used to be called the JNOV, even if you made the directed verdict, you can't raise the sufficiency on appeal.

Mr. Schroeder: --Well, Your Honor, going to the Federal Circuit, of course, the meaning of Rule 50 was in dispute.

And it was certainly, at that point, ConAgra's position that the evidence was sufficient... was insufficient, and that was the issue before--

Justice Ginsburg: Isn't--

Mr. Schroeder: --the court.

Justice Ginsburg: --that the Federal Circuit's own rule?

It... it was, I thought, pretty clear what it told us in that footnote, that if we were ruling... making the ruling... the Federal Circuit law is, if you don't make the 50(b) motion, you cannot get a reversal on appeal for insufficient evidence.

Mr. Schroeder: That is the Federal Circuit rule in patent infringement cases.

It was not the rule that the Federal Circuit would apply in this case, because the Federal Circuit would apply--

Justice Ginsburg: Borrow--

Mr. Schroeder: --apply the rule of--

Justice Ginsburg: --the Tenth Circuit rule.

Mr. Schroeder: --Yes.

Justice Ginsburg: Yes.

But that's... in respect to the Chief Justice's question, the... Unitherm could have thought,

"Well, the Federal Circuit is not going to deal with sufficiency; therefore, I don't have to beef up-- "

Mr. Schroeder: Well--

Justice Ginsburg: "# what I put in the appendix. "

Mr. Schroeder: --certainly, they did have to deal with that, Your Honor, because one of the grounds for appeal was that there as no antitrust standing.

So, this issue was before the Federal Circuit, no matter how you view the question.

But I think in addition to that, certainly everyone knew, when this case went to the Federal Circuit, that it was ConAgra's position that Tenth Circuit law applied, and that the evidence should be reviewed for its sufficiency--

Justice Stevens: Yeah, but the... the antitrust standing issue is not the same as the relevant market issue that was decided, is it?

Mr. Schroeder: --No, it's not, but it certainly is the same with respect to antitrust injury, and the Federal Circuit found there was no evidence of antitrust injury.

So, there, the entire record should have been before the Federal Circuit.

And, in fact, it was.

And so, when they made the determination that there was no evidence of antitrust injury, they did that in the presence of a full record on that issue.

There was no way that anyone could have thought that that issue was not before the--

Justice Scalia: Or as much of the record as the other side wanted to produce.

Mr. Schroeder: --Well, we have to assume they covered their bases, Your Honor, yes.

Now, let me talk a little bit about some of these issues that have come up.

First, with respect to the motion for a new trial, there was a motion for a new trial, under Rule 59, filed in this case.

The grounds for that motion were not sufficiency of the evidence; but, under Rule 59, when a motion is made for a new trial, on any grounds, it is before the District Court on all grounds.

Justice Ginsburg: I'm looking at the motion that you made, which was not in the first instance for a new trial; it was for a remittitur.

This is on page 34(a) of the joint appendix.

And you made a motion, in the alternative, for a new trail on antitrust damages, not liability.

So, I was really struck by the statement in your brief that you had, indeed, made a motion for a new trial.

You made it a motion for a remittitur and, in the alternative, a new trial, limited to damages.

You said nothing about a new trial on liability.

Mr. Schroeder: That's correct, Your Honor.

I'm merely pointing out that, under Rule 59, once a motion for a new trial is made, all issues relating to a new trial are before the court.

Justice Ginsburg: A new trial on damages... that's all you asked for... not a new trial on liability.

Mr. Schroeder: That's correct, Your Honor.

But I certainly would refer the Court to the Cone case, which I think is very similar to this case, procedurally.

In Cone, there was a Rule 59 motion.

There was no Rule 50(b)... excuse me, a Rule 50(a) motion, no Rule 50(b) motion.

There was a motion for a new trial on the grounds of newly discovered evidence.

Nevertheless, in the Cone case, the Court remanded the case for further proceedings, and the... and the court below considered the question.

And, in the end... the published opinions indicate, that case went back to the Fourth Circuit, and--

Justice Ginsburg: It--

Mr. Schroeder: --in the end--

Justice Ginsburg: --it was... the new trial request had to do with liability--

Mr. Schroeder: --Yes.

Justice Ginsburg: --whether it was for newly discovered evidence or something else.

But you... your motion was limited to damages.

And I really don't think that you can get where you want to go from a motion that is limited to damages, when you didn't need to.

You could have made a motion for a new trial on the whole case.

Mr. Schroeder: Well, of course, Your Honor, if there were no proof of damages, the whole antitrust claim would fail.

But I would also say that it seems to me that when a motion is made under Rule 50(a) for judgment as a matter of law, that certainly permits the District Court to grant a new trial, because it's a lesser remedy.

And we see situations all the time--

Chief Justice Roberts: Well, why... it's... why is that a lesser remedy?

It's just different.

I mean, remittitur is a lesser remedy, too, but you don't say,

"Well, if you've made a motion for a new trial, and then that falls by the wayside, you... the court can do remittitur. "

The approach seems to be,

"Something's wrong here, and we have to do something, so what is it that we can do? "

And you look around,

"Well, maybe we can give them a new trial, or maybe we can have a remittitur. "

But there are different motions for all these different things, and, if they haven't been made, they seem to be off the board.

Mr. Schroeder: --Well, certainly, Your Honor... let's take another example.

Suppose a litigant asks, as sanctions, that the case be dismissed.

Well, the District Court certainly could say,

"Well, you have a point, sanctions are in order. "

"But I'm not going to dismiss the case, I'm going to give you something else. "

There are many situations like that, where a particular remedy--

Chief Justice Roberts: But the problem there is still the same.

Whatever it is that gave rise to the motion to dismiss as a sanction... the misconduct by counsel... you're still addressing that same problem.

But a new trial addresses different issues than a judgment as a matter of law, and remittitur addresses different issues than a new trial.

Mr. Schroeder: --Well, it seems to me that it is the principal point of the trilogy that when a motion is made for entry of judgment based on insufficiency of the evidence, that raises the question of whether there ought to be a new trial.

That was the principal point discussed in the trilogy, that you really can't have one without the other.

Justice Ginsburg: The principal point was that the Court of Appeals could not enter... direct the entry of judgment as a matter of law if a 50(b) motion had not been made.

That's what those three cases--

Mr. Schroeder: That's--

Justice Ginsburg: --invoke.

Mr. Schroeder: --absolutely correct, Your Honor, the trilogy stands for that proposition.

But in all three cases of the trilogy, even though there was no Rule 50(b) motion, those cases were all remanded.

In no case was the verdict winner who had insufficient evidence allowed to prevail.

They just remanded the cases.

So, the Solicitor General relies on stare decisis, but he's asking the Court to do something radically different from what happened in any of those cases of the trilogy.

They're asking that judgment be entered for the party that failed to--

Justice O'Connor: Had Rule 59 motions been made in those cases?

Mr. Schroeder: --It's not clear from the record, I don't believe, as to all of the cases, Your Honor, but certainly it is clear in the first case, the Cone case, that there was a motion--

Justice O'Connor: Right.

Mr. Schroeder: --for a new trial, but it was based on different grounds.

It was based on newly discovered evidence.

Justice Breyer: So far, you're halfway into your argument.

I thought the basic question here was, first, whether a Court of Appeals, or anybody, can grant a J... what used to be called the JNOV without your making its... whatever it's called now... and without somebody making a motion.

And from your not opposing that, I guess the answer to the question is, of course not.

Of course you have to make a motion.

You have to make a motion for everything.

The judge is not a genius.

He can't... is not a mindreader.

And if you don't make a motion, you lose.

Okay?

Now, is there any argument against that?

Mr. Schroeder: When you say "that", Your Honor, you mean with respect to the... to the new trial or with respect--

Justice Breyer: No, I... I mean, I thought... there are two parts to this.

Question one is, Can you possibly get a judgment... what used to be called a JNOV or a JMOL or whatever... from the Court of Appeals, when you didn't make a motion for it, after the jury came in, in the District Court?

Mr. Schroeder: --The--

Justice Breyer: They say,

"Of course you have to make a motion. "

And, so far, I've heard no response whatsoever to what I'd think is a fairly basic question in this case.

And I'm assuming: of course you have to make a motion.

Mr. Schroeder: --Yes, Your Honor.

I'm glad you raised that point, because it is the fundamental point of the case.

Rule 50(a) provides that a motion for judgment as a matter of law can be made, and specifically says that the judge can grant that motion.

And then the rule goes on to say that that motion is deemed to continue to be pending.

There is nothing in Rule--

Justice Souter: No, it doesn't say it... it is deemed to continue to be pending.

The issue is deemed to be reserved.

Mr. Schroeder: --Yes, Your Honor.

Justice Souter: Which is a very different issue.

In other words, it's not waived and over with at that point, but it says nothing whatsoever, in express terms, about pending motions.

Mr. Schroeder: Oh, I agree, Your Honor.

I paraphrased the rule.

But the point is that the motion is still pending.

In--

Justice Souter: No, the issue is reserved.

The motion has been ruled upon.

The judge says,

"No, I'm not going to grant this motion before submitting the issue to the jury. "

That's the end of the motion.

The issue isn't over with, because it can be raised again after the verdict.

Isn't that what the rule provides?

Mr. Schroeder: --That's certainly not the way I would read it, Your Honor, because in this case--

Justice Ginsburg: How about a--

Justice O'Connor: That's the way this Court has read it.

That's the problem.

Mr. Schroeder: --I don't believe so, Your Honor, because if the Court... if the rule says that the Rule 50(a) motion can be granted; conversely, it can be denied.

If it can be granted or denied, those decisions are appealable under section 2106, which is the general provision that orders of the court can be appealed.

I do not see anything in Rule 50 that says that denial of the 50(a) motion is not appealable.

What Rule 50(b) does is--

Justice Ginsburg: --Well, it can't... it can't be... it would be interlocutory at that stage.

It couldn't be raised until final judgment is entered.

Mr. Schroeder: --Well, Your Honor, I think that would be a most peculiar rule.

Entering judgment in a case is one of the most fundamental and important things that a court does.

Justice Ginsburg: Yes, but you don't go up on appeal with a final judgment rule, a firm final judgment rule, as there is in the Federal system, from the denial or refusal to act on a 50(a) motion.

Mr. Schroeder: Well--

Justice Ginsburg: The trial isn't over.

There is no judgment.

You can't appeal til you have a final judgment.

Mr. Schroeder: --That's certainly correct, Your Honor, there can be no appeal without a final judgment.

But what I'm saying is that an interpretation of Rule 50, as a whole, which says to the trial court judge that a judgment should be entered without resolving the question of whether there is sufficient evidence, and then take that up later, under Rule 50(b), isn't a very good way to proceed.

Justice Ginsburg: Well, there is, you know... I mean, this truly is a case where a page of history is worth much more than logic.

The reason for that somewhat strange language is, at common law, it was thought, once the jury came in with a verdict, that was it, the judge had no power to overturn it, because of the Seventh Amendment's Reexamination Clause,

"no fact tried by a jury, shall be otherwise re examined in any court of the United States, than according to the rules of common law. "

And the rule of common law that is embodied in this somewhat strange language in Rule 50 is that there could be a reserved question so that after the jury comes in with the verdict, the judge would be deciding the pre verdict question by this post verdict motion.

I mean, there's... none of this is in doubt, where this language in 50 comes from.

It comes from a need to adjust to the Reexamination Clause of the Seventh Amendment.

Isn't that so?

Mr. Schroeder: Yes, that's all correct, Your Honor.

But if there were no provision of the rule that reserved decision under 50(a), I would still say that the denial of the 50(a) motion should be appealable when the judgment is entered, because the... all of the prior orders of the court merge into that judgment when it's entered.

Justice Ginsburg: But you don't get it out of that language, because that language is there for the specific purposes of allowing a judge, after their verdict, to enter judgment NOV.

Mr. Schroeder: Yes, Your Honor.

It certainly is there for that purpose.

But the rule doesn't mandate that the court... that the case proceed by that route.

What I'm saying is that once the 50(a) motion is made and denied, the stage is set for an appeal pursuant to section 2106.

The Rule 50(b) route is merely there to allow a litigant, who does not believe that the issue has been fully heard, briefed, considered by the court, to raise the issue again, but not to put us in the position where, in the normal course, the judge follows the usual procedure of submitting the case to the jury, because the jury may resolve the problem by deciding the case in favor of the party that should win on the evidence, but then, at that point, the judge merely has to enter... has to enter judgment in order to trigger the 50(b) motion.

That doesn't seem to be a good way to proceed, and I don't believe that's what's contemplated by the rule.

And, in fact, it is a common practice among--

Justice Ginsburg: He doesn't enter judgment to trigger the 50(b) motion.

The 50(b) motion is made in between the verdict and the entry of judgment.

Mr. Schroeder: --Well, Your Honor, the rule says that it can be made up to 10 days--

Justice Ginsburg: Right.

Mr. Schroeder: --after the entry of judgment.

So, from the point of view of the District Court, if the court ever wants to get to the end, wants to put a time limit on this, the only way to do it is to enter judgment.

That forces the moving party to get a 50(b) motion--

Justice Ginsburg: But I don't--

Mr. Schroeder: --on account of the defendant.

Justice Ginsburg: --I don't follow that, because you... you know, I'm sure, that it's almost routine that... yes, you have the 10 days, the extra 10 days, under the rules... but isn't it almost routine, at a trial, that the verdict loser will say,

"Judge, please give me JNOV, or, if not, a new trial? "

They don't wait til after the judgment is made... entered.

They could.

But it's just... well, in the trials I've seen, it's almost by rote that lawyers who lose, where the jury comes in for the other side, will renew the judgment as a matter of law motion and ask, in the alternative, for a new trial.

Isn't that the common practice?

Mr. Schroeder: Well, I think it's a common practice in those circuits which have indicated that a 50(b) motion is required to preserve all rights to appellate review.

Whether or not it is the common practice in other circuits where that is not required, I'm not sure.

Certainly--

Justice Ginsburg: Well, it's not a question of what is required or what is permissive, but isn't it to the lawyer's advantage, to the client's advantage, to say to the judge, sooner rather than later,

"Don't enter judgment. "

"Give me... give me judgment NOV or at least a new trial? "

Mr. Schroeder: --Well, Your Honor, this case may be a little different from some, in that the precise issue that was presented to the Federal Circuit, the failure of proof, was something that was identified very early in the case.

And it was presented numerous times to the District Court by a way of a summary judgment motion, by way of the pretrial briefs.

And the issue had not changed.

And, in fact, when the 50(a) motion was made, at the end of the trial, the Court may have noticed that it was made in a rather peculiar way, an attorney attempting to persuade the court that that motion should be granted wouldn't begin the motion by saying, "For the record".

But that's what happened here.

It was known, at that point, that the judge had made up her mind as to this issue, and wasn't going to change it, and, in fact, declined, on several occasions, to even listen to argument on the point.

So, the filing of a 50(b) motion would seem to be contrary to the generally accepted practice that attorneys are not--

Justice O'Connor: Well, if... should we disagree with you, Mr. Schroeder, on that, you seem to fall back, at the end of the day, on a plain error notion.

Is--

Mr. Schroeder: --Well--

Justice O'Connor: --that right?

Mr. Schroeder: --there are several things that we would fall back on, Your Honor.

When you say "fall back", I assume that that means if the Court were not to follow the precedent of the trilogy--

Justice O'Connor: If we don't agree with you on the--

Mr. Schroeder: --On the meaning of--

Justice O'Connor: --need for a--

Mr. Schroeder: --the trilogy.

Justice O'Connor: --50(b) motion.

Mr. Schroeder: Okay.

Under those circumstances, there were two questions.

One is, of course, plain error, and the other is retroactivity.

Justice O'Connor: Have we ever said that plain error would preserve this, in the civil context?

Mr. Schroeder: No, Your Honor.

We have found no case, either way--

Justice O'Connor: No, I--

Mr. Schroeder: --on that.

Justice O'Connor: --haven't either.

Mr. Schroeder: It's... there's no precedent that--

Justice Breyer: But even if there were, how could this kind of error ever be plain?

Mr. Schroeder: --Well--

Justice Breyer: I mean, ever.

Mr. Schroeder: --Your Honor, I--

Justice Breyer: If there's no evidence at all.

You have a patent, and a patent is a monopoly.

And so, what... obviously, it monopolizes a market, it monopolizes the market of a patent.

And you'd have to be a genius in antitrust law to know something's wrong with that argument.

And so, how could it all be plain?

Mr. Schroeder: --Well, Your Honor, there was another claim in this case on which Unitherm did recover, which is not before this Court, which was a claim for--

Justice Breyer: That has nothing to do with my question.

Mr. Schroeder: --Sure.

Justice Breyer: You were saying that the mistake was that there was not sufficient evidence that there was injury of an antitrust kind, and that there was a market.

So, I'm saying a person who knows a little, but not a lot, of antitrust law would think,

"Obviously, there's a market here. "

"There's the market covered by the patent. "

Mr. Schroeder: Well, there's not--

Justice Breyer: Obviously, there's injury, because a patent allows you to raise the price.

End of the matter.

Now, that's naive, but somebody who doesn't know antitrust law thoroughly couldn't possibly think that there is plain error here.

What's the response to that?

Mr. Schroeder: --Well, I think, Your Honor, first of all, in determining plain error, it's necessary to put it in the context of this case, where that very issue had been raised repeatedly and had, in fact, been ruled on by the court in denying the summary judgment motion.

So, we weren't dealing with someone who was naive in this respect.

We were dealing with someone who had faced this precise issue, and the very closely related issue of antitrust standing, which focuses on antitrust injury.

So, we got to this point in the trial.

We had a great deal of history--

Justice Breyer: What I'm worried about, to put all my cards on the table... if we were to say there is even a possibility of plain error in this case, the plain error exception in the rules would become a monster, wherein complex cases, people who hadn't made the proper motions would all be arguing plain error just as if they had.

Mr. Schroeder: --Well, certainly the plain error argument is always, in a sense, available, Your Honor.

But I do think this is an extreme case, and I think that's reflected by what the Federal Circuit said, that I read at the beginning of my argument.

But that's extremely strong.

Chief Justice Roberts: It's an extreme case, because there's insufficient evidence?

Mr. Schroeder: It's an extreme case for a number of reasons, and that's certainly one of them.

There isn't just insufficient--

Chief Justice Roberts: Well, it's--

Mr. Schroeder: --evidence, but--

Chief Justice Roberts: --not going to be plain error in every insufficient evidence case.

Mr. Schroeder: --No, but in... this is a... an... a case in which the insufficiency of the evidence was extremely apparent.

These parties--

Justice Souter: All right, let's assume it's extremely apparent.

Isn't... and assume, just for the sake of argument, that we have a simple case, not a complex case, so it's easy to see that, in fact, the evidence falls short.

It's still the case that this Court has discouraged, or has certainly... has either discouraged the granting of motions at the close of the plaintiff's case, or at the close of all the evidence... in any event, has put its imprimatur on denying those motions, subject to renewal after verdict.

How can we possibly find that there is plain error when a court does exactly what we have encouraged them to do in order not to waste a lot of trial time and jury time?

How could we ever find there is plain error, except with respect to the renewed motion after the verdict?

Mr. Schroeder: --Well, Your Honor, certainly where the motion has been made and has, in fact, been briefed, and has been considered by the court, and where you have a situation in which--

Justice Souter: And we have said, "Don't grant it".

Mr. Schroeder: --I'm sorry, Your Honor?

Justice Souter: And we have said, "Don't grant it".

Mr. Schroeder: Well, Your Honor, I guess we'd go back to the proposition that... I believe that the District Court could grant the 50(a) motion later; it did not have to wait for 50(b) motion.

And, in fact, it is a very common practice--

Justice Souter: It could do that even after it had ruled upon it and had denied it?

Mr. Schroeder: --Well, certainly in situations where the Court simply enters judgment and doesn't deny the motion first, that would be true--

Justice Souter: Well, I--

Mr. Schroeder: --would be true.

But--

Justice Souter: --I--

Mr. Schroeder: --even here--

Justice Souter: --I will... I will grant you that, were it not for our cases, textually, the argument you make is possible.

But I don't see how you can make that argument without our overruling a lot of law.

Mr. Schroeder: --Well, Your Honor, I... when it comes to "overruling a lot of law", I think that the fundamental fact here is that, in the trilogy, the case was always sent back for a new trial.

Never was judgment entered in favor of the party that had failed to prove its case.

So--

Justice Ginsburg: Sent back to... for a new trial because the Court of Appeals ordered a new trial, or sent back to the trial court for that court to decide as a matter of that court's discretion, whether to order--

Mr. Schroeder: --That's correct.

Sent back--

Justice Ginsburg: --a new trial?

The latter.

Mr. Schroeder: --to the District--

Justice Ginsburg: But it--

Mr. Schroeder: --Court.

Justice Ginsburg: --it was not... but, here, you're asking us to affirm something that a Court of Appeals did.

Mr. Schroeder: Well, the... the Court of Appeals ruled that the case should go back to the District Court.

We are asking this Court to affirm that and send the case back to the District Court, as a Federal Circuit ruled.

Justice Scalia: I'm not even sure your argument is so strong on the text, frankly.

I don't know why 50(b) says... it sets forth what can be done when the renewed motion is made.

You can, if a verdict was returned, allow it to stand, order a new trial, direct entry of judgment.

If no verdict was returned, order a new trial, direct... Why does the rule only say,

"In ruling on a renewed motion, the Court may? "

Mr. Schroeder: Well, Your Honor.

Justice Scalia: Why wouldn't it say,

"In ruling on a renewed motion or in acting upon the motion previously reserved. "

comma, "the Court may"?

Mr. Schroeder: Well--

Justice Scalia: I mean, where--

Mr. Schroeder: --I--

Justice Scalia: --and where does it get the power to do these things, in ruling on a motion previously reserved, if it's not set forth there?

Mr. Schroeder: --If you look at 50(a), Your Honor, it specifically says that the 50(a) motion can be granted.

Now, that would be inconsistent with a view of the rule that says that the only remedies available are set forth in section (b) and triggered by the renewal of the motion.

Justice Scalia: No, I'm talking about the only remedy available after the motion has been reserved, after--

Mr. Schroeder: Well--

Justice Scalia: --the court has declined to rule on it once.

Mr. Schroeder: --Well, if the motion is reserved, and the court has declined to rule on it, then the... it would seem to me that it follows that the court can grant that motion.

Justice Scalia: And that's all.

Mr. Schroeder: Well, it can also enter judgment, which constitutes another denial--

Justice Scalia: Can it order a new trial?

Mr. Schroeder: --Yes.

Most certainly.

Because--

Justice Scalia: Where does he get that power, under (a)?

Mr. Schroeder: --It is a--

Justice Scalia: Unless--

Mr. Schroeder: --It is a lesser remedy--

Justice Scalia: --Ah.

Mr. Schroeder: --than the one requested, that was--

Justice Scalia: Oh, well, then it shouldn't have been set forth in (b).

You didn't have to say it.

You could have just said, you know, "Allow"--

Mr. Schroeder: --Well, Rule 50(a) doesn't literally say that the motion can be denied.

It simply says that it can be granted.

But I think we have to infer from that, that it can be denied.

And I would equally infer that a lesser remedy is possible once the 50(a) motion is made.

But I don't think it's possible to read the rule as saying that the only way these remedies are available is through a 50(b) motion, because that's inconsistent with the provision that the motion can be granted under 50(a).

The... it, further, seems to me that if the... if the motion is... if decision on the motion is deemed to be had... to have been deferred, then that motion is still before the court, even if the court has denied it.

And the court can grant it later on--

Justice Souter: Yeah, but the--

Mr. Schroeder: --instead of interjecting--

Justice Souter: --rule doesn't deem it to have been deferred.

A judge may, in fact, not rule on it, although he does not grant it.

But the rule does not say that the motion is deemed to be deferred.

The rule talks about the issue being reserved, which is a different thing.

And the issue may be reserved whether the judge rules on the motion or simply says,

"I will take it under advisement and you can renew it after the verdict if you want to. "

Isn't that correct?

Mr. Schroeder: --Well, I would have stopped sooner, Your Honor.

I would have said,

"I will take it under advisement. "

That is really the essence of the rule, that the Court has this under advisement.

And it is a very common--

Justice Souter: Well, that may be, but it's still the case that the rule does not deem the... this rule does not deem, in... terms, the ruling on the pre verdict motion to have been deferred.

Mr. Schroeder: --Well, Your Honor, it is certainly a common practice that, while the--

Justice Souter: I'm asking you about what this rule says.

Did I just get the rule wrong?

Mr. Schroeder: --Well, Your Honor, I think that if ruling on that motion--

Justice Souter: If you don't--

Mr. Schroeder: --had been inferred--

Justice Souter: --want to answer the question, just say so.

Mr. Schroeder: --No, I'm... I'm very pleased to answer the question, Your Honor.

I believe that the rule permits the judge to decide the 50(a) motion at any time prior to entering judgment.

And the judge can change his or her mind on that at any time, because the issue is still before the court.

Justice Scalia: --Can a judge grant a new trial on a 50(a) motion?

Mr. Schroeder: Yes, Your Honor.

Chief Justice Roberts: Thank you, Counsel.

Mr. Schroeder: Thank you, Your Honor.

Rebuttal of Burck Bailey

Chief Justice Roberts: Mr. Bailey, you have 1 minute remaining.

Mr. Bailey: Thank you, Mr. Chief Justice.

Justice Scalia: Do you agree on the answer... with the answer to the last question I asked?

Can... on a 50(a) motion, can a judge grant a new trial instead of granting judgment?

Mr. Bailey: No, Your Honor.

Justice Scalia: I didn't.

Mr. Bailey: The result ConAgra contends for here, may it please the Court, leads to some really bad results.

It requires the rejection of longstanding precedent by this Court.

It overrules the jurisprudence of eight circuits.

It offends the special competency of the trial court.

It deprives the appellate court of the trial court's evaluation, an impartial evaluation of the sufficiency of the evidence, so the appellate court is left to sift through the record, an entire record, searching for points that have never been joined below.

And it creates confusion, subjectivity, and differing legal standards nationwide.

Thank you.

Chief Justice Roberts: Thank you, Mr. Bailey.

The case is submitted.

Attribution:

The Oyez Project

Featured:

Hohn v. United States - Oral Argument

Fri, 09 Jan 2009 14:50:04 +0000

Case:

Hohn v. United States

Media File:

96-8986_19980303-argument.mp3

Related Transcript:

1997_96_8986_argument.xml

Transcript:

Argument of Eileen Penner

Chief Justice Rehnquist: We'll hear argument next in Number 96-8986, Arnold Hohn v. the United States.

Ms. Penner, you may proceed whenever you're ready.

Mr. Penner: Mr. Chief Justice, and may it please the Court:

For the last half century this Court has been granting writs of certiorari to review erroneous refusals by the appellate courts to allow statutorily authorized and meritorious appeals.

That historical practice is fully consonant with the broad jurisdictional power conferred on this Court under the statutory certiorari provision, section 1254, and residually under the All Writs Act.

The statutory certiorari provision vests this Court with the power to review all cases in the courts of appeals over which those courts have jurisdiction regardless of the condition of those cases and irrespective of any decision that the court of appeals may have made.

This Court confirmed in--

Unknown Speaker: Well, I think in light of House v. Mayo, I think it's very hard to argue that there is statutory certiorari jurisdiction unless we want to overrule that case.

Mr. Penner: --I submit that Nixon v. Fitzgerald has already called into very serious question the underpinnings of the statutory certiorari decision in House.

House suggested that no case could be in the court of appeals if the certificate had been denied merely because the statute prohibited an appeal from entering the court of appeals absent a certificate.

Unknown Speaker: Did the Nixon case discuss the jurisdictional point at length?

Mr. Penner: It did not, but it--

Unknown Speaker: Well then, our rule is that jurisdiction that has been assumed without any elaborate discussion is not really to be regarded as contradicting a prior case that did discuss jurisdiction.

Isn't that correct?

Mr. Penner: --Mr. Chief Justice, we do not claim that Nixon v. Fitzgerald has even sub silentio overruled House v. Mayo.

Instead, we claim that it implicitly has rejected the underpinnings of House v. Mayo.

Unknown Speaker: But our precedents say that if jurisdiction is assumed sub silentio, without a discussion of the jurisdiction, that simply doesn't count.

Mr. Penner: That's correct, Your Honor.

In Nixon v. Fitzgerald the Court made a decision about what section 1254 means, and that decision, its interpretation, is irreconcilable with the holding in House.

Were the Court to reaffirm the statutory certiorari decision in House, it would have very serious implications for the scope of the section 1254 power which the Court had recognized in Nixon.

If a case is, in fact, not in the court of appeals when a court of appeals dismisses for lack of jurisdiction, what is left of Nixon?

Nixon decided that a case is in the court of appeals when there is a jurisdictional--

Unknown Speaker: Might have made a mistake.

Might have made a mistake.

Mr. Penner: --We should be--

Unknown Speaker: Especially in a case entitled United States v. Nixon, or Nixon v. Fitzgerald, and that's why we have that rule, that where we haven't thought and spoken about jurisdiction you shouldn't draw any conclusions from our entertaining of the case.

Mr. Penner: --The--

Unknown Speaker: I thought that's the rule.

Mr. Penner: --The Court thought very carefully about its jurisdiction in both Nixon v. Fitzgerald and the United States v. Nixon.

I... the cases that we refer to--

Unknown Speaker: In fact, there's much more discussion of jurisdiction in those opinions than in House v. Mayo.

Mr. Penner: --That's--

Unknown Speaker: House v. Mayo, they didn't even get a response from the State, as I remember it.

Mr. Penner: --Indeed, that's so, and the petition for certiorari was written by House's mother.

[Laughter]

I... we submit that even if Nixon v. Fitzgerald and United States v. Nixon are not the best authority for this Court, if the Court is concerned that there was inadequate discussion in those cases, turning to the plain language of the statute alone should be sufficient.

The language in section 1254 is as broad as it could possibly be, and we submit that Congress' choice of the language in section 1254 was intentional.

It conferred jurisdiction on the court in all cases, not just all appeals, but all cases, all matters, all judicial proceedings that could occur in the court of appeals and that, by its plain terms, would include proceedings of an original matter in the courts of appeals such as an application for a certificate of appealability.

Unknown Speaker: Well, what about a motion before the court of appeals to expedite a particular case for hearing before the court of appeals?

Mr. Penner: In our view that also would fall within the plain language.

The case in the court of appeals here is the jurisdictional question of whether the court of appeals had the power under section 2253 to decide the merits, to allow the appeal into the court of appeals.

That is exactly analogous to the decision that this Court made in Nixon v. Fitzgerald, that the predicate jurisdictional decision to dismiss an appeal for lack of jurisdiction was itself a case in the court of appeals over which this Court has certiorari power under section 1254.

Unknown Speaker: But don't you run in there, Ms. Penner, to our cases that say that piecemeal appeals are frowned upon?

You know, the final judgment rule and that sort of... and here you're saying, we can carve out what one... many people might think was simply one case into two cases.

One is the certificate of probable cause application and the other is the merits.

But doesn't that just bifurcate things that we have said in other contexts should not be bifurcated?

Mr. Penner: I think there are two answers, Mr. Chief Justice.

The first is that, to the extent that there is any bifurcation it's created by Congress itself, which mandated the creation of a gate keeping provision at the same time that it foreclosed--

Unknown Speaker: Well--

Mr. Penner: --review of an appeal unless a certain thing happened in that gate keeping decision, which is a decision to allow the appeal to proceed, but the second--

Unknown Speaker: --Do you really think that Congress in... having thought about this thing intended that we have jurisdiction to review a decision of the court of appeals not to grant a certificate of probable cause or a certificate of appealability?

Mr. Penner: --In my view, the plain language of section 2253, particularly when compared with the plain language of 2244(b)(3)(E), leaves no doubt that Congress expressly intended this Court to retain the certiorari power it has been exercising for the past half century.

In 2253, Congress prohibited only one thing from entering the court of appeals absent a certificate, and that is an appeal to the court of appeals from the final order in a proceeding under sections 2255 or section 2254.

It does not say anything about this Court's certiorari power and that silence is very significant when you consider that that provision was amended at the same time that Congress adopted section 2244(b)(3)(E), in which it expressly proscribed this Court from exercising its certiorari jurisdiction over an analogous gate keeping provision in the successive petition context, and I suggest that Congress had a very good reason for doing that.

It would have been much more concerned about the accuracy of the gate keeping decision in the first habeas petition context than it would have been in the successive petition context.

In the successive petition context, it is guaranteed that a prisoner has gotten a full right of review through the Federal courts.

In this context, with Mr. Hohn, for example, no court has yet actually reviewed the merits of his claim.

He was kicked out on an invalid waiver doctrine in the district court, and he was kicked out on an invalid ruling on the meaning of section 2253, as the Government has conceded in the court of appeals.

He is a Federal prisoner who has never had any hearing on his collateral claim.

If the Court concludes that it lacks statutory certiorari power it has residual authority in the All Writs Act to issue a common law writ of certiorari, as the Court held in House v. Mayo.

Unknown Speaker: That has to... those have to be an aid of jurisdiction, do they not?

Mr. Penner: They do, Your Honor.

Unknown Speaker: And by hypothesis here we would not have jurisdiction under the statutory certiorari?

Mr. Penner: By hypothesis here, yes.

Unknown Speaker: So wouldn't it be rather hard to say that that was an aid of our jurisdiction if it was... if our jurisdiction depended on issuing that writ?

Mr. Penner: It is an aid of the appellate jurisdiction that this Court could exercise over the appeal that the court of appeals has pretermitted by denying the certificate of appealability.

This Court has often held that it has the power, even when there is yet no case in the court of appeals, to order a lower court to allow a case to proceed, for example, by ordering a lower court to issue a bench warrant or to decide the merits, or even to allow the record to be transferred to the circuit court of appeals.

Each of those things, if they were not corrected by this Court, would end the case, which would otherwise develop into one over which this Court would have statutory certiorari power.

In this case, for example, if the Court were to reverse through its use of common law certiorari power the holding of the court of appeals that no certificate should be issued, the case would proceed, a decision would be made in the court of appeals, and that case would be reviewable by this Court on statutory certiorari.

Were the Court not to have that power, it would basically be giving the lower courts the power to eliminate its own jurisdiction, which cannot be the case.

Unknown Speaker: Well, but maybe that's what Congress wanted.

Mr. Penner: When the Court was interpreting the All Writs Act in... I'm sorry, Mr. Chief Justice, are you speaking of section 2253?

Unknown Speaker: Well, I'm speaking about... of that and whatever else is applicable.

I mean, to say that this particular result would obtain is not necessarily an argument against that result, it seems to me, if that's what Congress wanted.

Mr. Penner: In my view, it's a question of comparing the statutory intent in 1254, 1651, and 2253.

1254 and 1651 are extremely broad jurisdictional grounds of power which I believe cannot easily be read to restrict this Court's power in a way that it could not reach a particular judicial proceeding in the courts of appeals like this one.

The second question is whether 2253 indicates any intent to take that power away, and I don't see, in 2253, any suggestion in the plain language, or even in the purpose, to take it away.

The purpose of 2253 is to ensure that meritorious appeals proceed and that frivolous ones do not.

That purpose of Congress cannot be accomplished if the courts of appeals are applying that standard erroneously.

The power of this Court on certiorari merely will permit the Court to ensure that Congress' intent about what appeals should be permitted through the gate are... that those decisions that the courts of appeals made are correct, and--

Unknown Speaker: But the issuance of a certificate of appealability by a justice of this Court could accomplish much the same purpose as you say that accomplishes, couldn't it?

Mr. Penner: --In many cases, it will accomplish the same purpose for the question of individual justice for a single petitioner.

For example, Mr. Hohn would, indeed, be satisfied with issuance of a certificate by this Court, but the question under the All Writs Act is whether the issuance of a common law writ is necessary or appropriate in aid of the Court's appellate jurisdiction, and I submit that that is not just the appellate jurisdiction that the Court exercises in a single case, but a broader institutional interest in its ability to perform its appellate functions.

Here--

Unknown Speaker: Well, you just lost me.

I have always assumed that it meant in aid of the Court's jurisdiction in the particular case.

Mr. Penner: --Here--

Unknown Speaker: You're saying it means in aid of somehow the court's role in the society, or--

Mr. Penner: --I believe that its purpose is to permit both.

Here, it is in aid of the court's appellate jurisdiction in that it preserves a case that ultimately will come before the Court on statutory certiorari, as I mentioned earlier.

Unknown Speaker: --That's--

Mr. Penner: In addition, it is appropriate and--

Unknown Speaker: --But that one could be handled by... by--

Mr. Penner: --By a... that's correct.

Unknown Speaker: --By the application to a justice, who could refer it to the whole Court.

Mr. Penner: That's correct, Your Honor, but the application is an ineffectual and cumbersome tool for the Court to accomplish its appellate functions of ensuring uniformity among the circuit courts.

Unknown Speaker: But its appellate functions are defined by Congress, are they not?

There isn't some big appellate function up there in the sky that we can assume that... it's just what Congress says it should be, subject to the exceptions that Congress may provide.

Mr. Penner: Had Congress indicated an intention to prevent this Court from exercising its common law certiorari power, a slightly different question might be presented, but here there simply is no indication of that in section 2253.

It was completely silent on the subject and in comparison with section 2244, in which it barred certiorari review, it's fairly clear that Congress intended for this Court to continue to police the decisions of the lower court about what appeals could be taken in a habeas case.

Unknown Speaker: Ms. Penner, why wouldn't referral by the circuit justice to the full Court suffice to protect the appellate jurisdiction in the sky aspect of the whole thing?

Why wouldn't that be sufficient?

Mr. Penner: I guess one question is, if I... if Congress intended to eliminate the Court's certiorari power it seems unclear why it would have intended the Court to perform what is essentially the same function as that which it performs on certiorari through use of the application process.

I... the Court would be rendering binding decisions on the meaning of constitutional rights that were resolving circuit conflicts in highly developed opinions before the full Court through the application process, which is highly unusual.

I think the Court's practice strongly suggests that that is not its preferred method of practice in the application--

Unknown Speaker: Well, maybe not, but it seems to me that the burden is on you if you want to have an... you know, an original writ issued to show that it is necessary and that there's no other way to get this thing done.

Mr. Penner: --The All Writs Act speaks of the... a power being... existing when it is either necessary or appropriate.

In this Court's decision in Alkali, it confirmed that that power is available not merely to curb excesses of jurisdiction by the lower courts, but also to force lower courts to exercise their jurisdiction when it is appropriate to do so.

This is a case in which it would be appropriate for the Court to exercise its appellate jurisdiction through use of the All Writs Act.

It is certainly true that the Court could conceivably stretch the application process broad enough to make it so like the certiorari process that it can perform certiorari functions through the application process, but it is unclear why Congress would have intended that.

It also is extremely awkward, because it relegates to a single justice... typically when an applicant submits their application for a certificate to a single justice, it relegates to that justice the responsibility for determining whether the issue raises matters of national importance or a circuit conflict that warrant the full Court's attention.

And in contrast, in the certiorari process, all members of the Court have the opportunity to consider that question of whether it is worthy of the full Court's attention.

Unknown Speaker: So you think if we agree with you that you can get a... you know, a certiorari writ when you do get an application to a single justice, and I probably get more of them than anybody else, I don't have to worry about all of these cosmic questions?

Mr. Penner: I'm sorry, Your Honor.

Unknown Speaker: Well, you say that one of the disadvantages of not agreeing with you on the certiorari point is that each justice to whom an application is submitted would have to worry about such questions as establishing what the law ought to be in circuit conflicts and all of that.

Whereas I assume the consequence is, the unuttered consequence, if I agree with you, then I don't have to worry about that any more.

When I get these individual applications, all I have to think about... and I should never refer, never have to think about referring it to the Court.

Mr. Penner: Surely the burden on a single justice to consider those issues of whether a question of national importance is raised or whether there is a circuit conflict will be significantly less if the Court clearly establishes that the petition for certiorari remains an available route.

And, in fact, this Court has exercised its power to use certiorari repeatedly over the last 50 years, sometimes to resolve circuit conflicts, often to define the scope of constitutional rights, and to make very important statements about the availability of habeas relief, as an individual circuit justice acting in chambers would not have the responsibility for ferreting out those questions if the petition for certiorari remained available and instead could focus on the questions of individual justice that an application raised.

Which actually goes to another issue, which is that typically an applicant for a certificate will be presenting to the Court only issues of their own individual entitlement and will not be highlighting for the Court circuit conflicts and the importance of the issues they're presenting.

Unknown Speaker: Well, what do you see as the test of a certificate of appealability, Ms. Penner?

If I'm a circuit justice for the Fourth Circuit, ought I to decide to grant a certificate of appealability only if there's some... only if this Court would review it?

Or perhaps more broadly, if I think the thing is arguably one... you know, you could make up your mind one of two ways, before the court of appeals.

Mr. Penner: I understand Your Honor to be... are you questioning about the standard that the courts of appeals should be applying?

Unknown Speaker: Yes, and I mean, would a justice of this Court apply the same standard that a judge of the court of appeals applies?

Mr. Penner: The Government has argued that a higher standard should apply, that this Court should only issue certificates in the most extraordinary circumstances.

They made that argument on the assumption that certiorari review would be available.

I... that argument, that the Court should apply a different standard in deciding whether to grant applications for certificates, contravenes the plain language of section 2253 and this Court's own decisions.

Section 2253 expressly sets out a standard.

It is a substantial showing of the denial of a constitutional right, and that standard applies equally both to circuit justices and to circuit judges.

Had Congress intended for the court to apply a different standard, I expect that it would have said so.

In addition, the Court in Barefoot v. Estelle set out the standard which Congress subsequently codified, and it never indicated that, were a certificate application to be submitted to it, it would apply a different standard and, indeed, circuit justices in chambers appear to have been applying precisely that standard.

We do not argue that it would not be appropriate for the Court to require a petitioner to seek relief elsewhere before submitting an application for a certificate to this Court.

It is a rule that the Court has used in other circumstances, and it furthers the Court's appellate function by permitting it to review the decisions of lower courts rather than to be deciding questions in the first instance.

But that is different... requiring applicants for a certificate to exhaust other remedies first is a different matter than raising the bar and saying that they must prove not merely a substantial showing of a denial of a constitutional right, but also a clear and indisputable substantial showing.

One other point is that... Justice Scalia raised the question of the burden on justices in chambers.

The availability of petition for certiorari will ease the burden on justices in chambers of deciding applications for certificates, because the Court will have the power to slice through to the single error, the legal error that a lower court got wrong, in this case the question whether Mr. Hohn's claim was the denial of a constitutional or a statutory right.

A justice in chambers or, in fact, even the full Court, were the justice to refer the matter to the full Court, would not have that power and, instead, would have to consider all of the secondary issues, for example, those that were raised in our separate application in this case, and question whether a petitioner has made a showing of cause and prejudice for their procedural default, actual in the sense this is a burden that the justices in chambers will not have to bear if it holds to its 50-year practice of finding that... of issuing writs of certiorari to review the decisions of lower courts on certificates.

Unknown Speaker: Well, excuse me, could... but how does that work?

The Court would grant certiorari limited to that one issue, and the other issues could not be presented to the justice in chambers?

Mr. Penner: It's true that the Court could combine those two issues, but only if it affirms that is retains the certiorari power.

Were the Court to hold that it lacks the certiorari power, the full Court could decide one legal issue and then refer the rest of the case back to a single justice to decide the rest of the issues, predicate to determining whether a certificate should be granted.

If the Court will permit, and no further questions are pending, I'd like to save time for rebuttal.

Unknown Speaker: Very well, Ms. Penner.

Mr. Roberts, we'll hear from you.

Argument of Matthew D. Roberts

Mr. Roberts: Mr. Chief Justice, and may it please the Court:

The United States believes there are two reasons that this Court should adhere to House v. Mayo and hold that it may issue a common law writ of certiorari to review the action of the court of appeals in this case.

The first reason is stare decisis.

The second reason is that a common law writ of certiorari is the most practical available way to correct important legal questions such as the proper standard for issuing certificates.

Unknown Speaker: What if Congress had said that, you know, this Court is going to review cases by certiorari and define the terms and the time limits and so forth?

Do you think that we could issue a common law writ of certiorari for a case where someone didn't comply with the requirements to seek statutory certiorari?

Mr. Roberts: No.

This Court in its discretion would decline to issue a writ of certiorari when there was a plain intent to preclude review, but in this case there isn't a plain intent to preclude review.

Section 2253 only discusses... only precludes appeals as of right to the courts of appeals on the merits of a section 2255 motion.

It doesn't discuss certiorari jurisdiction, it doesn't discuss this Court's jurisdiction, and it doesn't discuss review of the question--

Unknown Speaker: But couldn't one infer from... perhaps not even infer, but the... part of the holding of House v. Mayo is that we don't have statutory certiorari jurisdiction here.

Why shouldn't that be the end of it?

Mr. Roberts: --It is the Government's position that House was correct and the Court doesn't have statutory certiorari, but the codification of statutory certiorari did not repeal this Court's ability under the All Writs Act to exercise common law certiorari.

Unknown Speaker: In aid of its jurisdiction.

Mr. Roberts: In aid of its jurisdiction, and--

Unknown Speaker: If we don't have statutory certiorari jurisdiction, why should we be able to use another writ to simply substitute for that to give us jurisdiction?

Mr. Roberts: --Well, it's not to substitute for that to give the Court jurisdiction.

It's in aid of the jurisdiction that may have wrongfully precluded by an incorrect decision by the court of appeals, keeping the case out of the court of appeals.

Unknown Speaker: Why isn't the case in the court of appeals for the purpose of deciding whether a certificate of appealability will be ordered?

Mr. Roberts: Well, House v. Mayo held that the case was not in the court of appeals.

Unknown Speaker: Then there's a lot of practice after that that seems to go the other way, so if... is that the only basis?

But I mean, in logic, if the case isn't in the court of appeals for that purpose, then why is a case in which the court of appeals denies qualified immunity appeal?

Why would that be in the court of appeals?

Why would a case in which the court of appeals says, we think that you've tried to appeal under a collateral order exception from Cohen, but we think you're wrong, why would that case be in the court of appeals?

Why would a case in which the court of appeals ever says we don't think you have jurisdiction to appeal, why would that be in the court of appeals?

In other words, if House v. Mayo is right, how can we take any of those cases?

Mr. Roberts: Well, it's certainly a close question, Justice Breyer, as to whether an application for a certificate is a case in the court of appeals.

Unknown Speaker: I mean, the Solicitor General... my point is, the Solicitor General I would think believes that we're right in taking those cases that I've mentioned.

Mr. Roberts: Yes.

There's--

Unknown Speaker: All right.

Now, if you think we're right in taking those cases that I've mentioned, then you must either think there's a distinction from House v. Mayo, or you must think House v. Mayo is wrong, so which is it?

Is it a distinction?

If so, what is it, or is House v. Mayo wrong?

Mr. Roberts: --It's a distinction, and the distinction is that here Congress has set up a two stage process with a screening mechanism to decide whether petitioner's case is in the court of appeals.

It would be odd to consider the application to that screening mechanism to be itself a case that brings the petitioner's case in the court of appeals, so that would be the reasoning in House and in the other cases that consider a leave to appeal not to be in the court of appeals.

Unknown Speaker: Well, in your view, do we have common law certiorari jurisdiction to review the denial of a court of appeal... a certificate of appealability and also jurisdiction to review the merits of the appeal?

Mr. Roberts: House holds that the Court has jurisdiction to review the denial of the certificate and, if it determines that the certificate was improperly denied, to review the merits.

Unknown Speaker: And that's your position here?

Mr. Roberts: And that is our position here.

The Government's position is that this issue was decided in House and that the Court should adhere to House, because stare decisis is particularly strong in cases like this one, which turn on statutory interpretation.

And Congress has revisited all these statutes.

It's revisited the All Writs Act, the certiorari statute, and section 2253 several times since House, yet Congress has made no changes to any of the statutes that indicate any disagreement with House.

Unknown Speaker: Of course, all we have to do, I suppose, if we accept your view of House, is review the certificate of appealability determination and stop there.

We don't have to go the further step, do we?

Mr. Roberts: No.

In fact, that's why we believe that a common law certiorari is the most efficient means to decide these questions, because in the context of acting on an original certificate, an original application for a certificate, the Court wouldn't be able to stop there.

The Court would have to review the entire case, the Court would have to decide all the legal issues that are necessary to determine whether there's a substantial constitutional issue, and the Court would have to apply those legal standards to the facts of the case and determine whether the petitioner is entitled to a certificate on the facts of the case, and that would be a very cumbersome method to achieve clarification of the standard for issuing certificates.

There's no reason to believe that Congress intended that.

Congress didn't say that in 2253 that that was the method of review that should be used and, in fact, in another provision of the AEDPA, Congress expressly revoked the Court's certiorari power to review orders by the court of appeals that authorize or deny the filing of successive habeas petitions.

So Congress was aware of how to limit this Court's certiorari power if it intended to do so, but it chose not to do so here.

Unknown Speaker: Now, in this Court the petitioner applied to this Court for a certificate of appealability, or at least to a justice, did it not?

Mr. Roberts: Yes.

Unknown Speaker: And I think that the Government opposed that on the grounds that the petitioner didn't demonstrate exceptional circumstances.

Mr. Roberts: Yes.

The Government opposed that on two grounds.

First, that adequate relief is available from another source and, second, the petitioner hasn't presented exceptional circumstances.

Unknown Speaker: And yet to exercise common law certiorari jurisdiction we have to determine there are exceptional circumstances.

Isn't that a little inconsistent?

Mr. Roberts: The exceptional circumstances are not met in the case of a certificate because the petitioner hasn't demonstrated an entitlement to a certificate.

I think that that just proves the point that I was making before, that the certificate context requires the Court to do more than the certiorari context.

In the certiorari context there are exceptional circumstances because there's no other way to clarify the standard in 2253(c)(2) for when a certificate should issue.

But in the case of a certificate, what would be required to show exceptional... exceptional circumstances, excuse me, is that the petitioner clearly merits the certificate and that it's been denied by the lower courts, and petitioner can't show that in this instance because petitioner hasn't proffered any evidence to show actual innocence and petitioner can't show cause to excuse petitioner's procedural default.

That's the Government's position.

Unknown Speaker: Mr. Roberts, may I ask you about an earlier piece of this somewhat confusing puzzle?

At the circuit court level, Judge McMillian said, I would grant the certificate of appealability.

Could he have done so?

Mr. Roberts: It is an oddity of the way the applications for a certificate work.

An individual circuit judge could grant a certificate, but the practice in the Eighth Circuit is to refer the applications for a certificate to a panel of the court, and in this case it was referred to a panel of the court and two of the judges on the panel determined that a certificate should not issue, and so that was controlling.

Unknown Speaker: So it's the circuit's practice, but the circuit's practice could be otherwise compatibly with the statute?

Mr. Roberts: Yes.

The circuit's practice could be otherwise... this Court in In re Burwell held that it was up to the individual courts of appeals to determine whether a request for a certificate should be decided by an individual circuit judge, by a panel, or conceivably by the whole court.

Unknown Speaker: Thank you.

What... to go back for a second, what is it that makes this a screening mechanism?

Is it that it goes to one judge?

Is that the reason that it's... you call it a screening mechanism?

I take it it's not the simple fact that the jurisdictional issue has to be decided first, or that the certificate of appealability issue has to be decided first.

It must be that it's directed to one judge.

Mr. Roberts: It's that Congress has set up a separate process to determine whether the case can go forward, and has explicitly mandated that unless the petitioner survives that hurdle, the case can't go forward.

In the Nixon case the jurisdiction question and the merits were one case, and so the jurisdiction question was in the court of appeals when the notice of appeal was filed.

Unknown Speaker: Thank you, Mr. Roberts.

Mr. Sutton, we'll hear from you.

Argument of Jeffrey S. Sutton

Mr. Sutton: Thank you, Mr. Chief Justice, may it please the Court:

At the same time Congress in 1996 was most conspicuously streamlining habeas review, the Federal Government and petitioner having proposed an interpretation of that legislation that multiplies by a factor of two or three the avenues of appellate relief available to individual Federal prisoners or State prisoners.

The twin vehicles for this development are 1) a theory of statutory certiorari that has never received the vote of a single justice of this Court and has been positively rejected by several decisions of this Court and, second, a theory of common law certiorari that has not been used meaningfully in an opinion by this Court since the end of World War II.

It would seem quite anomalous to resurrect the one theory and create the other in the one area of the Court's jurisdiction that is now most expressly regulated by Congress.

I submit that that's not what happened.

I'd like, Justice Breyer, to address your question about... and the Nixon cases.

The key difference between the Nixon cases and this one is the gate keeping decision is really not a jurisdiction decision.

Yes, it ultimately may have jurisdictional consequences, but keep in mind, when a court of appeals judge denies the certificate, that does not mean no jurisdiction.

The inmate can go to this Court, obtain a certificate... at that point there might be jurisdictional consequences, but of course at that point the review that is being sought is not just of what the circuit judge did, but also of what that circuit justice did.

That's extremely odd.

I'm not aware of another jurisdictional statute where individuals, whether inmates or not, can argue that a court of appeals made a mistake in a court of appeals panel or a court of appeals judge where this Court has already had an opportunity to look at the matter.

That's quite unusual.

Unknown Speaker: If you focus right on that decision, there is a decision that Congress is asking a circuit judge to make.

Judge, decide if a certificate of appealability should issue.

Mr. Sutton: Yes.

Unknown Speaker: That's the decision.

Where is that decision made?

When I was a circuit judge I used to sit in my office, which I felt was in the court of appeals.

[Laughter]

But where, metaphysically speaking, is the decision being made to issue or not issue the certificate of appealability?

Mr. Sutton: Well, of course, it is being made by a circuit judge, but I would submit--

Unknown Speaker: And where?

Where is that circuit judge?

Mr. Sutton: --The circuit judge is obviously in his chambers.

Unknown Speaker: Yes, all right.

So where would you say, metaphysically, with Congress not saying to the contrary, that decision was being made?

His chambers may not be at the court of appeals.

I mean, many judges have their chambers back home in their States that they--

--I'm not... I'm speaking--

Mr. Sutton: But Your Honor, actually... but actually, Your Honor, your question gets to a fundamental point.

The AEDPA is not an exercise in metaphysics.

The AEDPA requires a straight--

Unknown Speaker: --I'm not--

Mr. Sutton: --consistent interpretation--

Unknown Speaker: --I'm trying to get... what I'm focusing on is that particular decision, and I'm trying to think if there's some reason to say, no, no, that decision isn't being made in the court of appeals.

I grant you it's being made by one judge rather than three, but is there any reason for saying that that decision by the one judge is not a decision that is being made in the court of appeals?

Mr. Sutton: --I think for the same reason that this court would not review a 1292(b) decision by the court of appeals.

For example, let's say that a trial court decided to issue a certificate saying that an issue of law ought to go up to the court of appeals.

The court of appeals has discretion to decide at that point whether to take the issue of law.

They don't have to, and if that court of appeals does not take that issue, it's not in the court of appeals, and this Court cannot review it, and there's no decision to the contrary.

But another critical point here, you know--

Unknown Speaker: I thought that wasn't because of where it was located, whether in the court of appeals, except 22... in 1292(b) Congress has made it highly discretionary at two levels, and you've got to have them both.

And it can't be in the court of appeals unless the district judge puts it there, and if the court of appeals says no, then it's out.

But... so I don't understand the analogy to 1292(b).

Mr. Sutton: --Well, maybe I'm... I may be misunderstanding the question, Your Honor, but it really seems quite similar.

It seems to be another type of gate keeping function that is pre jurisdictional in nature, and then after all the whole function of 1292 and 2253 is utterly destroyed if one can review each of these decisions.

What ends up happening is, instead of narrowing and streamlining--

Unknown Speaker: 1292(b) is a question of when, not whether.

1292(b) is a purely, should it be reviewed now.

It can be reviewed later, so it's only a question of interrupting an ongoing proceeding.

That's why I don't see these... you are raising a now or never issue.

Either you get the certificate and you can present your question, or you don't, and you never can.

1292(b) is simply a timing question.

It doesn't say in any way that you can't bring up the issue.

Mr. Sutton: --Well, Your Honor, since I'm not getting very far on that analogy, let me try to make another point.

2253 creates another implication that I think undercuts the 1254 argument that has been made, and that's the implication created by the fact that when the inmate goes to a court of appeals judge the game is not over if the certificate is denied.

2253, after all, does say it can be brought to a circuit justice and, if necessary, referred to the whole Court.

I think that creates a very strong implication that when you're dissatisfied with what the court of appeals panel or judge does, that's how you resolve the matter.

You don't... you're not left with twin and possibly three routes of review.

Unknown Speaker: One of the issues that's arisen is whether that presents any different situation from what the Court had in House.

I'm sure you've seen the submission from the other side on that point.

Do you have anything further to add on that?

Mr. Sutton: This is the question as to what the state of the law was in 1945?

Unknown Speaker: Yes.

Mr. Sutton: Yes, Your Honor.

I most definitely do.

I would argue that the state of the law has changed quite significantly and, in fact, dispositively since 1945 and specifically since the changes in 1948.

I filed a letter with Ms. Nelson, with the Clerk's office, that indicates that the 1911 act, that section 293 of the 1911 act makes clear that the very definition that the Solicitor General's Office is relying upon does not apply and did not apply to the habeas statutes.

What that section says is the term title only refers to this act, and the 1911 act did not deal with the habeas statutes and most specifically did not deal with the 1908 gate keeping function that we're now dealing with and was first enacted in that year, so... but I would submit that's not all.

One can read House alone, and I would submit that in 1945 there was no better discerner of the state of the law than this Court in 1945, and the beginning of the House decision at page 43 makes it quite clear that their understanding of the law is that the only place to go is the district court judge and the court of appeals.

There's not a single mention of whether one can go to a circuit justice.

In fact, they quote the very statute, 28 U.S.C. 466, upon which I'm relying to make this argument, and I'd like to emphasize this point, because I think it offers--

Unknown Speaker: But you will concede that House was a rather skimpy opinion.

It was per curiam and there was no opposition, and it wasn't a very well aired case, was it?

Mr. Sutton: --Well, they all get respect from me anyway, Your Honor, and I--

[Laughter]

I would add... I would add that there's been nothing to suggest in any decision since then that House was wrongly decided, and I think what's important about this matter is this--

Unknown Speaker: Well, there has been one thing.

Mr. Sutton: --Excuse me.

Unknown Speaker: There has been one thing, and maybe you would comment on it.

Congress in 22... which is it?

I get the sections mixed up.

But anyway, there's a section in here that says there can be no appeal or review of a denial of a second or successive.

Mr. Sutton: Yes.

Unknown Speaker: Which if I understand your position correctly, that... Congress could have omitted that entirely and the law would have been exactly the same.

Mr. Sutton: Absolutely not, Your Honor, and I'm glad I have a chance to deal with that issue.

The clear statement provision, 2244, was needed precisely because of the main case on which the Federal Government and petitioner rely, House.

The statutory scheme in House was just like 2244 would have read without a clear statement.

2244 says, if you want permission for a second habeas, go to the court of appeals and get permission.

It says... would have said nothing about a justice, nothing about Supreme Court review.

That's the House statute, and because House was on the books, Congress quite smartly said we're going to avoid all the--

Unknown Speaker: Why didn't they do it as to the first habeas as well as the second, then--

Mr. Sutton: --They didn't--

Unknown Speaker: --and make it perfectly clear.

Mr. Sutton: --They didn't need to, because under statutory certiorari every single decision of this Court, every single decision of the Court that was on the books indicated that there was no statutory certiorari jurisdiction, so they didn't need a clear statement there and, precisely because, as I indicated in responding to Justice Souter's question, the law had changed since 19--

Unknown Speaker: Your view is they needed a clear statement for a second successive but they didn't need one for a first habeas because that law was already very clear with respect to first?

Mr. Sutton: --Sufficiently clear to not need a clear statement, yes, Your Honor.

Unknown Speaker: I find that rather puzzling.

Mr. Sutton: But, Your Honor, let's... well, I think the law was settled as to statutory certiorari.

I don't think anyone's arguing that the law was settled on that point.

The harder question, I agree with you, is whether the law was settled as to common law certiorari in light of the House decision.

There's one body of Government that would have noted... known whether they needed a clear statement in 1996.

It would, after all, have been Congress, because Congress is the one that changed the law in 1948 and said quite clearly if you're unhappy with the court of appeals gate keeping decision go to a circuit justice and, if necessary, the whole Court.

So I... you know... you're... I'm not happy with the look you're giving me but I do think that--

[Laughter]

Unknown Speaker: Probably you can't, because I... you still seem to think that it was absolutely necessary to spell out that there shall be no review of the denial of a second, but there's no need to do it for the denial of a first because the law was... I just find that mind boggling.

Mr. Sutton: Well, maybe I'm not making clear why--

Unknown Speaker: Maybe I'm just stupid.

Mr. Sutton: --No, I'm sure that it's an opposite problem.

The thing I'm trying to emphasize is that, with House on the books, if you have a statute that just says go to the court of appeals and nothing else, that would have allowed common law certiorari.

An inmate would have come--

Unknown Speaker: Well, if that's true why can't--

Mr. Sutton: --under settled law--

Unknown Speaker: --If that's true, why can't we review this case?

If you're right about that, then we should review on common law certiorari.

Mr. Sutton: --No, Your Honor, because the statutes changed.

There's not a single All Writs precedent in over 210 years of this Court's jurisprudence in which they granted All Writs relief, whether common law certiorari or any other--

Unknown Speaker: Well then, if that's true you don't need a special provision for the second habeas, either.

Mr. Sutton: --I'm not sure I follow that.

Unknown Speaker: I don't understand, under that argument, why it was necessary for Congress to enact a grant or a denial of an authorization by the court of appeals to file a second or a successive application shall not be appealable and shall not be the subject of a petition for rehearing or for a writ of certiorari.

Mr. Sutton: Because House was still on the books.

I don't have to worry in 2253 because the statute had changed and had given the inmate another available route for relief.

There's no All Writs Act precedent with which I'm aware, or that has been cited by petitioner or the Federal Government--

Unknown Speaker: Well, are you saying... let me just be sure I... you're saying that if they had not enacted (E), they could have... we could have accepted review in second habeas but not in first?

Mr. Sutton: --Yes, absolutely.

Absolutely.

Unknown Speaker: That is remarkable.

Mr. Sutton: But, Your Honor, that's House.

I mean, unless you're going to overrule House, that's exactly what House says.

Unknown Speaker: In House, I take it that the Court issued All Writs review, is that right?

Mr. Sutton: Yes.

Unknown Speaker: All right, and so then the question was, well, why can't we do that in this decision about certificate of appealability, and I take it your answer to that was, well, the reason they issued All Writs review before is because there was no other way to get it.

Mr. Sutton: Yes.

Unknown Speaker: But here, there was a way to get it now.

The way to get it now is, a single justice can issue--

Mr. Sutton: Absolutely.

Unknown Speaker: --All right.

Then the Solicitor General says in respect to your answer, well, that isn't really so, because at the time of House the word judge included single justice, so there was a way of reviewing then, just as there is now.

So now your response to the response to the response to the response is what?

Mr. Sutton: I think I've kept track of that.

The--

Unknown Speaker: That's the letter you filed.

Mr. Sutton: --That is the letter I filed.

Unknown Speaker: And the letter... the answer to that... I mean, you see, they've made it very parallel.

I mean, they've made it absolutely parallel to House, and your response to that now is what?

Mr. Sutton: Their argument... I want to make sure I've made their argument clear, because I don't think I did the first time through.

Their argument is that the phrase, judge of the court of appeals--

Unknown Speaker: Right.

Mr. Sutton: --in 1945 included a justice of this Court.

Unknown Speaker: Right.

Mr. Sutton: So that's their argument, and to make that argument they've looked to a definition they found in title 28 that says, judge of the court of appeals can include circuit justice, so at that point, that's a pretty good argument.

Now, the response to it is the letter I filed--

Unknown Speaker: I thought it was very good when I read it.

I was wondering what you were going to say in response.

[Laughter]

Mr. Sutton: --The response to it is that that definition comes from the 1911 act the Congress enacted that dealt with the judicial code.

Now, the 1911 act did not deal with habeas, did not modify the habeas statutes and, most notably, did not modify the gate keeping provision, but the critical language here, and this is the filing that I provided, is that definition says, when used in this title, all right.

That sounds kind of broad.

It sounds like all of title 28.

Well, it turns out in section 293 of that very act it says the word title only refers to this act.

In other words, only the 1911 act, so that... that argument's gone.

That argument doesn't exist.

But Justice Breyer, I can confirm it by common sense.

Since 1948 when the law was changed you've got, I think it's 17 different reported decisions by this Court concerning applications for certificate of probable cause that were denied or granted.

Between 1925 and 1948 there's not a single one.

There's not a single piece of evidence in that 23-year period that one could go to a justice.

And again, if one looks at House itself, page 43 of House, this Court was construing the state of the law at that point in time.

Unknown Speaker: Is there any reason, by the way, since you brought common sense into it, which I think is very helpful, is there any reason why Congress, assuming that the statute language allows it, would have singled out, out of all the things this Court can review, which is virtually all kinds of things, is there any reason that anybody would have wanted to pick out this set of cases, which would have let so... an egregious, really controversial refusal to grant a certificate of appealability that's the kind of thing we might review?

You know, the court's really wrong, or it's really controversial, there's a big legal issue involved.

Now, out of all the things we review, is there any reason why Congress would have wanted to say, that alone you cannot review?

Mr. Sutton: In other words, are you saying that they would have wanted to preserve the jurisdiction for the rare case, or why would they eliminate--

Unknown Speaker: Yes.

I mean, you're arguing, basically, that out of all the things... we can review all sorts of things.

Mr. Sutton: --Right.

Unknown Speaker: And assuming the language allows it, the All Writs Act, or whatever, is there any reason, really, Congress would have wanted to take this set of cases and say no, those are the ones you can't review--

Mr. Sutton: Right.

Unknown Speaker: --even for what we would likely review, a rare instance where it was an absolutely wrong grant, refusal to grant the certificate, or there's a big legal issue involved, something like--

Mr. Sutton: Well, as the Powell commission report indicated, direct review was not working and has not been working.

One of the critical problems that the AEDPA tries to address is the fact that there are frivolous habeas petitions that are occupying the Court's time and Government time when, in fact, its time would be much better spent focusing on the petitions that have merit.

The second reason they would have wanted to single out this class of cases is that their whole objective... that is, streamlining review... doesn't work if you leave other avenues of review open.

Unknown Speaker: --The Congress wanted cases deemed frivolous by lower court judges to cease.

Mr. Sutton: Absolutely, and to be terminated.

That's exactly right.

It's not just streamlining review and making sure it's efficient and that the courts focus on the claims with merit, but those claims with merit are done after the inmate has had one fair opportunity before the district court juge.

I think that makes sense.

But I think the other problem, I mean, if one doesn't adopt this interpretation, are some of the administrative problems that arise when you've got not just applications to the circuit justice available but common law and statutory certiorari available, so you've got two and three tracks of review, not about the merits but about this gate keeping decision.

The whole... the only reason--

Unknown Speaker: Well, what if you just have All Writs Act common law jurisdiction?

Mr. Sutton: --Well, we... I don't--

Unknown Speaker: This Court has rarely exercised it.

It doesn't look like that's a big problem, does it?

Mr. Sutton: --Well, Your Honor, if... once the Court says there's power, that message will get to the inmates, and the inmates will say, if there's power, there's always a reason to file, and filings experience has shown are not always based on whether there's merit, so I think one of the fundamental goals of the act would be undermined.

But I'm not sure the Court could say just All Writs Act jurisdiction is available.

The... 2253 is on the books and 2253 does allow for applications to circuit justices and by referral to the Court.

Unknown Speaker: Yes.

That clearly is there by statute, I suppose.

You concede that.

Mr. Sutton: No, I do, and I guess the point I'm making, and perhaps not very well, is that if you allow All Writs Act jurisdiction on top of that, you're left with two track review.

You're left--

Unknown Speaker: Well, but maybe we have another problem.

I mean, we assume and we repetitiously say that we assume that Congress knows what we're deciding over here.

There was a... in several of the briefs there was a string cite to the cases in which we seem to have honored the limitation on House, i.e., no statutory cert, very much in the breach and why shouldn't we assume that Congress understood that and would therefore quite reasonably have assumed that we were going to exercise statutory cert jurisdiction?

Well, I know one answer to that is, you've still got House on the books.

Well, maybe possibly the best answer in a totally unsatisfactory situation is to say, go on applying House even if you're right on the point that you have made that, in fact, there has been one change in the law since House and that is, a circuit justice can do what a circuit justice couldn't do then.

Maybe House is sort of the best way out of a messy situation for which there's ultimately no satisfactory answer unless we go back and reexamine House.

Mr. Sutton: --When you say leave House on the books, you're including the All Writs Act interpretation--

Unknown Speaker: That's right, and apply it here whether your distinction holds up or not, because that's the... that's in effect the only alternative that would honor what I suppose was a congressional expectation without taking a total reexamination of House itself.

Mr. Sutton: --Well, Your Honor, a couple of things.

I think one thing I want to make clear which I hope is responsive to this question, I'm not aware of a single issue that will escape review by the circuit justice route, so I can't imagine any reason, any customary reason for preserving All Writs Act power in this area.

I know of no precedent where this Court allows All Writs Act power where there's already another statutory mechanism either for preserving this Court's jurisdiction or resolving some drastic problem--

Unknown Speaker: Let me suggest a way in which the circuit justice might... you know, it takes four votes to grant certiorari.

It's very often we grant cert on the basis of four votes, and when five justices think it... cert should be denied.

Now, what if the application went to one of the five who just didn't think there was any merit to it, whereas the... all eight of the others might think there was?

I don't think you are suggesting the circuit justice must routinely refer everything to the whole Court.

Mr. Sutton: --No.

I think that would be left to the practices of the Court.

The practice that I think the Court would adopt is the one I think it's been using at least for the last 20 years without exception, is that circuit justices do not act on their own and say, great, I don't have to worry about the other eight.

They act as surrogates--

Unknown Speaker: I've acted on my own on many, many occasions where I've denied relief.

Mr. Sutton: --Perhaps I'm wrong in this understanding, but I had always thought circuit justices act as surrogates for the whole Court, so that they did not take... keep in mind just their own views of a particular matter but are sensitive to what other justices may... how they may view the matter.

Unknown Speaker: Oh, but I've voted to grant certiorari when I thought... or I... put it the other way.

I voted to deny when I didn't think anybody would be interested in the case and I turned out to be wrong.

It happens very often.

My judgment just was incorrect.

My colleagues thought it was a much more important issue than I did.

It seems to me that could happen here just as well, unless you routinely referred it.

Mr. Sutton: Well, again, I'm... I don't want to suggest what the Court's practices should be, but--

Unknown Speaker: But your argument is that there is no loophole, that everything will be subject to review by the Court, and I just don't think it would be.

Mr. Sutton: --Well, I think the view that there's no loophole is the trust in the Court both as an institution and as its body of nine individual justices.

Unknown Speaker: You assume no one justice will make a mistake, is what you're saying.

Mr. Sutton: Not after a district--

Unknown Speaker: And I've made a lot of them.

Mr. Sutton: --Not after a district... keep in mind, the Court only gets involved after a district court judge in most circuits has denied it and after a court of appeals has denied it.

That's the only opportunity, and I... but there's always a risk of mistake.

I suppose there's the risk of a mistake even of a precedent, but I think it's... it was entirely appropriate for Congress to make the judgment that with respect to this problem of frivolous habeas claims clogging the courts, that we ought to expedite review of those that don't have merit.

Unknown Speaker: At the court of appeals level does the court of appeals judge act as a surrogate for the court of appeals?

Mr. Sutton: As this Court indicated in Burrell in 1956, that is up to the court of appeals.

They're entitled to establish their own practice that says individual judges--

Unknown Speaker: Well, what would you think under the statute if they're... if a single circuit judge acts, is he acting as a surrogate for the court of appeals?

Mr. Sutton: --It depends on that court of appeals' rules and practices.

Not necessarily.

I think it could quite plausibly be the case.

I'm not aware of a circuit that has this practice, but it could be the case--

Unknown Speaker: Would the practice be any different in the courts of appeals than under the old certificate of probable cause?

Mr. Sutton: --No, Your Honor.

I mean, it's something they've been doing for quite a while.

In fact, longer than this Court has been doing it, since 1925.

This has been something that they've had to manage.

Congress was aware, Justice Souter, to get back to your question, of how they managed it and I think the question of decisions by this Court, where there's no discussion of jurisdiction, can't plausibly create an implication that Congress knew about those decisions that the Court itself had not decided to address in terms of jurisdiction--

Unknown Speaker: Well, they... I wouldn't impute to Congress any knowledge that we had somehow formally reexamined House, but I guess I do think we should impute to Congress the knowledge that we are, in fact, reviewing these decisions, that we are, in fact, acting as if we had statutory cert jurisdiction in certain of these cases and my imputation of knowledge doesn't go beyond that.

Mr. Sutton: --Well--

Unknown Speaker: But if it goes that far, then it's difficult, it seems to me, to argue, as I think you were suggesting, that there is a kind of overwhelming restrictive premise in AEDPA which goes so far as to assume, or as to include a congressional assumption that we could not review in these circumstances.

Mr. Sutton: --Well, I think there clearly is when it comes to statutory certiorari, because there's not a single case that discusses that issue and says there is--

Unknown Speaker: But there are single cases in which we apparently were doing it.

Mr. Sutton: --But--

Unknown Speaker: We didn't say so.

Mr. Sutton: --But, Your Honor--

Unknown Speaker: We didn't discuss it, but we did it, didn't we?

Mr. Sutton: --I don't mean to quibble, but as between decisions that discuss the issue and decisions that silently ignore it, I think the better rule is to assume Congress knows about the decisions that discuss the issue.

Unknown Speaker: Mr. Sutton, shouldn't we just stick to the language of the statute?

Will you be willing to wager that more than 2 percent of the Members of Congress ever heard of House?

[Laughter]

Mr. Sutton: Your Honor, I've no idea, as you will agree, what they meant or what they knew, but that's exactly why we give them the benefit of the doubt.

Thank you, Your Honor.

Unknown Speaker: Mr. Sutton, you were appointed as amicus curiae by this Court and we thank you for your performance in this case.

Mr. Sutton: Thank you.

Unknown Speaker: Ms. Penner, you have 3 minutes remaining.

Rebuttal of Eileen Penner

Mr. Penner: Justice Ginsburg raised an issue which is precisely the sort of issue that this Court could not reach but for its certiorari power and that is the question whether, after In Re Burwell, a single dissenting judge on a court of appeals panel, his vote in favor of a certificate is sufficient to mandate that a certificate be issued.

That is the sort of question, the procedural question about issuance of a certificate, that this Court would have no opportunity to review.

Unknown Speaker: Do you think it's vitally important that that be the same Nation wide, that one court of appeals follow one practice, it would be terrible if the other followed the other practice?

Mr. Penner: The question is whether Congress did.

I cannot imagine all of the situations in which an important procedural issue might arise that this Court would need to resolve, but there may be questions that go to the heart of section 2253 that Congress would want this Court to have the authority to resolve.

There was a point about... I... about the state of the law at the time that House was decided, and I... we have stated our position in the letter that we submitted, but I just want to clarify that the question... the question that Mr. Sutton has raised and the question about the legislative history is whether the 1925 act retracted the power that the 1908 act had conferred on circuit justices to grant certificates of probable cause.

The language of section 13 strongly suggests that the only part of the 1908 act that was retracted was the part that required direct appeal to the Supreme Court and that justices retained their power to grant certificates.

Unknown Speaker: Do you have any explanation for the dearth of any applications in that period?

Mr. Penner: We don't... I personally cannot say that there is a dearth, because there... it's extremely difficult to search this Court's records from that period in applications that would have been decided in chambers, so I don't think--

Unknown Speaker: Mr. Sutton said there was.

Mr. Penner: --I think that... I am uncertain that Mr. Sutton would be able to make a declaration that there were no applications.

He can only say that Westlaw does not report any.

Many of these are simply not published and they're not available, and I think I can make a recommendation... representation that I've asked the Clerk of the Court about... or the Librarian about how to get this, and it's very difficult to find, so we don't know whether they occurred or didn't occur during that period.

It's certainly true that House didn't mention it, but House also did not mention another form of relief that was available, and that was an original petition for habeas corpus to this Court, which House had indeed sought.

The existence of that remedy did not deter the Court in holding that it had common law certiorari power.

In addition, the question about whether the 1911 act's definition of circuit judge applies, the fact is that the 1925 act did not even use the language, circuit judge, so the definition of circuit judge is sort of irrelevant.

The only question is whether the 1925 act eliminated the power of the circuit justices that the 1908 act had created.

Unknown Speaker: Could I ask you a quick question?

If we accepted the SG's idea that a request to a single judge in a circuit is not in the circuit, in the court of appeals, would that also apply to first habeas petitions?

Mr. Penner: I'm sorry, could you--

Unknown Speaker: If we accept the position that it's not in... is it all right if I ask this, Chief--

All right.

If we accept the position of the SG that the request for a certificate of appeal, you know, to go to the circuit justice... they're saying that isn't in the court of appeals, right?

Okay.

Does that mean for purposes of habeas corpus, a first habeas petition, you also have to get a certificate, don't you?

Mr. Penner: --Yes.

Unknown Speaker: All right.

Would that mean that we would then be unable to hear denials of those certificates, too, in first habeas?

Mr. Penner: It may have the same implication.

Chief Justice Rehnquist: Thank you, Ms. Penner.

The case is submitted.

Unknown Speaker: The honorable court is now adjourned until tomorrow at ten o'clock.

Attribution:

The OYEZ Project

Featured:

U. S. Bancorp Mortgage Co. v. Bonner Mall Partnership - Oral Argument

Fri, 09 Jan 2009 14:49:58 +0000

Case:

U. S. Bancorp Mortgage Co. v. Bonner Mall Partnership

Media File:

93-714_19941004-argument.mp3

Related Transcript:

transcript.xml

Transcript:

Argument of Bradford Anderson

Chief Justice Rehnquist: We'll hear argument next in Number 93-714, U.S. Bancorp Mortgage Company v. Bonner Mall Partnership.

Mr. Anderson.

Mr. Anderson: Mr. Chief Justice and may it please the Court--

This is a case which contains within the question presented, as set forth in the Court's March 28th order, a much more narrowlyfocused question, and that question is whether the decision below should be vacated when after this Court granted certiorari the parties settled and mooted the case before this Court, and that settlement did not contain any agreement or condition requiring, or for that matter precluding vacatur.

We also contend for a rule... a more general application, and that is that the established precedent confirmed in the Munsingwear decision and in later decisions of this Court which require vacatur upon mootness, that those decisions be generally adhered to in cases where mootness arises as a result of settlement.

And because that is the established practice of this Court, we believe that the burden should be on the respondent, Bonner, to demonstrate why that practice should be changed.

Our position here can be summarized rather succinctly 1) in a case like this one, where the Court has granted review so that the decision below is not final in the Federal statutory scheme and therefore there is no presumption of correctness, we believe, which attaches, vacatur is appropriate generally and in this specific case.

Unknown Speaker: Mr. Anderson, when you say vacatur, are you referring just to the judgment below, or are you referring also to the opinion, if there was an opinion below?

Mr. Anderson: We are referring to what in essence is the judgment below.

We do not contend, as has been suggested by Bonner, that the opinion should be somehow expunged from published sources, or that it should be depublished or withdrawn.

What we are addressing is the... what in essence is the judgment below.

Unknown Speaker: And you would leave it to some other rule or set of rules to decide whether the opinion should continue to have precedential value in the circuit, and that sort of thing?

Mr. Anderson: That's correct, Mr. Chief Justice.

Unknown Speaker: Thank you.

Mr. Anderson, may I ask you--

--What would a circuit court judge do if there were an opinion and the judgment had been vacated and that opinion is on the book?

Is that the law of the circuit in the Ninth Circuit?

Mr. Anderson: I don't believe it would be the law of the circuit, Your Honor.

The... our position is, and I think it's consistent--

Unknown Speaker: So it's just like an interesting law review article hanging out there?

Mr. Anderson: --No, Your Honor.

I think that it would be not comparable to a law review, but perhaps comparable to the decisions that we have found in the Seventh Circuit on this same new value exception issue, where there has been much learned discussion about the issue, most of it... I guess all of it in dicta, and it has provided, I think, a useful examination of the issue which then ultimately goes to establish the basis for what ultimately will become the precedent.

Unknown Speaker: Now, you've confused me.

I thought you just told the Chief Justice you didn't care, that you would leave that to, you know, for another day.

Mr. Anderson: We do care.

Unknown Speaker: Yes, you do care.

Mr. Anderson: But we would leave it to another day, Your Honor, although we--

Unknown Speaker: Well, your position is that it has not precedential effect.

Mr. Anderson: --That's correct.

Unknown Speaker: But I thought you answered just the opposite to me a moment ago.

You said the vacatur would not cover the opinion, but only the judgment.

Mr. Anderson: I'm sorry, Your Honor, I must have misinterpreted your question.

It is not necessary to our argument here today that a determination be made as to what the precedential effect, if any, of vacatur is.

Unknown Speaker: Is there any reason why, say, the Ninth Circuit couldn't... consistent with your position why the Ninth Circuit couldn't have a rule that said, even though a judgment of our court which has been vacated pursuant to Munsingwear, nonetheless we will continue to regard our opinion in that case as a circuit precedent?

Mr. Anderson: They could have such a rule, Your Honor.

I don't believe that is the case, but they could have such a rule.

Unknown Speaker: One frequently sees cases cited at least where they are vacated on other grounds.

You cite it for one proposition, you know, paren, vacated on other grounds, and that seems to be considered proper authority so long as the vacatur is not for the reason cited.

Mr. Anderson: I believe that could be the case, Justice Scalia.

I was simply stating that our position generally is that, our understanding of the law is that normally a vacated decision would not have precedential or binding effect on the lower courts.

Unknown Speaker: Mr. Anderson, may I ask you a preliminary question about Munsingwear?

Do you think we should read Munsingwear as a case in which the mootness was the result of happenstance, which was the word used in the opinion, or should we read that as a case in which the mootness or the underlying mootness resulted from the acts, the unilateral act of one party, and hence creating the mootness?

Mr. Anderson: We would contend, Your Honor, that the mootness to the extent it was created there, was created by the unilateral act, and that the reference to happenstance by the court in Munsingwear was not a description of what had happened, but was rather more of an offhand reference to--

Unknown Speaker: A misdescription of what had happened?

Mr. Anderson: --Possibly a misdescription of what had happened, yes, Your Honor.

In fact, as you know, Munsingwear did not involve directly the question of mootness.

The question before the Court in that case was whether res judicata effect should have been given to the judgment, which the United States did not challenge directly below.

The Court indicated also that, had the United States moved to vacate in the court of appeals, that it would have been entitled to that relief.

Unknown Speaker: Do you think it's fair to say that the court in Munsingwear did not view it the way you have just described it?

What was the point of talking about happenstance, and happenstance alone, if it viewed it your way?

Mr. Anderson: Well, the explanation, Your Honor, I think is reflected in the subsequent decisions of this Court after Munsingwear was decided.

There are at least a dozen decisions in which, with Munsingwear standing there as precedent, this Court has granted vacatur in cases where mootness came about as a result of--

Unknown Speaker: Well, yes, but we're now in effect saying, should we be doing that.

Your position is stronger if we view it as a case in which the mootness resulted from the unilateral act of a party.

You would agree there, I take it?

Mr. Anderson: --Yes, that is correct.

Unknown Speaker: May I just ask... you see, I'm not sure your argument tracks your position in your briefs... is it your position that there should, we should announce a general rule that when there's a settlement there will always be a vacation of the judgment below, or is it to be decided on a casebycase determination?

Mr. Anderson: Ultimately, as we have argued in our briefs, the decision whether to vacate is bottomed on discretion by this Court.

We believe that that discretion is appropriately exercised as a general matter in cases where mootness occurs as a result of the joint action of the parties in agreeing to a settlement where the prevailing party below agrees to--

Unknown Speaker: I'm still a little puzzled as to what you're saying.

The discretion should be exercised as a general matter to vacate, but does that mean that we should adopt a rule we should always vacate without looking at the particular facts, or are we simply... I don't quite understand.

Mr. Anderson: --Well, there may be circumstances, Justice Stevens, where the Court would have to look at the particular facts.

I think those circumstances would be unusual and perhaps extraordinary.

For example, where you have what in essence might be a sham settlement, or where the parties can identify a pattern of abusive settlements, but the general rule--

Unknown Speaker: Why would that make any difference?

Mr. Anderson: --Because ultimately vacatur is premised on the exercise of discretion by this Court, and the interests promoted by vacatur, which are fairness and the prudential considerations that we have outlined, would not be promoted, I don't think, in a situation where the settlement was in fact not a settlement.

For example, where the losing party below essentially pays the full amount of the judgment.

In essence, what it's saying there is that it is prepared to live with the judgment, it is prepared to comply with the decision below, and in that circumstance, where the prevailing party below has not made any concessions, has not agreed to forego reliance on that lower court decision--

Unknown Speaker: No, but it's willing to pay in the particular case, but it still doesn't like the general rule that the court announced, and that's... that... I really don't understand your position, but go ahead.

May I ask you to clarify your position that you care only about having the judgment expunged?

The judgment doesn't do anything.

What can hurt is either the preclusive effect or the precedential value, so what does it mean to vacate a judgment if that judgment is still going to have, if the opinion is going to have precedential value?

What do you accomplish by vacating the bare bottom line if everything else is retained?

Mr. Anderson: --Well, Your Honor, in this instance, as the Court said in Munsingwear, one of the purposes of vacatur is to prevent the spawning of any legal consequences, and that would include law of the case.

And in this particular case, the bankruptcy court has retained jurisdiction, the consensual plan to which the parties agreed is to be implemented over a period of 5 years, approximately, it is to prevent collateral estoppel effects flowing from that judgment, and we believe that, notwithstanding the respondent's argument there are collateral estoppel effects that might flow here under the United States v. Mendoza case which applies collateral estoppel to issues of law, and those--

Unknown Speaker: --indicated that a court could adopt, say, the Ninth Circuit, a rule that vacated opinions to have precedential value, so even though you might prevail in a subsequent quasi collateral estoppel, there would be no collateral estoppel but you'd lose anyway under this hypothetical rule, which seems to me a very strange rule.

Mr. Anderson: --If there were litigation outside the Ninth Circuit, Your Honor, I'm not sure that would be the case.

The precedent certainly might be binding--

Unknown Speaker: No, I'm talking about, assume you're back in the Ninth Circuit.

Mr. Anderson: --We would be in that situation.

The precedent would be then binding in the Ninth Circuit.

Unknown Speaker: But no estoppel, even in the Ninth Circuit, because that requires a judgment.

Mr. Anderson: That's correct.

That's correct, Your Honor, although to a certain degree, as Justice Kennedy pointed out, there is a merging of the estoppel effect and the precedential effect within the confines of the Ninth Circuit, and only within those confines.

Unknown Speaker: Well, under your theory that it's within the discretion of the court to decide whether to vacate the judgment or not, if the court were to decide not to vacate this judgment after the settlement, is that an abuse of the court's discretion?

Mr. Anderson: I don't think so, Your Honor.

I think the court may exercise that discretion in any way it seems fit, and I don't believe that would be an abuse of discretion.

Unknown Speaker: So you just leave it entirely open to the court to weigh the factors one way or another and decide what to do?

Mr. Anderson: Subject to the general rule that we suggest that vacatur upon mootness where the mootness occurs as a result of settlement is generally appropriate for the reasons that it promotes the values that we have described in our briefs... fairness between the parties, and the prudential concerns that the judicial system must have with regard to the development of precedent.

Unknown Speaker: Well, in this case, what possible grounds, under your rule, would a court have for refusing to vacate?

Mr. Anderson: In this particular case?

Unknown Speaker: Yes.

Mr. Anderson: I don't believe there would be any grounds for refusing to vacate in this case.

Unknown Speaker: Well then, the answer to Justice O'Connor is it would be an abuse of discretion.

You told me it would not be an abuse of discretion to refuse to vacate.

Mr. Anderson: That's correct, Your Honor, and perhaps I misunderstood your question.

Since the decisions of this Court are generally not reviewable, I wouldn't think that... it could not be characterized as an abuse of discretion.

[Laughter]

Unknown Speaker: Well, let's talk about a court of appeals.

Mr. Anderson: I think there are some differences when you begin to talk about the court of appeals, Your Honor.

Unknown Speaker: Okay.

It's a court of appeals on these facts, and the court of appeals refuses to vacate the judgment.

Is that an abuse of discretion?

Mr. Anderson: I would think it would be.

I would think it would be, and the reason is, as long as there is an appeal pending so that that decision which the court of appeals is reviewing is not final, the court of appeals has not been able to complete its review of that decision, then the judgment should be vacated.

Unknown Speaker: What if the court of appeals has decided the case, but there's a petition for rehearing pending?

Mr. Anderson: I would say that that would be, the same rule should apply.

Unknown Speaker: They should vacate the decision.

Mr. Anderson: That decision is not final.

That decision is not final.

Unknown Speaker: If the parties settle, that's the end of the ball game.

Aren't you, in effect, asking the Court to write a term into the settlement agreement that you did not successfully negotiate?

Many of these agreements put in the agreement itself that a term of the settlement is that the decision will be vacated.

Here, you're asking the Court, in effect, to put in as a term of the settlement what the opposing party and you didn't negotiate.

Mr. Anderson: Justice--

Unknown Speaker: Because Bonner is resisting the vacation.

Mr. Anderson: --Bonner is resisting it, Justice Ginsburg.

However, it was not a term that was negotiated.

we do not believe, however, and we do not urge that that be a distinguishing consideration, because the principles underlying vacatur, fairness, and the prudential concerns that I mentioned, particularly fairness we don't believe should be premised on the relative bargaining power of the parties.

Fairness--

Unknown Speaker: Well, I don't understand why you're in a different position from somebody who's just decided to forego an appeal, why we should treat you differently from someone who has withdrawn an appeal, or decided not to appeal.

Mr. Anderson: --Well, if I may briefly explain some of the factual considerations that led us to where we are today, I think that will answer the question.

For example, in this case, the parties were negotiating prior to the filing of the bankruptcy case in 1991.

U.S. Bancorp had proposed certain settlement terms that it was willing to live with.

Those terms included very basic minimums that it required, a market rate of interest, an adequate loantovalue ratio, things of that nature.

Those terms were ultimately what was accepted by Bonner in January of 1994 and then some subject to certain other conditions which then also were met later so that the consensual plan could be confirmed in March of 1994.

Bonner was the party that made certain concessions and decided to forego reliance on the decision it had won in the Ninth Circuit.

U.S. Bancorp did not exercise unilateral action.

When you look at the facts in that light, I think what you see is that U.S. Bancorp was in the position of having to choose in this dilemma whether to accept an economic settlement which was favorable on its terms or having to defend a decision, or to challenge a decision in the Ninth Circuit which the prevailing party was no longer willing to litigate and was willing to forego, so it is not unilateral action in that sense at all.

I think also that the fact that this Court granted certiorari is perhaps one of the most salient elements of this particular case.

Another salient element is that the settlement which I briefly described was a bona fide settlement.

There's no issue in this particular case of collusion.

There's no issue of a deep pocket attempting to purchase vacatur in this case.

So those concerns which have been raised by the respondent simply do not apply.

Unknown Speaker: Do you think we should investigate each case for those concerns, have a minifactual hearing every time there's a motion to Munsingwear a case?

Mr. Anderson: I do not, Your Honor, and I think that the general--

Unknown Speaker: So your proper answer should be, you know, maybe, maybe not, but tough luck?

Mr. Anderson: --I don't think so.

Unknown Speaker: You can't have it both ways.

I mean, you either have to acknowledge a possibility that that could happen now and then, or else you're going to have to say, we're going to have to conduct these inquiries.

Mr. Anderson: I believe it could happen now and then in the extraordinary circumstances that I alluded to earlier as a... if the general rule which we propose is adopted, I don't believe it would be necessary for the Court to engage in those kinds of inquiries.

Unknown Speaker: May I just ask in that regard, this case settled after we granted the certiorari, is that right?

Mr. Anderson: That's correct, Your Honor.

Unknown Speaker: And you advised the Court it had become moot.

Did you make a motion to have the judgment vacated?

Mr. Anderson: Yes, we did, Your Honor.

Unknown Speaker: You did make a motion.

Mr. Anderson: In our reply to the memorandum filed by the respondent suggesting mootness.

Unknown Speaker: You moved that... you filed a motion.

I didn't remember that.

Mr. Anderson: Yes, Your Honor, and we requested application of the Munsingwear result.

Going back to Justice Ginsburg's question, as a factual matter, U.S. Bancorp at the time the settlement was being negotiated in fact relied on what it believed was the existing precedent in this Court.

Unknown Speaker: Why wouldn't it make sense just for us to dismiss and you can go to the Ninth Circuit that says it will take these on a onebyone basis, move under 60(b) for them to reopen and vacate the judgment?

Mr. Anderson: Well, I think the fact that this Court has granted certiorari, Your Honor, indicates that it should be this Court that vacates the judgment for the reasons that the grant of certiorari by itself in a way is like creating a doubt about that precedent.

Although that precedent is now binding in the Ninth Circuit, it forever will have this question mark attached to it as to the review which was granted by this Court and which was not able to be completed as a result of the settlement of the parties.

Unknown Speaker: So if it didn't grant cert, then it would be proper just when you have the settlement to dismiss outright?

Mr. Anderson: That may be the correct result, Your Honor.

We would urge that this Court adopt explicitly, if it has not already, the Velsicol procedure that was proposed by the Solicitor General, and so that if the Court... if the matter were certworthy at that time, the Court could make the determination that vacatur was appropriate, even if certiorari had not been granted by the time the parties settled.

Finality, then, is one of the key considerations that we believe direct or would require vacatur in this particular case.

I wanted to distinguish this case from, I'm sure, the decision that will be relied upon by the respondent, and that is the Karcher v. May case.

In that case, the court was not dealing with, even with mootness, and not directly dealing with vacatur.

In that case, the parties who were named in the petition had lost their position as legislators in New Jersey, and the court found that they did not have standing to assert any longer the position that they had been asserting, and that therefore the appeal was dismissed for want of jurisdiction.

The reference to happenstance in that case was simply to the argument of those parties that their loss of position was a matter of happenstance.

The court pointed out that, in fact, the statutes in place in New Jersey at that time were specifically intended to avoid mootness.

Unknown Speaker: Thank you, Mr. Anderson.

Mr. Kneedler.

Argument of Edwin S. Kneedler

Mr. Kneedler: Mr. Chief Justice, and may it please the Court--

Since this Court's decision in Munsingwear and indeed, before that time, this Court has followed a consistent practice of vacating decisions of the lower courts that have become moot as a result of the settlement of the parties.

Unknown Speaker: You're talking, then, not just about judgments, you're talking about opinions also?

Mr. Kneedler: Judgments should be vacated.

It follows from that, in our view, that the precedential impact of the decision is also eliminated.

Unknown Speaker: You don't agree, then, with your colleague who just spoke?

Mr. Kneedler: I do not.

One of the important points the Court made in Munsingwear itself was that the decision should be vacated in order to prevent it from spawning any legal consequences, and those legal consequences could be collateral estoppel, they could be law of the case, but they can also importantly be the precedential impact of the decision in other cases.

So it is an important aspect of the vacatur to eliminate the precedential impact of the decision.

Unknown Speaker: Mr. Kneedler, you're right that we've done it often, but almost all the times we've done it, we've done it by way of a per curiam opinion or summary disposition.

In fact, In think Munsingwear is the only case I recall where we've discussed the reasons for it, and we also have a principle that in matters of procedure and judicial administration stare decisis is least strong.

Mr. Kneedler: Well, several points I'd like to make in response to that.

Munsingwear was a discussion of the issue, but included in the Court's discussion in Munsingwear where the Court announced its general rule, it made no mention of the word happenstance.

The Court referred to its established practice when a case becomes moot, and cited a number of cases, four of which, as is pointed out in footnote 5 of petitioner's brief, involved settlement.

So the Court was recognizing that the general practice that it had already established at the time of Munsingwear applied to settlement, so there was no need to separately discuss, no need on this Court's part to separately discuss how that rule should apply to settlement because the Court was already relying on cases that involved settlement, and that, the Court's following of that practice since that time simply confirms that there has been a general rule.

The question before this Court is whether the Court should now depart from that general rule, and we think that respondent has shown no reasons for doing so.

The problems with a case--

Unknown Speaker: Has the issue been litigated before, as far as you know?

Mr. Kneedler: --I think in general not.

I think the party, the parties have recognized the consequence that mootness leads to vacatur of the decision below.

Unknown Speaker: So this is really the first time we're confronting the issue in an adversary context?

Mr. Kneedler: The first time the Court has certainly chosen to argue--

Unknown Speaker: --standing up and arguing both sides of the case.

Mr. Kneedler: --Yes, but my point is that in Munsingwear itself the issue was litigated completely, and at that time the Court was relying on cases that involved settlement, and the Court's consistent practice since then has showed that it is in fact a settled rule, and we see no reason to depart from that.

Unknown Speaker: What do you mean by litigated completely in Munsingwear?

Mr. Kneedler: Well, the question of what the proper disposition of a lower court judgment should be when a case becomes moot was--

Unknown Speaker: The parties took opposing positions on the question?

Mr. Kneedler: --They did.

Well, in Munsingwear the issue arose afterward when the United States tried to avoid the collateral estoppel consequences, or res judicata consequences of a judgment that... where the appeal was dismissed and the United States did not seek to have that judgment vacated, and what the Court said is, to prevent that from happening, the Government should have sought an order having the lower court decision vacated, and the Court referred to its established practice, which included cases that had been settled.

Unknown Speaker: Mr. Kneedler, I'm not sure I have your answer to Justice Scalia's question.

Did the parties file briefs on the issue in the Munsingwear case, or did the Court just dispose of it by explaining what it was doing?

Do you know?

Mr. Kneedler: My understanding is the parties filed briefs on the merits, and it was heard on certiorari.

It was not disposed of--

Unknown Speaker: Is that not a case that became moot after we had granted certiorari?

Mr. Kneedler: --No.

The case became moot because the product was decontrolled while the appeal was pending in the lower courts.

Unknown Speaker: I see.

Mr. Kneedler: And the appeal was dismissed from the trial court.

Unknown Speaker: I see.

Mr. Kneedler: The appeal from the trial court to the court of appeals had been dismissed.

Unknown Speaker: And in fact the bottom line was preclusion.

Munsingwear, the holding in Munsingwear is the Government was precluded.

Mr. Kneedler: Yes, but because the Government had not sought to have the judgment vacated, and what the Court said is that its established practice had been that if the Government had sought that release, it would have been granted.

Unknown Speaker: Well, on the way to holding that the Government was bound, the Court said, en passant, but if the Government had done this we would have followed our established practice.

Mr. Kneedler: Yes, and then what... the Court has continued to follow its established practice in settlement cases.

That's the point that I'm making.

Unknown Speaker: Well, but the dictum, the considered dictum of Munsingwear also classified it as a happenstance case, not a settlement case, regardless of what we may have cited.

Mr. Kneedler: Well, it described the inability, or the lack of review as having occurred by happenstance, but it doesn't appear to me that--

Unknown Speaker: Well, but the happenstance referred, I thought, to the event which resulted in the mootness, wasn't that correct?

Isn't that correct?

Mr. Kneedler: --That's not even clear, but we can assume for the moment that that's correct.

I think the Court could have been just saying that the review was precluded by circumstances beyond the Court's control, but the important point, there was just a reference in one sentence to the word happenstance, but when the Court stated its general rule, it did not contain the word happenstance on page 39 where the Court described its established practice, and again referred to cases involving settlement.

Now, to depart from that and adopt a casebycase rule would have a number of disadvantages.

It would take this Court's time in looking at the facts of each case to see whether vacatur would be appropriate.

It would also undermine the certainty and predictability for the parties in entering into settlements and, indeed, in Munsingwear the Court announced--

Unknown Speaker: In Munsingwear, though, the Court says the established practice has been to reverse or vacate the judgment below and remand with a direction to dismiss, it doesn't say anything about the opinion.

Mr. Kneedler: --No, it doesn't say anything about the opinion, but the opinion would have precedential effect only because of the judgment.

The lower courts, like this Court--

Unknown Speaker: Well, why do you say that?

Mr. Kneedler: --Well, the precedent comes from the judgment of the Court and the opinion explaining the judgment, and the extent of the opinion that's necessary to the judgment becomes precedent, but it is the judgment that is the judicial role, it is the judgment that settles the case or controversy, and therefore the judgment that is binding precedent in other cases.

Unknown Speaker: Mr. Kneedler, have you ever cited a case, has the Government ever cited cases in a brief in which it cites a case as authority and then says, parenthesis, vacated on other grounds?

Mr. Kneedler: Yes, citing it for its persuasive force if it is... if the judgment is vacated and not reinstated, I don't think it has binding precedential impact, force.

We would cite it for whatever force it might carry, and the fact that it was overturned by a higher court on other grounds suggests that the reasoning might be particularly persuasive, but would not be binding.

Unknown Speaker: The reasoning wasn't reversed, at least, right?

Mr. Kneedler: Exactly.

Unknown Speaker: But what would you do if you were a district judge in the Ninth Circuit and we follow the procedure you recommend, and the same issue comes up that this panel decided?

Would you follow the opinion, or would you say well, it doesn't count, if you were a district judge?

Mr. Kneedler: If the court, if the district court found it persuasive, it could follow it, but the point is, it would be an independent act of judging on the district court's part to decide what the correct result was without having that answer dictated by the court of appeals' decision.

And after all, the court of appeals' decision was rendered tentative at best by virtue of this Court's grant of certiorari, and it seems to us it would be unwise to leave a decision that this Court has found sufficient reason to grant review and perhaps reversed, standing as binding precedent in the court of appeals, and not free the parties to litigate that question in other cases.

Unknown Speaker: Well, but you'd give the same answer as was referenced to the district judge's position if the Ninth Circuit had vacated the opinion after a settlement with quite... suppose there's a settlement while the case is on rehearing in the Ninth Circuit, no certiorari granted, and then it's vacated.

What does the district court do then?

Mr. Kneedler: It would be the same thing, if the--

Unknown Speaker: All right, so the grant of certiorari is irrelevant.

Mr. Kneedler: --Well, it just indicates from the perspective of this Court's role, this Court sits to resolve conflicts or to resolve differences in the lower courts, and in this case the Ninth Circuit's decision on the new value exception was the first decision after this Court's decision in Northwest Bank sustaining the new value exception.

It would be consistent with this Court's role of superintending the decisions in the lower courts to eliminate that precedent, and to allow the issue to continue to percolate in the lower courts, a practice which this Court has recognized is of considerable benefit.

I'd also like to address the question of fairness.

The rule we propose is consistent with the role of the courts.

The rule we propose is consistent with the role of the courts sitting to litigate actual controversies between parties, and not to announce broader principles except as a derivative aspect of that judicial role, and there... yes.

Unknown Speaker: This is perhaps... this is what we would have done, I think, in the court of appeals.

Imagine... we're out, I think.

That's all right.

Answer Justice Breyer's... go ahead.

Well, it's going to be... well, imagine two parties had agreed that the settlement is conditional upon vacating the judgment below.

I, as a court of appeals judge, would have sent the whole thing back to the district judge to make a decision about that.

And the reason I would have had him do that is there are not many, but there are quite a few complex litigations involving cleaning up the Boston Harbor, for example, or managing mental health facilities, for example, and the vacating of a judgment might have significant implications on lots of other parties to the mental health litigation or the cleanuptheharbor litigation, and might have changed their whole strategy were something like that to come up, or might have all kinds of implications that only the district court would know about.

Therefore, even had they agreed on the settlement, I would have sent it back to get the district court's determination about how it affects third parties.

Now, where I don't even have that agreement, I would worry about a rule that said, automatically vacate, for the reason I don't know what counts as a settlement.

An appellant may simply stop.

Is that a settlement?

Moreover, 99 percent of the time, the appellant won't bother to ask for the vacating of the judgment, so sometimes it's there, sometimes it's not there.

People later on come in and argue about the significance of that.

It sounds complicated.

So that was my reaction when I read the brief.

I'm not saying that's what I'm actually thinking, but I wanted to know how you see this as working out according to your rule.

Mr. Kneedler: Okay, several things.

The... when the appellant doesn't dismiss the appeal, the appellant is still seeking review of the judgment below, just as the petitioner does here, so the party is... it's different from where the party has just decided to let the lower case judgment stand.

That's the first thing.

The second thing is that what causes... what leads the court to vacate the judgment is not the agreement of the party to vacate the judgment, it's the agreement of the party that settles the case which renders the case moot.

It's the mootness, then, under the Munsingwear rule, that requires vacatur.

The third and last point that I wanted to make is where the vacatur is conditioned upon approval of the court, in a sense the case may not yet be moot, because the settlement is not conclusive, but where--

Argument of John Ford Elsaesser, Jr.

Chief Justice Rehnquist: Thank you, Mr. Kneedler.

Mr. Elsaesser, we'll hear from you.

Mr. Elsaesser: Mr. Chief Justice and may it please the Court--

We argue that this Court should not extend Munsingwear to mandate routine vacatur, or any kind of stipulated reversal upon settlement.

We argue that such vacatur would erode certainty, it would allow for the manipulation of courts, including judge and forum shopping, and would directly challenge this Court's longheld belief in the fundamental importance of stare decisis.

Public confidence in our judicial system would be undermined if decisions could be bought and sold at will, and the only settlements that would be promoted by such a rule as the Government proposes would be in the rare but important cases where the court's future the court decisions' future impact and future results that a party might suffer has a present monetary value to one of the parties.

I would suggest that these impacts and these results go far beyond even the broadest possible reading of Munsingwear, which the Government does in its proposal.

We suggest a better rule that is short and simple in its application no vacatur upon settlement.

We believe this rule not only properly follows Karcher v. May, but it limits vacatur to its proper place, an equitable rule that is discussed in Munsingwear, and when mootness is due to circumstances beyond the parties' control, it is unfair to apply preclusion and collateral estoppel to those parties in that dispute.

That would be the only circumstance where routine vacatur should occur, is when you have the situation of happenstance.

Unknown Speaker: What about when the winner throws in the towel, when the winner says I'm afraid what the Supreme Court might do with this, so I'm giving up?

Mr. Elsaesser: Well, in that situation, I don't think that would... if the winner caves in during the appellate process, I don't think that in any way moots the... well, you're saying if he just pays the judgment, or does the... does whatever the other party requests.

Then no, I don't think there would be any grounds to vacate the court decisions below, because the parties are getting everything they wanted in that circumstance, Justice Ginsburg.

They've received every... if the winning party, our party in this particular case, throws in the towel, then the other--

Unknown Speaker: And makes it a condition... then they have a settlement, and part of the settlement is that the winner is going to give up that victory, so that the case is not decided on appeal.

Mr. Elsaesser: --Well, then I think you're getting right back into a stipulated vacatur situation, not as in the record of this case, but on the record of, for instance, the Izumi situation, where you have... as soon as you go down that road, you're getting to a stipulated vacatur between the parties, and that is not an external cause, or an external grounds that I believe would justify vacatur under those circumstances.

Unknown Speaker: Mr. Elsaesser, you mentioned a moment ago Karcher v. May.

Do you disagree with your opponent's characterization of that, that it was simply a loss of standing on the parties who were prosecuting the appeal to appeal?

Mr. Elsaesser: Well, I don't disagree that that was a situation where there was a loss of standing, Mr. Chief Justice, but I do argue that there is no effective difference between the appellant in Karcher simply declining to proceed to go any further and a situation here where, as a result of the settlement agreement between Bonner Mall and U.S. Bank, the petitioner in this case, the appellant in a lower appellate court situation, simply declines to go any further.

I don't believe there is any effective difference, because in both situations you end up with a dismissal.

You end up with a dismissal of the appeal.

Unknown Speaker: Yes, but certainly in Karcher v. May there was nothing consensual about it as to the party who was seeking to appeal, but it was said to have no standing.

Mr. Elsaesser: No, there was nothing consensual in not having any standing, but when the appeal ends, there was no reason to go back down and vacate the lower court opinions, so in that situation I think that's the same result you gain in this particular case, where the bank makes a conscious decision that as part of the settlement, or by settling, by their act of settling they moot the appeal.

I think the effect is the same.

Unknown Speaker: Well, the effect may be the same.

The procedure is certainly quite different.

Mr. Elsaesser: That's correct, Mr. Chief Justice, it is.

Unknown Speaker: As a practical matter, why do you oppose vacating the judgment here?

Mr. Elsaesser: Your Honor--

Unknown Speaker: Why does your client oppose it?

What use do you anticipate making of it?

Mr. Elsaesser: --Your Honor, we oppose vacatur in this setting, in the post mootness, essentially motion before this Court for vacatur.

It was no part of our bargain.

I must concede to you that my client in this particular case has no future interest as a result of this settlement, any more than in this particular case the bank has no future interest in this particular settlement.

They have an interest, as they've conceded in their brief, that they want to be able to relitigate the issue in the Ninth Circuit and perhaps their companions elsewhere wish to do the same in other circuits, but it is true that our party has no identifiable interest in vacating a particular judgment, particularly in this situation where it was a pure issue of law from the ground up, if you will, from the bankruptcy court decision all the way up.

It made no specific findings of fact.

Unknown Speaker: Is it clear that the petitioner here would not be bound by the decision below insofar as res judicata or collateral estoppel effect is concerned?

Mr. Elsaesser: Your Honor, we agree with the Government in one respect, that if the Court grants the vacatur in this situation, it takes away the precedential and preclusive effects of the decisions below.

Unknown Speaker: I'm not talking about precedent now.

I'm talking about, strictly speaking, res judicata effect, or a collateral estoppel effect.

Mr. Elsaesser: I think it would have to dispute of those, too, if there was a vacatur.

Unknown Speaker: No, I understand.

But without the vacatur, would there be such an effect?

Mr. Elsaesser: I don't believe there would be true collateral estoppel because it was a pure issue of law.

I believe there would be res judicata effect--

Unknown Speaker: But doesn't preclusion apply to issues of law as well as of fact?

Mr. Elsaesser: --Yes, they do, Your Honor.

Unknown Speaker: All right.

So why couldn't the bank, having litigated and lost this issue, be taken to have litigated it and lost it against all the world, and then there would be preclusion, collateral estoppel with respect to that determination of law.

Mr. Elsaesser: I don't believe, Your Honor, that Mendoza would go so far as to preclude... if this Court vacates the rulings below, as far as they want them to have vacated, I don't believe that that would have a preclusive effect in another case in another State by a U.S. bank from raising a pure issue of law of whether that applies.

Unknown Speaker: What about in this very case?

At least in the petitioner's reply, they do posit this settlement falling through and then their being back in the same circumstance and again the new value issue coming up in this very case.

Mr. Elsaesser: Well, certainly I think in that situation you would have the result that vacatur would allow them to argue the legal issue again and respond, as they have responded in argument, that the precedential value of the Ninth Circuit opinion was only... well, it really becomes advisory only, no different than any other kind of persuasive authority.

Unknown Speaker: But if you did have a litigation of fact involved here, what would be the res judicata effect if we go your way... collateral estoppel effect if we go your way?

Mr. Elsaesser: If you had an issue of fact, then I think it would have binding res judicata effect.

I don't think there's any que... the--

Unknown Speaker: So you're not arguing that that is mitigated by the fact that a court later on could in fact consider the settlement as a reason not to give estoppel effect?

Mr. Elsaesser: --I'm not sure if I understand that particular point.

I think that in a question of fact there would clearly be binding res judicata effect.

Unknown Speaker: And there would be no way to get out of it on your view, and there should be no way to get out of it.

Mr. Elsaesser: There should be no way.

Unknown Speaker: They didn't have to settle.

Mr. Elsaesser: They did not have to settle, but in addition to that, there are no extrinsic grounds to vacate the lower court decision.

There would be no unfairness when the parties to a settlement have essentially contracted... they've contracted their own res judicata, and they don't really have any needful concerns over what the prior rulings were below, because they've already reached agreement.

The only difference to that, of course, is in a situation where they have actually contracted with the vacatur, and while I concede that that's not--

Unknown Speaker: What if that happens?

Is your position that even if the parties' settlement agreement provides that the party appealing the decision below shall move the court to vacate it?

Mr. Elsaesser: --Well, that was precisely the case in Izumi, and I think that really is even worse.

I concede, Justice Scalia, that my client is a business person.

They would have accepted a monetary offer at some level, just as Windmere did in Izumi, to contract out of the court decision.

That very well could have happened if the offer had been made and accepted, and I think that is the strongest argument against vacatur upon settlement, is because it clearly allows for the purchase of precedent, even though that is not the circumstance in this case.

Unknown Speaker: So it isn't just the parties' expectation that you're asking to be defended here, but rather the integrity of the process.

Mr. Elsaesser: Well, absolutely, Justice Scalia, because to make that a part of a bargain, it's no more proper in that circumstance to be able to, for us to be able to sell the precedential value of that opinion than for the bank to be able to purchase it.

That is simply a contract that should not be allowed to be made when the result is going to be the vacation, in this case, of binding circuit precedent.

Unknown Speaker: Well, Mr. Elsaesser, you take it as a given, I guess, that if there is a vacatur it is not just of the judgment but of the opinion as precedent.

Mr. Elsaesser: I do take that, Your Honor.

I think that's the Government's position, and I believe--

Unknown Speaker: It is the Government's position.

I don't think it's the petitioner's position.

Mr. Elsaesser: --No, it is not... the peti... well, I disagree with you there, Mr. Chief Justice, because I think the bank wants it both ways.

They argue, as Phillips did, that, well, it could be precedent if someone wants to consider it precedent, but maybe it is or maybe it isn't.

They're really not... because they clearly want, as a motivation here, to remove that precedent from the Ninth Circuit.

It does nothing for the bank to relieve the judgment relieving stay at the trial level.

That is... that's beyond any contemplation of any parties.

The only motivation that they would have is to destroy the precedential impact.

Unknown Speaker: And you say that there should never be vacatur?

Mr. Elsaesser: No, I do not say there should never be vacatur.

I believe that vacatur is entirely appropriate under the Munsingwear situation, where there is a change in the law, where there is a party, perhaps, who is subject to an injunction who dies, and therefore there is no successor party.

In those circumstances where there is external cause, vacatur as an equitable doctrine under Munsingwear is appropriate.

Unknown Speaker: But why, then why should there have been vacatur in Munsingwear, where in effect the Government caused the change which resulted in the case becoming moot?

Mr. Elsaesser: Well, I don't agree that there was vacatur in Mun... I think Munsingwear was prospective in that respect.

Unknown Speaker: Yes.

Mr. Elsaesser: But in answer to that question, you've got the unique situation of the Government where they're making laws and they're enforcing laws, and I think in that particular situation it was merged.

The legislative or administrative section of Government changed the regulation, and the council responsible, or the department responsible for enforcement therefore lost its rights.

I believe that's an external cost.

Unknown Speaker: Well, can the bank here say, you know, that our mortgage loan department made this decision, but I'm the general counsel, I don't want to be bound by it?

Mr. Elsaesser: No.

That's not an external situation.

Unknown Speaker: Well, why should it be external with respect to the Government?

The party is the United States of America, which represents both the legislature and the executive branch.

Mr. Elsaesser: Well, I believe in that circumstance it will not be a difficult or burdensome rule for this Court or for any circuit court of appeals or for that matter district court to determine that happenstance standard if the law governing the dispute that everybody is relying on changes, which is the situation in Munsingwear, than that is an appropriate grounds and, we argue, the only appropriate grounds for vacatur.

Unknown Speaker: Why?

I mean, there are about 50,000 appeals every year in the Federal system, and I take it you want the same rule for appeals as for the, as when the Supreme Court's involved, is that right?

Mr. Elsaesser: Yes, Your Honor, and I would point--

Unknown Speaker: And 50,000 cases are coming up, and most of them involve legal issues not of tremendous significance, and all these decisions are written by district judges who may be writing quickly, may have just a couple of sentences.

And if somebody on the appeal says, I'm not going to abandon this further, but I'm worried about the collateral estoppel effect, so the two parties agree that they will settle the matter provided they get rid of that collateral estoppel, what's wrong in the ordinary case from permitting that agreement to take effect, assuming it has no major implications for third parties and isn't in complicated litigation?

Mr. Elsaesser: --Well, I think it would be a unique situation, in answer to your question, Justice Breyer, where it wouldn't affect third parties, because there would be no reason for that party to need vacatur, and what you're describing is the exact situation in Phillips.

Phillips bought itself a new judge and a new district, essentially was blessed with forum shopping by obtaining vacatur of the original district court decision, which was just a jury verdict.

It was not Ninth Circuit precedent.

It was a jury verdict and a denial of a motion for new trial, which was pending before the Federal circuit.

Now they can get around that finding, litigate what they concede is the identical issue in Illinois in the hopes of getting a different result, and I would argue that's precisely the type of relitigation that every Court in the Federal system, including this one, has a vested interest in avoiding.

Why--

Unknown Speaker: It's not a victimless situation, you suggest.

The courts are the victims.

Mr. Elsaesser: --I think the courts are the victims.

I think there are--

Unknown Speaker: Res judicata and collateral estoppel are there in part to serve the interests of the courts not to have to redo things all the time?

Mr. Elsaesser: --Well, that's... yes, and I think in the Phillips situation, I think that's perhaps the clearest example, is that we know... we don't have to speculate on this broad question of whether vacatur promotes settlements or doesn't promote settlements.

We know in that situation Phillips has, for 57 million dollars, bought the right to relitigate the issue in Illinois and pretty much as many times as they want, if they have other defendants on the same issue, and in this case, what the bank is asking for, and it's in their brief, is they believe there is a tangible benefit to be gained by really starting a relitigation of the new value rule in the Ninth Circuit all over again from the settlement table to the bankruptcy court to either the BAP or the district court level and all the way up to the circuit.

If there was no need to get rid of the binding precedent, there would be no need for them to move to vacate.

Unknown Speaker: What I'm asking is, I'm, let me say what the case in front of me I'm thinking of.

A very large proportion of our appeals concern matters of fact.

What are the underlying facts of the contract?

What happened in the auto accident?

Lots of them are that way, and what I'm thinking of is if in a factbased appeal, which comprises a very large percentage, the parties are... they want to settle, but they're worried about the collateral estoppel effect of factfinding, for example, so they say, we'll settle it if you vacate the judgment below.

It's an auto accident.

Nobody else is involved, just these parties.

What's wrong with that?

Mr. Elsaesser: What's wrong with it--

Unknown Speaker: I know one thing is you could say, which is a reasonable point, that well, the court is somehow involved and is a kind of a victim.

I've got that.

Is there anything else?

Is that the only consideration, or are there others?

Mr. Elsaesser: --I think in the terms of the district court, the res judicata and collateral estoppel are the important reasons not to do that, because it would be almost impossible to determine.

Justice Breyer, you mentioned in response to the other question that you believe the appropriate circuit practice is to remand questions of vacatur to the court that decided it.

I'm not necessarily opposed to such a rule, but I think that rule is always leaving open the question.

Parties have rights under Rule 60(b).

They can go in and make a case, and in general... generally, 60(b) is a pretty tough standard to meet with a trial judge, and I don't think the mere settlement of the parties saying X has bought Y's opposition to a vacatur so vacate should be, in and of itself, a 60(b) grounds, but we could live with a rule that would at least allow the court that made the decision be the court to decide whether or not to vacate.

Unknown Speaker: We could live... Bonner really has no... the decision here is not going to affect Bonner one way or another, so I understand you really to be arguing as a friend of this Court, because we asked you to brief the issue.

I see the issue as a repeating one for Bancorp, but Bonner has no continuing interest.

Mr. Elsaesser: I concede that, Your Honor.

That is correct.

Bonner has no continuing action, or no continuing... they had no reason to agree to a vacatur, but they had no future interest, nor, I believe, does the bank have any future interest, other than a desire to change the law in this case nonlegislatively.

Unknown Speaker: Well, the bank does suggest that it's possible that the new value exception will again become an issue between these parties if the plan that's now on the table isn't confirmed.

Mr. Elsaesser: Well, the plan was... I'm not sure of the exact--

Unknown Speaker: Well, there's a 5-year period, and if it doesn't work out, it may be back to square one.

Mr. Elsaesser: --Right.

In 5 years the bank has to be paid in full.

It would be difficult, under the stipulated consensual plan... it would be virtually... I would say it would be impossible for Bonner to again invoke the new value exception under those circumstances, other than--

Unknown Speaker: So you are arguing this as kind of a friend of the Court.

There's no interest of your litigant in it.

Mr. Elsaesser: --Only the remotest.

I have to concede this is more in the nature of a friend of the Court.

Unknown Speaker: Well, we're indebted to you for doing that.

[Laughter]

Mr. Elsaesser: Your Honor, Mr. Chief Justice, I think I would argue that the idea or the concept of evading precedent, or evading preclusion, as a grounds for vacatur, is a recent phenomenon.

I would argue that at the time of Munsingwear, and in the summary treatment that this Court has given Munsingwear since its enactment, that litigants frankly did not see the possibility of being able to buy a court decision, being able to use a procedure that is... if one reads Munsingwear really has no application.

But seeing that in the circuits as well as this Court Munsingwear seemed to be an automatic rule for disposition of cases, this presented an opportunity.

Only in the last 10 years and, really, to a great amount only in the last 5 years, have the circuits had before them situations which it is clear that, for instance, in the Oklahoma City case the Government is coming in and buying a decision.

In the Phillips case, Phillips is coming in and buying a decision.

In the other cases decided in the Second Circuit, where they did make a distinction between appellate opinions and district court judgments, again in the Manufacturers Hanover case just in the past yearandahalf the concern is there that, if you allow routine vacatur upon settlement, whether or not you're presented... whether you're ever presented with anything other than a notice by the parties, or whether you're presented, as they were in Oklahoma City, with a joint motion contemplating vacatur, in either of those circumstances, every circuit other than the Federal circuit that had to address vacatur upon settlement in recent times have said, this is not a Munsingwear situation.

This is not happenstance.

This has the potential for abuse.

It has the potential for manipulation of precedent.

It has a potential for people being able to purchase decisions.

Unknown Speaker: In principle, how do you distinguish other cases where a case has been moot, for example, by the death of one of the parties?

You don't deny that we have authority to vacate the judgment below then.

What is your argument?

Mr. Elsaesser: I think the death of a party is... it's clearly not a voluntary act of that party--

[Laughter]

--and it's not--

Unknown Speaker: Well, I understand, but I mean, I need some conceptual framework.

This is an equitable power that we have, and in that case there is an equity in eliminating the decision below?

Mr. Elsaesser: --I think... I would argue, Justice Scalia, that that's what Munsingwear in fact does provide, is equitable grounds.

I don't believe Munsingwear is grounded in Article III.

I believe it is in equitable grounds.

We have the doctrine of collateral estoppel.

If you follow the results, without vacatur, of this case, there will be unfairness, because an outside occurrence occurred, whether it is the death of a party, or the change of a law, or the modification of an ICC regulation, and that sort.

That is--

Unknown Speaker: And in a case where a party has voluntarily declined to pursue his legal remedy, there's no equity in relieving him of the judgment below?

Mr. Elsaesser: --No, and I would argue that that is the finding in Karcher, is that voluntary termination makes no effective difference.

I would further like to argue, and argue in conclusion, that the decision of a court, this Court under these circumstances or any other court, is a decision.

I don't believe you... that it can be avoided that this is a decision, it is a ruling.

I do agree with the Government that it does, a vacatur does specifically vacate precedent.

I don't know how the terms vacating can do anything with the Ninth Circuit opinion but to vacate precedent and relegate it to arguable authority.

Without happenstance, without this extrinsic event, this outside event, the decision that any court makes in a vacatur situation is made in a vacuum.

There are no grounds presented.

There's no reasoning presented.

There has still been no articulate reasoning of why the court should vacate by the bank, other than the Ninth Circuit might have been wrong, we couldn't find out, so there should be an asterisk by the decision that renders it not as precedent in the case.

And you would be really in a situation of destroying existing parties... you couldn't avoid destroying existing... excuse me.

You couldn't avoid destroying existing court decisions without it being on the whim of the parties if you adopted... if you extend Munsingwear the way the Government proposes to do it, which will be an automatic vacatur.

It wouldn't be practical for this Court to have vacatur hearings.

The better rule is simply to determine if it's happenstance that should be apparent, and it's moot.

If it's not, dismiss the appeal.

If they have grounds, if the losing party below has grounds to go to the circuit, 60(b)-type grounds, or go to the district court, they're not foreclosed by the refusal of this Court to vacate.

The parties can--

Unknown Speaker: What about the people that have been operating under our Munsingwear rule and have bought vacaturs fair and square?

What do we tell them now?

Mr. Elsaesser: --Justice Scalia, I don't think they've bought it fair and square, because they're really... the rulings that have followed Munsingwear from this Court have been summary dispositions, first of all.

Second of all, the distinction was raised in Karcher, and third, in the various circuits, right now, as we stand here, in the various circuits in either a majority, or nearly a clear majority of the circuits, Munsingwear is specifically limited to happenstance.

The courts now, with the Second and Tenth Circuit, are saying this.

Even the California supreme court, which has been truly the champion of vacatur, just last week backed away and vacated an appellate court decision in a per curiam... I mean, refused to vacate an appellate court decision in a per curiam--

Unknown Speaker: Wasn't there legislation in California, though, that caused that?

Mr. Elsaesser: --No, because Governor Wilson just vetoed that legislation just in the... that and the supreme court's decision just last week.

I don't have the cite on it yet.

I just have the reporting of it.

In that case, after pronouncing Neary, they distinguished themselves, or they distinguished an appellate decision from Neary.

In other words, they were--

Unknown Speaker: You'd say they distinguished themselves, too.

[Laughter]

Mr. Elsaesser: --Well, they wanted to draw that line between appellate courts and trial courts, and I don't know if that's a line that really... really can be effectively drawn.

I think 60(b) can take care of what the litigant's problems are in the Federal court.

I thank you, Mr. Chief Justice.

I thank Your Honors.

Chief Justice Rehnquist: Thank you, Mr. Elsaesser.

The case is submitted.

Unknown Speaker: The honorable court is now adjourned until ten o'clock tomorrow.

Attribution:

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Featured:

Republic National Bank Of Miami v. United States - Oral Argument

Fri, 09 Jan 2009 14:49:28 +0000

Case:

Republic National Bank Of Miami v. United States

Media File:

91-767_19921005-argument.mp3

Related Transcript:

transcript.xml

Transcript:

Argument of Stanley A. Beiley

Chief Justice Rehnquist: We'll hear argument next in No. 91-767, Republic National Bank-of Miami v. United States.

Mr. Beiley, you may proceed whenever you're ready.

Mr. Beiley: Mr. Chief Justice, and may it please the Court:

This case concerns Federal appellate jurisdiction.

The issue is can the United States, by executing on a favorable currency forfeiture judgment, divest a Federal appellate court of appellate jurisdiction to decide the merits of a timely filed appeal.

The Eleventh Circuit below held that the Government had this power, which holding is contrary to the majority of the circuit courts of appeals which have addressed this very issue.

It is the Government's position in this case that the Government can bring a civil forfeiture lawsuit, win the case at trial, and then prevent an appellate court from deciding the merits of that appeal by transferring the funds in dispute from the territorial jurisdiction of the trial.

Unknown Speaker: I suppose, would its position also be that if pending the, pending the decision of the district court the property was sold and the proceeds were transferred to some other place the district court would lose jurisdiction too, I suppose?

Mr. Beiley: I believe that would follow from the Government's position.

That's certainly not the position that we advocate before this Court.

The late Judge Vance in his dissent in the Eleventh Circuit's One Lear Jet case, which dissent is now the basis for the rule in the majority of the circuits, referred to the majority opinion which adopted the Government's arguments being made before this Court as follows, and I quote.

It offends fundamental principles of fairness, it represents a departure from common sense, and it is analytically flawed.

We believe Judge Vance's comments are correct.

It is the bank's position in this case that the Government should not have the power to defeat a Federal court's appellate jurisdiction by its unilateral act of levying on a forfeiture judgment.

We believe that when the Government or any party brings a lawsuit in Federal court that party, as the plaintiff, submits itself to the court's in personam jurisdiction regardless of the nature of the underlying action.

The bank further submits that the nature of the trial court proceeding, whether you call that proceeding in rem, quasi in rem, or in personam, should have no bearing on the issue of Federal appellate jurisdiction.

Unknown Speaker: Well, this would be your view even in a classical admiralty action, Mr. Beiley, where everybody agrees it is a prototypical in rem action, nonetheless the Government there would submit itself to the personal jurisdiction of the court?

Mr. Beiley: It's not only my position, Your Honor, but it has been adopted by this Court in several of the cases cited in our brief in a pure admiralty case, the Feckler case, the British transport case, and several prize cases where the Government has intervened in admiralty in rem cases and then objected to cross claims being filed against it.

And this Court had held that when the United States intervenes it takes the position of a private suitor for all purposes for which justice may be done.

Unknown Speaker: Well, is that the same thing though as an admiralty action say initiated by the Government?

Mr. Beiley: Our position would be it would be the same, Your Honor, that the Government by initiating an action, as well as any plaintiff that initiates an action, submits itself to the court's in personam jurisdiction.

Unknown Speaker: Notwithstanding sovereign immunity?

Mr. Beiley: That is correct, Your Honor.

Sovereign immunity we believe would apply to suits against the Government, not to suits by the Government.

In your hypothetical, and Mr. Chief Justice, you asked about the Government initiating a lawsuit.

So that our position is--

Unknown Speaker: Well, Mr. Beiley, what about cases like the Brig Ann where the court has stated that the release of the res ends jurisdiction?

Mr. Beiley: --Justice O'Connor, first, we don't believe that ancient admiralty cases should be relevant to an issue of Federal appellate jurisdiction in a currency forfeiture suit.

But even under those old admiralty cases, our reading of the cases, I recognize the Government has a contrary interpretation.

Our reading of the traditional old admiralty cases, which we don't believe to be relevant, is that jurisdiction vests upon the initial seizure and that the continuous seizure or the continuous court control of the res, even in the old admiralty cases, is only required in two circumstances, none of which apply here.

Unknown Speaker: Well, for example if a third party absconds with the res, what happens then?

Mr. Beiley: In a traditional admiralty case if the only way that the court can fashion meaningful relief to the litigants is to have custody of the res and it's essential that that res be before the court to make a meaningful award, then you have this useless judgment exception, as we referred to it in the rules, and the court will not entertain a suit where it can't fashion any meaningful relief.

But that's not the case here.

The Government has the money.

The Government has had possession of the money from the time this lawsuit started.

So we don't believe--

Unknown Speaker: Mr. Beiley, you would say that even in the old admiralty cases, I think you would say this, that if the case had already been decided by the district court and was on appeal, as it is here, and at that point somebody absconded with the ship, the appeal would have proceeded, even in old admiralty cases.

Wouldn't you say that?

Do we have a case where that was the situation?

Mr. Beiley: --Our position would be if the absence of the ship in the ancient admiralty cases would make any judgment rendered by the appellate court, or on remand the trial court, meaningless, then the court under concepts of mootness or case in controversy could decline jurisdiction and dismiss the case.

But again that's not the situation in this case, when the Government has had the money from the inception of the suit, and even under their position has the money today in the Treasury.

Certainly meaningful relief can be fashioned in this case.

Unknown Speaker: So you're saying the old admiralty cases are no different from what you would say should apply here?

Mr. Beiley: I'm saying the old admiralty cases, Justice Scalia, should not have any relevance to currency cases.

To the extent they do I think the principles are the same.

Unknown Speaker: Well, I'm not sure I agree with you that they shouldn't have any relevance.

Why shouldn't they have any relevance?

Doesn't Congress, isn't our normal rule that Congress enacts against the background of the common law and we interpret their statutes against that background?

Mr. Beiley: Congress in this case said that the procedure of forfeiture cases shall as far as practicable conform to admiralty.

We interpret that as a position that procedurally you follow admiralty practice in forfeiture cases, but we do not read that as a declaration by Congress that every rule of substantive law that has ever been developed in admiralty cases ipso facto apply in forfeiture cases.

Nor do I know of any court that has so held.

Unknown Speaker: I suppose if the money in this case wasn't in the bank or in some place but it was in a bag and somebody stole it, I suppose then that would be, the court of appeals could dismiss the case?

Mr. Beiley: Does Your Honor's hypothetical mean stole it during the course of the trial court proceeding or after the judgment?

Unknown Speaker: After the judgment.

Mr. Beiley: Your Honor, that again gets to the issue, as the Government suggests, about the necessity for posting of bond.

That is a financial risk any litigant takes.

That shouldn't be a jurisdictional issue.

For example, if you wish to preserve the res put a bond to protect and insure the continuance of the presence.

And you have the right to do that if you wish to put up a bond.

Our point though that that's a financial risk.

It shouldn't be converted into a jurisdictional risk as the Government would seek to do in this case.

Unknown Speaker: Under your view the language in the Rio Grande was really quite unnecessary in which the court indicated that jurisdiction remained if the res was removed by some improper action or by accident or by fraud?

That was just quite unnecessary under your view of the case?

Mr. Beiley: No, Your Honor.

I think that case held that initially, that initial seizure vested jurisdiction, and that certainly an accidental or an improper removal of the res would not divest jurisdiction.

Unknown Speaker: Well, why would the court have qualified its language then to say that accidental or improper removal?

It would just say that any transfer of the res, any relinquishment or any disappearance of the res suffices.

Mr. Beiley: Your Honor, if the res were an immutable rule of jurisdiction, if a court lacked power to proceed to adjudicate a case without that res before it, then I would submit that any removal of the res for any reason, accidental, improper, act of God, or otherwise, should divest the court of jurisdiction.

I think the exception in essence highlights the original rule as we interpret the admiralty cases, which is that jurisdiction is complete upon initial seizure unless the removal would make the court's judgment meaningless and worthless because there's no basis to afford the parties relief.

Unknown Speaker: Well, but I'm still not quite sure what your explanation is for the accidental, fraudulent, or improper removal language.

It seems to me those are quite unnecessary qualifications.

Under your view the Rio Grande court should have said and any subsequent removal by the res is insufficient to destroy jurisdiction.

Mr. Beiley: With the two exceptions that I read out of the admiralty cases, Justice Kennedy--

Unknown Speaker: All right.

Mr. Beiley: --the useless judgment and the voluntary abandonment situation which came up in one of the other old admiralty cases.

Unknown Speaker: All right.

Didn't the Government make some agreement with the bank early on--

Mr. Beiley: Yes, Justice White, they did.

Unknown Speaker: --that they would not, that they could foreclose but they wouldn't, they would hold the proceeds subject to the bank's lien?

Mr. Beiley: Justice White, the agreement was that, the case started out as a forfeiture against a luxury home.

Unknown Speaker: Yes.

Mr. Beiley: During the course of the proceedings the Government got a sales offer and, on joint motion with my clients consent, asked the trial court to sell the property and take the proceeds from the property and put those proceeds in the court registry as a substitute for the realty.

Unknown Speaker: And did they do that?

Mr. Beiley: Yes, they did, Your Honor.

Unknown Speaker: Well, how did they ever get the proceeds out of the court registry?

Mr. Beiley: After the judgment became final they asked the marshall to wire transfer the funds by bookkeeping entries to the Treasury.

Unknown Speaker: I see.

So you think whatever they, you don't think there was an agreement then with the bank that they would hold the proceeds?

Mr. Beiley: Well, we think the Eleventh Circuit misinterpreted the stipulation.

That is not a focal point of our argument here because we--

Unknown Speaker: So you don't rely on any agreement whatsoever?

Mr. Beiley: --That's correct.

Unknown Speaker: Okay.

Mr. Beiley: We don't think this Court took jurisdiction, certiorari jurisdiction to interpret a stipulation.

Unknown Speaker: I would think you would, if it was sort of a breech of faith by the Government you would certainly be relying on it.

Mr. Beiley: The stipulation indicated that our rights would be without prejudice.

By wire transferring the funds we think we have been prejudiced but we are not relying on that as the basis for the relief that we seek before this Court.

Unknown Speaker: Are you going to deal in your oral argument, Mr. Beiley, with the Government's appropriations clause argument?

Mr. Beiley: Yes, Mr. Chief Justice.

In fact I will address that now.

The Government takes the position that now the funds somehow are in the Treasury, and that being in the Treasury the appropriations clause precludes the relief that we seek.

I think their argument fails for at least two reasons.

One, the issue of whether these funds are Government funds, it's my position, is only when this case is over, when the appeal is over.

We say it's our funds.

The Government says it's their funds.

That's the issue for a court on the merits to decide.

Unknown Speaker: But the money that you're talking about basically was remitted to the Treasury, was it not?

Mr. Beiley: Well, we don't concede that, Your Honor.

Money we believe to be a fungible asset.

We believe that all that happens when money moves from one account to the other are bookkeeping entries.

I think either the First or the Third Circuit or perhaps both expressed it best when they said to predicate jurisdiction on what Government pocket holds the money is seemingly an artful way to determine Federal or public jurisdiction.

Unknown Speaker: It would seem arguable at least that Congress drew a distinction, that there are different funds that Government deposits are housed in and once it goes into the Treasury it's subject to this appropriations clause limitation that it wouldn't be subject to if it simply remained in a different account.

Mr. Beiley: Mr. Chief Justice, if the Government's position on that point is correct, the Government in the classic in personam case, take a case, a student loan hypothetical where the Government sues, collects.

The defendant chooses not to supercede and the Government collects money from the defendant while the appeal is pending and sends the money to the Treasury, which they would have a right to do where you have an unsuperseded judgment.

Is the Government going to take the position in that case that the appropriations clause bars relief because in an in personam case the loser of a student loan claim did not supercede?

Unknown Speaker: Well, I suppose you have to look at the statute.

But it seems to me your argument that money is fungible, that it's an intangible, cuts against your appropriation arguments.

You were the, you began by saying that oh, this is not, I assume you meant this is not public money.

The title is contested to this.

But the minute you say that it's simply an accounting entry that is fungible then it seems to me that that weakens your argument under the appropriations clause.

Mr. Beiley: Your Honor, I don't think so.

I think that what happens when money is in a bank account, you have a debtor-creditor relationship, the bank and the depositor.

You have a situation here where the Treasury owes money to the Government which has not yet been resolved until this appeal is resolved on the merits.

As the First or the Third Circuit or perhaps both have said, the Government is everywhere so the obligation is owed everywhere.

But more importantly, and I didn't quite finish my answer to the appropriations clause question posed by the Chief Justice, to the extent we need statutory authority to get these funds we have two sets of statutes.

We have 28 U.S. Code 2465 which says quite plainly that forfeited property shall be returned to a successful claimant, and we have 28 U.S. Code 524 (c)(1)(d) which is the Department of Justice asset forfeiture funds which says one purpose for which forfeited funds should be used is to be paid to claimants.

So to the extent--

Unknown Speaker: What do you do with 1301(d) that says a law may be construed to make an appropriation only if the law specifically states that an appropriation is made?

Mr. Beiley: --Your Honor, we think both of those statutes set forth appropriations out of forfeited funds to be paid to claimants to those funds, such as the bank in this case.

There is nothing in those statutes that say that the statutes don't apply if the money is in the Treasury.

It says that forfeited funds shall be returned to the successful claimant.

Unknown Speaker: And you say that is language of specific appropriation?

Mr. Beiley: I believe it is, Your Honor.

Specific appropriation for use of forfeited funds.

If forfeited, if Congress says forfeited funds shall be paid to a successful claimant the fact that the Government has levied and put the funds in the Treasury doesn't change that those funds can serve that purpose.

Unknown Speaker: I suppose if this hadn't been treated as a jurisdictional matter and the court of appeals had decided the case against the Government it wouldn't make any difference whether the funds were then in the Treasury or not.

The Government would have to pay a judgment.

Mr. Beiley: That's certainly our position, Your Honor.

Unknown Speaker: So it, it really doesn't make... even if they had transferred the money they might have to pay a judgment, just like the Government has to pay judgments a lot of times.

Mr. Beiley: That is our position.

Unknown Speaker: When they lose a tax case sometimes they have to--

[Laughter]

Mr. Beiley, can I ask you kind of, well just a question?

Do you understand the Government and the court of appeals to be taking the position the case is moot?

Mr. Beiley: They, in their brief they take the position that there are mootness concerns.

They don't quite come out and say that the case is moot but they suggest mootness concerns.

We don't think the case is moot.

Unknown Speaker: It seems to me it either, if it were moot we ought to vacate the judgment below, would be the normal disposition, and then you'd get your money back.

That's our normal disposition with moot cases, and I'm not quite clear what your understanding is or what their understanding is of the mootness case.

Mr. Beiley: I'm not particularly certain as to what the Government means why the case is moot.

If their position is that the appropriations clause makes it moot, I believe I answered that contention a moment ago.

Unknown Speaker: I thought, thinking that their theory was taking the res out of the territorial jurisdiction of the district rendered the case non-justiciable or moot, which would be true if the plaintiff were still trying to get the money out of the res, but this is the opposite here.

Mr. Beiley: That is correct.

Unknown Speaker: And if you vacate it you, it seems to me... I suppose I should ask Government counsel this question.

Mr. Beiley: The Government's suggestion in this case that the solution to this jurisdictional problem is the posting of a bond or the attention of a stay, and with all respect to the Government, we believe simply makes no sense.

The sole purpose of a supersedeas bond historically and otherwise is to assure a successful trial litigant that its judgment will be paid if the execution on that judgment is delayed while an appeal goes forward.

There's never any risk of non payment to the Government in a civil forfeiture case because the Government has possession of the property.

They had it at the inception of the suit and they had it after the suit was over.

A bond would serve no useful purpose whatsoever.

Nor is a stay, which is a discretionary ruling by a trial court, a very sensible prerequisite to Federal appellate jurisdiction because Federal appellate jurisdiction should not depend upon trial courts discretionary rulings.

Unknown Speaker: Well, doesn't a bond, doesn't the supersedeas bond ordinarily provide not just to secure the principal but interest as well for damages for a delay, whatever you want to call it?

Mr. Beiley: Traditionally the amount of a supersedeas bond would cover future interest on the principal sum of money and perhaps appellate costs.

That is correct, Mr. Chief Justice.

Unknown Speaker: Well, so just holding the property as the Government does would not allow it necessarily to recover those elements.

Mr. Beiley: There's nothing that prohibited the Government from putting those funds in an interest bearing account.

We would have no objection to the Government levying on those funds and investing it in anyway they saw fit.

Our position is that that shouldn't preclude us from taking an appeal to a Federal appellate court.

If the Government wished to invest those funds and earn interest they are perfectly free to do so.

Unknown Speaker: And you don't really care whether they move it to the Treasury or not as long as you get your appeal.

Mr. Beiley: That is correct.

Unknown Speaker: And if you win the case you would think the Government would pay you.

Mr. Beiley: We would think so.

[Laughter]

The position that we assert, that the plaintiff, any plaintiff, when it brings a case in court submits itself to the in personam jurisdiction of the court, we believe applies here.

Very early on this Court in two old cases, Adam v. Saenger and Nations v. Johnson, held, and I don't think I can state it any better, that no rule can be a sound one which will deprive a party of his right to have his case submitted to an appellate court.

No rule.

Adam/Saenger, Nations/Johnson, hold that when the plaintiff seeks relief that that party is subject to the court's jurisdiction for all purposes for which justice is required.

Unknown Speaker: You don't say the Constitution guarantees you the right to appeal, do you?

Mr. Beiley: No, Justice White.

The right to appeal is not a constitutional right, but I certainly believe it to be a very fundamental right of a Federal litigant.

Unknown Speaker: Well, you've got it by statute, I guess.

Mr. Beiley: That is correct.

Congress, in prescribing the appellate jurisdiction of Federal courts, in 28 U.S. Code 1291 states that Federal courts of appeal have appellate jurisdiction over trial court final judgments.

What we believe the Government is doing here is attempting by its unilateral act of levying on a judgment to interfere with that congressional appellate jurisdiction mandate, which we believe to be improper.

Unknown Speaker: Well, but you certainly don't have a right to appeal where some event occurs that simply causes there no longer to be a case or controversy, right?

Mr. Beiley: That is correct, Justice Scalia, but that is not the case here.

Unknown Speaker: Well, but why wouldn't the same, why wouldn't the same answer be given if indeed the problem here is that the lower court can no longer enforce its judgment?

Why--

Mr. Beiley: We believe, Your Honor, that the lower court can indeed, if this case were decided on the merits in favor of my bank, decide this case on the merits and enter--

Unknown Speaker: --Enter what?

A judgment against the United States?

Mr. Beiley: --Yeah.

Direct the Government under restitution principles in the two statutes cited before to give us those forfeited, those portions of the forfeited funds to which my bank is--

Unknown Speaker: What are the two statutes that you're relying on for that?

Mr. Beiley: --I'm relying on 28 U.S. Code 2465 which holds that upon a successful judgment in favor of a claimant forfeited funds shall be returned to the claimant, and 28 U.S. Code 524(c)(1)(d).

Unknown Speaker: That's of course not an appropriation, that provision?

Mr. Beiley: We believe it is an appropriation with respect to forfeited funds.

It directs the allocation of forfeited funds to a successful claimant.

What the Government has possession of in this case is forfeited funds.

We are seeking to get the portion back that we claim we're entitled to.

Unknown Speaker: What was the issue between you and the Government about the right to have your lien recognized?

Mr. Beiley: Under civil forfeiture law, Justice White, the burden of proof is on a claimant to property, such as a mortgagee, to prove by a preponderance of the evidence that that party had no actual knowledge of the underlying transactions.

Unknown Speaker: So you are claiming to be an innocent owner?

Mr. Beiley: That's correct.

We were claiming innocent ownership, and that was the dispute of the Government.

Unknown Speaker: And the district court found against you?

Mr. Beiley: The district court found against us.

Unknown Speaker: And you wanted to litigate that in the court of appeals?

Mr. Beiley: We took that issue up.

We felt there were clearly erroneous factual findings of the trial court and that the trial court applied the wrong legal standard.

Unknown Speaker: Let's assume that the two statutes you rely on are not appropriations.

Do you lose?

Mr. Beiley: I don't believe so, Justice Souter.

Unknown Speaker: Why not?

Mr. Beiley: Those statutes direct how forfeited funds shall be paid.

I don't think the Government can avoid the impact of that case by bringing a suit to acquire forfeited funds and put it into the Treasury.

Unknown Speaker: So you're saying in effect that the statute assume, or those statutes on my assumption, those statutes presuppose that the Government will not have put the money in the Treasury and therefore the deposit in the Treasury would be a mistake and therefore legally they would not be subject to the appropriations clause.

Is that what you're saying?

Mr. Beiley: I believe those statutes would apply whether the funds remained in district court in the marshall's account or were levied upon as they were done in this case and wire transferred or by bookkeeping entries put into the Treasury account.

Unknown Speaker: Well, if they're in the Treasury why aren't the statutes unconstitutional as violative of the appropriations clause?

Mr. Beiley: Because Congress--

Unknown Speaker: If they are properly in the Treasury, strike that.

If they are properly in the Treasury why aren't the statutes in excess of congressional power and in violation of the appropriations clause?

Mr. Beiley: --We believe them to be, the statutes to be an appropriation as to what use can be made of forfeited--

Unknown Speaker: But that's contrary to my assumption.

I said if we assume they are not appropriations, Justice Scalia's question, then do you lose?

And you're telling me why you don't.

But I think what you're, as I understand it what you're telling me is that they could not be regarded as appropriations... I'm sorry, that they, that the funds could not be regarded as properly in the Treasury because their transfer to the Treasury was mistaken.

Mr. Beiley: --Justice Souter, if the import of Your Honor's question is if these two statutes were unconstitutional would I be making a different argument, we would not be making, we would be making an argument that would lead to the same result, and the argument we would be urging, in addition to the one we urge with the statutes, is that the plaintiff is subject to the court's in personam jurisdiction.

Unknown Speaker: You contend that if you get a judgment on appeal permitting the entry by the district court of an order for return of a property that this would constitute within the meaning of this statute the compromise of a valid lien or mortgage against property that has been forfeited?

That's a very strange way to--

Mr. Beiley: I don't believe so.

The very rulings or interpretations of that statute, which we cite in our brief, by the Government show that one of those purposes is to pay valid mortgages against the property.

24--

Unknown Speaker: --This is not a mortgage against the property.

You're saying you want a judgment for return, you want a judgment for money out of the Treasury.

Mr. Beiley: --We want our mortgage on property recognized, and the fact that that money has been turned over to the Treasury we don't think in anyway changes the result.

If I may, Mr. Chief Justice, reserve the remaining time for rebuttal.

Unknown Speaker: Very well, Mr. Beiley.

Mr. Long, we'll hear from you.

Argument of Robert A. Long, Jr.

Mr. Long: Thank you, Mr. Chief Justice, and may it please the Court:

The question in this case is whether the court of appeals has jurisdiction over an appeal when the district court has entered a final judgment of forfeiture in an in rem proceeding, the final judgment has not been stayed and the res has been released from the district court's control and deposited in the United States Treasury.

Unknown Speaker: Mr. Long, can I ask you right at that point what was the, was there jurisdiction at the time the notice of appeal was taken, which as I understand it was prior to the transfer of the res?

Mr. Long: Yes.

We would say yes, at that point the res was still--

Unknown Speaker: The jurisdiction was in the court of appeals then.

And supposing the transfer had been made after the opinion was announced but before the mandate went down?

Mr. Long: --I'm sorry.

If the--

Unknown Speaker: Suppose the transfer were not made when it was in this case but after the case had been argued and the court had deliberated on the case and announced from the bench they were going to rule in favor of the other side, but the mandate had not gone down, and then you transferred?

Mr. Long: --I think the mandate would be the court's opinion in that case--

Unknown Speaker: No, a mandate is not the court's opinion.

Mr. Long: --Well, the mandate would be the court's decision.

I think if the res left the court's jurisdiction before the court decided that would deprive the court of jurisdiction to control the disposition of the res.

You catch me... I'm not exactly sure what the effect of a mandate is when we run into it in our work.

Unknown Speaker: See, I was always under the impression that the jurisdictional act for vesting jurisdiction in the court of appeals was filing the notice of appeal.

I thought as long as there was a controversy between the parties the court of appeals would retain jurisdiction.

Mr. Long: That is generally true, but--

Unknown Speaker: What is your strongest case to the contrary of that proposition?

Mr. Long: --I think the Brig Ann, the Rio Grande, and a number of cases cited in footnote 3 of our brief are all strong cases for the proposition that in an in rem proceeding, which is a different animal, different from the normal in personam proceeding, the court's jurisdiction, the court's--

Unknown Speaker: The appellate court's jurisdiction was defeated by a transfer after the appellate court had acquired jurisdiction.

Mr. Long: --Well, that was what was at issue in the Rio Grande case.

The court recognized an exception, we view it as a rather narrow exception where the res is improperly or fraudulently removed from the court's control.

Unknown Speaker: Why does that make a difference?

Mr. Long: Well, I think that the court was unwilling to allow an unjustice to be, an injustice to be done in that case so it was willing to modify the rule to that extent.

Unknown Speaker: Why is that any greater injustice than this, if they are right on the merits?

Mr. Long: Well, we feel that there was no injustice in this case--

Unknown Speaker: I understand.

Mr. Long: --and I'd like to address that point at some length.

Unknown Speaker: But if they were right on the merits there was an injustice.

Mr. Long: No, because we feel that they had reasonable steps that they could have taken to preserve the court's jurisdiction on appeal.

They didn't take those steps, and since they didn't take simple steps that were available to them it is not unjust to end the case at this stage.

And I would like to address that as one of the--

Unknown Speaker: Could I ask you--

Mr. Long: --Yes.

Unknown Speaker: --What did the, did the district court do something affirmatively to release the funds other than just enter the judgment for the United States?

Mr. Long: Yes, it did, Your Honor.

Unknown Speaker: What did it say?

Mr. Long: It entered an order requiring the marshall to dispose of the res in accordance with law, and that's precisely what the Government did.

It disposed of the res in accordance with law by depositing it in the Treasury.

Unknown Speaker: Mr. Long, if contrary to the facts in this case the Government had had custody of the funds during the proceedings in the trial court, say by agreement of the parties or something you put it in an interest bearing account and during the pendency of those proceedings the Government improperly transferred the funds to the Treasury, your position would be the same, wouldn't it?

The Government lawyer would be in hot water, we'll accept that, but your position would be the same on the, on mooting, in effect mooting the case by loss of the res, wouldn't it?

Mr. Long: Our position would be the same under the appropriations clause.

Unknown Speaker: Yeah.

Mr. Long: Once money is in the Treasury, even if it gets in there by mistake--

Unknown Speaker: And that would be dispositive of the case for you.

Mr. Long: --That would be dispositive of the case under the Rio Grande, this old decision that there is an exception to the normal rules of in rem jurisdiction for improper removals, but that can't trump the appropriations clause.

Unknown Speaker: Well, then whenever the appropriations clause is involved the so-called injustice exception is simply unavailable?

Mr. Long: That's our position.

The appropriations clause is a very clear, simple constitutional command.

There must be an appropriation.

Unknown Speaker: Is there no cause of action, I mean there are appropriations for the payments of judgments rendered by the court of claims under the Tucker Act and under other legislation.

Is there such a big hole in our judicial system that the Government skips off with this money and there's no cause of action?

Mr. Long: Well, again we don't regard it as a big hole because we think there were fairly simple steps that the petitioner could have taken here and the law was clear in the Eleventh Circuit.

They didn't take those steps so we don't feel that there is a gap that needs filling.

Unknown Speaker: Well, I think it's a gap if the Government is sitting on money that it really shouldn't have.

You would acknowledge... let's assume that the judgment below was wrong, should have been reversed on appeal, the Government has money that it shouldn't have.

Mr. Long: Well, it is often the case, Justice Scalia, in the case involving an injunction, for example.

If the losing party fails to get a stay of the judgment a final judgment can be executed and there may be irreversible consequences of that.

Unknown Speaker: Let's assume that I consider this an unjust enrichment of the Government.

Mr. Long: All right.

Unknown Speaker: If we reversed the district court order by Munsingware the case, just set it aside, take you at your word and say there's no longer any jurisdiction in the courts, since there isn't the case is moot, would there be a cause of action for return of the money under any Federal statute?

Mr. Long: It is possible--

Unknown Speaker: A separate cause of action.

Mr. Long: --There might be a cause of action against a Government official.

We don't think there would be any action against the United States.

The Tucker Act that you mentioned in the claims court, this Court has said there has to be a substantive right to recover money damages against the United States.

Unknown Speaker: Yes, but I think you have to sustain the fact that the court of appeals doesn't have any jurisdiction before you even get to the appropriations clause because if the court of appeals had retained jurisdiction rightly in this case and yet the money was gone, and the court of appeals decided that you lost the case and they entered judgment against the United States.

I suppose the United States is always getting judgments entered against it which they have to pay.

Mr. Long: That's true, but the answer to that question depends on the basic distinction again between a true in rem proceeding, which this is, Congress has said it is a true in rem proceeding.

Unknown Speaker: So you agree then that you must, the appropriations clause cannot, cannot finish this case without your winning the jurisdictional point?

Mr. Long: No, I don't.

I think the appropriations clause--

Unknown Speaker: Well, I can't imagine... if the court of appeals had jurisdiction and could decide against you, you're going to pay the judgment, no matter where the money is.

Mr. Long: --Well, as a practical matter, yes, of course.

If this Court--

Unknown Speaker: All right, so you have to convince us first that the court of appeals didn't have jurisdiction.

Mr. Long: --Well, but you may not want to put it in terms of jurisdiction, but the court does not have power to enter an order requiring a payment from the Treasury that has not been authorized by Congress in an appropriations act.

Unknown Speaker: And contrary-wise Congress passes a bill appropriating money to pay judgments rendered against the United States.

Mr. Long: Well, that's right.

There is the judgment fund, but again that has to, as the court said in OPM against Richmond, there has to be a statute that gives you a substantive right to damages money recovery against the United States.

But again let me make the basic point, it is a fundamental feature of a true in rem action that the defendant is the res.

That has been established since before the time of the Constitution.

A judgment, an in rem judgment must be satisfied, if at all, out of the res.

That's why once the res has left the court's control it really doesn't do to say well, it can simply enter a judgment, you can get it from some place.

Unknown Speaker: Why is that the case?

In an in personam jurisdiction the court acquires jurisdiction because it has the body of the defendant, right, and it can exercise control over them.

If he leaves the jurisdiction we don't say oh, God, he's gone now, the court can't do anything so the case is over.

Why should it be any different for in rem jurisdiction?

Mr. Long: That is a distinction, Justice Scalia.

I think the reason for it, it's a long established historical distinction.

The reason is that an in rem judgment has to be satisfied out of a particular piece of property.

An in personam judgment could be satisfied out of any property or person located anywhere.

Unknown Speaker: By a particular--

Mr. Long: So the risk of having an unenforceable judgment is much higher.

I mean, the classic case is the ship that sails, the court releases--

Unknown Speaker: --Yes, but you've got your parties reversed.

The plaintiff has to satisfy the judgment out of the res.

The Government is the plaintiff here.

It couldn't of course satisfy a judgment if the res went elsewhere.

But the defendant doesn't have to satisfy any judgment out of the res, he's just to keep what he owns.

Mr. Long: --Well, it is true that the Government has taken the property and has put it in the Treasury, but it is no longer in the court's control.

Unknown Speaker: What should the amount of the bond have been in this case?

Mr. Long: We think the amount of the bond should have been sufficient to insure that the Government was compensated for the costs of an appeal.

Unknown Speaker: And would that have preserved jurisdiction in the court?

Mr. Long: Oh yes, certainly.

Unknown Speaker: Even if the bond was less than the amount of the forfeited proceeds, suddenly you have solved what you consider to be the jurisdictional defect?

Mr. Long: Well, I mean, I haven't solved it.

That's what the Federal Rules of Civil Procedure Rule 62 provides for.

The amount of the bond is--

Unknown Speaker: So the amount, the amount of the bond need not be the amount of the res, and yet the res is now constructively, I take it, before the court simply because a bond for costs has been posted?

Mr. Long: --Well, that is the requirement of the rule.

The amount of the bond could be greater.

We would think in some cases, probably in most cases the court, recognizing that the Government held the property, would require a lesser bond.

Unknown Speaker: Well how would that satisfy your concerns under the appropriations clause?

Mr. Long: Well, we would not be entitled to remove the property.

The purpose of the bond results in a stay, and then the Government is not allowed to execute the judgment and the property stays within the control of the court.

Unknown Speaker: But you also agree if by some hook or crook you had your hands on the property and the court did not in my hypo and you were investing it by agreement, a bond could have been filed and if you then improperly transferred it to the Treasury you're going to be making the same argument you're making today.

Mr. Long: Then there is an appropriations clause problem.

If that case were to arise the attorney general would exercise his discretion to return the property to the claimant or return it to the control of the court.

But yes, there is an appropriations clause problem and it arises whether or not the money gets into the Treasury accidentally or improperly.

Unknown Speaker: How could the attorney general exercise his discretion?

You mean in violation of the appropriations clause?

Mr. Long: No, under, the asset forfeiture fund is a fund in the Treasury and Congress has provided that money may be paid out for certain purposes.

Unknown Speaker: For you, but not for the other side, you say.

I mean, you say that they can't use it but the attorney general can use it.

Mr. Long: Well, one of the purposes provided by Congress is that the attorney general in his discretion may use the money to compromise valid liens and mortgages.

And if a mistake had been made we would certainly consider correcting it.

Unknown Speaker: You would acknowledge then that if this case came out against the Government that he'd be able to use that same fund to find the money to pay the claimants here, isn't that right?

Mr. Long: Well, no, because there is no statute that authorizes an appropriation for that purpose.

A statute, as you said yourself a moment ago, a statute giving the attorney general discretion to do something is not the same as an appropriation paying judgments.

Unknown Speaker: So you're saying that it is the discretionary character of the attorney general's act that defeats it?

Mr. Long: Yes, it is not, it does not meet the requirement of the appropriations clause because it does not clearly provide for the payment of a judgment in this case.

Unknown Speaker: Does the appropriations clause apply simply to public monies?

Why are these public monies if the title to them is contested?

Mr. Long: Because Congress has provided that this is a fund in the Treasury and has provided that payments from the fund have to be made pursuant to an appropriation by Congress.

Unknown Speaker: But you were identifying the funds in an almost quasi physical sense.

You were saying once something is in the Treasury it is entirely beside the point of the appropriations clause whether it was proper to transfer it there or not, and the point, I think the point of Justice Kennedy's question is isn't there some concept of what ought or ought not to be in the Treasury that should be applied before the appropriations clause argument would be appropriate.

Mr. Long: Well, our position is that if money is in the Treasury then it can only be gotten out with an appropriation, and I think that's--

Unknown Speaker: So that if Government officials steal money, if Government officials overcharge taxpayers and so on, knowingly and fraudulently, and the money gets in the Treasury that's it, subject to the appropriations clause?

Mr. Long: --The money can be paid out only pursuant to an appropriation, that's right, even in an extreme case.

It's a clear and simple constitutional command.

Let me back up, if I could, and take just a minute to summarize our argument.

I intended to do this at the beginning and I think I can give our entire position in a nutshell.

We have basically just four points that we think establish our case.

First, the first point is that under a long established rule applicable to true in rem proceedings the court's jurisdiction depends on its control of the res.

An in rem judgment must be satisfied if at all from the res--

Unknown Speaker: May I just ask right there, on the Rio Grande case that was jurisdiction to grant a judgment to the libellot, not to the libelee.

Are there any cases where the jurisdiction, where you have the same status of the parties that you have in this case, where it's the defendant who is claiming there is still power to correct an erroneous judgment?

Mr. Long: --Well, I'm not aware of any admiralty case, but the Shaw case is an in rem proceeding.

That was United States against Shaw, it's cited in our brief, 309 U.S. 495.

That was an in rem proceeding and there the United States was the plaintiff, or it came in and made a claim, and the question was well, did it therefore submit to the court's jurisdiction and the answer was no, that--

Unknown Speaker: For what purpose?

Jurisdiction for purpose of--

Mr. Long: --For purposes of a counter claim.

Unknown Speaker: --But not for the purpose of deciding the merits of the dispute that the Government had initiated.

Mr. Long: Well, it was its counter claim and set off, but again in order to get money out of the Treasury or to get a judgment against the United States there would have to be a right of action in personam.

Then we move out of the specialized world of the in rem proceeding, and that's really a different claim.

A claim against the United States for money is not the same as a claim for the return of this property.

Unknown Speaker: Well, I understand, but what I'm suggesting is you don't have a single United States Supreme Court case that supports the first proposition you are advancing here.

There's no case that's on all fours with the position here.

Mr. Long: We do not have a case that's on all fours, but respectfully I think the Brig Ann and the Rio Grande are quite strong support for us.

Unknown Speaker: The Rio Grande would support you if they had taken the money away from the district court before you got your judgment, and you would be absolutely right.

Mr. Long: Well, I can't imagine that if the other side had happened to get control of the ship and go off with it that the result would have been any different.

What the court was concerned about in that case was that there was a clear violation of statute.

The bond, appeal bond was posted in that case and the court made a great deal of that and said it was clearly contrary to law for the property to be carried off.

It didn't matter which party carried it off in that case.

So our first point again is that an in rem proceeding, the judgment must be satisfied out of the res.

If the court can't control the res it cannot enforce a judgment in rem.

Our second point is that the United States did not consent to the entry of a judgment in personam when its agents filed an in rem forfeiture proceeding.

Congress has not authorized the entry of a judgment in personam in petitioner's favor, and there is no in rem exception to sovereign immunity.

Third, petitioner's appeal is barred by the appropriations clause.

Proceeds of the sale of the res have been deposited in the Treasury and Congress has not appropriated funds to pay a judgment for petitioner.

And finally, there is nothing unfair or unjust about requiring petitioner to take reasonable steps to preserve the court's jurisdiction on appeal.

Appellants are often required to take such steps.

Losing claimants can obtain an automatic stay by posting a bond which protects the Government against the costs of an appeal, including the costs of storing the property, and if a losing claimant cannot afford to post a bond the court has discretion to stay the judgment without requiring a bond.

Unknown Speaker: Mr. Long, are you simply saying that the court of appeals was without jurisdiction period, or are you saying that this case is actually moot?

Mr. Long: Well, the case is over.

We think it's not, there has been a final judgment, it has been executed, there is nothing left for the court to do.

Unknown Speaker: Supposing in this case that the bank had simply failed to file a timely notice of appeal to the court of appeals.

Now, the court of appeals would have been without jurisdiction, the case would have been over, yet no one would have suggested the case was moot.

Mr. Long: We think this case is exactly parallel.

In Munsingware for example, if I recall it correctly, the court refused to enter a Munsingware order for the Government because it said we had failed to take simple steps we could have taken to preserve our rights.

That's precisely the situation we have here and so--

Unknown Speaker: So you say, you do not say the case is moot?

Mr. Long: --No.

The case is simply over.

There has been a final judgment, we have executed it.

There is nothing left that a court of appeals can do.

But the original judgment is not moot.

And of course this Court has jurisdiction to decide the jurisdictional question, that's properly before the Court.

Petitioner really doesn't contend that it comes within a recognized exception to the jurisdictional rule, but instead argues that this Court should basically jettison the rule that in rem jurisdiction requires the court to control the res.

We urge the Court to reject that suggestion, which is a radical one.

The rule that the court must control the res in an in rem proceeding serves the important purpose of preventing Federal courts from issuing unenforceable judgments.

The rule is regularly applied by the courts of appeals, cases cited in our brief including the cases with the, circuits with the greatest familiarity with admiralty such as the Fifth Circuit, the Ninth Circuit, and the Eleventh Circuit.

Moreover, and this is a central point of our position, Congress has legislated in this area on the assumption that the traditional rules of in rem jurisdiction apply in this area unless modified by statute.

Congress has provided in 28 USC 2461(b) that forfeiture proceedings shall conform as near as may be to in rem proceedings in admiralty unless otherwise provided by act of Congress.

Thus the courts are not at liberty to develop one set of jurisdictional rules for forfeiture proceedings and a different set of rules for admiralty cases.

And in addition Congress clearly understands the rules of in rem jurisdiction and has shown that it modifies them when it chooses to do so.

For example, it modified the traditional rule in a customs statute, 19 USC 1605.

That's discussed in our brief.

The purpose of that modification was to alter the traditional rule that Congress understood would otherwise apply, that the res must remain in the judicial district while the in rem procedure was pending.

Unknown Speaker: So you would then, you would come out the same way if a ship sitting in port were the subject of the action and the Government wins and it just, it's a hotly contested-case and then the Government just sails the ship away.

The former owner of the ship can't do a thing about it?

Mr. Long: Well, whether it's the Government or another party, if there is a final order that allows the party to do that, allows the Government to do it in your hypothetical, any final judgment can be executed.

And once the ship has sailed to South America or wherever the long standing rule in admiralty cases is that the court cannot do anything because it can't control the disposition of a ship in South America.

Now if it were done improperly or fraudulently the court could continue to exercise jurisdiction under the Rio Grande as long as the, because the appropriations clause problem wouldn't arise in that case.

Unknown Speaker: Why do you think it can do that if the ship is gone?

Mr. Long: Well, the court made an exception to its rule.

There is a risk of unenforceable judgments, certainly.

The court, it doesn't discuss this in the Rio Grande, it's an old decision, but the court--

Unknown Speaker: Let's assume the ship has gone to South America but the court, the court of appeals says the removal was absolutely fraudulent.

Now, what's it going to do?

Mr. Long: --Well, under the Rio Grande the court, the appeals court would decide the appeal and would, it might issue a judgment.

A judgment might be--

Unknown Speaker: Against whom?

Against whom?

Mr. Long: --It could be against the ship or it could be--

Unknown Speaker: Could it be against the person who illegally removed it?

Mr. Long: --Well, I was assuming that the owner of the ship took it away.

Yes, it could be, it could require the return--

Unknown Speaker: The owner of the ship only because the district court ruled that it was forfeitable.

Mr. Long: --Well, again there's a question.

An in rem judgment would have to be a judgment against the ship.

The court might also enter, I suppose, an in personam judgment against the plaintiff on the theory that the plaintiff, now not the Government so not subject to sovereign immunity, had consented to the, had consented to the jurisdiction of the court--

Unknown Speaker: Was the United States in this case?

Mr. Long: --Well, the United States is the plaintiff in this case, but again the United States is subject to sovereign immunity and can only be sued--

Unknown Speaker: Well, what would you say if it were, if the court of appeals had said we have judgment, we have jurisdiction here because we think the Government illegally removed the funds?

Let's assume there had been a stay which the Government did not observe.

But the money is in the Treasury.

So what does the court of appeals do?

Mr. Long: --Well, in the exact hypothetical you give the court of appeals cannot issue a judgment that requires payment out of the Treasury without an appropriation by Congress.

Unknown Speaker: I agree with that, but what does it do against the... can the court of appeals then issue a judgment against the United States which would be satisfied in the normal course?

Mr. Long: No, because there is no statute that--

Unknown Speaker: So there is no exception for illegal Government action in removing the res?

Mr. Long: --Well, if it's a res that's not in the Treasury, yes, there would be again because then the appropriations clause wouldn't apply.

Unknown Speaker: So even putting up a stay in a supersedeas bond would not have guaranteed the bank a right to have its appeal heard here if the Government chose to disregard the stay?

Mr. Long: Well, in that case the Government would have been acting illegally and--

Unknown Speaker: But I thought you told Justice White it didn't make any difference, that the court of appeals still had no jurisdiction.

Mr. Long: --Well, as we read the appropriations clause there is no exception for money that gets--

Unknown Speaker: But your first point is that the court of appeals had no jurisdiction.

If the court of appeals could enter judgment against the Government on the merits, very likely a judgment like that could have been satisfied out of the judgments fund, might it not, without having to violate the appropriations clause?

Mr. Long: --Well, again, this Court has said in cases such as OPM against Richmond that the judgment fund is not an all purpose fund that allows a court to enter judgment against the United States.

There has to be another statute that gives a substantive right to recovery.

Now, if there was something illegal or fraudulent, that is not the case we have here, I think it's quite likely there would be some sort of way to sue an official of the Government.

There may be ways that that could be done, and certainly the attorney general has discretion to correct an error.

But that's not the case here.

And let me close, if I could, by emphasizing, we have tried to convince you that there would be great difficulty in making this case come out for petitioner, that it would require changing subtle principles of in rem jurisdiction--

Unknown Speaker: Well, wait--

--There's no, you admitted there's... no case like this has ever come up before in this Court.

We don't have to overrule a single case to disagree with you.

Mr. Long: --With respect, Justice Stevens, I don't think I admitted that.

I think the Brig Ann and the Rio Grande--

Unknown Speaker: Well, what case is like this one that you can cite?

Mr. Long: --I think the Rio Grande is quite similar.

Unknown Speaker: That's the closest, and that's where they could not have recovered, not... it's the exact opposite of this case.

Mr. Long: Well, again, I think it wouldn't have made any difference if the other party had taken the property away.

But there's a sovereign immunity problem, there's an appropriations clause problem.

If there were a grave injustice in this case perhaps the Court should strain to change the rule, but Congress has demonstrated that it knows about these rules and will change them if it wants to.

In fact Congress is considering legislation right now that's supported by the administration that would change this rule.

We think that the decision should be left to Congress.

This is, after all, a rule that would have the effect of expanding the limited jurisdiction of Federal courts.

And finally, what happened here was not particularly unfair to the bank.

They could have obtained an automatic stay by posting a bond.

They didn't do that.

They have not offered any excuse for doing that.

They are wrong in contending that the bond serves no purpose.

It serves to compensate the Government for the costs of the appeal and the costs of maintaining property.

A lot of these cases involve boats and airplanes.

The costs are quite significant.

And it also deters frivolous appeals.

There is actually, Congress expressly requires a bond, by the way, when an administrative forfeiture proceeding is converted into a judicial forfeiture proceeding.

So Congress doesn't think that a bond is useless when the Government has the property.

There is no merit to petitioner's contention that it didn't have enough time to decide whether to appeal.

It had as much time as any criminal defendant has, and in injunction cases there is no automatic stay at all.

So some parties are in a worse position than this and have to act immediately to obtain a stay.

The Government finds itself in that position in FOIA cases, for example.

And there is no basis for the speculation that there will be an avalanche of emergency stay applications if the ordinary established rules in in rem proceedings are allowed to continue in effect.

These are the rules that apply in the Fifth, Seventh, Ninth, and Eleventh Circuits, the circuits that have the most experience with admiralty proceedings, and there has been no avalanche of emergency stays or no problem with courts not ruling on the stays in a timely fashion.

As this Court said in Halstrom against Hillimuck County, the equities do not weigh in favor of petitioners whose procedural default is caused by their failure to take the minimal steps necessary to preserve their claims.

Thank you.

Unknown Speaker: Thank you, Mr. Long.

Mr. Beiley, you have 3 minutes remaining.

Rebuttal of Stanley A. Beiley

Mr. Beiley: I would like to conclude with a very brief statement.

We believe that appellate review, though not a constitutional right, is certainly a very basic, fundamental, and important right to Federal litigants.

We believe it is a right that is worth preserving.

We respectfully ask this honorable Court to preserve it here.

The Eleventh Circuit's decision should be reversed and the case sent back to the Eleventh Circuit to reinstate the appeal and decide my client's case on the merits.

Unknown Speaker: What is supposed to happen then?

Mr. Beiley: We would ask the Eleventh Circuit to order the Government out of the forfeited funds to pay us those funds to which we are entitled on our mortgage, Your Honor.

Unknown Speaker: You wouldn't care whether you were asking for the return of the specific funds or not, I suppose.

Mr. Beiley: Any Government money is fine with us.

[Laughter]

Unknown Speaker: And you don't think you need the consent of the Government to have a judgment like that entered?

Mr. Beiley: We do not, Justice White.

I thank the Court very much for its consideration.

Chief Justice Rehnquist: Thank you, Mr. Beiley.

The case is submitted.

Attribution:

The OYEZ Project

Featured:

Maine v. Taylor - Oral Argument

Fri, 09 Jan 2009 14:48:31 +0000

Case:

Maine v. Taylor

Media File:

85-62_19860324-argument.mp3

Related Transcript:

1985_85_62_argument.xml

Transcript:

ORAL ARGUMENT OF CABANNE HOWARD, ESQ. ON BEHALF OF THE APPELLANT

Chief Justice Burger: Mr. Howard, I think you may proceed whenever you are ready.

Mr. Howard: Mr. Chief Justice, and may it please the Court:

The issue in this case is whether the State of Maine, consistent with the Commerce Clause, may prohibit the importation of live baitfish for the purpose of protecting its environment.

The case is here on the State's appeal from a decision of the United States Court of Appeals for the First Circuit which declared the state statute unconstitutional for failing to survive the strict scrutiny test required by this Court in Hughes versus Oklahoma.

This Court subsequently postponed jurisdiction over the appeal until this hearing.

After a brief summary of the relevant facts and a statement of why this Court has jurisdiction, I would like to explain why the Court of Appeals misapplied the proper standard for appellate review of factual findings in district court set forth in Rule 52(a) of the Federal Rules of Civil Procedure, and why the Court also subjected the Maine statute to an unnecessarily strict standard of constitutional scrutiny.

The State of Maine has a small and unique freshwater fishery.

It is available to all residents and non-residents alike.

To protect that fishery, in 1959 the State's legislature passed a statute which is at issue in this case to protect the fishery against the importation of diseased fish.

In 1981, Congress passed the Lacey Act Amendment of that year, making it a federal crime to engage in interstate commerce in violation of statutes such as Maine's.

In February of 1983, the Defendant in this case was indicted for importing and 158,000 baitfish, some of which contained various diseases about which the state was concerned.

The Defendant moved to dismiss the indictment on the grounds of the unconstitutionality of the underlying state statute.

The state was permitted to intervene pursuant to Title 28 United States Code, Section 2403(b) in order to defend its statute.

An evidentiary hearing was held before a United States magistrate and the state and federal government introduced substantial expert testimony showing that its statute satisfied both prongs of the Hughes versus Oklahoma test, those being that the statute was needed to protect the state against various parasites and exotic species which could come in through a shipment of live bait, and, secondly, that there was no alternative to an absolute ban on the importation.

The district court and... The magistrate and subsequently the district court agreed with the state and sustained the statute, but the Court of Appeals, asserting its freedom to re-evaluate the evidence completely, reversed.

The state then appealed to this Court, although the United States government did not.

The state believes that this case is covered by the plain language 28 United State Code, Section 1254(2) which gives this Court jurisdiction, and I am quoting,

"by appeal by a party relying on a state statute held by a court of appeals to be invalid. "

On the merits, on the question of the adequacy of the evidence to support the district court's finding, the state believes that with regard to the... that the principle error created by the Court of Appeals in this case was a decision in effect to retry the case.

The state's evidence here was overwhelming that the statute met both prongs of the Hughes test.

With regard to the legitimate purpose behind the statute, the state fish pathologist and two other expert... academic experts testified that the statute was needed to guard against both three specific parasites which could establish themselves in Maine's sport fish such as trout, bass, and salmon, and also that the statute was needed to protect against the introduction of exotic species such as, for example, the common carp, which might successfully compete with indigenous species for habitat.

The same witnesses, as well as the Defendant's own expert, testified as to the second prong of the Hughes test; that the scientific community has not established a testing program of any kind for baitfish.

And, since that is the case, since there is no possibility of inspecting fish or testing fish--

Unidentified Justice: General Howard, can I interrupt you for just a second?

Mr. Howard: --Yes.

Unidentified Justice: As I understand your brief, you take the position that the Court of Appeals acted as a trial de novo in effect and you are giving your version of the evidence.

You are not giving us the findings that you think the Court of Appeals ignored.

Do we have to look at the original underlying evidence ourselves or can we content ourselves to look at the district court's findings?

Mr. Howard: What I am reciting is what the district court found to be the facts in the case.

Unidentified Justice: I thought you were reciting what witnesses testified to.

I am sorry.

Mr. Howard: Well, that is contained in the district court's findings if you read them, the findings of... It refers specifically to what the witnesses testified and then find as a fact certain things, these things.

Unidentified Justice: In your submission, do we need to go beyond the district court's written opinion to find out what the facts are?

Mr. Howard: Well, we believe that this Court should act in the same way as the Court of Appeals should have acted, which is to apply the clear erroneous test to the record and if you find that there is substantial evidence in the record to support the findings of the district court, you should reverse the Court of Appeals and--

Unidentified Justice: What part of the district court's findings are you now referring to just so I can follow by looking at the--

Mr. Howard: --In the jurisdictional statement?

Unidentified Justice: --Well, wherever the district court's... They are not numbered findings as we normally have.

Mr. Howard: Oh, no.

But, if you read... It is not a very long opinion.

It covers nine pages.

Unidentified Justice: Right.

Mr. Howard: It is replete with references to the transcript.

I don't think you will find any difficulty in finding where the findings are.

Unidentified Justice: Does he find that all the testimony is true that you describe?

He does recite a lot of testimony.

Mr. Howard: Yes.

Yes, he does.

With regard, for example, to the question of alternatives, he finds as a fact... The quote is "the fact remains", I am quoting now.

It is on page D-9.

"The fact remains that testing procedures have not been devised. "

Unidentified Justice: There were differences in the opinion testimony.

Mr. Howard: There were... If I can summarize--

Unidentified Justice: But, nevertheless, the court believed judgment of another.

Mr. Howard: --Yes, that is right.

The thrust of the Defendant's expert testimony which the Defendant's counsel will summarize also was that the diseases and parasites that the state was concerned about were really not that serious, therefore, there was no need for--

Unidentified Justice: Did the findings of the district court necessarily involve passing on the credibility of these experts?

Mr. Howard: --Yes, sir, they certainly did, and we would suggest that is a very important part of this case.

Unidentified Justice: That is what puzzles me because one of the things he said was that the lack of agreement is not itself the ground for taking one position or the other.

He, in effect, seemed to say that there is disagreement among experts and you need more than that in order to come to the correct conclusion.

Doesn't he say the experts disagree on the issue?

Mr. Howard: The experts were in disagreement on the question of the seriousness of a threat.

Unidentified Justice: Correct.

And, does he resolve that disagreement?

Mr. Howard: He says that it is not... The Commerce Clause should not be read to require the state to take the risk that something will happen to the state.

Unidentified Justice: Correct.

So, he is saying that no matter which one is right the fact that there is disagreement is enough to support the reasonableness of the state... That is quite different from saying that he picked one set of experts over the other.

Mr. Howard: Well, that is true.

Either way it is satisfactory for us.

Unidentified Justice: Well, I understand, but it is a different argument.

[Laughter]

Well, Mr. Howard, this line of questioning gets to a question I have had frankly and that is what does the Hughes case require, what is the test laid down in Hughes?

One aspect of it, as I understand here, is that the state has the burden of establishing that no non-discriminatory alternative is available.

The district court, as I understand it, said that Hughes does not preclude the state from acting where the evidence on the effectiveness of such alternatives is in doubt and where the potential disruptive impact is great.

Now, I read the First Circuit's opinion as possibly disagreeing with that as a legal standard under Hughes.

And, if that is the case, then you have a legal issue here to deal with before you have to grapple with the underlying facts.

Mr. Howard: Well--

Unidentified Justice: In other words, maybe the district court read the standard under Hughes to generously according to the First Circuit.

Is that a possibility?

Mr. Howard: --We think that we have satisfied the Hughes test even giving it the strictest reading that the First Circuit's opinion could be read to give it.

So, we are not relying on any--

Unidentified Justice: Well, do you think the district court's articulation of this standard, that if the evidence is in doubt, then that is enough for the state?

Do you think that is correct?

Mr. Howard: --Well, I think that makes sense.

Unidentified Justice: Well, it may make sense.

Do you think it is correct under Hughes?

Mr. Howard: Well, I think Hughes could be read to include such a statement, where there is such a test, where there is doubt in the scientific community.

As I am going to say in a minute, of course, we... think... A further argument in this case can be made that the standard should be not as strict as the Hughes test in the first place.

But, that argument aside, I think--

Unidentified Justice: I think it is important to know whether there is some framework here for a disagreement on the legal standard between the district court and the First Circuit.

Mr. Howard: --I didn't get the impression from reading the district court's opinion that the district court... rather reading the Court of Appeals' opinion that it was disagreeing with what the district court had said.

I think the Court of Appeals agreed that the district court was applying the strict scrutiny test and in applying the test it is fair enough to say that if there is doubt among the scientific community as to what the status of science is, that that ought to be enough to give the state a legitimate purpose in legislating against uncertainties.

So, I don't see a difference between the two at all.

As I was saying a second ago, the prohibition... the needs of this prohibition in this case is required because of the absolute testing procedure.

The evidence that the district court found was that there is no testing procedure.

So, in short, the state feels that it satisfied the Hughes test in this case no matter how strictly one wants to state it.

And, in fact, the Hughes test can't be satisfied on the evidence in this record.

It probably is a test that nobody can satisfy.

Now, beyond this, the state also suggests that the strict scrutiny test of Hughes may not be appropriate to apply in this case for the reason that the Congress enacted the Lacey Act Amendments in 1981 which encouraged the states to pass statutes of this kind.

And, if the courts were to continue to apply the strict scrutiny test to statutes like this, that would frustrate the will of Congress in passing the Lacey Act Amendments.

In short, there is a need to harmonize the policy of Congress in encouraging statutes like this with, of course, the policy of the Commerce Clause to prevent the economic vulcanization of the United States.

In our brief, we have suggested that there is a way in which the Court could fashion a lower degree of scrutiny.

We are not arguing that there should be no scrutiny at all, of course, but we do argue that there should be a lesser degree of scrutiny.

For example, on the question of legitimate purpose, we think that the proper way under the Lacey Act to approach a case like this would be to presume that the state statute, that the state legislature has acted for the legitimate purpose that it says and put the burden on the Defendant to come in with some evidence that there is some illegitimate purpose going on.

And, similarly, on the question of whether there is an adequate alternative, the state should be given a little bit more leeway than being required to adopt any hypothetical alternative that the Court of Appeals might be able to think up.

In conclusion, the state believes that the Commerce Clause should not require it to take the risk that the indiscriminate importation of baitfish would not be harmful to its environment.

If there are no further questions, Mr. Chief Justice, I would like to reserve the remainder of my time.

Chief Justice Burger: Mr. Ganzfried?

ORAL ARGUMENT OF JERROLD J. GANZFRIED, ESQ. IN SUPPORT OF THE APPELLANT

Mr. Ganzfried: Mr. Chief Justice, and may it please the Court:

I would like to address some of the questions that came up during the state's presentation and that is that there is no difference of opinion in the record on the fact of whether there were may tests, inspections, certification, or sampling procedures presently available to test these fish for the parasites and exotic diseases in any way other than a total exclusion.

The district court found that the fact remains that there is no testing technique.

The Court of Appeals did not find that finding to be clearly erroneous and, in fact, Appellee Taylor does not contest to the contrary.

His brief in this Court on page 25 says simply that there are procedures that could be developed.

So, we submit that what one might ordinarily expect would be a less restrictive form of regulation in this area, mainly an inspection and testing procedure is on the facts that Maine has proven in this case, simply not available.

Unidentified Justice: Can you buy baitfish in Maine?

Mr. Ganzfried: You can buy live bait in Maine.

Unidentified Justice: Warm water bait?

Mr. Ganzfried: I may not have the technology correct, but if it is from Maine, if it is not imported into Maine--

Unidentified Justice: Yes.

Maine people do sell bait for the purpose... for the same purpose that these baitfish were--

Mr. Ganzfried: --Mr. Taylor, the Appellee in this case, is a commercial bait salesperson in Maine.

He is an in-state seller of live bait.

Unidentified Justice: --Of live bait that is produced in Maine.

Mr. Ganzfried: That is correct.

Unidentified Justice: These were golden shiners.

Are golden shiners available in Maine?

Are they produced there for bait?

Mr. Ganzfried: I believe that there is a form of golden shiner that is produced in Maine, although as I recall--

Unidentified Justice: How do they know that--

Mr. Ganzfried: --it is indicated in the brief and has a different name.

Unidentified Justice: --How do they know that the baitfish produced in Maine are without bacterial injury?

There must be some testing procedures then.

Mr. Ganzfried: Yes, there are some procedures for testing.

The difficulties with them are, number one, that in order to test a fish you have to kill the fish.

Once you kill the fish, it is not live bait.

Unidentified Justice: If they can assure themselves that the baitfish produced in Maine posed no danger, why can't they assure themselves by visiting some out-of-state hatchery that the right procedures are--

Mr. Ganzfried: The record indicates, and it is uncontested on this point, that the parasites, diseases, and predators that were discussed in this case are not native to the State of Maine and have not been previously found in the State of Maine.

Unidentified Justice: --How do they know that they haven't been if they can't test?

Mr. Ganzfried: To the best ability that they have with the tests... They have no test that they can perform without killing the fish and, therefore, rendering no longer live baitfish.

Unidentified Justice: That is true of all fish.

I mean, if you were importing trout or salmon or whatever, you just take a sample and you kill the ones in the sample, isn't that right?

Mr. Ganzfried: Yes.

The difference is, and the testimony in the record reflects this, is that for trout and salmon, testing, sampling, and certification procedures have been developed and they are regarded as reliable.

No such procedures have been developed for live baitfish and to the extent that there are any testing procedures at all, they are not considered reliable and they often produce false negatives, so even... As Mr. Walker, the state expert, the first witness in the case, testified, he examined the fish in this batch of 158,000 Mr. Taylor was bringing in and based on the tests available to him, he said even the fish he killed and examined he could not certify that they were free of these diseases and parasites.

Unidentified Justice: So, you say that because these parasites have never been found in Maine as far as you know, that Maine is just lucky enough not to be cursed with those, but they know that other states, baitfish from other states are.

Mr. Ganzfried: That is correct.

Unidentified Justice: And, you never can tell when they are or are not.

Mr. Ganzfried: You can sometimes tell when they are, but you can never tell with any reliability that they are not.

Unidentified Justice: May I ask one question about the absence of testing procedures which seems to suggest kind of ends the case.

Wasn't the dispute in the testimony over the question whether the problem was sufficiently serious to justify the expenditure and so forth to develop testing procedures?

Some experts said, well, this doesn't amount to anything anyway, so that is why we don't have tests.

That is what the conflict was.

Mr. Ganzfried: That is right.

And, the portion of the district court's opinion to which I referred to before discussing the disagreement, the district court does indicate that he is speaking about a disagreement only with respect to the question of the legitimacy of a state interest and not as to whether there is a less restrictive alternative and found that the Defendant's expert agreed with prosecution that there is not testing/inspection/certification procedure.

The district court's comment to that disagreement was limited to the legitimacy of the purpose.

The Court of Appeals did not find to the contrary on the purpose.

The district court upheld the purpose, the Court of Appeals did not find that the state's purpose was not a legitimate state purpose.

Unidentified Justice: Do you take the view that if there is disagreement among experts on whether there is a serious problem or not that that is a sufficient basis for sustaining the statute without the judge finding that one group of experts was right as opposed to the others?

Mr. Ganzfried: We think that the question of whether the threat to the state is a sufficiently serious one is essentially a legislative determination and that the--

Unidentified Justice: So, your answer is if they can get one expert that says it is serious, that is enough to justify the statute even though the judge says I don't know whether to believe him or not.

That is your position?

Mr. Ganzfried: --Our position is essentially... The orderly way to proceed is for Mr. Taylor, if he develops a test, which he hasn't done yet, to present that, to present his experts, to present his possibilities as to inspection and certification procedures to the state legislature.

It basically is our feeling that under Hughes versus Oklahoma, there should be sufficient elbow-room for a state to implement prophylactic measures when the effect on the state's ecology would be very serious and there is substantial scientific basis for the state's concern.

On the question of the state of the record in this case, I would point out that the Defendant's expert himself contradicted himself on the point.

He indicated he was the first person to discover one of the parasites that is involved here and he put a good deal of study into it because, as he said, it was regarded as a major problem.

Unidentified Justice: We have to look at the underlying evidence.

We can't just read the district court's opinion, right?

Mr. Ganzfried: No.

I think the findings the district court sustaining the legitimacy of the state purpose and according proper deference to the state legislature, not substituting the court's judgment for the legislative judgment, and the findings of fact by the district court, which were not found to be clearly erroneous by the Court of Appeals, but were simply disregarded by the court which, as it said, read the record and "drew its own conclusions".

We think that where the Court of Appeals went wrong was in substituting its finding of fact for those of the district court and in substituting its judgment for the state legislature.

Unidentified Justice: Mr. Gansfried, do you think there is any tension or disagreement between the district court and the Court of Appeals on the Hughes standard?

Mr. Ganzfried: They articulate the Hughes standard the same way, but in terms of the application of that standard to the particular case--

Unidentified Justice: I mean, the Court of Appeals seemed to apply a more strict standard under Hughes.

Mr. Ganzfried: --The Court of Appeals seemed to assume it was the arbiter of both facts and state interest.

And, under this Court's decision, it is neither.

I have addressed the difficulties with the Court of Appeals' opinion.

Let me get back to one important point that is a factual one and that is the uniqueness of Maine's situation.

They do prohibit the importation of live baitfish, but if I could draw an analogy to this Court's decision in Philadelphia versus New Jersey, the situation Maine was in here is similar to what New Jersey would have been in had there been no domestic solid waste in New Jersey.

Here, the State of Maine is attempting to keep out and protect its environment from that which was not there before.

Thank you.

Chief Justice Burger: Mr. Eggert?

ORAL ARGUMENT OF E. PAUL EGGERT, ESQ. ON BEHALF OF THE APPELLEE

Mr. Eggert: Mr. Chief Justice, and may it please the Court:

Mr. Taylor in the court below has attacked the constitutionality of the state statute which forbids the importation of baitfish.

He has done that in a fairly unique circumstance of being in the midst of a federal criminal prosecution and attacking a state statute.

As background for that particular challenge, Mr. Taylor has been in the bait business for approximately 17 years.

He has raised in the State of Maine baitfish and mainly golden shiners during that period of time.

They are, indeed, the same type of species of golden shiners that he was attempting to import in this particular situation.

The reason Mr. Taylor is importing golden shiners from other states is due to the reality of aquaculture in Maine.

Maine has a harsh winter, a short warm season during which fish may be raised and harvested and the fish selling cycle is just the opposite of that.

Maine fishermen can fish year around with live bait, but they do not do so.

Mainly, they fish in winter, ice fish with live bait, and that is the peak season for Mr. Taylor.

It is very difficult for Mr. Taylor to raise golden shiners and keep them over the winter to supply the demand of his customers, and, therefore, in order to remain in business and to grow in his business as the demand of the marketplace dictates, he has been forced to go outside the state during winter months to bring back in golden shiners.

The initial question that is before this Court as I understand it is a matter of jurisdiction which has been reserved to this hearing.

Our position on jurisdiction is that Section [= 1254(2)] is not as clear cut as the state would have us believe, but, in fact, that particular statute does not apply to criminal cases, which this is.

It is a criminal appeal.

And, that that statute applies only to civil cases.

That is clear in the legislative history of that statute and in the very language of the statute itself.

That does not mean that this Court cannot hear the merits of this particular case, but that we would contend that the Court must treat this as a petition for Writ of Certiorari and we would further contend that this question is not important enough for the Court of grant that petition.

All parties in this particular case, I think, agree that this statute that we are talking about is discriminatory.

It is a flat prohibition against the importation of baitfish.

It stops it at the border.

What is being prohibited is something that the state allows all the time to go on within its borders.

Golden shiners are a common baitfish within the State of Maine and outside the State of Maine.

Once this discriminatory effect of the statute has been admitted by all parties, the constitutional law which... the body of constitutional law which has surrounded the analysis of the statute indicates that the courts must look at the statute and the proposed justification for the statute with strict scrutiny.

We would contend that the district court, through the magistrate's findings, and also the district court's findings, gave lip service to that strict scrutiny standard and said that they were applying the strict scrutiny standard and, in effect, were merely adopting the opinions of the state's experts because they really didn't have any basis for distinguishing between or finding one expert's opinion to be more correct than the others.

They fell back to the position that the state has proposed these problems as their legitimate purpose.

The Defendants contest that, but we are not really sure, therefore, we will accept the state at face value and allow the statute to stand.

We contend that the Court must do more than that, that the Court must not just make findings perhaps on a preponderance of the evidence standard or maybe even a lesser standard in this particular case, as what the court did, but they must make those findings and then look and scrutinize those findings in the context of everything else that was presented in the hearing.

I think this Court does, indeed, have to go back to the transcript to look at the evidence that was presented.

Unidentified Justice: Well, Mr. Eggert, in the brief you suggest that under a Commerce Clause analysis that clear and convincing evidence is the standard to be applied.

Now, you are not arguing that to us, are you?

Mr. Eggert: No, I am not, Your Honor.

I think I may have been analogizing that when that is the standard and the lower court... When a clear and convincing standard is evidenced as the standard, and the lower court has obviously misapplied that standard, that the Appellate Court then has to look at the record, the factual record, and make a determination for itself from that record whether or not the lower court is correct.

Unidentified Justice: Well, this is just a preponderance--

Mr. Eggert: As it pertains, I believe, to the initial findings of fact, but that is not sufficient that the findings of fact agree with the state's position.

The Court must go further than that and apply those facts to the statute and that is where the strict scrutiny comes in.

It is not enough that the Court say, yes, we agree, for instance, that there is a parasite which could be introduced into the State of Maine through importation of baitfish.

It goes further than that to find out if that is a sufficient reason for blocking commerce at Maine's border.

In two of those particular instances--

Unidentified Justice: --I am not sure I understand your idea of strict scrutiny here which is the kind of thing you might apply under an equal protection analysis if there were discrimination on the basis of race.

We don't have that there, do we?

We just have the requirements set forth in Hughes versus Oklahoma that we have to apply, isn't that right?

Mr. Eggert: --Well, the Hughes versus Oklahoma indicates that the strict scrutiny standard is what is being applied and what has to be applied.

That language is identical to that used in equal protection cases.

I know of no other place in which that standard is fully explicated.

I would suggest to the Court that, yes, indeed, it is the same standard and that the courts have to go beyond just what is presented to it by way of factual basis.

This particular case is justification for the statute and gives serious consideration and hard consideration as to whether or not that is sufficient to allow a state to block interstate commerce.

In this particular case factually, we have one of the parasites, capillaria, being proposed and that was found in this particular shipment, as I understand it.

That is proposed as a justification for blocking interstate commerce, and yet the state's expert has agreed he has found capillaria within the state.

Unidentified Justice: Well, under... in applying the Hughes test, do you think the Court of Appeals is free to just speculate on other possible alternatives or does the Court of Appeals have to consider and rely on the evidence as determined by the district court?

Mr. Eggert: No, I don't think it can speculate and go totally outside the record, but it certainly can look to other sources in the sense that the First Circuit Court of Appeals did.

It went to Maine's statutory and regulatory structure to see whether or not Maine's avowed purpose with this statute was at all consistent with what they do with other fish.

The state's contention is that somehow baitfish are entirely different from trout and salmon which they would like to encourage in the State of Maine and that is true because they are different species.

However, there is a bit of prejudice, I believe, involved in that particular conception and that is that somehow the baitfish dealers in Arkansas are not as careful and good as the trout raisers in Maryland, let's say, without much justification for that.

The state's experts--

Unidentified Justice: Mr. Eggert, supposing that we were dealing with district court findings of just rather plain, ordinary facts as to whether there were or were not an adequate test for this parasite.

Now, if the district court finds those facts of particular weight and the appeal is taken to the Court of Appeals, does the Court of Appeals review those under a clearly erroneous standard as it would other findings of fact?

Mr. Eggert: --No, I don't believe they do.

Unidentified Justice: Why not?

Mr. Eggert: Because it is a mixed question of law and fact.

Unidentified Justice: The hypothesis I gave you was the kind of factual questions that are classical, factual questions under any application of Rule 52.

You are always going to be applying law to facts.

That doesn't set you free from the clearly erroneous test.

Mr. Eggert: I agree.

Unidentified Justice: Why isn't the Court of Appeals bound by the clearly erroneous test here?

Mr. Eggert: They are bound by the clearly erroneous test when they look at the facts, but they are not bound when they then apply the legal standard to that.

Unidentified Justice: Well, no, I don't think anyone would think they were.

Mr. Eggert: Okay.

But, then, when they go and look at the legal standard that the district court applied and determines, which I believe they did determine, that the district court was wrong with that legal standard, then I think that opens to question whether or not the district court was adequately and properly looking at the factual record in making its findings.

Unidentified Justice: Is that the clearly erroneous test or is it something different?

You know, it is a rather vague statement.

Mr. Eggert: I guess it is more of a hybrid.

I think the courts have said that when there are factual findings that don't fit into the legal structure or the proper legal standard, that the courts then are not bound by those factual findings.

That they then have to somehow get back into the record and review the facts.

So, if as far as we had to go was to say could the district court, based on the record, determine that there were no alternative means or that there were no other alternative means of testing or that there are no adequate methods of testing and that was the end of the question, then I think, yes, the district court would be correct.

The Court of Appeals would apply the clearly erroneous standard.

But, that does not end, in my view, the inquiry that the Court of Appeals has to undertake when it reviews the district court findings.

I would like to perhaps clear up a problem in the record and that is I do not believe any of the experts said there were no procedures except procedures for testing various fish for these parasite problems.

The state's expert himself testified that he tested the fish in his samples for the three parasite problems and was satisfied that he found two of the three within the shipment.

I think that is pretty clear evidence that, in fact, there is a testing procedure.

What is really at issue and what the experts disagree upon is the sampling procedure which is undertaken.

Now, with trout and salmon, everybody has agreed that some "X" number of a thousand fish, five out of a thousand fish can be sampled and if those are disease free, then we can pretty safely say that the entire shipment is disease free.

Experts have not yet agreed we can do that and say we have sampled five of the thousand baitfish and, therefore, the entire shipment is disease free and the reason that hasn't been done is because these particular problems that the state is talking about do not pose a threat to the total ecological system of the warm-water fish in Maine.

There is no evidence in the record that that kind of problem is posed by importing baitfish.

Unidentified Justice: Even diseased baitfish?

Mr. Eggert: That is correct.

Unidentified Justice: Well, what is the state's position of what would happen if a large number of diseased baitfish were imported?

Mr. Eggert: The state's position is that that is going to pose a problem.

Unidentified Justice: What sort of a problem?

Mr. Eggert: I don't know.

Unidentified Justice: And, your position is it doesn't pose any problem?

Mr. Eggert: Our position is that it does not pose a problem in the sense that it will not infect the wild fish population; that there is no evidence in the record, even though these parasites have existed in other states all over the country, there is nothing in the record from the state that shows that these have ever... that these problems have ever been transmitted to wild fish and there certainly should be if the state is correct.

Unidentified Justice: Was this a subject of the expert testimony, one of the subjects of the expert testimony?

Mr. Eggert: Yes.

Unidentified Justice: Did the experts disagree?

Mr. Eggert: Yes.

The state's expert testified that these problems do exist in fish, in baitfish, golden shiners; that they have been found in illegally imported baitfish, but that is as far as they go.

They say that one of the parasites does cause mortality in individual fish, but a scarcity in the record of whether or not that translates into any harm for the environment.

What is not in the record perhaps is that this is a changing field.

The experts are disagreeing and they perhaps are going to be developing, and as I understand it, have developed tests for--

Unidentified Justice: Meanwhile, who is supposed to bear the risk?

Mr. Eggert: --When it comes to--

Unidentified Justice: You don't suggest that these parasites don't exist?

Mr. Eggert: --No.

Unidentified Justice: In these shiners.

Mr. Eggert: No, they do, and they exist in probably all the other... in many of the other states and have not caught the problem.

Unidentified Justice: Maybe so.

That may be so, but it is an undesirable thing to have them spread around, isn't it?

Mr. Eggert: I am not sure I would concede that, no.

It is something that--

Unidentified Justice: You are saying that it would not be a sufficient threat to permit Maine to keep them out of the state?

Mr. Eggert: --No.

Unidentified Justice: With or without tests?

Mr. Eggert: No.

I would submit that, yes, that they are not a sufficient problem.

Unidentified Justice: So, your submission is even if there is no test Maine has to let them in.

Mr. Eggert: Yes.

Unidentified Justice: May I ask this question?

I am confused at the moment.

There is a section in your brief on page 25, the caption of which says,

"The Court of Appeals Did Not Sufficiently Consider the Serious Consequences to Maine's Ecology of Invalidating the Challenged Statute. "

Are you representing the Solicitor General?

Mr. Eggert: No.

Unidentified Justice: I beg your pardon.

Mr. Eggert: The other--

Unidentified Justice: You are saying there is no risk to Maine's ecology?

Mr. Eggert: --That is what I am saying.

Unidentified Justice: Right.

Mr. Eggert: The other reason that the state's attempt to... or the state's scheme to protect its ecology, if I may phrase it that way, cannot be effective is that Maine's water environment is not unique.

In fact, it shares a substantial watershed with the State of New Hampshire which the state's own expert conceded.

His testimony was sufficient that the state could not possibly block these problems from coming to the State of Maine as long as the State of New Hampshire allowed importation of baitfish into that particular state.

And, he further conceded that as far as he knew, and it is as far as I know true, the State of New Hampshire does allow importation of these golden shiners.

In fact, they come probably from the same place, through the Massachusetts wholesale dealers, into the State of New Hampshire.

And, any release of those baitfish in the State of New Hampshire, at least in the common, shared watershed between New Hampshire and Maine is going to mean that these problems are going to exist in Maine, if, in fact, they don't already exist, and they probably do, and the state--

Unidentified Justice: So, you are just submitting the state isn't... they may have a little problem and they aren't entitled to try to keep it little.

Mr. Eggert: --Well, Your Honor, they certainly don't take any steps with their regulatory and statutory scheme to try to deal with that problem as exists within the state.

Mr. Howard mentioned the possibility of carp coming into the state.

Well, carp does exist in the State of Maine and it exists in the lower Kennebec River.

And, I don't know of anything that would prevent people from taking that carp and spreading it to the rest of the state.

If the state is really serious about dealing with what they perceive to be problems, it would seem to me it would be within a framework, consistent framework, that would deal with all these problems, both in state and out of state and they just don't do that.

They take it one little perceived problem and have dealt with it in a most severe fashion and that is to stop all commerce in that particular area.

Finally, and perhaps by no means least, the district court found that there was no economic protectionism involved in this particular statute despite some direct evidence in a publication by the Department of Inland Fisheries that it was better to raised baitfish in Maine and keep Maine's baitfish economic alive and healthy rather than spending our money in Arkansas.

The Circuit Court of Appeals, I think, more correctly looked at that and at least indicated that that was a reflection, that there was, indeed, some economic protectionism involved in this particular case and that is the very problem that the Commerce Clause is designed to prevent.

Unidentified Justice: Do you think Maine could just prevent bait fishing entirely?

Mr. Eggert: Yes, indeed, they could.

Unidentified Justice: And, keep out baitfish from any other states?

Mr. Eggert: Yes.

Unidentified Justice: I know they could prevent bait fishing, but do you think could keep... They could enforce that rule by preventing importation of baitfish?

Mr. Eggert: I would think the state could regulate in such a fashion that they say people in Maine, we will not allow fishing with live bait in the State of Maine.

If that is a serious problem, if the state thinks there are serious problems with live bait, then that is an even-handed regulation that they certainly could adopt.

Politically I am not sure the could, but--

Unidentified Justice: You don't think the state is required to go to that length to meet its reasonable alternatives?

Mr. Eggert: --No.

I am suggesting that the state is required to perhaps expend a little bit of effort to regulate and allow baitfish to be imported into the State of Maine under strict controls perhaps, but not be allowed to just flatly prohibit the importation of baitfish.

I believe that the State of Maine can, if it wants to, devise a system, a permanent system, a licensed system, an inspection system which would satisfy them and which would satisfy Mr. Taylor and other bait dealers in the State of Maine, indeed, as many other states in the northeast.

Unidentified Justice: Is your client prepared to share its costs... share the cost of sending inspectors all around the country?

Mr. Eggert: If that is what it takes for him to be able to import baitfish, to have them inspected somewhere else, he certainly would.

The place where most of these baitfish come from in Arkansas, there is, in fact... I am not sure, the Department of Inland Fisheries research station there that does, in fact, test sample certified fish to be disease free and they certainly could do that right there at the source in Arkansas and the fish could be brought into Maine quickly.

Thank you.

Chief Justice Burger: Do you have anything further?

Mr. Howard: Yes, Mr. Chief Justice, just three points in response to the prior questions.

Justice White, with regard to the question you were just asking, the problem of sending inspectors to other states is the same problem that applies to inspecting in Maine.

There is no test that anybody can apply anywhere.

ORAL ARGUMENT OF CABANNE HOWARD, ESQ. ON BEHALF OF THE APPELLANT -- REBUTTAL

Unidentified Justice: If two out of every hundred thousand baitfish are diseased, you may find those two but you would never know whether you found them all.

Mr. Howard: That is the point.

The point is there is no test that can be done to find the parasites and the diseases.

There is such a test for semolinas.

The scientific community has not developed one.

That is uncontradicted on this record which leads me to respond to an earlier question from Justice O'Connor.

You were concerned, as I recall, about whether there is a difference in the test that the district court and the Court of Appeals applied here.

I had a chance to reread the Court of Appeals' opinion during the other arguments and I can't see anything in there that indicates that the Court of Appeals criticized the district court on its application of the test.

And, furthermore, the point on which the Court of Appeals reversed; that is that there was other means that the state hadn't sought and found to protect itself, that point is one in which there is no disagreement in the record.

There is no evidence at all that there is no test.

The record is unequivocal.

The disagreement occurs on the point as to whether there is a risk, whether there is a real risk or not.

The Defendant's experts on that issue tried to make the point that there was a difficulty on the risk.

But, that wasn't the point on which the Court of Appeals reversed the lower court.

So, it doesn't seem that there is a problem with regard to the application of the test in either case.

And, as to the question about the risk, Justice Stevens, I think you were concerned that the district court didn't make findings about that and if I could just direct your attention to a paragraph on page D-7 of the jurisdictional statement.

It is in the middle of the page, the first full paragraph.

I think that is the paragraph where the court is finding that... having cited the testimony above it... the court is coming to the conclusion that given the somewhat unique characteristics associated with the Maine fish population, the substantial uncertainties surrounding the effects and so on shows that there is a risk.

Unidentified Justice: What sentence do you refer?

I just read that paragraph as a recitation of what the testimony was.

Mr. Howard: Well, I realize the court didn't use the words "I hereby find"--

Unidentified Justice: He didn't say I believe this one and I don't believe that one.

He didn't do that.

Mr. Howard: --Yes.

Well, I think that is his conclusion.

Unidentified Justice: What makes you think that?

Mr. Howard: Well, because--

Unidentified Justice: It is a summary.

Mr. Howard: --That is right.

It is a summary of the preceding testimony and then in the next paragraph he goes on to the next standard.

Unidentified Justice: Without ever saying I agree with that expert.

Mr. Howard: Excuse me?

Unidentified Justice: Without ever saying he agreed with the testimony.

Mr. Ganzfried: He didn't actually say I hereby find so and so, but I think--

Unidentified Justice: What he said was there is a disagreement and in view of the fact there is a disagreement the state is entitled to rely on the uncertainty.

Mr. Howard: Right.

But, I think he is finding that there is a substantial uncertainty.

That is to say that he is not finding that... He is finding that there is a legitimate uncertainty here.

Presumably there could be a situation where a state could come in--

Unidentified Justice: And, in case it does, the state can go ahead and protect its environment.

Mr. Howard: --Yes.

Unidentified Justice: That is what it says.

Mr. Howard: Anyway, I think that finding is there, at least I would characterize--

Unidentified Justice: The finding that there is uncertainty is there, yes.

Mr. Howard: --Yes, that is right, and that is what we need.

All we need to show is there is a finding as to uncertainty and there is substantial evidence to support that finding.

And, if that is the case, we think we should win the case.

Unidentified Justice: Do you know of any other states that have a similar rule?

Mr. Howard: No.

And, I think one of the reasons why there isn't is because the State of Maine... and it is in the record and the courts found this below... a unique and fragile fishery here which requires a prohibition of this kind.

Many other states have regimes where the state administrative officer, the Fish & Game Commissioner, let's say, has the power to regulate the importation of fish and presumably under those--

Unidentified Justice: Why are these shiners any more dangerous to Maine than they are to New Hampshire?

Mr. Howard: --Well, they would be equally dangerous to New Hampshire.

Unidentified Justice: New Hampshire lets them in, don't they?

Mr. Howard: I think they do.

At least--

Unidentified Justice: You don't know that?

Mr. Howard: --I don't know the answer to that, as to what the New Hampshire law is.

Unidentified Justice: What about Vermont?

Mr. Howard: I don't know, but the situation--

Unidentified Justice: Do you know of any other state that keeps them out.

Mr. Howard: --I know of no other state that has a statutory prohibition.

Unidentified Justice: Well, do you know of any other state that lets them in on the assumption that the threat is not very great?

Mr. Howard: It is a question of what the state administrative officers do with their administration discretion that legislatures may have given to them.

Unidentified Justice: So, I ask you again, do you know of any--

Mr. Howard: No, I do not know, but that doesn't mean it isn't being done.

In short, it is the fragility of the Maine ecology that requires a prohibition of this kind.

Unidentified Justice: --You mean some diseased fish would cause more havoc there than they would in the non-fragile New Hampshire fishery?

Mr. Howard: Yes.

We have a very unique fresh-water, pure-water fishery with a lot of... a small number of fish, trout, bass, salmon that are very vital to our state and because of that unique fact the state has a special interest in keeping that pure.

Thank you.

Chief Justice Burger: Thank you, gentlemen.

The case is submitted.

Attribution:

The OYEZ Project

Featured:

Thornburgh v. Amer. Coll. of Obst. & Gyn. - Oral Argument

Fri, 09 Jan 2009 14:48:34 +0000

Case:

Thornburgh v. Amer. Coll. of Obst. & Gyn.

Media File:

84-495_19851105-argument.mp3

Related Transcript:

1985_84_495_argument.xml

Transcript:

ORAL ARGUMENT OF ANDREW S. GORDON, ESQ., ON BEHALF OF THE APPELLANTS

Chief Justice Burger: We will hear arguments first this morning in Thornburgh against American College of Obstetricians and Gynecologists.

Mr. Gordon, I think you may proceed whenever you are ready.

Mr. Gordon: Mr. Chief Justice, and may it please the Court, this appeal is from a decision of the Third Circuit, which in reviewing a preliminary injunction ruling struck down numerous provisions of Pennsylvania's Abortion Control Act.

The case presents a variety of questions.

First, the Court must decide whether an appeal lies from a decision of a Court of Appeals which strikes down state statutes as unconstitutional but which remands for further proceedings on additional constitutional claims.

Next, the Court must determine whether the Court of Appeals' substantive rulings were consistent with this Court's recent decisions on the permissible scope of abortion regulation.

And finally, even if the Court finds that the Court of Appeals properly applied the law to the limited record before it, the Court must decide whether it was appropriate for the Court of Appeals to finally declare these provisions of state law unconstitutional before the state has been given a fair opportunity to present evidence in defense of the statute.

Unidentified Justice: Mr. Gordon, just as a matter of curiosity, is Governor Thornburgh still a party to this litigation?

Mr. Gordon: The parties did agree that he should be removed, but the District Court never entered an order on that, so technically I believe he still is a party, but he will be removed as soon as it is returned to the District Court and the District Court issues an order.

Unidentified Justice: Well, the case comes up here in a posture with a high official of Pennsylvania as the lead name, and he vetoed all this legislation.

It seems a little strange situation.

Mr. Gordon: Well, if I may, he vetoed a prior bill.

This particular statute he did sign, and he approved this statute.

Now, before discussing the question--

Unidentified Justice: But you are taking the position he still is a party?

Mr. Gordon: --There has been no order of dismissal issued.

Unidentified Justice: Even though the parties have agreed that he should go out.

Mr. Gordon: Yes.

It is our understanding until the Court issues an order dismissing him that he is still a party.

Now, before reaching the questions presented to the Court this morning, I would like to sketch very briefly the procedural history of the case, which is relevant to the issues before the Court.

The statute was passed in June of 1982, and it was not until October that this lawsuit was filed.

About one month later, the plaintiffs filed a motion for preliminary injunction, and they attached to this motion 40 detailed affidavits.

On November 18th of 1982, the District Court issued a procedural order to govern the hearing on the motion for preliminary injunction, and as a part of this order, the District Court directed the parties to agree on stipulations, and also prohibited any party from contesting any fact at the hearing unless that party had positive evidence to offer in support of that particular fact.

So, stipulations were agreed upon, but they were agreed upon solely for the purposes of the preliminary injunction hearing, and they were largely drawn from the allegations of the complaint and the complainant's affidavits.

The District Court with one minor exception denied the preliminary injunction, and after lengthy consideration, the Court of Appeals struck down numerous provisions of Pennsylvania's statute.

First, the jurisdictional question.

As I said, the question is whether or not an appeal lies to this Court from a decision of a Court of Appeals striking down some provisions of state law but remanding to the District Court for further proceedings on additional constitutional claims.

The appeal statute does not expressly require that to be appealable a decision of a court of appeals must finally dispose of all constitutional issues, and in fact--

Unidentified Justice: You mean 1254 when you say that?

Mr. Gordon: --Twelve fifty-four two, that's right.

In fact--

Unidentified Justice: In other words, because Congress didn't say final judgment expressly, the inference is that Congress intended appealability even when there wasn't a final judgment?

Mr. Gordon: --I think it certainly permits that conclusion, but that is not our entire argument.

We don't base our entire argument on the omission of the word "final".

Unidentified Justice: Well, to the extent you base your argument on it at all, what does that do with 1254(1), which allows cert, as you know, before or after rendition of a judgment or decree?

Wouldn't that be superfluous if you were right?

Mr. Gordon: No, I don't believe so; 1254(2) applies to a very narrow class of cases.

Unidentified Justice: I am talking about 1254(1).

Mr. Gordon: Well, I know, and 1254(1) obviously applies to the broader range of cases.

I don't think the Court has ever held for cert that there need be a final order.

I think it is entirely consistent, and in fact the original version of the statute enacted in 1925 from which 1254(1) and 1254(2) are derived were worded similarly and very broadly.

Namely, both of those sections, and more particularly the predecessor of 1254(2), provided for an appeal in any case in a Court of Appeals if the decision was against the constitutionality of the state statute.

And certainly the decision under review here satisfies those general requirements.

The decision... the case was properly in the Court of Appeals, and the decision was against the constitutionality of the statute.

Unidentified Justice: Well, I know, but the question is whether there is a final judgment.

Mr. Gordon: We don't argue that there is a final judgment in this case.

Unidentified Justice: But you say it is nonetheless appealable under 1254(2).

Mr. Gordon: Yes, we do.

Unidentified Justice: I am wondering why you can't read 1254(2) as Congress intending the long time requirement of final judgment obtained here and that 1254(1) was simply an exception.

Mr. Gordon: Well, we understand--

Unidentified Justice: Why can't it be read that way?

Mr. Gordon: --Well, the absence of the word "final" permits a reading either way, but it is our position that the general rule of finality does not, cannot, and should not be followed when there are particular policies which are relevant to a specific statute, and which support the conclusion that non-final review should be permitted.

As to the particular statute involved in this case, namely 1254(2)--

Unidentified Justice: Yes, but if we have to read 1254(2) as Congress telling us that you couldn't appeal anything here except a final judgment, that controls us, doesn't it?

Mr. Gordon: --I am not sure that I understand your question.

If you interpret it as requiring a--

Unidentified Justice: A final judgment, then--

--That is the end of it.

--that is the end of it.

Mr. Gordon: --Then we request that the Court grant certiorari in this case.

That is our alternative argument.

As I was saying, in this particular statute, Congress was concerned about the effect on federal-state relations, which comes about when a federal court strikes down a state statute, and while the power to declare state statutes unconstitutional obviously is necessary if we are to preserve the federalist system, Congress believed that states should be entitled to enforce their laws absent this Court's decision of unconstitutionality.

This policy--

Unidentified Justice: Getting back, if I may, since I had to interrupt, now, as I understand it, there are apparently several provisions of this Pennsylvania statute still before the District Court, are there not?

Mr. Gordon: --That's right.

Unidentified Justice: And as to the five... there are five here, are there not?

Mr. Gordon: Yes.

Unidentified Justice: And as to those five, did not the stipulation of facts expressly reserve the right to make a record in the District Court so that our holdings could be, I gather, changed by subsequent factual developments?

Mr. Gordon: That was certainly the intention at the time when that stipulation was entered into.

Unidentified Justice: Why should we treat with these important questions now?

Where do we actually get a true final judgment out of the District Court before we address them?

Mr. Gordon: Well, the problem is that the Court of Appeals issued a final judgment as to these particular statutes in this case.

There is no other way to interpret their decision other than it being a final declaration as to these provisions that we have brought before the Court this morning that they are unconstitutional, that they cannot be enforced, and that there is nothing that we could prove on remand or should be able to prove on remand that would change that result, so that is the difference.

Unidentified Justice: Well, would you be satisfied if we simply said the Court of Appeals erred in entering a final Judgment on those issues?

It should have just said the injunction was not an abuse of discretion?

Mr. Gordon: No, we wouldn't be satisfied with that.

Unidentified Justice: I wouldn't think you would be.

So why are you making this argument?

0 [Generallaughter.]

Mr. Gordon: Well, let me tell you why.

I don't think that would really get us anywhere for this reason.

Plainly, if the Court of Appeals held that the statutes are unconstitutional, they would have if they applied the proper standard of review at the time found that there was a likelihood of success on the part of the appellees on the merits, and it is our position that that conclusion was plainly incorrect.

Unidentified Justice: So you would have attempted to come here anyway if the Court of Appeals had just said the preliminary injunction was all right?

Mr. Gordon: Well, I am not certain that we would have.

Unidentified Justice: Well, if you wouldn't, why should we do anything more than affirm them as to the preliminary injunction?

Mr. Gordon: Well, the difference is this, first of all, that that isn't what they did, and it is clear, I would think, that if that is all this Court does, then it would be an exercise in futility for us to go back to the District Court anyhow, because no District Judge is going to be able to look beyond the fact that the Court of Appeals reached the merits, and feels rather strongly, to say the least, that these provisions are unconstitutional.

As I was saying, this policy--

Unidentified Justice: Mr. Gordon, for which of the statutes at issue here is there in your view a need for additional factual record before a final adjudication on constitutionality is proper?

Mr. Gordon: --Let me say that it is our position based upon the appellee's apparent conception that they have no additional evidence to offer that the Court may reach the merits and uphold these statutes based on this record.

If the Court disagrees with our position on the merits--

Unidentified Justice: Well, you take the position then that no additional factual record is necessary for the final decision on any of these statutes and their validity?

Mr. Gordon: --We take the position that the Court may uphold these statutes based on this record.

However, if the Court concludes that the Court of Appeals properly applied the law to the limited record before it in finding that there were problems with the statute, then we have evidence to offer on most of the provisions.

I would say probably the one exception is the second position requirement, where the only contest is whether or not you can read this particular statute as including an exception for an emergency.

I don't think there is any additional evidence we have to offer on that provision, but on the others, I think there are additional justifications by way of facts that we can offer if the Court deems that necessary.

Unidentified Justice: Do you take the position that abstention is appropriate as to any of the statutes to allow the state courts to interpret them?

Mr. Gordon: I am not sure that it would be feasible.

Pennsylvania has no particular certification procedure that we could use to get a ruling on the interpretation of these statutes, so I am not sure that extension would be a feasible alternative, and frankly, I don't understand abstention to be the proper course when the statutes can clearly be interpreted in a constitutional manner, and that certainly is our argument.

Unidentified Justice: May I ask, Mr. Gordon, did I correctly understand that the reservation to make a further factual showing may be triggered by either party?

Mr. Gordon: At the District Court level?

Unidentified Justice: Yes.

Mr. Gordon: Absolutely.

In fact, it was done in this case.

There was a reservation.

Unidentified Justice: Well, I am speaking as to the five provisions before us.

You have a stipulation as I understood it that expressly reserved the right to make a record in the District Court as to the five issue you have before us.

Is that right?

Mr. Gordon: As to those and all of the issues that were involved, yes.

Unidentified Justice: Yes, and that reservation may be triggered without regard to what the Court may think by either party to the stipulation?

Mr. Gordon: That was certainly our understanding when we entered into it.

The difference at this level is that based upon the Court of Appeals decision, the appellees take the position they have nothing additional to offer, so there has been a change since we entered into that stipulation.

Now, just to finish up the jurisdictional point, it is our position that this interest that Congress recognized in the appeals statute is as surely damaged by an interim decision such as this one as it is by a final one, and it requires that cases such as this one be appealed.

We request the Court to take jurisdiction over this appeal.

The Court has recognized that a woman in appropriate circumstances is entitled to have an abortion free from state regulation.

But at the same time the Court has held repeatedly that there is a permissible role for the states to play in ensuring the protection of maternal health and life.

In passing the statute under review here, the Pennsylvania legislature attempted to strike the balance which this Court has mandated in its decisions.

In some respects, based upon subsequent decisions of this Court, the legislature misstepped, and so we conceded the invalidity of several provisions of the Act while we were still in the Court of Appeals.

But as to the provisions that we have brought to the Court this morning, the legislature clearly showed a proper regard for the rules which this Court has prescribed.

For example, the Pennsylvania statute provides that a second physician should be present at abortions performed after viability.

Now, it is common ground among the parties that the state may require that a second physician be present, and the parties also agree that there must be an exception to this requirement if an emergency prevents the attendance of a second physician.

We differ only on whether this statute contains such an exception.

In our view, a view shared by Chief Judge Sikes below, the statute clearly provides for such an exception.

It is a complete defense to any charge brought under the section of which the second physician requirement is a part that the abortion was necessary to preserve maternal life or health.

This exception is plain.

It is far plainer than the one which was found by the Court to be acceptable in the Ashcroft case, and so this provision clearly should be upheld.

Next, the informed consent requirement.

The notion that patients are entitled to relevant information before submitting to a course of medical treatment is well accepted in the law.

This doctrine of informed consent has been developed by the courts and the legislatures--

Unidentified Justice: Mr. Gordon, it would help me a little bit if in your argument you would identify the sections you are talking about as you go along.

I caught up on the other one, but it--

Mr. Gordon: --Okay.

The informed consent provision is Section 3205 of Pennsylvania statute.

As I mentioned, the doctrine of informed consent has been developed by the courts and the legislatures to protect the patient, and the Court has recognized that this requirement may be extended to the abortion procedure, that women are entitled to know what will be done, the consequences of their choice, and the alternatives to abortion.

In fact, the Court has indicated more recently in the Affrin case and by way of a summary affirmance regarding Pennsylvania's prior statute that a state permissibly may set forth general requirements, categories of information which must be given to a woman to ensure her informed consent, and there is a very real need for this type of statute.

The Pennsylvania legislature specifically found and the evidence revealed that women, despite existing requirements for informed consent, are not always being provided with relevant information, and it has been reported that some clinics encourage women to undergo abortion by withholding information which might cause them to bear the child to term.

The Pennsylvania statute does not put words in the mouth of the counselor or the physician, and it describes only in general terms the information which should be offered.

It contains no parade of horribles, no statements of dubious validity, and it gives doctors and counselors the room they need to tailor the exchange to the needs of each individual patient.

These requirements hardly erect an unconstitutional obstacle to abortion.

Next, the reporting requirements which are found in Section 3214 of Pennsylvania's statute.

These reports which are described in the statute are easily completed, and there has been no showing that the minimal effort required to complete these forms translates into a restriction on abortions.

The reporting of data on abortions plainly serves important health interests by advancing the study of this medical procedure, and there is no serious contest over the relevance of this information, much of which already is reported to federal officials.

Of course, if this information is to be of any value in research, it must be available to researchers who are studying this problem.

And the statute adequately protects confidentiality by deleting the names of the patient and the doctor and providing severe penalties for unauthorized disclosure.

Next, Pennsylvania in Section 3206 of the statute has provisions which require minors to obtain parental consent or judicial approval for abortions.

Pennsylvania's statute clearly satisfies the general requirements which this Court has prescribed in this area.

Now, appellees argued in the Court of Appeals that the statute is too general, and that it must be augmented by procedural rules.

In the absence of such rules, the Court of Appeals accepted this argument and enjoined the statute.

Since that time, rules have been issued, and yet appellees continue their attack on the statute, an attack which in some respects is similar to the one they presented below, and in other respects has shifted focus to take account of the new rules.

But the essential question whether this statute is constitutional is still a live question.

The specific inquiries have been altered somewhat by these new rules, but certainly the Court faces no insurmountable obstacle in addressing the appellee's facial complaints.

All that is required in the way of procedure for a provision like this is that the minor be provided with an effective opportunity to obtain judicial approval, and these rules and the statute together provide as adequately as they can for quick, confidential proceedings.

They do not, as the appellees suggest, permit parental involvement in every case.

The state courts are given authority to appoint counsel, to appoint a guardian, but are left with their traditional discretion in these matters.

This statute is plainly constitutional.

It is an important provision, and it should be permitted to go into effect immediately.

The final provision of Pennsylvania's statute which is before the Court involves the choice of abortion technique or method which must he used during abortions performed after viability.

This statute provides limited protection to the viable fetus.

It requires that after viability the doctor used the abortion technique which is least risky to the fetus unless that technique would pose a significantly greater risk to the life or the health of the woman.

We do not argue that the state may require that a woman sacrifice her life or health to preserve the chances for survival of the fetus, and in our view this statute, by using the phrase "significantly greater risk", does no more than use a term which is familiar to physicians and researchers in this field, namely, a difference in relative risk that is statistically or scientifically meaningful.

In all research, statistical experts, medical researchers recognize that even under the best of circumstances, under the best design test, there may be differences in relative risk which are not scientifically or medically meaningful, and this statute does no more than recognize this common understanding.

For these reasons and those outlined at greater length in our brief, the conclusions of the Court of Appeals were plainly incorrect, and they should be reversed.

But even if the Court decides that the Court of Appeals properly applied the law to the limited record before it, it was inappropriate for the Court finally to declare these provisions of state law unconstitutional before the state has been given a fair opportunity to present evidence in support of the statute.

At the very least, the decision should be vacated and any order limited to a preliminary injunction.

I would like to reserve the remainder of my time for rebuttal.

Thank you.

Chief Justice Burger: Very well.

Ms. Kolbert?

ORAL ARGUMENT OF KATHRYN KOLBERT, ESQ., ON BEHALF OF THE APPELLEES

Ms Kolbert: Mr. Chief Justice, and may it please the Court, on at least 12 occasions since 1973 this Court has been called upon to define the scope of a woman's fundamental right to choose abortion.

Only two years ago this Court decided Akron and Ashcroft, and forcefully reaffirmed the landmark case of Roe versus Wade.

If this Court reaches the merits, the parties agree that the sound constitutional principles in Akron and Roe and all of the cases following it are controlling.

Before addressing the merits, however, I will first address the question of this Court's jurisdiction.

Appellants concede that this case is interlocutory, that it arose as an appeal from the ruling on a preliminary injunction.

Appellants also concede in their briefs that finality has always been the prerequisite to the mandatory appeal jurisdiction of this Court under Section 1254(2).

With no support and precedent, the Commonwealth asked the Court to reject a rule that has been an integral part of appeal practice throughout this century.

Although Congress has narrowed the scope of the appeal statutes several times in the last 60 years, it has never modified Section 1254(2) to disturb the finality requirement.

If there is a need to change this finality rule, Congress can and will do so.

Unidentified Justice: Well, does 1254(2) by itself speak in terms of finality?

Ms Kolbert: Your Honor, it does not, but in 1891, in a case called MacLeish versus Roth, this Court found that the absence of the word "finality" did not mean that finality was not required.

This Court applied the finality rule to appeal statutes, and Congress knew that when passing this Section 240 which was the predecessor to Section 1254(2).

Since that time, this Court has specifically applied finality to the Section 1254(2) and this Court has never retreated from those rulings.

The importance of the finality rule is really very well demonstrated by this case.

Given its piecemeal nature, it is very possible that this case could come before the Court at least twice and possibly three to four times if appellant's argument is to hold weight.

Unidentified Justice: Would it then have been enough if the Court of Appeals had said because of possible doubts about constitutionality it would simply enter the preliminary injunction and let events take their normal course?

Ms Kolbert: Your Honor, we believe that the Court of Appeals could have easily done what it did, which is reach facial constitutionality of the five provisions which it held unconstitutional, because as a matter of law the District Court had applied both the wrong standard and there was no possible way to construe the statutes in a constitutional manner, but yes, we were before the Court of Appeals asking for the vacation of denial of the preliminary injunction, and that would have been fine for us at that time.

Unidentified Justice: Undoubtedly when lawyers go in to get a TRO or even at the preliminary injunction stage they aren't ready always to litigate constitutionality on a complex matter, are they?

Ms Kolbert: No, and we were not, Your Honor.

This case came up before the Akron and Ashcroft cases were decided.

We believed that this Court was... at that time that the Court was about to rule very conclusively on these matters, and had asked for a preliminary injunction until this Court ruled on those cases and the Court of Appeals could then... at that point it was in the District Court, but then the Court of Appeals held the matter until this Court ruled and could apply the rulings of these courts on this question.

Unidentified Justice: Did you urge the Court of Appeals to rule finally on the constitutionality?

Ms Kolbert: Yes and no, Your Honor.

The first time that we were before the Court of Appeals, we urged them to await this Court's rulings in Akron and Ashcroft.

On the second time that we appeared before them, we did feel that the rulings in Akron and Ashcroft were conclusive as to the facial validity of several of the provisions.

Unidentified Justice: Well, if there is no appellate jurisdiction, that doesn't mean there wouldn't be jurisdiction by certiorari.

Ms Kolbert: That is correct, Your Honor.

However, the policies that underlie the finality rule, that is, the policies of minimizing the docket of the Court and the policy against piecemeal review would also apply.

Unidentified Justice: We have never held that finality is required in certiorari jurisdiction.

Ms Kolbert: No, Your Honor, but there are some requirements of certiorari jurisdiction which are not met here.

There is no conflict in the circuits in these matters.

Although it is a significant issue, it will be before this Court on mandatory--

Unidentified Justice: That has been enough to get certiorari here in many, many cases.

Ms Kolbert: --That is correct, Your Honor.

However, in this case, there is no doubt the case will return to the Court under its mandatory appeal jurisdiction when the matter has been finally resolved.

We are not saying the Court should never hear these questions, only when--

Unidentified Justice: But at least we would have to determine to deny certiorari.

Ms Kolbert: --This Court would only have to determine--

Unidentified Justice: Well, they ask us to treat it as certiorari, if there is no appellate jurisdiction, so we would have to deny.

Ms Kolbert: --You would have to deny certiorari.

That is correct.

In the event--

Unidentified Justice: Ms. Kolbert, in the reply brief that your opponent filed, they point out the Walters case where it came up on a preliminary injunction.

Do you have any comment on the applicability of that case?

Ms Kolbert: --Your Honor, this Court has long distinguished Section 1254(2) from Section 1252, which was the Walters case, and in fact 1252 does contain explicit language that allows both appeals from final orders and appeals from interlocutory orders.

We believe that the appeal provisions have been treated differently, basically because in the Walters situation there was an appeal from a finding that a federal statute was unconstitutional.

In the event that the Court reaches the merits, I would like to address the post-viability provisions that are before the Court, and then discuss the reporting and informed consent provisions.

Appellees rely on our briefs for the parental consent and the second doctor requirements.

Pennsylvania makes it a felony to perform a post-viability abortion unless it is necessary to protect a woman's life or health.

This prohibition is not at issue here.

What is at issue is additional standards, additional standard of care requirements and choice of abortion methods that are imposed on a very small class of women who have life or health-threatening problems that force the termination of pregnancy at this late stage.

Post-viability abortions are extremely rare.

They are performed on women who desperately want to have their children, but unfortunately due to some kind of underlying medical disease or pregnancy-related disease are forced to terminate the pregnancy.

Under threat of criminal sanction, the Pennsylvania statute requires two things.

First, it requires the physician to use the standard of care that he would use as if the fetus were to be born prematurely rather than being aborted, regardless of the consequences to the woman's health.

Second, the physician must use the abortion technique most likely to result in a live born fetus unless that technique would cause a significantly greater medical risk to the woman.

Now, as found by the Court of Appeals, the significantly greater language on its face directly intrudes upon the ability of a physician to give his primary allegiance to his patient, that is, the woman, and forces the physician to trade off the woman's best medical care in order to only marginally increase the chance of fetal survival.

The Commonwealth concedes that such a trade-off is impermissible, but they ask this Court to delete the word "significantly" in order to cure the constitutional problems.

To do that, to delete the word "significantly", this Court would be forced to rewrite the statute, and we do not believe that the Court can do that.

But the statute, even if the word "significantly" were deleted, contains other problems.

It requires doctors to compare risks of differing abortion methods that are impossible to compare.

For example, a physician could use a prostaglandin method or a saline method on a woman who had diabetes or who had hypertension or combined, which is frequently the case.

Each method carries approximately the same risk of mortality in a mathematical sense.

The prostaglandin method, however, will increase the risk of stroke, and the saline method would increase the risk of uncontrolled diabetes.

What the doctor is required to do here is to compare those two risks, to say is the risk of stroke a significantly greater medical risk than the risk of uncontrolled diabetes, and it is that comparison that is impossible to make, especially without consulting his patient as to which risk she is likely or wanting to accept.

The question then becomes as a result of the statutory language, the vague language, and the impossibility of the judgment that the doctor is required to make what is going to happen.

It is our belief that criminal sanctions are likely to produce one of two results.

Either the physician will not provide medical care in these circumstances for fear of criminal liability or the doctor will use the technique which is the most fetal saving to the detriment of women's health, and it is that problem, putting the doctor making these judgments, that is problematic.

Moreover, and I think this is an important point, the prostaglandin method or the saline, in choosing between the two methods, although the prostaglandin method is a little less fetal toxic than the saline method, that does not change the fact that both methods are extremely likely to cause the death of a fetus.

So that to inject that criteria as a critical factor in deciding which method to use makes no medical sense and therefore puts the... and puts the physician into threat of criminal sanction.

Like the statute found... also like the statute found invalid under the Colautti decision, the standard of care requirement which is independent of the choice of method requirement contains no life or health exception.

It therefore compels the physician to treat a woman already suffering from serious health problems as if she were perfectly healthy.

For example, steroids often given to women in the late stages of pregnancy when they go into very premature labor in order to increase fetal lung capacity and improve the chance or the likelihood of fetal survival, this kind of treatment is contraindicated to women who suffer severe diseases, and in fact would be contraindicated for many of the women who are needing this kind of treatment, who are needing the abortion in the first instance.

The statute, however, has no exception for the life or health of the mother, and therefore requires the physician to provide medical care in a manner that is contrary to his best judgment.

For these reasons, the standard of care and the choice of method requirements must be found unconstitutional.

Turning to the reporting requirements, the reporting requirements contained in the Pennsylvania Act are unprecedented in their scope.

They under pain of criminal sanction again require physicians to report over 40 different types of information, including the basis of the physician's own medical judgment about each individual woman who obtains an abortion.

In addition to the separate reports that must be filed, these reports must be open for public inspection and copying, particularly in this area where public disclosure is likely to result in an increase of violence, intimidation, and harassment directed against providers of abortion services, and thereby chilling the exercise of constitutional rights both to the woman and the physician.

The reporting requirements cannot withstand scrutiny.

These reports go way beyond those found constitutional by this Court in Danforth, recordkeeping requirements that were characterized there as approaching impermissible limits.

Given these burdens, the Commonwealth must show that there is a compelling state interest to justify the reporting requirements.

This they haven't done and they cannot do.

In fact, the Pennsylvania Department of Health's past practice has shown that patient care may suffer if abortion providers and women are subjected to increased levels of harassment.

Indeed, when required to justify the reporting requirements and the public disclosure requirements of another section of this Act that was before the District Court on remand, the Commonwealth did not assert a public health interest at all.

Rather, they argued that such disclosure was justified because it advanced first amendment rights of protestors.

Even the Centers for Disease Control which in their briefs the Commonwealth acknowledges to be the leading public agency in the collection of health data is able to use aggregate reports that adequately protect the confidentiality of both the doctors and the women involved.

Unidentified Justice: May I ask a question?

Have any malpractice suits made use of information in these public reports?

Ms Kolbert: Your Honor, the reports have not yet become public.

As a result of the Court of Appeals injunction on these provisions and a subsequent injunction by the District Court as to other provisions, the reports have not become public, and earlier Pennsylvania law which I may say satisfied the CDC requirements for health data kept the reports totally confidential.

So, to my knowledge, in Pennsylvania no malpractice claims have been used.

There have, however, been a number of cases around the country where women's identities have been disclosed through reports, either in hospitals or through information that has been collected by opponents of abortion outside abortion clinics.

For example, opponents have taken pictures of women entering clinics, copied down license plate numbers, and tried to track down individual women.

As a result of that, there have been many suits that have been brought, not many, but several suits that have been brought to try to sue the opponents of abortion for those practices.

Unidentified Justice: You say these reports have not been made public.

I assume they aren't even being... they probably aren't even being kept, are they, with the injunction in effect?

Ms Kolbert: The reports at issue here are not being kept.

The reports under Section 3207 and 3214F which were the subject of the lower court proceedings after remand which involved corporate identification and the number of abortions performed per trimester are being kept but they are under order to be no public disclosure.

The reporting requirements, as I said, therefore must be held invalid, and I would like to turn quickly to the informed consent requirements in the Act.

The Court of Appeals decision finding the informed consent provisions of the Pennsylvania law unconstitutional must be affirmed.

To do so, the Court need only apply the Akron decision.

During the course of this litigation, after the Court decided the Akron decision, the Commonwealth conceded the unconstitutionality of both the 24-hour waiting period and the doctor only counseling requirements which are contained in Section 3205, the very provision that is before this Court.

Because the section is not severable, like the ordinance in Akron, the entire informed consent provisions must fall.

The specific informational requirements, however, are invalid in their own right for the same two equally decisive reasons that this Court condemned the Akron ordinance.

First, the information is designed not to inform a woman but to persuade her to withhold her consent altogether.

And second, the statute prohibits the physician from specifically tailoring the informed consent dialogue to the needs of the patient.

Now, counsel for the appellants this morning said, well, the doctor is free to tailor the information.

The statute does not say that anywhere within it, and that under the ruling in Akron is an equally decisive reason for striking down these provisions.

This statute requires--

Unidentified Justice: May I ask before you go on, is the physician required to advise the woman that the father will support the child?

Ms Kolbert: --Yes, he is, Your Honor.

It is either the physician or a counselor, a designated agent.

That appears in the second set of requirements in the Act.

Unidentified Justice: In view of statistics as to the number of unwed mothers that have children, what does an unwed mother understand when she is told that the father of the child will support--

Ms Kolbert: Your Honor, it is our view that to tell the woman that the father is liable for support, given the national crisis in the collection of child support enforcement orders that Congress has recognized, and the difficulty in the collecting of support may in many cases be misleading, but in addition to inform that, to use... to provide that information to certain women, such as a rape victim who must be informed that her assailant is liable for the support of her child if she carries the pregnancy to term can be extremely cruel and traumatic in that situation, and may force her to relive that trauma.

It is those very situations that that information may not be appropriate at different times.

It is our view that the statute must allow the physician to tailor the information to the specific needs of this patient, and he can't do that, or the counselor can't do that given the mandates of the provision.

The statute, as I said, is both cruel and inaccurate in some situations, and misleading, and also requires the provision of irrelevant information which can harm the health of the woman in certain instances.

Let me give you another example.

Informing a woman that there are unforeseeable risks to an abortion is an inaccurate statement given that abortion is the most studied medical procedure in American medicine today, and can only be intended by the legislature to arouse unwarranted fears of the woman.

In addition, it is irrelevant to provide information such that medical assistance payments are available or information that the state strongly urges the woman to contact particular agencies and consult private social agencies that are run by opponents of abortion in situations where the woman needs the abortion in order to protect her life.

In those circumstances not only is it irrelevant, but it could be harmful to the woman's health, and the facts in the record do show that.

Accordingly, the informed consent provisions must be held in invalid.

In conclusion, the Pennsylvania Act constitutionally infringes on the rights of women in consultation with their physicians to make critical decisions about abortion and to interfere with women's ability to control their own lives and health.

It has been argued to this Court that the controversy surrounding the abortion issues requires a retreat from the principles both espoused by this Court in Rowe and reaffirmed most recently in Akron, yet it is precisely this controversy that compels a clear and unwaivering dedication to those sound and fundamental principles.

This Court's steadfast adherence to Rowe and Akron is the only way to guarantee the protection of the cherished individual liberties at stake.

Accordingly, FOE has asked this Court to dismiss this case for lack of jurisdiction, or in the alternative to affirm the ruling of the Court of Appeals.

Chief Justice Burger: Do you have anything further, counsel?

Mr. Gordon: No, Your Honor, I have nothing further.

Chief Justice Burger: Thank you, counsel.

The case is submitted.

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ORAL ARGUMENT OF JOHN H. GARVEY, ESQ., ON BEHALF OF PETITIONERS

Chief Justice Warren E. Burger: We'll hear arguments next in Heckler against Edwards.

Mr. Garvey, I think you may proceed whenever you're ready.

John H. Garvey: Thank you.

Mr. Chief Justice and may it please the Court:

Section 1252 of the Judicial Code provides that any party may appeal to this Court from a decision by a court of the United States holding unconstitutional an act of Congress.

The issue in this case is whether the Government must appeal to this Court in a case where it concedes that the statute is unconstitutional and the only issue is the question of what relief should be provided.

The statute in this case is Section 211(a)(5)(A) of the Social Security Act, which deals with self-employment income from a family business in community property states.

What that section says is that if a family business is not run as a partnership then for purposes of old age, survivors and disability insurance all the income from the business shall be attributed to the earnings account of the husband, unless the wife is able to show that she exercised substantially all the management and control of the business.

In 1980 the Attorney General determined that that presumption made in that section was unconstitutional and informed Congress that he would not defend on appeal a case called Becker against Califano, which had held that section unconstitutional.

Three weeks later Respondent filed this action on behalf of a class of affected wives in community property states.

The Government acknowledged in the district court that the section was unconstitutional and did not defend it.

So the district court shortly entered judgment on the uncontested issue of liability and held the section unconstitutional.

Thereafter and until now, the only issue in this case has been what relief should be provided for that deficiency in the statute.

The Government proposed in the district court that, since the invalid provision was simply an exception to Section 211(a), the general rule applying in the 42 non-community property states, that what the district court should do was what was done throughout the rest of the country.

That is to say, if the family business wasn't run as a partnership then all the income should be attributed to one spouse or the other without the use of any presumption, after a determination of which one was chiefly responsible for running the business.

The district court disagreed and held, among other things, that in community property states the income should be divided between husband and wife according to the amounts of their labor in the business.

The Government appealed to the Court of Appeals, which dismissed in a one-sentence order saying it didn't have jurisdiction because of Section 1252, and the Government then petitioned this Court for a writ of certiorari.

Our position can be summed up briefly in two points: number one, only an appeal from the constitutional issue can bring a case to this Court: number two, the question of relief in this case is not part of the constitutional issue.

Let me begin with the first of those points.

Only an appeal from the holding of unconstitutionality can bring the case to this Court under Section 1252.

It's important to recognize at the outset that Section 1252 is a unique jurisdictional provision.

In that section what Congress did was to pick out from the whole universe of cases that customary go from the district courts to the Court of Appeals a few unique cases which, because of their great importance, were thought to warrant extraordinary treatment and immediate review in this Court.

The extraordinary treatment is, first of all, tat they're within the mandatory appellate jurisdiction of this Court; but in addition, they leapfrog over the Courts of Appeals.

And unlike even cases coming to this Court under Section 1253, they haven't had the benefit of review even by three district judges by getting here.

The reason Congress did this, in the words of the sponsor of the bill which became Section 1252, the reason was this.

The sponsor of the bill said:

"It is ridiculous that the final determination as to the constitutionality of an act of Congress be held in abeyance for two or three years and nobody knows whether or not it is constitutional. "

The House report said, in similar--

Unidentified Justice: Mr. Garvey, do you propose to shift at some point in your argument from the statement of the sponsors to the language of the statute?

John H. Garvey: --Indeed I do.

I intend to turn there briefly.

Let me, if I may, just finish this thought and then I'll turn to the language of the section.

The House report on the bill said that its purpose was to provide a prompt determination by the court of last resort of disputed questions of constitutionality of the acts of Congress.

This is not such a case.

As I will demonstrate when I get to my second point, it does not even involve a constitutional issue.

At most what it involves is something like a question of statutory intent.

At worst, it involves nothing more than a simple question about whether the district judge properly exercised her equitable discretion in providing a remedy for a conceded unconstitutional provision in the statute.

Those are like the questions that the Courts of Appeals address every day.

They are not the questions of extraordinary importance that Congress determined should come immediately to this Court.

Now let me turn to the language of the statute--

Unidentified Justice: I suppose some issues, although not constitutional ones, can be as important in other ways.

John H. Garvey: --That is certainly so.

There are many questions of statutory construction that are more important than some of the kinds of questions that can come to this Court under Section 1252.

Nevertheless, Section 1252 does not turn on the importance of the question, but on whether an act of Congress has been held unconstitutional.

Now, what the statute provides... and we have reproduced it at page 2 of our brief.

What the statute provides is, in the first paragraph it addresses what should be done with appeals from the holding of unconstitutionality.

In the second paragraph it addresses what should be done with other issues.

The first paragraph says:

"Any party may appeal to the Supreme Court from a judgment, decree or order by a court of the United States holding an Act of Congress unconstitutional in any civil action to which the United States is a party. "

Now, there are two ways in which that, in which the language in that first paragraph, can be read.

But I would suggest that only one of them makes sense in light of what Congress had in mind in providing this extraordinary review mechanism.

One way of understanding that language is that any party may appeal from any issue that is decided in a judgment or order along with the issue of the unconstitutionality of an Act of Congress.

So one way of looking at the judgment or order is that it's a kind of grab bag and, provided the issue of unconstitutionality is in there, a party is entitled to take any other issue up to this Court, even if the unconstitutional question is not brought to this Court.

So for example, if in this Court in the same judgment in which the district court held the statute unconstitutional it had also denied attorney's fees to the plaintiff, this grab bag interpretation of the first section would entitle the plaintiff to bring up to this Court the question of her entitlement to attorney's fees, even though the constitutional question is not presented.

Or, to take another example, if in the same judgment the district court had decided a pendent question of state law and nobody was interested in appealing the holding of unconstitutionality, this grab bag way of reading the first paragraph would entitle the losing party on the question of state law to bring it directly to this Court.

Unidentified Justice: By calling it a grab bag way of reading the paragraph, are you suggesting it's not a preferred or not a reasonable way of looking at the paragraph?

John H. Garvey: That's exactly what I'm suggesting.

Unidentified Justice: Well, certainly it doesn't seem implausible to me, given the language you just read, that you say any party may appeal to the Supreme Court from a particular kind of final judgment.

What kind of final judgment?

A final judgment holding any Act of Congress unconstitutional.

And if the final judgment meets that definition, it may contain a number of other provisions, and if you want to appeal any of them you have to go to the Supreme Court.

John H. Garvey: As I said, the language and the syntax of that paragraph will support that reading.

I suggest that that reading doesn't make a lot of sense in light of what Congress had in mind in adopting that section, and that there is another reading which can be given to it, which is that the first paragraph is entitled to authorize only appeals from the holding of unconstitutionality, that that is the issue which brings the whole case to this Court and that's an essential prerequisite for getting the case up here under the first paragraph.

Unidentified Justice: Mr. Garvey, did the United States take a protective appeal here?

John H. Garvey: No, we did not.

Unidentified Justice: Was that a conscious decision?

John H. Garvey: I don't know whether it was a conscious decision or not.

That interpretation of the first paragraph of Section 1252 I think is, the interpretation we propose, is supported by the language of the second paragraph, because what the second paragraph says is that once this notice of appeal, which I think is this proper Section 1252 notice of appeal, is filed, the second paragraph tells you what to do with the other issues in the case.

It says if any of those issues have been taken to other courts... that is to say, to the Court of Appealss... prior to the filing of the proper Section 1252 notice of appeal to this Court, they shall be treated as taken directly to this Court... that is to say, they will be transferred from the Court of Appeals to this Court... when the holding of unconstitutionality is brought here, so that the whole case can be decided together.

It also says in the first paragraph that the party who has received a notice of appeal under this section shall take any subsequent appeal or cross-appeal to the Supreme Court.

Now, the reason for that direction is, in the example that I gave earlier, if the winning party is sitting around drafting her notice of appeal on the question of attorney's fees to the Court of Appeals, where it would go but for an appeal to this Court on the question of unconstitutionality, the first sentence says that she ought instead to file the notice of appeal to this Court because the appeal on the constitutional question has brought the case here.

Unidentified Justice: Suppose, Mr. Garvey, that you have the whole range.

You have a decision on constitutionality, which would clearly in your view bring the case directly here, but that there were also some remedial factors and some attorney's fees.

Is there any statute that would prevent this Court, after it had decided the constitutional question, to remand the case for a determination, for an examination by the Court of Appeals of the other two questions that were not constitutional?

Or would this Court be required to decide all the issues?

I don't believe this Court would be required to decide all the issues.

I think the reason why the second paragraph directs the other issues to be brought to this Court is that in the ordinary case the party bringing them up won't yet have had a chance to have them reviewed and Congress didn't want those issues being decided simultaneously with the decision on the constitutional question in this Court so that inconsistent results might be reached.

But the procedure you suggest wouldn't result in possible inconsistencies in the determinations.

But one way or another, the parties would be entitled to review of the district court in some way?

John H. Garvey: Yes, they would.

The second paragraph, by leapfrogging over the Court of Appeals, deprives those parties appealing on other issues of their usual right to have at least one appeal in the Court of Appeals.

Well, that is our first point, that only an appeal from the holding of unconstitutionality can bring the case, although it brings the whole case, to this Court under Section 1252.

Our second point is that the question of relief in this case is not a part of the holding of unconstitutionality.

Respondent has maintained that the issue of relief here is an intrinsic aspect of the holding of unconstitutionality.

But that is not so, as I think a couple of examples ought to make clear.

Suppose that what the district court had done in this case after holding the statute unconstitutional was to adopt the approach the Government suggested.

Suppose the district court had concluded that, because this exception to the general rule in Section 211(a) was invalid, that it ought to apply the basic rule in Section 211(a) that applies in non-community property states.

If Respondent, plaintiff in the district court, had appealed that issue of relief to this Court, Respondent would not be able to contest the holding of unconstitutionality, having prevailed on it in the district court.

And the Government, having conceded the unconstitutionality of Section 211(a)(5)(A), would have no interest in contesting it in this Court, and yet the appeal would be brought directly here.

Or to take an even more extreme example, suppose the district court had gone a step further and actually... suppose this were an individual action.

Suppose the district court had gone a step further and actually recomputed the Respondent's earnings account.

Suppose that on the basis of that recomputation the district court had concluded that Respondent was entitled to collect $200 in old age benefits under the Social Security Act, and suppose that Respondent believed she was entitled to collect $205 a month.

If relief is in fact an intrinsic part of the holding of unconstitutionality, Respondent would be entitled to bring to this Court her disagreement with the district court about the additional $5 a month, notwithstanding that again she couldn't contest the holding of unconstitutionality, having prevailed on that issue in the district court.

Or, to take just one more example, suppose the district court had done what it did in this case and said that the income was to be divided between husband and wife, but that the district court had declined to recompute earnings accounts back to 1950 because, the court might say, some wives are going to be better off under those earnings accounts, under the earnings accounts of their husbands, than they will be under the new standard, and we don't want to disturb their reliance interests; and some husbands are going to be deprived of benefits if we recompute.

So we'll just make this prospective.

Once again, when the case got to this Court there would be no question about the unconstitutionality of Section 211(a)(5)(A).

Now, what those examples show, I think, are two things.

What they show first of all is that there is involved in this case at this point no constitutional question whatever.

The choice among the three types of relief that I suggested in those examples is not determined by the Constitution.

All three of them are constitutionally permissible.

What's more, the type of relief that the district court chose, the one of those three that I suggested or another one, the one that it chose, the type of relief that the district court chose might in fact be, for all we know, precisely the one that Congress would prefer it to apply, given the unconstitutionality of Section 211(a)(5)(A), which everybody concedes.

That means that the district court's decision on the question of relief, unlike its decision on the question of unconstitutionality, may very well be quite consistent with the wishes of Congress.

Unidentified Justice: But I take it it was not consistent with the Government's arguments there as to what the intent of Congress was.

John H. Garvey: Indeed not.

But whether or not it is inconsistent with the wishes of Congress is something that at this point we don't know, whereas its holding on Section 211(a)(5)(A) we do know is inconsistent with what Congress wanted, because wrote that into the statute and the district court said that statute is invalid.

So the question of relief may very well be consistent with what Congress wanted to do, and in that case I would suggest that there isn't the need for immediate review in this Court that exists in the case where the statute is actually held unconstitutional and that issue is still being litigated.

Now, I said that those examples showed two things and one of them was that the case didn't really involve any question of unconstitutionality; in fact, it really involves a question of what Congress would want to do, or maybe what it involves is a question about equitable discretion.

For example, in last example that I gave the district court took account of the reliance interests of people who were already collecting benefits under the invalid provision and said that maybe the most equitable approach is to protect their interests by making the judgment prospective.

Those kinds of decisions about what Congress had in mind, about the equitable... about the reliance interests of people who are already collecting benefits, are the kinds of questions that the Court of Appeals decide every day in cases of statutory construction, in cases where... in other cases involving issues about the proper remedy.

What's more, the impact of the decision on the question of relief is quite unlike the impact of the holding of unconstitutionality.

The impact might only be a difference of five dollars a month, as was shown in the second example that I gave.

I think--

Unidentified Justice: Mr. Garvey, can I ask you this question?

You use hypothetical examples, which is understandable because this problem doesn't exactly arise every day.

How often has this particular problem... has it ever arisen before where the Attorney General has conceded the unconstitutionality of a statute?

John H. Garvey: --Yes.

I think this is precisely the question that arose in Montana Contractors against Kreps, a case in which this Court dismissed for lack of jurisdiction.

The issue in Montana Contractors was whether the plaintiff was entitled to collect damages after the district court held the minority business enterprise provision of the Public Works Employment Act unconstitutional.

And I presume because the Government did not docket a separate appeal on the question of unconstitutionality, this Court dismissed plaintiff's appeal on the question of whether he was entitled to damages because of the enforcement of that provision.

Unidentified Justice: You say you presume.

Certainly our summary action doesn't explain it, does it?

John H. Garvey: No, your summary action does not explain it, although it does note that the dismissal is for lack of jurisdiction.

I would also suggest, Justice Stevens, that it may be, with the less frequent use of three-judge courts nowadays, that the question may be one of more significance in future cases than it has been in the past.

We suggested in our reply brief that the question might come up in the wake of this Court's decision in INS against Chada about questions of severability, which we say are really no different from the question of relief involved in this case.

So it is one which I think has not only arisen in the past, but may reoccur with some frequency.

Let me make just one last point.

The question in this case is not whether this Court should review the question of relief or not.

The question in this case is whether this Court should immediately review the district court's decision on the issue of relief, because we presume that if an appeal were taken to the Court of Appeals and the impact of the relief really were severe and it really was fairly clear that the relief chosen was not the one that Congress would have preferred, that certiorari is always available from the Court of Appeals' decision on the question of relief under Section 1254(1).

So the question is not whether this Court should review it; it's whether it should review it immediately, rather than after having the benefit of the Court of Appeals' determination.

If there are no further questions, I'd like to reserve the remainder of my time for rebuttal.

Chief Justice Warren E. Burger: Very well.

Mr. Dudovitz.

ORAL ARGUMENT OF NEAL S. DUDOVITZ, ESQ., ON BEHALF OF RESPONDENTS

Neal S. Dudovitz: Thank you, Mr. Chief Justice, and may it please the Court:

The issue before you today involves both determining the parameters of the appeals to this Court as well as appeals to the Court of Appeals under Section 1291.

As the Government has acknowledged, the federal district court in this case did hold a federal statute, Section 211(a)(5)(A) of the Social Security Act, unconstitutional.

It also went forward and awarded constitutionally adequate relief to the class members whose rights were violated.

The Government filed a notice of appeal from the district court order holding the statute unconstitutional.

But they filed that notice of appeal to the Ninth Circuit and not to this Court.

There was, as, Justice Blackmun, you noted by your question, no protective appeal filed in this Court.

Section 1291, which sets forth the jurisdictional parameters for the Court of Appeals, says that the Court of Appeals may not have jurisdiction if it's possible for there to be an appeal to this Court.

The operative word in the statute is the word "may".

If you may appeal to this Court, then the Court of Appeals loses its jurisdiction.

And as this Court has emphasized recently in its Donovan case, what that means is is that there is only one place for you to go when you're appealing from an order holding an Act of Congress unconstitutional.

The issue here then turns on whether or not this case presents a situation where the place for the Government to go if they had an appeal was this Court.

We believe that the requirements of 1252 are pretty clear right on its face.

They talk about, as most of the commentaries have pointed out, four basic requirements, three of which... that it be from a proper court, that it be a civil action, the Government be a party... are really not controversial and certainly are not in issue in this case, and the fourth requirement, that the order being appealed from must be from a holding that a statute is unconstitutional.

Well, there's no doubt that the order of the district court from which the Government appealed was in fact such an order.

And it is important to recognize in this case that their notice of appeal purports to be a notice of appeal from that entire order.

It simply says, we're appealing from that final judgment where the court, the district court, held the statute unconstitutional.

We contend that, on the basis of that kind of notice, which fits squarely within 1252 and particularly so in a situation as here where the issue the Government wants to contest is really the relief that the court fashioned consistent with the Constitution to remedy the violation.

Unidentified Justice: Well, Mr. Dudovitz, I'm curious to know how much of your position depends on the form of the Government's notice of appeal.

Supposing everything were the same here except the Government's notice of appeal said, the Government appeals from all of that order the district court entered except that portion holding such and such unconstitutional.

Do you think that should have gone to the Court of Appeals?

Neal S. Dudovitz: No, I don't think that should have gone to the Court of Appeals.

I think the fact that the Government did that sort of highlights why this case is appropriate, but in and of itself it is not determinative.

And that is because what it highlights essentially is there was a choice.

And as I pointed out, under 1291 when there's a possibility that seems to point us toward 1252.

In fact, the Government would concede that.

The Government would concede that they in fact could have appealed the constitutional issue to this Court even though they didn't contest it in the district court, similar to what happened in the Clark case, where they didn't contest it in the Court of Claims and then appealed it to this Court.

So that's something that the Government says can happen.

Unidentified Justice: Suppose a concession of unconstitutionality was made and the Court of Appeals rejected it.

Would there then be a decision under 1252 on the constitutionality?

Neal S. Dudovitz: Yes, there would, because--

Unidentified Justice: And then what should be done?

Neal S. Dudovitz: --1252 is not limited to applicability in the district court.

It also applies to the Court of Appeals.

Unidentified Justice: Oh, I didn't make myself clear.

I mean when it came to the Court of Appeals, the district court not having passed on it but having accepted the concession, the Court of Appeals said, no, we don't accept concessions on constitutional issues and we're going to decide it.

Then could they decide it?

Neal S. Dudovitz: I guess your question presumes that it was proper for that case to get in the Court of Appeals in the first place.

If it was, as I was trying to say, if it was and then the Court of Appeals holds the statute unconstitutional, then you're going to be under 1252 and the appeal from the Court of Appeals could come directly to this Court because, as I was saying, 1252 is not limited to the district court.

Unidentified Justice: As an appeal and not as a cert.--

Neal S. Dudovitz: Not as a cert, that's correct.

With regard to the relationship of the relief to the constitutional question, I would point out that the Government itself agrees, as they've noted on page 3 of their reply brief, that the district court must address the questions of relief as a consequence of holding that statute unconstitutional.

That is something the court had to do.

That was part of its job once it found that statute unconstitutional.

And it seems to me that that puts that issue as a predicate; that the predicate to that issue therefore is the holding of unconstitutionality, which therefore binds the Government to do something.

And that's the kind of problem that the court... excuse me... that Congress wanted to bring to this Court.

When the Government was going to be bound, when something was going to happen to the Government as a result of holding the statute unconstitutional, Congress wanted this Court to quickly and promptly resolve that problem, to make sure that the disruption to the Government was minimum.

Now, the Government's line here that they've attempted to draw we contend just plainly doesn't fit within the statute on its face.

They are trying to draw, in a sense here, lines which do not exist.

There is no phrase or statement in Section 1252 that suggests that the issues to be appealed must be the question of constitutionality.

Unidentified Justice: --Certainly there are intimations in the second paragraph, aren't there?

Neal S. Dudovitz: There are, but it's very different, Your Honor, from the kinds of language that exist in the other direct appeal statutes, that talk more about the kinds of issues, such as 1257 and 1254.

And it's also very different from the earlier predecessor of 1252, which was repealed in 1925.

And in that earlier language, which the Government cites in its cert petition at page 11, the statute said that in any case that involves constitutional construction on application of the Constitution or in which the Constitution or the laws of the U.S. are brought into question, that that's when you bring a case up.

Now, the Congress didn't go back and bring that language back.

Unidentified Justice: But now take the second sentence of the second paragraph on page 2 of the brief:

"All appeals or cross appeals taken to other courts prior to such notice shall be treated as taken directly to the Supreme Court. "

Now, that hypothesizes that appeals to the Court of Appeals by some party would have been proper in the case of a judgment which held an Act of Congress unconstitutional, don't you think?

Neal S. Dudovitz: Well, I contend and we have argued that what that could very well be referring to is in fact other kinds of appeals, such as interlocutory appeals, which may have been appropriate in the Court of Appeals prior to the holding of the Act being unconstitutional.

The real import of the entire second paragraph is to make sure that when this Court gets a case where an Act has been held unconstitutional, it gets all aspects of the case so that it has the power to determine what should be done in this situation to make a final and quick decision in order, again, to avoid disruption to the Government.

Unidentified Justice: That's certainly part of what the statute is trying to do.

But another part, as your opponent has suggested, is to select out a very few cases that Congress felt deserved the immediate attention of this Court, and certainly the focus of Congress was on the declaration of unconstitutionality.

Neal S. Dudovitz: Well, I agree it's very few cases, and I can partly, I think, try to answer Justice Stevens' question about how many cases.

There is a statute, which of course the Government has cited, which requires the Attorney General to notify Congress when they're not going to appeal from a holding of unconstitutionality.

It's my understanding that in the years '81, '82 and '83, subsequent to this case, there have been two times where the Attorney General has so notified the Government.

That's other than the one time before in this case.

We're not... this is one of those unique cases.

There aren't very many times when this happens.

In fact, the Government itself points out the great difficulty it always has in conceding the unconstitutionality, that they rarely do that.

So this is a unique case.

I don't think it's a common case in any way.

Let me add, Justice Rehnquist, to one other major reason I believe that the kind of line that the Government wants to draw here in terms of constitutionality doesn't make sense, and that is because it's really premised on the theory that in interpreting the statute this Court ought to be trying to minimize its mandatory docket.

Now, whether or not we all think that that's something that ought to be done, the fact is that this Court has held very explicitly that 1252 is not to be so interpreted.

In fact, the purpose of 1252, as this Court has held before, is to expand the mandatory docket and not restrict it.

And therefore, the Court should not view the language here with the idea of supporting the minimizing of the mandatory docket, but rather with the idea of what Congress desired.

Unidentified Justice: I don't think our cases support you.

If I understand your contention, you're saying that once Congress has decided to expand the mandatory docket by passing a statute such as 1252, that statute ought to be generously construed.

Now, I think that the whole history of the three-judge court situation and appeals from three-judge courts indicates that this Court recognizes when Congress wants to increase our mandatory docket, but it doesn't construe those statutes generously or beneficently, or whatever you want to use, the term.

Neal S. Dudovitz: I think this Court has explicitly said, going back to the McLucas case and in the Grace Brethren Church case, that 1252 is not to be construed in the same fashion as 1253, the three-judge court.

It is separate--

Unidentified Justice: No, but what it said in McLucas was that it shouldn't be construed in the same way that the three-judge court appeal statute was, where we held that in order to have the appeal the three-judge court had to have jurisdiction.

We said that wasn't required here.

But I don't think that really is the same thing as saying we'll treat as broadly as possible the substantive definitions of what can be appealed.

Neal S. Dudovitz: --Well, I guess, Justice Rehnquist, as I read those cases the Court has really said that the basis for the 1253 cases was in fact carrying out the principle of limiting the mandatory docket of this Court, and as a result that 1253 was going to be interpreted, if interpretation was necessary, in a restrictive way.

On the other hand, the cases... and they go back before these three-judge court cases.

The Reid case, where the word "party" was interpreted; that the Court specifically said, we're not going to take a restrictive view of the word "party", we're going to take a more broader view of the word "party".

Another... let me add a final point on what I think are some problems with the Government's line drawing, and that is I think it's very difficult to draw that line and then make it consistent with the footnote in the Regan case, where it says that an appeal by a party who succeeded in the lower court on an issue which the lower court found to be constitutional fits within the first paragraph.

That is not an appeal on the issue for which the court held unconstitutional at all, and in fact, as the Government has pointed out in its reply brief in Regan, the real reason for that appeal was relief, because in order for the plaintiffs to get the relief they wanted they needed to try to succeed on a different issue.

They were really appealing relief.

And the Court didn't say that that issue comes up under the second paragraph as a further appeal once the Government made its appeal.

Instead, it said it comes up under the first paragraph.

It comes up under that more broad language.

And I think that that's consistent with what we're arguing here.

Unidentified Justice: Mr. Dudovitz, you have referred to the Grace Brethren Church case as supporting your view and it seems to me it does no such thing.

Jurisdiction under 1252 in that case was premised on the district court's implicit but necessary holding that the federal statute was unconstitutional, and the Government challenged that holding.

That's the point which you omitted.

Neal S. Dudovitz: Well, I understand that the Government challenged the constitutional holding.

But it seems to me... well, first of all, I don't believe there is any case that the Court has actually handled that is exactly the same as this case.

Probably we wouldn't all be here if that were true.

But what Grace Brethren does, I believe, is it follows a line of cases from this Court which indicates the broader interpretation of what it means to hold an Act of Congress unconstitutional.

We have cases like Fleming, where--

Unidentified Justice: But Grace Brethren was wrestling with the problem of whether it was an implicit holding of unconstitutionality.

Neal S. Dudovitz: --Right.

Unidentified Justice: That's all.

It didn't deal with this question at all.

Neal S. Dudovitz: What it does, I think, is it follows from first the holding that you don't really have to hold an Act of Congress unconstitutional; it can be the Act applied, which is a much earlier line of cases from the Fleming case.

And then... and I do think that it's taken at least somewhat of a step further to say, not only do you not have to hold the Act itself unconstitutional, but in fact if you held a state statute unconstitutional but it effectively tied in the federal statute and affected the operation of the statute program, the Federal Government... I think the language of Grace Brethren talks about the Federal Government being effectively bound by that decision of the lower court... then you're also under 1252.

Unidentified Justice: It found, of course, that implicitly the federal statute was held unconstitutional and the Government challenged that.

So it is not this case.

Neal S. Dudovitz: I wouldn't disagree that it was not this case.

All I'm trying to suggest is that its view of how to interpret 1252 is consistent, I believe, with our view of how you interpret 1252.

Unidentified Justice: Mr. Dudovitz, while you're pausing let me just be sure I'm right about one assumption.

Taking your opponent's hypothetical appeal on attorney's fees, where you wanted to appeal because the court didn't allow them, denied an allowance entirely, you would agree that should come here under your reading of the statute?

Neal S. Dudovitz: I would not.

I think what comes here under my reading of the statute is relief that is necessary to remedy the constitutional wrong.

The attorney fees relief doesn't come from that.

It really comes from a separate statutory basis.

That is, if the statute wasn't there, if we didn't have the equal access to justice statute--

Unidentified Justice: Well, assume it's a single judgment.

The court says, it's hereby ordered that the statute is declared unconstitutional, that's paragraph one.

Paragraph two is, there will be an award of attorney's fees of $1,000.

You appeal from that judgment and you say, the only relief I want is an increase.

You are not contending that that appeal would be to this Court?

Neal S. Dudovitz: --Let me try to clarify that.

I think my view is that as the statute is set out that definitely does fit within it, and I think that's how this Court has to interpret the statute, that that's correct that--

Unidentified Justice: I'm not sure whether you're saying there would be jurisdiction here or not.

Neal S. Dudovitz: --On its face I think that there would be jurisdiction.

What I'm saying is that if this Court feels... and I would point out also that we're far different from that--

Unidentified Justice: I understand.

Neal S. Dudovitz: --situation in this case.

But if this Court feels that it has to in a sense draw some lines... I mean, I think the statute is fairly clear on its face, but if you have to draw some lines, the relief aspects I think that fit within the constitutional question are constitutionally required relief.

And attorney fees is not constitutionally required relief.

Unidentified Justice: So you're in effect arguing, you're challenging your opponent's second point rather than his first point.

In other words, he argues: one, it has to be an appeal from the constitutional holding; and secondly, he argues this case does not involve a constitutional issue.

You're response to that is: No, this case does involve a constitutional issue and that's why it's appealable.

Neal S. Dudovitz: That's right.

Unidentified Justice: You're not arguing that it would be appealable even if it did not present a constitutional question?

Neal S. Dudovitz: Probably partly arguing both.

I think that--

Unidentified Justice: You're not, then, really relying on your sort of plain language... you're not resting your whole--

Neal S. Dudovitz: --I would not rest solely on the plain language.

I think even if you don't do the plain language we're still there, because effectively this is a constitutional ruling.

Unidentified Justice: --Right.

Neal S. Dudovitz: But under the plain language there's no doubt.

I mean, it seems to me that, as the Government would concede, if the plain language were correctly undoubtedly this case should have been here under 1252.

Unidentified Justice: Whether it's a constitutional ruling or not that's being appealed?

Neal S. Dudovitz: Well, as long as the district court held the statute unconstitutional, that's correct.

Unidentified Justice: Yes, but you're much less confident on that argument, as I understand you.

You aren't taking a four-square position that the attorney fee issue by itself would be appealable.

Neal S. Dudovitz: I'm saying that I think you can set that issue aside if you want to, because of the fact that the relief doesn't flow directly as a remedy for the constitutional violation.

Let me finally turn to one other point which the Government has requested here to this Court which I want to address briefly, and that is they have asked that, even if this Court determines that we are correct, that the Court ought to vacate the district court's order and remand to allow the district court to enter a new judgment, from which a new notice of appeal could be filed, and therefore they could then appeal to this Court and have the relief issues brought here.

We think that that is a particularly inappropriate action for this Court to take should the Court decide in our favor.

I think the question of whether you do that or not is really an equitable kind of decision and you must look at what the effects of that are and what actions of the Government ought to be protected here.

First, the effects of it could be very disastrous to the class members in this case, who are old and disabled women who, as the district court noted, are largely living on the social security benefits, some of which they receive as a result of this, the district court's ruling.

The district court's relief has been fully put into place by now.

In fact, it was required to be so by August 1983.

The Government, while it sought a stay in the district court, did not pursue the stay.

They did not argue that having the relief implemented while this was going on was going to be necessarily particularly harmful to them.

So it seems to me that their failure to do that, the effect that this has on the class members, and finally the fact that the Government didn't take any action which you ought to really protect, which Justice Blackmun pointed out by his question, they didn't file a protective notice... and it seems to me after the Donovan case, which you remember came down three or four months before the final judgment in this case, that at worst from the Government's position there were some questions to be asked as to where an appeal ought to go.

The Government didn't do anything in this situation to try to suggest that they were... to protect themselves.

They could have filed two notices of appeal, something that happens all the time.

They could have tried to say something in their notice of appeal.

They could have done something to indicate their awareness of what they say is a difficult problem.

Given those circumstances and the effect on the Plaintiffs, and finally noting that if what's left here in this case is just the relief ordered by the district court that also is relief that can be remedied somewhere else.

Congress can remedy that if the Government thinks that the relief that's left by the district court is particularly inappropriate.

In fact, Congress has acted on many occasions in these social security sex discrimination cases to set forth new rules and new standards.

So that to leave in place relief for a statute we all agree is unconstitutional and then to have another forum available to remedy that relief it seems to me is not very onerous.

In fact, it's less onerous, I think, than what happened in the Donovan case, where what was left in effect was the ruling a statute was unconstitutional when the Government thought the statute was constitutional.

And so it seems to me that we are not any different than that.

Just one other point before I close, and that is the Government made the comment that the Montana Contractors case was in effect on point here.

And I agree first with the comment of Justice White that that summary affirmant should have little effect as a precedent even if it were.

But I don't think it really is on point.

My understanding of reading what happened in that case is the Government did in fact first appeal, file a notice of appeal to this Court on the constitutional question.

As a result, the plaintiffs had no choice under 1252 but to file their second appeal to this Court.

I think we all agree that once an appeal is here under 1252 there is no choice.

The Government then decided not to perfect its appeal.

The Government never filed a jurisdictional statement.

It dropped its appeal and then moved to dismiss the other party's appeal.

They sort of got stuck in this Court, and therefore the Court... and then the Court held lack of... no jurisdiction.

It seems to me, given the extraordinary circumstances of that situation, that that's really not a case that ought to stand as precedent for this situation, which is far different.

So I would again urge this Court to remember the uniqueness of this kind of situation.

It doesn't happen very often.

It happens very rarely and it does present, I think, a situation where Congress wanted this Court to be the determining factor of what was going to happen to this kind of federal program.

Thank you.

Unidentified Justice: Anything further, Mr. Garvey?

REBUTTAL ARGUMENT OF JOHN H. GARVEY, ESQ., ON BEHALF OF PETITIONER

John H. Garvey: I just have three brief points, if I may.

If I understand correctly what Respondent's counsel has said, essentially, unless they're able to win on this unlikely point regarding the first paragraph, what this case all boils down to is whether the relief in this case is constitutionally mandated.

That, as the examples that I gave showed and as all the cases cited in our reply brief at page 3 to 5 indicate, is simply not the case.

The second point I want to make is a rather technical point in response to a concern by Justice Rehnquist.

You pointed out that under the second paragraph of 1252 Congress at least contemplated that some kinds of appeals would be filed to the Court of Appeals prior to the filing of what I have been calling the proper Section 1252 notice of appeal.

Respondent in her reply brief indicated that those prior appeals were probably appeals taken under Section 1292(b) of the Judicial Code.

In fact, Section 1292(b) was not enacted until 1958, so it's unlikely that they had 1292(b) appeals in mind.

There were... there was a narrow class of interlocutory appeals that could be taken before that time, although they weren't even the kinds of appeals that Rule 54(b) of the Federal Rules of Civil Procedure contemplate, because that rule didn't exist in 1937 either.

There was a narrow class that Congress probably had in mind as well, simply a question of who beat in filing the notice of appeal.

And the third point I want to make is that, if we should lose the proper disposition of this case should not be like the disposition of the Richland County case.

In the Richland County case, in the Government's brief in this Court we conceded that we had gone to the wrong court in taking our appeal to the Court of Appeals and, as this Court said, the direction in which we should have gone was clear under this Court's precedents.

In this case, by contrast, I think we had very good reason for believing in Montana Contractors against Kreps that the proper place for us to go was to the Court of Appeals and not to this Court.

And so if we should be wrong about where we should have gone, at least the proper disposition would be to remand to the district court for entry of a fresh decree from which we may take a proper appeal to this Court.

Unidentified Justice: May I ask you one final question?

It hasn't been argued, but I'm just suggesting a rationale for requiring jurisdiction to be accepted by this Court of Congress might have been that it did not want the Attorney General to be able to concede the unconstitutionality of statutes without this Court in effect approving the concession, and that therefore they wanted the mandatory jurisdiction here, because it's certainly conceivable that the Attorney General might unwisely make a concession of that kind.

And that perhaps underlies their requirement that you tell the Congress whenever you do this.

John H. Garvey: That's conceivable, although I, having read the legislative history, have found no indication of that.

And what's more, the Attorney General's choice to intervene or not in these cases is discretionary, so that he may let go by a holding of unconstitutionality without even getting involved.

I think in light of that what you suggest is not probable.

Unidentified Justice: Well, I suppose you would be taking the same position even more strongly if you had contested the constitutionality... had attempted to sustain the constitutionality of the statute in the district court and you lost, and then, rather than appeal that declaration, you appealed only the remedy.

John H. Garvey: We would still be taking the same position.

Unidentified Justice: You'd go to the Court of Appeals?

John H. Garvey: That's correct.

Unidentified Justice: And if you were right then, you should be right when you concede?

John H. Garvey: A fortiori, we should be right when we concede.

If there are no further questions, we would rest.

Chief Justice Warren E. Burger: Thank you, gentlemen.

The case is submitted.

We'll resume at 1:00.

Featured:

Westinghouse Electric Corp. v. Tully - Oral Argument

Thu, 30 Aug 2012 22:13:57 +0000

Case:

Westinghouse Electric Corp. v. Tully

Media File:

81-2394_19831101-argument

Related Transcript:

81-2394_19831101-argument

Transcript:

ORAL ARGUMENT OF PAUL M. DODYK, ESQ., ON BEHALF OF THE APPELLANT

Chief Justice Warren E. Burger: We'll hear arguments next in Westinghouse Electric against Tully.

Mr. Dodyk, I think you may proceed whenever you're ready.

Paul M Dodyk: Mr. Chief Justice, and may it please the Court:

in this appeal, Westinghouse Electric Corporation challenges the constitutionality of the way in which the State of New York taxes the income of a domestic international sales corporation or DISC.

A DISC is not a typical business corporation.

It is a vehicle established under the Internal Revenue Code to permit the deferral of income taxes with respect to certain income from exports.

The income which may be attributed to a DISC and on which tax may be deferred is determined by a formula set forth in the Internal Revenue Code such as 50 percent of net income or 4 percent of gross receipts derived from exports.

DISCs typically perform no functions, own no property, have no employees.

A DISC is essentially an accounting segregation of a portion of a taxpayer's export-related income for purposes of tax deferral.

The export-related income so segregated is essentially pure income separated from the costs which generate that income.

Those costs remain on the books of the business entities whose exports are in question.

Under the Internal Revenue Code as it was in effect during the relevant period, a taxpayer was essentially permitted to defer federal taxes on 50 percent of income allocated to the DISC until that income is distributed to the parent.

Turning to Westinghouse, Westinghouse and its affiliates are engaged in a variety of businesses, some of which exports products, a portion of the income from which during the relevant period was allocated by Westinghouse to the DISC.

During the years here in question, 1972 and 1973, approximately 75 to 80 percent of the Westinghouse DISC income was derived from Westinghouse exports, approximately 20 to 25 percent from affiliates of Westinghouse.

The record in this case establishes that the affiliates of Westinghouse did no business in New York.

It further establishes that the affiliates are autonomous, independently managed, and deal with Westinghouse on an arm's length basis.

The State of New York does not treat these affiliates as unitary with Westinghouse and has not attempted to tax their income in recognition of the fact that they do not do business in the State of New York.

The tax practices here at issue arise from New York's taxation of accumulated DISC income.

The particular tax involved is the New York corporate income tax.

The New York corporate income tax is a formula apportioned tax.

In determining the amount of income which the State of New York taxes, it first attempts to determine the taxpayer's total income.

It then multiplies it by a fraction which is determined by the relationship of the taxpayer's New York property, payroll and revenue to the total payroll, property and revenue of the taxpayer.

In determining the amount of a taxpayer's income to be apportioned to New York, the state in this case added to the income of Westinghouse the total income of its DISC, including the amount on which federal taxes were deferred, and including the amount derived by reason of exports by Westinghouse non-New York affiliates.

Having determined the income apportioned to New York, the state then applied a tax rate of 9 percent to that income as allocated to the State of New York.

In computing the tax actually due, however, the court took another step, and that is, it permitted a credit with respect to 70 percent of the tax due on accumulated DISC income.

And it is that credit which is at issue in this case, because the State of New York, although it permits that credit, it permits it only with respect to exports which are shipped from a regular place of business in the State of New York.

More specifically, in calculating the credit, the New York statute requires the taxpayer to multiply its accumulated DISC income by a fraction of which the numerator is gross receipts shipped from New York, and the denominator gross receipts from exports shipped from all sources.

In this case the result was to limit the credit permitted Westinghouse to approximately 5 percent of the accumulated DISC income which New York taxed.

Of course, with respect to other corporations which have their base of operations in New York, such as General Electric, the credit is much greater.

The basic result of New York's limitation on the availability of the credit is that if a firm ships exports from New York, it will pay a tax of 2.7 percent on accumulated DISC income attributed to that shipment, but if it ships that export from New Jersey or any state other than New York, it will pay a tax of 9 percent.

But in terms of dollars, if you assume a corporation with $100 million of accumulated DISC income, 50 percent of which is apportioned to the State of New York, that taxpayer will pay to the State of New York a tax in the amount $4,500,000 if it ships from non-New York facilities, but if it ships from New York facilities, its tax bill will only be $1,350,000.

Unidentified Justice: Mr. Dodyk, what you're saying is basically that the federal Constitution requires the credit New York extends you to be larger than it was calculated to be under the statute.

Paul M Dodyk: That is correct, Your Honor.

Unidentified Justice: I suppose you could win on that point and still be worse off financially if the case went back to the New York Court of Appeals after reversing, and the New York Court of Appeals decided that the New York legislature never would have enacted the credit at all if it knew that this was going to be the result.

Paul M Dodyk: Well, I guess in that case my client, Westinghouse, would be a very altruistic enforcer of constitutional principle.

Or some would have said I would have succeeded in shooting myself in the foot.

But in any event, that's something for the Court of Appeals on remand to determine.

Unidentified Justice: If you win.

Paul M Dodyk: Yes, of course.

Our argument is essentially a simple one, and that is, that any tax scheme which works that difference, which imposes a higher rate of tax on shipments which are made outside the taxing state than it does on the same equivalent shipment made inside the State of New York is an unconstitutional burden on the commerce clause because it discriminates against interstate commerce.

In this particular case we believe that the operation of the credit and its unconstitutionality is exacerbated by the fact that the State of New York requires the taxpayer to add to its income base the entire amount of DISC income, but excludes from the denominator of the apportionment formula the property, payroll and revenue of the non-New York affiliates whose shipments accounted for 20 to 25 percent of the DISC income involved in this case.

Unidentified Justice: Let me ask right there, the shipments that originated in New York, were all of them made in interstate commerce?

Paul M Dodyk: Yes, Your Honor.

Unidentified Justice: So then it's really not a discrimination against interstate commerce; it's a discrimination between two kinds of interstate commerce.

Paul M Dodyk: In a sense that is true.

And much the same was the case, of course, in the Boston Stock Exchange case where the Court observed, I guess for the first time, that even if one is dealing with a discrimination between two forms of interstate commerce, that is still a form of discrimination which the commerce clause proscribes.

Essentially, we believe that this case is governed by the Boston Stock Exchange case and Maryland v. Louisiana.

In Boston Stock Exchange, New York imposed a tax on any transfer of securities which had certain defined connections or contacts with the state of New York.

That tax scheme, however, included a deduction or I should say a credit and a limitation which was applicable if the transfer was executed on a New York Stock Exchange, so that the effect was that a transfer which was executed on the Boston Stock Exchange or some other stock exchange would bear a higher rate of tax than a transfer which was executed on the New York Stock Exchange.

And we submit that this case is no different.

In the Boston Stock Exchange case if you executed that transfer, you paid a higher rate of tax if that transfer was executed in Boston as opposed to New York, so here, if you ship the export from the port of Boston, you pay a higher rate of tax than you do if you ship that export from New York.

Similarly, in Maryland v. Louisiana, the State of Louisiana imposed a tax on the first use of natural gas coming into the state from wells located on the federal offshore properties, and it then built into the tax scheme a series of limitations in deductions which effectively limited the incidence of that tax to gas which was shipped out of Louisiana to out-of-state users, and this Court held that set of limitations to work an unconstitutional discrimination against interstate commerce.

Although obviously Appellees do not accept our characterization of their tax as discriminatory, they do not deny, they have never denied and cannot deny that the effect of that tax, economic effect, is to impose a higher rate of tax if an export is shipped from a non-New York facility as compared to one which is shipped from a New York facility.

Appellees have not cited a single case in which this Court has sustained a state tax which has that differential geographical impact, and to our knowledge there are no cases which do so.

Appellees' response really consists of two basic arguments.

One is justification by reference to apportionment, and one is argument by analogy.

They say that the constitutionality of the taxes was deemed because the tax is a properly apportioned income tax.

That argument, I submit, fails for two reasons.

First, as we have pointed out, the tax is not properly apportioned; and second, and equally important, apportionment is irrelevant to the reason why we are urging that the tax is unconstitutional.

The reason that the New York tax is unconstitutional is that it results in a higher tax rate if property is shipped from a non-New York source than if the property is shipped from a New York source.

Unidentified Justice: Both owned by the same--

Paul M Dodyk: Pardon?

Unidentified Justice: --Both owned by the same entity?

Paul M Dodyk: Yes.

Both owned by the same entity.

So even if the base of the tax were proper--

Unidentified Justice: Mr. Dodyk, does that always follow?

Your income tax might well go up if you ship from New York, might it not?

Paul M Dodyk: --Well, it might well go up in the sense that you would have added payroll and property to the numerator if you established the facility in New York as opposed to having the facility established in New Jersey.

But I submit, Your Honor, that effect is going to be infinitesimal, because all you're talking about here is establishing a warehouse and handling facility, the property and payroll of which are but a small fraction of the property and payroll which came together into the manufacture and shipment of the product in question.

So to the extent that the state relies on an offsetting increase, I submit that the underlying economics will not support the argument.

Now, the reason why the formula apportionment defense I think fails is because we're not attacking at this point the tax based on its basis.

We're not saying that formula apportionment is wrong; we're saying that what's wrong is allowing a credit to a taxpayer which turns on the locus from which the export is shipped.

And because that is the source of the unconstitutionality, we submit that the basis of the tax is simply irrelevant.

Or to put it another way, if you take a look at the Boston Stock Exchange case, which to my mind involved a very similar form of discrimination which was struck down, there was no question but that the State of New York could tax that stock transfer which was executed on the Boston Stock Exchange.

The Court accepted that there were sufficient contacts with the State of New York to permit the tax, but the unconstitutionality arose from the difference in the rate of tax applied because of where the transfer was executed.

Similarly, in Maryland v. Louisiana, the taxable incident was first use of natural gas within the state.

The federal government did argue that the first use also made the tax unconstitutional, but this Court rejected that argument and said for purposes of the opinion it assumed that the State of Louisiana had sufficient contact with the first use to permit it to impose a tax.

So that in both Boston Stock Exchange and Maryland v. Louisiana, the basis of the tax was a valid basis, just as the Appellees here argue formula apportionment constitutes a valid basis.

Now, the Appellees seek to avoid the governing force of Maryland v. Louisiana and Boston Stock Exchange by suggesting a distinction, and the distinction is that in Boston Stock Exchange and Maryland v. Louisiana you were dealing with a transactional tax in a sense, whereas here we're not dealing with a transactional tax but with a formula apportioned income tax.

It's true that distinction does exist in the facts of the cases, but Appellees have never suggested any reason why the difference in the tax base should make any constitutional difference.

And, again, I submit that difference, the difference between formula apportionment and transaction is irrelevant because the source of the unconstitutionality is the discriminatory impact which results from the application of the credit.

The argument by analogy, Appellees in amicus argue that since they could constitutionally take a variety of other steps to reduce the impact of state taxation that they should likewise be permitted to implement the credit scheme here at issue.

Appellees' only authority for that proposition is an off-repeated quotation which they take from the Boston Stock Exchange case to the effect that states may use their taxing power to compete with other states for a share of interstate commerce.

And then Appellees in amicus go on to cite as alternative measures which they might constitutionally take: providing police and fire protection, providing investment subsidies, reduced taxation of exports, abolition of DISC income taxation, and indeed, abolition of the corporate income tax altogether.

I submit that the phrase relied upon from Boston Stock Exchange is far too vague to provide this Court with informed guidance for the resolution of the particular constitutional questions presented here.

To say that states may generally use their taxing power to compete for interstate commerce is to say nothing about the legality of a tax which results in higher rates being imposed on out-of-state export shipments as compared to in-state export shipments.

Moreover, that language appears only as a general reservation in the context of an opinion in which this Court struck down a taxing scheme which is very similar to the one we have here at bar.

The various alternative tax and incentive schemes which New York adduces as being... justifying analogy are all distinguishable in that none of them involves a tax which weighs more heavily on out-of-state shipments than in-state shipments.

Of course, a state may choose to abolish taxes on DISC income, on export income or on corporate income altogether; but in none of those cases does the state create a tax, the rate of which differs depending on the location from which the export is shipped.

Were New York to exempt a certain category of income such as DISC income or export income from tax, that income would be exempt from New York State tax whatever the point of origin.

Here, however, the undeniable and undenied effect of the New York credit scheme is to impose a tax which is levied at a rate of 9 percent on DISC income derived from out-of-state shipments and a rate of 2.7 percent on New York-based shipments.

None of the hypothetical constitutionally permissible analogies suggested by Appellees involve any such discriminatory effect.

None of the authorities relied upon by Appellees sanction such discrimination.

To the contrary, as I have said, Boston Stock Exchange and Maryland v. Louisiana, the principles of which are governing here, mandate the invalidation of any tax scheme which results in a state levying heavier taxes on a transaction because of its out-of-state locale.

Thank you, Your Honor.

Chief Justice Warren E. Burger: Mr. Schiff.

ORAL ARGUMENT OF PETER H. SCHIFF, ESQ., ON BEHALF OF THE APPELLEES

Peter H. Schiff: Mr. Chief Justice, and may it please the Court:

My view of the case that Mr. Dodyk has argued is very different from what I understand the case to be and what the facts to be.

As a matter of fact, it seems to me a good part of what Mr. Dodyk has argued are the issues on which you relate to the second issue in the jurisdictional statement with respect to which you dismissed it for being insubstantial.

It seems to me it's the law of the case that the... New York was perfectly proper in viewing Westinghouse and the Westinghouse DISC on a unitary basis.

Nevertheless, a good part of the argument that I've heard just now and in their briefs seems to challenge the application of the unitary principle.

Admittedly, it is done by the back door in relation to the credit, but it seems to underlie the claim that somehow New York is taxing out-of-state income or is... because they claim that we are... about the credit, that the measurement of the credit is wrong because we base it on DISC income related to shipments from a place of business in New York, but that we don't give it credit if the shipments are from a place outside New York, assumes that we are somehow taxing income that is outside the state.

Now, what New York has done here in applying the three-factor business allocation formula which this Court so recently reaffirmed in the Container case, was to only tax New York income.

Now, once it's determined what the overall amount of New York income is, we submit that it was reasonable for New York to apply a credit only to that portion of the accumulated DISC income, and that's the DISC income for which the federal government provides a tax break, is to try to ascertain what of the total amount of DISC income is reasonably attributable to New York.

Because in the first place in applying the business allocation formula, as our Court of Appeals has said, New York is only taxing New York income.

And I think it would be a strange policy indeed, whether the commerce clause or any other provision of the Constitution, to say that we have to give a credit on income that we have never taxed in the first place.

Unidentified Justice: Well, isn't that upside down, though, really?

If... if all of the DISC income had arisen from shipments from New York, there had been the same unitary income but the tax would... you wouldn't have had any tax on the DISC.

Peter H. Schiff: No.

The... the credit is only--

Unidentified Justice: Well, anyway... anyway your credit would have applied to all the DISC income, wouldn't it?

Peter H. Schiff: --Well, no, no.

The credit applies... well, it might if everything is from New York and if all the DISC income is--

Unidentified Justice: That's what I said.

That was my hypothetical.

Peter H. Schiff: --Well, that's--

Unidentified Justice: So you would have collected less tax if all of the DISC income had been from New York.

Peter H. Schiff: --Well, the objective--

Unidentified Justice: Wouldn't... wouldn't you?

Peter H. Schiff: --I think probably so.

The objective--

Unidentified Justice: Well, probably.

That's the whole purpose of the credit.

Peter H. Schiff: --The objective of the credit is to some degree track the credit that's being given by the federal government, but that--

Unidentified Justice: It sounds peculiar... it sounds peculiar that your credit is trying to identify the income attributable to New York so you can tax it, when in fact you find out the income attributable to New York, and you don't tax it.

You give it a credit.

Peter H. Schiff: --Well, we give it a lesser rate, but I don't see what's peculiar about that.

I mean we can only... we would only--

Unidentified Justice: Well, usually when you identify income as originating in the state, that's when you tax it.

Peter H. Schiff: --But we're only taxing income in the state in the first place, Your Honor.

Unidentified Justice: Oh, I understand that.

Peter H. Schiff: And the question then is do we have to tax the DISC income at the same rate as all other New York income, and that's all that the division here involves.

Other business income which... that's related to New York which isn't DISC income we rate... we tax at the 9 percent level.

If it is DISC income or if we have an investment tax credit or some other credit, it is a somewhat lesser rate.

Now, let me also point out that the credit here... Mr. Dodyk keeps talking about we tax it at 2.7 percent.

If he had used the figures in the record as applied to Westinghouse rather than deriving hypothetical examples throughout his brief, the effective tax rate on the accumulated DISC income which is derivable from the record in 1972, one of the years in question here, was approximately 8.69 percent; in 1973 it was about 8.65 percent... the fact reflected by the actual size of the credit here.

The size of the credit in 1975 that they are objecting to and apparently they want to pay more is about $2,500.

In 1973 it was about $6,000, even though Westinghouse was paying an overall corporate income tax in New York of about a million dollars for the two years combined.

And I suggest in response to a question that Justice Rehnquist asked that the... that if Westinghouse were to win in this case, that it would be, in terms of the questions that have been left open by this Court, an invalidation of a DISC credit in its entirety with the result that yes, indeed, Mr. Dodyk would be shooting himself in the foot because his client would be paying about $10,000 more for the two years here in question.

Whether he could then change the New York legislature's way of determining the credit I do not know, but I don't think it is a legislative question.

The issue here is whether the DISC credit is invalid or not and not how it was computed.

They did not preserve any arguments, as far as I can see, in this Court or even in the court below.

Unidentified Justice: While you're pausing, is it correct that the purpose of the credit is to make the... or to provide a motive for these special export companies to have as much business originate in New York as possible?

Peter H. Schiff: Yes, absolutely.

Unidentified Justice: In other words, the purpose--

Peter H. Schiff: Or at least to not lose any more business than necessary.

Unidentified Justice: --The purpose is to have a direct impact on the way goods are shipped overseas.

Peter H. Schiff: Well, in terms of the goods that are shipped, Your Honor--

Unidentified Justice: Well, at least that the business transactions--

Peter H. Schiff: --It's a question of really of where... I would say it's a question of where Westinghouse does it business, because the question isn't really where it is shipped.

Unidentified Justice: --Your purpose is to--

Peter H. Schiff: We are... obviously, the purpose of the credit.

Unidentified Justice: --Are you trying to escape the word "commerce"?

Peter H. Schiff: No.

I think I'm trying--

Unidentified Justice: That it would affect commerce?

Peter H. Schiff: --Well, it may affect commerce.

I think any credit does.

And the differentiation between state taxes in one state and another always is liable to affect commerce.

New York, unfortunately, is a state which has some of the highest taxes in the country, and recognizing that the--

Unidentified Justice: But at least those high taxes normally affect everybody the same.

Peter H. Schiff: --Well, I think they affect everybody the same.

Unidentified Justice: But this one doesn't.

Peter H. Schiff: Oh, yes, it does.

It does.

Unidentified Justice: Well, I don't know--

Peter H. Schiff: Everybody who is doing business--

Unidentified Justice: --I know you pay more taxes if you ship from New Jersey than you do if you ship from New York.

Peter H. Schiff: --No, not to New York.

You don't pay it to New York, because you're not paying any taxes on what is being shipped from New Jersey.

That would be an incident of the New Jersey taxation, not an incident of New York taxation.

Now, this is... could I--

Unidentified Justice: That... that... but in your unitary scheme you attribute all that income to the parent, and you take all that DISC income into--

Peter H. Schiff: --We're applying the unitary principle just the way it's been applied regularly.

Unidentified Justice: --So you're taxing the DISC income that originates in New Jersey at a higher rate than if it originated in New York.

Peter H. Schiff: Well, Justice White, if--

Unidentified Justice: Well, isn't that so?

Peter H. Schiff: --No, no.

Not--

Unidentified Justice: Why isn't it?

Peter H. Schiff: --I mean I think... I think that the--

Unidentified Justice: Well, you give a credit to one and not another.

Peter H. Schiff: --Well, if I understood what you were just saying, when you apply the apportionment principle, of course, in some sense, as Mr. Dodyk points out in his reply brief, if the 5 percent business allocation formula is applied, you could say your taxing some New Jersey income, some California income.

Unidentified Justice: Well, that isn't the point.

Peter H. Schiff: But that's... that's not the point.

Unidentified Justice: No.

I wasn't trying to make that point.

Wouldn't... wouldn't Westinghouse have paid less tax to New York if all of its shipments, all of its DISC shipments had been from New York?

Peter H. Schiff: If all of its DISC income and all of its--

Unidentified Justice: All of the... all of the... all of the... all of the shipments in international trade had been made from New York.

Peter H. Schiff: --If the... there had been a place of business... that is, a manufacturing company or a warehouse that Westinghouse was... through which it was generating its income, if that is where the exports are coming from, yes.

Unidentified Justice: If they... if they ship--

Peter H. Schiff: But it's not a question of where the port of embarkation is.

Unidentified Justice: --No.

If they ship... if they... if instead of having a warehouse in Delaware they had one in New York and made the shipments from there, they would have paid less tax.

Peter H. Schiff: If all the incidents were in New York, I think as we point out in our brief, it is likely that there would be more income to New York.

There would also be more cost.

New York might or might not make more or less tax.

And one of the problems we have with Westinghouse's presentation is they have made absolutely no factual showing on this record.

They've been purely hypothetical.

Now, I think the teaching of this Court--

Unidentified Justice: Yes, but, Mr. Schiff, can I interrupt you again?

At page 26 of your brief you say,

"The purpose of giving the tax credit is to prevent export business being driven out of New York. "

You say,

"The credit is designed to maintain export business in New York. "

Peter H. Schiff: --Absolutely.

It's totally--

Unidentified Justice: Well, then, it must... it must make a difference where the export business is.

Peter H. Schiff: --Well, the hope is... well, if they do some New York export--

Unidentified Justice: You stand by those statements, I take it.

Peter H. Schiff: --Of course.

If they do some New York export business, if they are generating some of their income from New York business, and that's being exported... because that's the only thing that the DISC credit relates to... we will then apply a lower tax rate to that income, which we think is totally consistent with this Court's language in the Boston Stock Exchange case and other cases like the Bowers case which permit states to give credit to try to compete.

Now, there is a major difference between our tax and the credit in this case and the Boston Stock case and the Maryland against Louisiana case.

In those cases... in the Boston case it was clear that New York was... while it was... it was attempting to tax extraterritorially, I think.

We are imposing a tax on the stock transfer, but we oppose the full tax, but it varied depending on whether the transfer was being accomplished through an out-of-state stock exchange or a... the New York Stock Exchange.

There was, however, enough incidents to tax it in New York because the transfer of the stock certificate, I think, was happening there, so that we were discriminating depending on where part of the transaction happened.

In this case the only thing that we tax in applying the unitary principle is New York income, and then we only apply credit to the New York income.

As a matter of fact, it's a very, very conservative credit because we use these two percentages, which means that the credit boils down to something like a quarter of one percent.

Unidentified Justice: Of course, that doesn't make it valid or invalid, does it?

Peter H. Schiff: No, it doesn't, except that in terms of the effect on commerce, the degree of it is also relevant.

It's not done in pure abstract terms, Your Honor.

It is done in practical terms.

But in any event, we are not taxing extraterritorially, and the same thing was true in Maryland against Lousiana.

There, Louisiana--

Unidentified Justice: I didn't think that was the issue in the case.

I thought--

Peter H. Schiff: --In which case?

Unidentified Justice: --This one.

About whether you're taxing extraterritorially.

Peter H. Schiff: I think... I think... well, I have to--

Unidentified Justice: If you want to get an... you might have something if you want to set up that straw man, but I thought it was a case of discrimination.

Peter H. Schiff: --Well, but I... I, with all due respect, I do not see how we get to discrimination in this case if we are not taxing, as they suggest, extraterritorial values in the first place, or giving a credit extraterritorially.

The statement made is that we should not be giving a credit to New York DISC income because we are taxing... would be taxing out-of-state DISC income at a higher level.

Now, that seems to me to assume that we are taxing something out of state in the first place, and we are definitely not doing that.

I must admit, and this may be my problem, I have had difficulty in understanding what the issue in this case is, because from our perspective the formula applied after... to the total income means that we are only taxing New York income.

Unidentified Justice: What is... what is the formula upon which you include the income of the DISC within your tax?

Peter H. Schiff: It's the three factor business allocation formula, Your Honor.

Unidentified Justice: And it... but it... it's treated as being... the whole outfit is unitary, isn't it?

Peter H. Schiff: It's treated as if the... it's really combined, I guess, but it's the Westinghouse Electric and Westinghouse DISC are treated as being unitary.

Unidentified Justice: Except you don't include... does that include DISC?

Peter H. Schiff: Well, we include everything, all the income and all of the property, receipts and payroll of those companies.

What Westinghouse would have us do is to go behind the companies that are being treated in the combined income, which is something that is not done in application of the business allocation formula.

Now, we do, if Westinghouse claims that by not going behind it there is something unfair in the application of the business allocation formula, which is, I think, truly what they are arguing here.

New York tax laws, we have pointed out in our brief, would have permitted them to try to show some unfairness as it relates to the facts of this case.

They haven't made any effort to do that.

They--

Unidentified Justice: Well, is your position basically that your formula that includes the DISC within the income that's taxed to Westinghouse is supposed to compute out only New York income?

Peter H. Schiff: --That is exactly our position.

Unidentified Justice: And, therefore, when you're giving credit, you ought to be able to credit only on the basis of New York income.

Peter H. Schiff: That is exactly our position.

You said it much better than I.

But that is our... our position in a nutshell.

And--

Unidentified Justice: But isn't New York in fact, even though it's calculating a total tax on all the company's business in New York, isn't New York multiplying that by the fraction of the company's total export business that's conducted in New York rather than simply the fraction of the company's New York business that's export-related?

Peter H. Schiff: --Well, in terms of the original allocation, the only formula that's used to determine what income is taxable is the business allocation formula, and then in determining the DISC credit, we multiply it by both fractions.

It's a very conservative way of doing it, but as far as I have been able to figure it out is that we want to make sure that, a) we're only taxing New York income, and that we're only applying the credit to New York income; and b) that the income with respect to which we give a credit is only DISC income as opposed to income generated from other sources.

Now, I have to tell you that the net result is a very small credit.

I think we could have given a larger credit.

And I think that's what Westinghouse wants, but frankly, that doesn't amount to any constitutional infirmity.

But that's exactly what we do, Justice O'Connor.

I did want to distinguish the Maryland-Louisiana case because there, too, Louisiana was taxing extraterritorially and giving a credit solely to Louisiana so that the tax really wasn't being paid in Louisiana but was paid on the same gas every place else.

But there was no question that there was an extraterritorial tax which could only be done if it was in a nondiscriminatory fashion.

Here, as I have said, there is no extraterritorial tax.

The credit is... I think the concept of it is perfectly reasonable as well as its application.

For these reasons I ask for an affirmance of the court below.

Chief Justice Warren E. Burger: Do you have anything further, Mr. Dodyk?

ORAL ARGUMENT OF PAUL M. DODYK, ESQ., ON BEHALF OF THE APPELLANT -- REBUTTAL

Paul M Dodyk: Just a moment, Your Honor.

I think the central thrust of Appellees' argument is that because the income which is being taxed here is in some sense New York income as determined by formula apportionment, they can proceed from that basis to structure credit which clearly discriminates against non-New York shipments.

I submit to the Court that the transaction in Boston Stock Exchange was accepted by the Court as a New York transaction; that the first use tax in Maryland v. Louisiana was accepted by the Court as a Louisiana transaction, but that did not justify in grafting on to that properly based tax a set of limitations which had a geographically discriminatory effect.

Thank you, Your Honor.

Chief Justice Warren E. Burger: Thank you, gentlemen.

The case is submitted.

Featured:

Silkwood v. Kerr-Mcgee Corp. - Oral Argument

Thu, 30 Aug 2012 22:13:56 +0000

Case:

Silkwood v. Kerr-Mcgee Corp.

Media File:

81-2159_19831004-argument

Related Transcript:

81-2159_19831004-argument

Transcript:

ORAL ARGUMENT OF MICHAEL H. GOTTESMAN, ESQ., ON BEHALF OF THE APPELLANT

Chief Justice Warren E. Burger: We'll hear arguments next in Silkwood against Kerr-McGee Corporation.

Mr. Gottesman, I think you may proceed whenever you're ready.

Michael H. Gottesman: Thank you, Mr. Chief Justice, and may it please the Court:

This is a tort action arising under state law.

It was in the federal court because of diversity of citizenship.

The occasion for this tort action is that plutonium escaped from a manufacturing plant of the defendant and that plutonium contaminated Karen Silkwood and her apartment.

And the complaint in this action, resembling complaints that have been filed, I suppose, for time immemorial in the courts of this... of the states of this nation, sought compensatory damages for both the injury to person and to property and punitive damages for this state law tort.

The jury awarded both compensatory and punitive damages.

The court of appeals, the court below, affirmed in part the compensatory damage award and reversed it in part.

For all purposes here that... the rulings on the compensatory damages are not important except that the court rejected an argument of the defendant that compensatory damages were preempted by the Atomic Energy Act, and in fact held that compensatory damages could be awarded, and in fact affirmed an award of compensatory damages for property damage.

Unidentified Justice: Now, the only compensatory damage award that remains in the case, as I understand it, is the $5,000 property damage award.

Michael H. Gottesman: That is the only award that remains in the case.

There is a debate between the--

Unidentified Justice: And the entire $10 million punitive damages has to hang then on the $5,000 property damage, is that correct?

Michael H. Gottesman: --Well, at the present... in the present posture of the case--

Unidentified Justice: At present?

Michael H. Gottesman: --Yes.

In the present posture of the case, the punitive damage award, if it were not preempted, the court of appeals would have to address, number one, whether that size award can properly be predicated on the property damage award; and number two, if not, whether there should be a remittitur or whether there should be a retrial on the amount of punitive damages.

Unidentified Justice: Does Oklahoma law, so far as you know, as to punitive damages draw any distinction between a property damage award and a personal injury award?

Michael H. Gottesman: None, Your Honor.

The courts have squarely held that punitive damages may be awarded for property damage alone, or for personal injury alone, or for both.

The standards are identical in both cases.

And the measure of punitive damages in Oklahoma relates to the gravity of the harm threatened by the defendant's reckless or malicious conduct.

So that there have been a number of Oklahoma decisions which have set aside in part a compensatory damage award and yet still affirmed in full the punitive damage award.

But in any event, that issue is not here.

That issue is the next one for the Tenth Circuit to address once it's established that punitive damages are not preempted.

Unidentified Justice: Yeah.

Even if you won, it would be remanded then to determine whether that damages award is adequate as premised or... or excessive... excuse me... excessive as premised on only a $5,000 property--

Michael H. Gottesman: Well, that issue would be before the Tenth Circuit.

There is a question whether Kerr-McGee has waived the right to make that claim because it didn't advance it, but certainly the question of whether it has been waived or not, and if not, the question of whether the award will sustain the punitive damage award are both for the Tenth Circuit to decide.

But, of course, the Tenth Circuit never got to those questions because it ruled that punitive damages are absolutely preempted by the Atomic Energy Act in any suit against a nuclear operator relating to exposure to radiation.

And that, of course, is the issue that has been brought to this Court by us, and there is a question at the threshold.

The issue was brought to this Court on an appeal alleging that the Tenth Circuit by ruling as it did had held invalid the Oklahoma punitive damage statute.

This Court has postponed the determination of jurisdiction, and I do want to spent just a moment explaining why we think that this in fact is a proper appeal under 1254.2.

In Oklahoma punitive damages exist only by statute.

There has been a punitive damage statute since the first territorial legislature of the state.

There has never been a common law of punitive damages.

And that punitive damage statute makes punitive damages available, if, of course, the culpable conduct is present, in any action except a contract action.

And the Supreme Court of Oklahoma has read those words literally and in authoritative decisions has said that except for contract actions, punitive damages are available in any action.

We will not entertain arguments as to whether it's a good idea or a bad idea.

This is the legislative policy of this state.

Now, because that is the law of Oklahoma, the district court, upon finding that there was evidence to support a verdict, was required to submit the punitive damage issue to the jury and said that it was required to do so.

It submitted it in the words of the statute, and the jury found a violation in reliance on that charge.

Both parties told the court of appeals that punitive damages in Oklahoma are governed exclusively by this statute.

And the court below, given those arguments and given an argument by Kerr-McGee that there was preemption, began its conclusive paragraph, the paragraph where it found preemption, saying,

"Arguably, there should be a strong presumption against preemption of state laws affecting such vital interests of its citizens as those involved here. "

Now, in Oklahoma the only state law that the court could have been referring to was 23 Oklahoma Statute Section 9.

And though the court did not cite that section by name, having begun that conclusive paragraph saying

"Arguably, there are strong arguments against preemption of state laws, but nevertheless, we find preemption. "

we submit that the court has held invalid Section 9 as applied to nuclear operators in radiation cases in the full substance and import of its opinion.

We think, indeed, that's what it said, but whether it said it or not, that is certainly the effect of what it did.

And as the Solicitor General acknowledges, appellate jurisdiction exists if the invalidity of the state statute was a necessary predicate for the court of appeals decision, and we think it was.

Now, turning to the issue on the merits, the preemption issue, we're dealing here with a state's right to punish, to punish conduct that injures people and that injures people and is accompanied by a particularly reprehensible state of mind... either the deliberate infliction of injury or the infliction of injury with a reckless disregard for the safety of the state's citizens.

Now, this kind of punishment, this civil punishment, if you will, punitive damages, has been a traditional element of the tort law in 46 states of this country and is still in the tort law of 46 states.

And what it is designed to do lies at the core of the state's interest, that the police power is designed to protect people against reprehensible conduct, very much as the criminal law is.

And the question we have here is whether Congress in enacting the Atomic Energy Act intended to deprive the states of this traditional piece of a tort action.

This is not a separate action.

It is a remedy available in the traditional tort action.

And, of course, the answer is wholly one of congressional intent.

We approach that question with certain assumptions that this Court has stated are always the starting point for analysis.

First, an attempt to preempt a traditional state right is never lightly presumed.

That is especially so when the state right is exercised in the form of tort actions.

This court has said that.

And it is, we would suggest, uniquely so in this case.

Never in the jurisprudence of this nation, not in this Court, not in any other court, has there ever before been a holding that Congress left compensatory damages unpreemptive and yet preempted the punitive damages in that very same cause of action.

Unidentified Justice: --Yet, Mr. Gottesman, the position you take that punitive damages are primarily to punish suggests, at least in your view, that the punitive damages serve a much different purpose than compensatory damages, which I suppose are just to make whole.

Michael H. Gottesman: That's correct.

They serve a different purpose, but the reason that you don't find that kind of selective preemption is that the purpose that they serve, punitive damages, lie absolutely at the core of the state's interest and much more at the periphery of the federal interest.

So that as I'll indicate, as we do in our brief... and if we have time, I'll get to... it would be much less likely that Congress would make a judgment to preempt punitive damages than compensatory.

Unidentified Justice: Are you suggesting it would be more likely if they had to choose that they would have preempted compensatory damages?

Michael H. Gottesman: Well, I think it's not likely they would choose to select between them, and indeed, there's never been a ruling by this Court that found one and not the other.

Congress either leaves tort actions alone or it doesn't.

And indeed, the burden of what I'm about to come to is that Congress has made rather remarkably clear here an intention to leave state tort actions alone, one that encompasses.

Unidentified Justice: Of course, logically, though, punitive damages are in a sense regulatory, and it was Congress' intent to leave in place... to leave the regulatory aspects to the NRC for safety purposes.

Michael H. Gottesman: Well, I think logically, Justice O'Connor, both compensatory and punitive damages are regulatory, and this Court has repeatedly so said.

Both have regulatory effects.

Both have regulatory purposes.

For example, the state court, by determining what is the standard of care that it will hold Kerr-McGee to and hold it responsible, therefore, for compensatory damages, regulates.

If it says the standard of care is simple, reasonable care, it imposes one burden on Kerr-McGee.

If it says the standard is absolute, strict liability, it holds Kerr-McGee to a much stricter standard of performance.

So that both compensatory and punitive damages are regulatory; they regulate different things.

Compensatory damages regulate what the Nuclear Regulatory Commission regulates: the standard of care with which you operate your plant.

Punitive damages regulate something that the NRC does not regulate: your state of mind in the operation of that plant, whether you are the kind of person who behaves with a reprehensible state of mind.

Now--

Unidentified Justice: Mr. Gottesman, are you conceding, in effect, that the radioisotopes involved here are subject to the same preemption doctrine as perhaps the operation of a nuclear reactor would have been?

Michael H. Gottesman: --Well, there are some differences in this case.

I'm not sure that we necessarily have to.

I think the answer would be the same.

But I think it's important to note that this plant was not covered by the Price-Anderson Act.

As to this plant Congress made the judgment we have no interest in impeding the operation of state tort law at all, as contrasted with a nuclear power plant where Congress has made certain selective judgments to override the state tort law.

Now, it's--

Unidentified Justice: Do you think then that, for instance, damages to the public arising out of a terrorist attack on a nuclear facility would be preempted?

Michael H. Gottesman: --Oh, absolutely not.

I would assume that, assuming states can otherwise prosecute terrorists criminally for invading any other plant, they could likewise prosecute them for invading a nuclear power plant.

I shouldn't think that there would be a question about that.

Indeed, I think even the Solicitor General's brief concedes you can prosecute everybody but the corporation itself.

Now, however we might derive answers to this logically, the fact is that the determinative question here is what Congress intended and what logic Congress was applying.

And we have the benefit here of a much more extensive insight into Congress' views about preemption than we ordinarily have in a preemption case, because Congress spoke a lot more about this.

To be sure, as this Court held last term in Pacific Gas and Electric, Congress in enacting the 1954 Atomic Energy Act and opening up this industry to the private sector reserved to federal exclusive control regulation, at least in the strictest sense: licensing, inspections, that sort of thing.

There's no question that Congress occupied that field.

And, indeed, those on the other side of this case embrace the statement that this Court made in PG&E that Congress has occupied the field of regulation, and seek to evolve their entire solution out of that sentence of the opinion.

But it can't be done, because were that proposition right, it would follow that Congress had preempted compensatory damage remedies as well, which this Court has repeatedly said are regulatory.

And yet, everybody understands, and this Court has said in Duke Power and PG&E, that when Congress enacted the 1954 Act, it did not preempt the state's existing rights to entertain tort actions by those who were the victims of radiation injuries.

And, indeed, it's precisely because the '54 Act did not preempt those tort actions that we got the Price-Anderson Act, because people said we're not going to enter this field; we are afraid of our potential tort liability.

And so Congress addressed that question of tort liability in the Price-Anderson Act.

Now, Congress in that act did not cede to the states the right to entertain tort actions.

That's what our adversaries here say.

They say Congress ceded to the states the right to have tort actions.

That's not what Price-Anderson did.

Congress said the states have these tort actions.

They have them already.

The question here is whether we should put any limitations on them.

And in that context Congress spoke at length about its view about the state tort action.

We have a window to congressional understanding here that is quite unique, and I want to refer just to a few of the statements, and to read them very briefly, that Congress made expressing its views.

The other side says well, never mind what Congress said here: they really only meant compensatory damages.

But that wasn't the congressional mind-set.

For example, the Joint Committee report in 1956... and this is when the only interference with state tort law that Congress made was to put a $560 million limit of liability for certain operators, not for Kerr-McGee.

The Joint Committee report stated the two basic principles underlying the bill, and the first of those was,

"Since the rights of third parties who are injured are established by state law, there is no interference with the state law except for the $560 million limit of liability. "

Senator Pastore, who was the chairman of the Joint Committee when the '66... or the floor manager, I'm sorry... when the '66 amendments were made said,

"This bill follows the approach of the original Price-Anderson Act; that is, making a minimum interference with the laws of the several states insofar as legal liability for nuclear incidents is concerned. "

"Our committee continues to endorse this general approach. "

Finally, the Joint Committee in 1966:

"The bill has been drafted so that minor claims involving nuclear facilities or materials. "

--and what we have here is a minor claim...

"may remain subject to the traditional rules of tort law. "

Now, there are no qualifications, and this isn't a semantic thing.

Congress had a mind-set, and it approached this problem with several concerns.

The first of those concerns was that Congress or the sponsors of Price-Anderson felt that if they tried to overly interfere with state tort, well, they couldn't get a bill through Congress.

And so there are a number of statements quoted in our brief of the principal sponsors of this legislation saying we are going to proceed by selective limitation on the state tort law.

We will identify with precision what it is about state tort law that we think we need to modify, because that's the only way we're going to get a bill through Congress.

If we try to reach out in an overly broad way in a field that is so sensitively one of state's rights, we're not going to get this bill through.

So that was number one.

Number two, they thought this to be an area that was big and mysterious and had lots of elements, and it was different in every state.

And they said there's... the chairman of the Joint Committee said there's a jungle of 50 states' tort laws out there.

We don't know where to begin to tackle those, and we don't want to.

We are simply going to identify what the problems are that we think we need to address and address them explicitly.

And finally and most importantly, Congress said that except for extraordinary nuclear occurrences... the meltdown of a power plant... there is no reason why a nuclear plant should be treated any differently than any other business entity in this country in terms of its amenability to the tort law.

Unidentified Justice: Would a state tort action lie in the nature of a nuisance suit against a power plant, a nuclear power plant?

Michael H. Gottesman: I would think that it would like for damages... if we're talking about radiation emissions, then I would think that the message of this... it isn't a necessary message, because that's not what Congress was thinking about when they made these statements; what they were thinking about were people being injured.

But if we're dealing with radiation emissions, then however the state may put the label, if my property or my person is injured by the emission of radiation and I suffer an injury, I have one of these lawsuits.

So that I think the answer would be yes.

But certainly in this category, in the Kerr-McGee--

Unidentified Justice: And you don't... you're not troubled by the language of this Court in the PG&E case about the preemption?

Michael H. Gottesman: --Well, I think if... I think the question of whether a state court could enjoin a nuisance would be much more troubling, because there you would be doing not that which Congress so clearly had in mind, which is conferring damages, but there you would be, in effect, revoking the license of the plant to operate.

I think there's a very serious question whether in light of PG&E that could be done.

Unidentified Justice: What you're saying is that PG&E dealt with safety regulation by the states as such, by a commission or perhaps by a nuisance action, but it didn't go so far as to say that perhaps things that are tangentially concerned with safety but primarily devoted to compensation or punishment were also to be swept under the rug with safety concerns.

Michael H. Gottesman: That is our submission, Your Honor.

Yes, that's right.

Now... now, I do want to note we have in our brief noted that there... it is unmistakable that the Atomic Energy Commission in 1966 after this bill believed... and it was the agency administering the statute... believed that punitive damages were available.

In the limited time I have remaining I don't want to focus on that.

But the point that I do want to focus on and close with is that Congress made a judgment repeatedly articulated in this legislative history that except where we're dealing with an ENO, there is no reason why these plants should be treated under the tort law any differently than any other plant.

And Kerr-McGee is here saying ah, but because we're a nuclear operator, we ought to be exempted from the rules that are applicable in tort suits against every other plant.

Whatever the logic that they could spin out for that, that is not the decision that Congress made, and the legislative evidence is overwhelming that Congress made the opposite decision.

Unidentified Justice: Well, Mr.... Mr.... Mr. Gottesman, if the... if the plant is complying in all respects safety wise with federal standards and federal regulations but the state nevertheless and by virtue of its tort standards says that you must conduct your plant differently, you must run your plant differently or you're going to be subject to a damage suit, and it doesn't make any difference to us whether you're complying with the federal law or not; you have to comply with this safety standard or you're going to be held to be negligent.

That's essentially your submission, that the state may do that.

Michael H. Gottesman: Everyone on the other side concedes the state may do that.

Unidentified Justice: I don't think that concessions can find the Court very easily.

Michael H. Gottesman: Okay.

But then--

Unidentified Justice: I mean people frequently try to concede that--

Michael H. Gottesman: --Then I take it is our submission... it is our submission and their submission that the state can say notwithstanding your compliance with the federal standards, which the federal government says are no guarantee of safety... this is cost-benefit; this is what we say we want... notwithstanding full compliance with that, you can still do incredible damage to people.

And if a state chooses to--

Unidentified Justice: --So the states can say you just didn't run your plant safely, so you're subject to damages.

Michael H. Gottesman: --Absolutely.

A state can have a negligence standard, and a jury will sit there and decide did you run your plant safely; and Congress said that's exactly what we want.

Chief Justice Warren E. Burger: Mr. Cook.

ORAL ARGUMENT OF C. LEE COOK, JR., ESQ., ON BEHALF OF THE APPELLEES

C. Lee Cook Jr: Mr. Chief Justice, and may it please the Court:

As has been noted, this case comes to the Court as a $5,000 property damage case, the personal injury aspects of the case having been disposed of by the court of appeals below and not the subject of appeal here.

The liability for that $5,000 in property damages resulted from a... on the basis of a liability without fault under the doctrine of strict liability.

The plaintiff conceded that he did not and could not prove how the contamination to Karen Silkwood's property occurred.

Now, the question, the principal question raised by this case is whether an award of punitive damages with respect to a claim based on radiation hazards resulting from the operation of a federally licensed and regulated plutonium plant is preempted by the Atomic Energy Act.

As has been noted, the question of jurisdiction has been reserved.

Just a brief comment on that.

The plaintiff seeks to make jurisdiction in this Court for mandatory appeal under Section 1254.2 of the Judicial Code.

That section is to be strictly and narrowly construed.

It permits mandatory appeal only when the court of appeals invalidates a state statute as being repugnant to the Constitution or the laws of the United States.

In this case, the state statute which the plaintiff seeks to invoke was not even mentioned by the court of appeals, much less held invalid either facially or as applied.

All the court did here was hold punitive damages under the circumstances of this case cannot be awarded; and thus we urge that there is no jurisdiction in this Court.

Also, we suggest to you that this is not an appropriate case to take on certiorari.

Its unique facts make it very unlikely that it will have any precedential value, and the basic principle upon which it relies... namely, that stated in Pacific Gas and Electric... does not involve any conflict in the circuits but is now well settled in light of your decision last term.

Now, turning to the merits, in your decision in Pacific Gas and Electric you described two forms of preemption, both of which are applicable here.

First, you said there is preemption if the Congress has fully occupied a field.

You also said there is preemption even if Congress does not fully occupy a field if the state action stands as an obstacle to the accomplishment of the federal purpose.

Both those preemptions exist in this case and require affirmance of the decision below.

Let's talk about the first one first.

In PG&E--

Unidentified Justice: Which one did the court of appeals use, both or just one?

C. Lee Cook Jr: --Your Honor, I think they used the... the preemption on the basis of entire occupation of field, but I cannot tell you whether they also had in mind that in this particular case there is an obstacle to the accomplishment of a purpose.

In your decision in PG&E you removed any doubt that Congress has fully occupied the field of the regulation of nuclear hazards and the safety in the operation of a radiation facility.

And that applies whether it's a nuclear reactor or whether it's a plutonium plant.

This is a licensed facility--

Unidentified Justice: Mr. Cook, if you're right in that, I suppose... and although the California case involved state regulation licensing requirements... if you're going to carry that over en bloc to state tort law, which I don't think that statement from PG&E at all requires, I take it compensatory damages would also be preempted.

C. Lee Cook Jr: --No, Your Honor, I do not think so.

Let me deal with that... that point right now.

The fact of the matter is that the suggestion here, the argument here that there is... that compensatory damages are also preempted and that somehow the Court was inconsistent in holding that punitive damages were preempted and compensatories were not I believe is wrong for at least two reasons.

First of all, Congress in the Price-Anderson Act and in the legislative history related to the Price-Anderson Act indicated an intention that with respect to the compensation of injured victims, making them whole, it was the intention of Congress that they should have available state tort law remedies.

No such intention with respect to punitive damage was ever expressed.

Secondly, and probably more important, the argument of the plaintiff here ignores the distinction between punitive damages and compensatory damages.

Punitive damages have as their sole function controlling of conduct, conduct that the jury believes does not meet the safety standard that should be applied.

Compensatory damages, on the other hand, have as their primary function the recompensing of the injured plaintiff; in other words, making the plaintiff whole.

Unidentified Justice: Well, but surely you don't suggest that when the state court said charges on negligence sufficient to support a recovery of compensatory damages it isn't laying down a standard of care directed to safety?

C. Lee Cook Jr: I don't suggest that at all.

What I do suggest is that there is a nonsafety rationale as well, and that is the making whole of the innocent injured victim of a nuclear incident.

Unidentified Justice: Well, but isn't there also a nonsafety rationale to punitive damages in the sense of punishing someone who is regarded as having deliberately done wrong?

C. Lee Cook Jr: No, Your Honor, I do not believe so.

I believe, particularly in Oklahoma, the law is that punitive damages are to punish and deter conduct.

As a matter of fact, this Court reaffirmed that principle just last term in Smith v. Wade where it said the purposes of punitive damage is to punish reprehensible conduct and deter the defendant and others from engaging in that conduct in the future.

In fact, under Oklahoma law if punitive damages do not have the effect of punishing and deterring conduct, they will not be permitted to stand.

The case cited in our brief, the Nixon case, stands for that proposition.

And in the most recent brief filed last week by the plaintiff, its reply brief, there's cited a new Oklahoma punitive damage case.

It's the most recent statement by the Oklahoma Supreme Court on the subject of punitive damages.

That case not only restates all the principles that we expressed in our brief concerning the role of punitive damages, but it has this additional statement.

It said,

"Unlike the purpose of compensatory damages, which are to benefit the individual plaintiff, punitive damages are imposed to benefit society. "

"The plaintiff acts as a private attorney general to punish the culpable wrongdoer, thereby encouraging adherence to safety standards that benefit consumers generally. "

So what the court in the Theory v. Armstrong case at 661 Pacific Second and cited in the second footnote to the plaintiff's reply brief, has made it clear is that punitive damages in Oklahoma are for the purpose of imposing a safety standard and then enforcing it.

Unidentified Justice: Well, has the Oklahoma court said that compensatory damages are not for that purpose?

C. Lee Cook Jr: What the Oklahoma court I think has said is that compensatory damages have... and the... as their basis the intention to benefit the plaintiff, to make him whole for the wrong he has suffered.

Unidentified Justice: What wrong, though.

Isn't it as... as... as the Justice has said, you have to show that some standard of conduct has been violated before you're going to get--

C. Lee Cook Jr: Actually, in Oklahoma you do not because there's... it's strict liability in Oklahoma.

So irrespective of the conduct you engage in, if it's your plutonium, you're liable.

Unidentified Justice: --Is that... and the jury was instructed both on negligence and strict liability, wasn't it?

C. Lee Cook Jr: Not with respect to the property damage.

The property damage--

Unidentified Justice: Well, that may be so, but now let's talk about personal injury.

You... you would say that... you would say that compensatory damages for personal injuries are not preempted.

C. Lee Cook Jr: --Your Honor, I don't think that--

Unidentified Justice: Is that right or not?

C. Lee Cook Jr: --Well, let me... let me--

Unidentified Justice: I thought that's what you had conceded.

C. Lee Cook Jr: --Let me respond this way.

That question is not before you.

That's the decision of the court of appeals.

Unidentified Justice: Well, it's before you right now.

[Laughter]

C. Lee Cook Jr: I understand it is before me right now.

Unidentified Justice: Well, how about an answer.

C. Lee Cook Jr: And my response... my response is on the state of the present law under... I would say the compensatory damages are not preempted.

Unidentified Justice: Even though... even though in the process of awarding them you find that the plaintiff or the defendant has not lived up to some state-imposed standard of safety?

C. Lee Cook Jr: If... if indeed... if indeed the state-imposed standard of safety is a negligence standard.

Unidentified Justice: Well, even though... even though the plant is in complete conformity with federal law as far as safety is concerned.

C. Lee Cook Jr: Your Honor, I would argue that if indeed the plant is in complete conformity with federal law, there is no way of finding, there's no basis for finding that it was not operated reasonably and--

Unidentified Justice: Well, there is... there is the state has a different standard or purports to impose a standard that's inconsistent with federal law.

But you don't purport in this case, as far as I can tell, to point... to rely for your preemption analysis on any conflict of federal law.

It's more general preemption.

C. Lee Cook Jr: --We rely on that because that is the basis of the decision below, that's true.

Unidentified Justice: Yes.

C. Lee Cook Jr: There is a conflict, however, that I want to deal with.

Unidentified Justice: Well, then, if there is, I don't know how you could concede on compensatory damages.

C. Lee Cook Jr: Well, Your Honor, the reason I'm conceding on compensatory damages is because while compensatory damages may have a regulatory effect and they may produce a safety benefit, they have as well a nonsafety rationale, and that is, making whole the plaintiff who has been injured, who has suffered a loss.

This Court said... as a matter of fact, in your opinion you said the ration... the question we must ask--

Unidentified Justice: That was the Court's opinion.

[Laughter]

C. Lee Cook Jr: --That was the... excuse me, Your Honor.

The question we must ask in Pacific Gas and Electric was is there a nonsafety rationale for the state action, for the state statute involved there.

Now, if we apply that same question here, we can see a difference between punitive damages and compensatory damages, because if we ask that question with respect to compensatory damages, we have to say that there is a nonsafety rationale, and that rationale is to make whole, to recompense the injured plaintiff who has suffered damage because of a nuclear incident.

Unidentified Justice: But under--

C. Lee Cook Jr: Whether it be because of a standard of care or not.

Unidentified Justice: --Under your analysis then it would depend solely on the Oklahoma law.

If the Supreme Court of Arkansas had said that our punitive damages are just to make sure a plaintiff is really compensated... it may have nothing to do with safety... presumably the punitive damages would go the same way as compensatory damages under Arkansas law, even though it's a federal inquiry.

C. Lee Cook Jr: It may very well turn on that point, Your Honor.

I think, however, generally speaking the law of this country is that compensatory damages by definition are not... I mean punitive damages by definition are not compensatory but indeed are for the purpose of punishing alleged wrongdoing and establishing a safety standard.

After all, what we are dealing with here is whether under Oklahoma law and the purposes of Oklahoma... of punitive damages in Oklahoma we have preemption.

If we ask that same question... is there a nonsafety rationale for the state action in the case of punitive damages... we can only reach one answer.

There is no rationale other than safety with respect to punitives.

And that is particularly so in Oklahoma.

Unidentified Justice: Well, punishment of the offender.

C. Lee Cook Jr: Punishment of the offender still has as its purpose, I submit, safety.

It has no other purpose.

Unidentified Justice: Well, compensatory has the same element.

C. Lee Cook Jr: Compensatory has that element plus the element of making the injured plaintiff whole, which is not present with respect to punitive damages.

Unidentified Justice: Well, but punitive has the element of punishing plus safety.

I mean you can say one... each one of them has two components if you want to break it down that way.

C. Lee Cook Jr: Well, I submit, Your Honor, that punishment has a safety rationale and a safety rationale only.

Why... we only punish because this particular defendant has not lived up to the safety standard that the jury has been convinced is the appropriate safety standard to apply.

Unidentified Justice: But, Mr. Cook, what about criminal laws?

Say the criminal statute provided for punishment for precisely the conduct that was involved here.

I think you've conceded that would not be preempted.

C. Lee Cook Jr: Your Honor, I would concede that a criminal statute is different.

I... if... obviously if someone takes... chooses plutonium as the means by which to commit a crime as opposed to using a knife or some other--

Unidentified Justice: Say the statute... say they had a statute... I can't recite these rather complicated facts... the facts as we disclose by this record if done maliciously and so forth and so on shall constitute a crime under the laws of Oklahoma punishable by a fine $10 million, would that be preempted?

C. Lee Cook Jr: --Your Honor, I... I don't mean to dodge your question.

I have trouble under... I have trouble conceding a circumstance because all we're talking about here is the general operations of this plant and how there could be a statute that--

Unidentified Justice: Well, the briefs indicate there are unusual facts here.

C. Lee Cook Jr: --Oh, well, Your Honor--

Unidentified Justice: And we... so I think we have to take the facts as your opponent describes them in view of the fact that the jury ruled against you.

C. Lee Cook Jr: --If you... if you... if you examine those facts in... unfortunately, many of those facts were contained in a series of footnotes in the reply brief.

Unidentified Justice: Right.

C. Lee Cook Jr: And we didn't have a chance to respond to those.

Had they been in the opening brief, we would have.

Suffice it to say, and the bottom line, I think, on this is the testimony of the regional director of the Nuclear Regulatory Commission who had responsibility for this plant.

He testified that it was the view of his agency that the plant was safely operated.

Unidentified Justice: Yes, I know, but they had some kind of a safety report that said there were about 18 or 20 safety problems, none of which violated the federal regulations.

C. Lee Cook Jr: Oh, well, Your Honor, if I could just talk briefly about those.

Those are matters which were... were, I submit, not the basis of the punitive damage award in this case.

Let me just give you an illustration of one of them.

One of them said, for example, that there was a period of... a contamination incident or contamination was permitted to exist for 14 days.

It sounds like there's some contamination out there that creates a danger, a risk.

If you read the backup materials on that what you'll see is we had a vacuum cleaner that we had trouble cleaning, and so that they couldn't get it clean, so they decided to put it in a bag and put it aside and decide whether they could find a way to clean that or whether they had to throw the vacuum cleaner away.

It took 14 days to make that decision.

There was no exposure of the public or workers or anybody to health.

The reason that was rejected by the Nuclear Regulatory Commission is that it created no health or safety problem.

The whole argument on that point... I'm kind of getting out of order here... but the whole argument on that point, I submit, misses the point of what the Nuclear Regulatory Commission does.

The Nuclear Regulatory Commission has broad discretion in the regulation of plants such as this and does indeed control them.

Unidentified Justice: Well, let me ask you this genera question.

Do you contend that the state could not make it a crime to do anything that is authorized by the federal agency?

If a federal agency authorizes it, then the company is immune from criminal liability?

That the federal agency has not prohibited it, I should say?

C. Lee Cook Jr: No.

I--

Unidentified Justice: You can't say that.

C. Lee Cook Jr: --Obviously, I do not submit that, Your Honor.

Let me turn... let me turn to the--

Unidentified Justice: Just before you turn--

C. Lee Cook Jr: --Sure.

Unidentified Justice: --Suppose that there is a safety standard issued by the NRC which is... which the plant and the company is supposed to live up to.

Suppose that they did not, and it's plain.

Plainly they did not, and it created... it hurt somebody, like Silkwood.

And it hurt somebody, and it's... the... it's shown that the company negligently, if not recklessly, disregarded the federal safety standard.

State tort suit.

I would suppose that consistent with your theory you would say that punitive damages would not be authorized then.

C. Lee Cook Jr: That's right.

Compensatory, yes, but not--

Unidentified Justice: Well, I know.

But even though... even if... even if the purpose of imposing the punitive damages was regulatory in the sense we want you to make sure to live up to federal standards.

C. Lee Cook Jr: --Yes, but you see, it's the--

Unidentified Justice: What's wrong with that?

What's wrong with that?

C. Lee Cook Jr: --Well, what's wrong with it is it conflicts with the intention of Congress.

Unidentified Justice: Why?

C. Lee Cook Jr: Because what Congress has done is said we're going to have a... not a... we don't want a dual regulatory system.

We want a single regulatory system--

Unidentified Justice: Well, Congress certainly didn't... didn't reserve for itself the awarding of damages for injuries caused by violations of federal standards.

They certainly left that to the states, didn't they?

C. Lee Cook Jr: --Injuries, no, Your Honor.

They gave to... to the agency the power to impose sanctions and to--

Unidentified Justice: I said the... the... the power to award damages to people who are hurt by the violation of federal standards.

C. Lee Cook Jr: --Oh, that's true, Your Honor.

I--

Unidentified Justice: They left that to the states.

C. Lee Cook Jr: --Yes.

Unidentified Justice: And you say that a state could not when a violation of a federal standard is found impose punitive damages.

C. Lee Cook Jr: That's right, Your Honor.

Unidentified Justice: Even though the purpose of it was to live up to federal law.

C. Lee Cook Jr: And because that... the function there is regulatory, and that's the function that has been delegated to the Nuclear Regulatory Commission.

Now, in addition to the fact that Congress has occupied this field, the... the imposition of punitive damages stands as an obstacle to the accomplishment of the federal purposes, specifically the purpose to encourage widespread participation in the development of atomic energy for peaceful purposes, and the express desire and intention of Congress to have dual regulation of radiation hazard... to not have dual regulation of radiation hazards.

If a state passed a law or an administrative agency adopted a rule which imposed a standard upon a nuclear facility, even the plaintiff would concede that's preempted.

But he argues somehow punitive damages are different.

But what is the saving difference?

Giving the jury the power to devise the safety standard is no different than having it done by a state agency except that it varies from case to case, and it's subject to all the whims and vagaries of juries and the ability of counsel to inflame them.

But the result is the same.

It's the state standard of safety which controls the plant and not the Nuclear Regulatory Commission's standard of safety which this Court has already held has exclusive jurisdiction over that subject.

Unidentified Justice: Would you say that the injuries in this case were caused by conduct that was perfectly proper under federal law?

C. Lee Cook Jr: Your Honor, the fact of the matter is there is no evidence here of what caused this damage.

The plaintiff conceded that he could not prove what caused this damage.

And that brings me to this point with respect to the property damage award.

And if I could just close for a minute on that point.

When this case is reduced to a $5,000 property damage case, as it is, there is no predicate for the punitive damages because there is no showing of the cause of that property damage award.

And under Oklahoma law if it wasn't caused by an act which was reckless or accompanied by malice, it cannot be the basis of punitive damages.

Unidentified Justice: Well, that question's still open, isn't it, in the... even... even if... even if we reversed, wouldn't that... would that issue still be open in the court of appeals?

C. Lee Cook Jr: It would be, but, Your Honor, I think that is a basis for your affirming also, because there is no evidence of the cause of the damage to the property.

Thank you.

Chief Justice Warren E. Burger: Mr. Garvey.

ORAL ARGUMENT OF JOHN H. GARVEY, ESQ., AS AMICUS CURIAE

John H. Garvey: Mr. Chief Justice, and may it please the Court:

I would like to make just two points.

The first of them is that the federal regulations in this case do exactly what the state of Oklahoma was trying to do through the imposition of punitive damages.

And the second point is that there is indeed a difference between compensatory and punitive damages which demonstrates that Congress intended to prohibit punitive damages and intended to encourage compensatory damages.

Let me just say a few words about my first point, which is that federal regulation is not only adequate to cover this case but also does exactly what Oklahoma did.

The Atomic Energy Act in Section 2077A and the regulations promulgated by the NRC in Section 70.3 say that you can't possess plutonium without a license.

They also say that you can't transfer plutonium except to a licensee.

There is no limit on the amount of plutonium that they're speaking about.

That means that with respect to the 300 micrograms that were found in Silkwood's apartment in this case that if either party had been responsible for the transfer or the possession of that plutonium in the apartment, it would have... it would have violated both the statute and the regulations.

Unidentified Justice: Is this a radioisotope, Mr. Garvey?

John H. Garvey: I wish I knew.

I don't think so.

I think when Congress used the words radioisotope in 1959 they meant maybe things like cobalt 60 and... and--

Unidentified Justice: Certainly it's fairly important to determine in deciding whether this has been preempted or not, under the government's theory, isn't it, when the Joint Committee Report in '59 says we're leading... leaving radioisotopes--

John H. Garvey: --Oh, there is... there is absolutely no doubt but that Congress attempted to preempt the operation of plutonium fuel fabrication facilities in all their respects.

In the '59 report the... the... well, what Congress said was--

Unidentified Justice: --Well, one thing Congress said was that we're leaving radioisotopes to the states.

John H. Garvey: --Yes.

There is no question but that this is not radioisotope within the meaning of that discussion.

Unidentified Justice: And what's your authority for that?

John H. Garvey: Well, I think if you look at the AEC analysis of the bill, which appears in 105 Congressional Record '83-'84, and if you read the House and Senate reports that accompany the 1959 amendments, it's clear that Congress made a distinction between facilities that possess special nuclear material in quantities sufficient to form a critical mass, and this was such a facility, on the one hand.

And radioisotopes that are used for medical purposes or related uses, on the other hand.

There is no doubt but that Congress intended to cover this facility.

There is no doubt but that the... that the amount of plutonium found in her apartment, had Kerr-McGee been responsible for its presence there, would have violated both the statute and the regulations.

I might go on to say that the regulations also provide in great detail for the... for the protection of workers in plutonium and processing facilities like this one.

They talk about what sort of precautionary procedures have to be taken in handling plutonium.

They also set exposure limitations which... which... which apply to this case.

The baseline exposure limitation is that operators of these kinds of facilities have to keep exposures as low as reasonably achievable.

Now, any willful exposure to plutonium almost by definition violates the as low as reasonably achievable standard, but it might also say that the amount of plutonium that the NRC discovered on its investigation in this case... that was discovered at the autopsy, had it been received in the course of a week or even in the course of a quarter would also have violated the numerical limitations that are found at the end of Part 20 of 10 CFR.

In addition to that statutory and regulatory scheme, the NRC imposes on licensees specifically tailored license conditions to make sure that these plants are operated safely.

In this case the license was about that thick.

It was introduced as Exhibits--

Unidentified Justice: So your... your point is... is... is that if... that if had been shown that Kerr-McGee was responsible for the presence of that plutonium, there would have been a violation of federal law.

John H. Garvey: --Yes.

I want to go farther than that, because the NRC conducted an investigation, and its report is reproduced as an appendix to the motion to dismiss in this case.

The NRC concluded that the appellees had not violated the federal regulations.

If they had concluded that there had been a violation, the current procedures, which you will find in Appendix C to Part 2 of 10 CFR, say, for example, that the NRC can impose civil fines for any significant failure to control licensed material.

That would include this case.

Unidentified Justice: Well, that wouldn't... there wouldn't be any intention to... there wouldn't be any bar, though, to a... to a state court action for compensatory damages--

John H. Garvey: No, it would not.

Unidentified Justice: --For the violation of the federal law.

John H. Garvey: No, it would not.

In fact, Congress intended to encourage awards of punitive... of compensatory damages.

The NRC has no authority to award compensatory damages.

Unidentified Justice: Right, right.

So there was no intent to preempt the state damage action.

John H. Garvey: Indeed not.

In fact, the Price-Anderson Act rests on the assumption that state compensatory damages actions are permissible.

On the other hand, Congress enacted Section 2282 for the specific purpose of allowing the NRC itself to impose civil fines.

And as this Court noted in Gertz against Robert Welch, punitive damages are nothing other than private fines levied by civil juries.

There are a number of differences between compensatory and punitive damages which make clear Congress' intent.

That first is that the statute treats them differently.

It leaves to the states the award of compensatory damages.

It gives to the NRC the authority to impose civil fines.

The second point I'd like to make is that appellant suggests that in some way reading the--

Unidentified Justice: But, Mr. Garvey, the civil fines imposed by the NRC, do they go to a person who's claiming injury or do they go to the government?

John H. Garvey: --Well, they go to the government.

Unidentified Justice: So that isn't exactly analogous then to punitive damages.

John H. Garvey: No, it's not exactly analogous, although Oklahoma law recognizes that... that the collection of punitive damages isn't a right of the private party.

It's really a private party acting as a private attorney general on behalf of the public.

So I think where they go is really a matter of insignificance.

Appellant suggests that in some way it's strange that Congress might--

Unidentified Justice: Excuse me there.

The impact on the wrongdoer, if he is a wrongdoer, is the same whether the money goes to the government or whether it goes to the private claimant.

John H. Garvey: --That's correct.

Unidentified Justice: It has a deterrent effect.

John H. Garvey: That's correct.

That's correct.

Appellant suggests that in some way it's strange that Congress should have drawn this line between compensatory and punitive damages, but it's done in any number of other statutes as this Court has recognized.

If this had been... if this facility had been a federal facility, the Federal Tort Claims Act would have subjected the government to state standards for negligence in suits for compensation but would not have permitted suits for punitive damages.

This Court has recognized that the Railway Labor Act, suits brought under that act permit compensation but not punitive damages.

Section 303 of the Labor-Management Relations Act permits compensation but not punitive damages precisely because of the effect that they have on future conduct.

That's, I might add, a sensible reason for drawing a line between compensatory and punitive damages in this case.

In Pacific Gas and Electric this Court said that states were free to reject nuclear power if it cost too much, but not because it was unsafe.

I might add the Court's opinion said that states were free to reject nuclear power if it cost too much, even though the decision about cost entailed some thinking about safety.

In the same way, Congress intended that the states should be allowed to assure that nuclear power pay all its costs... the cost of injury, the cost of harm... but that they not be allowed to go further and punish nuclear licensees for operating unsafely.

Unidentified Justice: Well, I suppose that in the process of awarding compensatory damages if in a particular case the state was attempting to impose a standard of performance inconsistent with federal law, that would pose a different problem.

John H. Garvey: I don't believe so.

I think that Congress intended that the states should be allowed to award compensation under standards of strict liability.

Indeed, in the Price-Anderson Act they wanted to encourage that in the case of extraordinary nuclear occurrence.

Unidentified Justice: Well, you aren't answering my question.

John H. Garvey: Well, I think I... I think I am, because in awarding damages under standards of strict liability, the state makes no decision about standards of care.

Unidentified Justice: Well, I asked you if the state was awarding damages in accordance with some standard of care that was inconsistent with the federal law.

They didn't work... suppose the state isn't... doesn't purport to award damages on a strict liability basis.

They are awarding damages because you failed to run your plant this particular way, and it just happens to be inconsistent with the federal law.

John H. Garvey: I find it curious that appellants have turned that argument to their own advantage.

What they're really saying is if the state, in order to protect a licensee, decides to award compensatory damages in less than all cases by using a negligence barrier to collection that that somehow justifies the state in awarding punitive damages in situations where the NRC would not permit them.

Chief Justice Warren E. Burger: We'll resume there at 1:00.

Mr. Gottesman, you may proceed.

ORAL ARGUMENT OF MICHAEL H. GOTTESMAN, ESQ., ON BEHALF OF THE APPELLANT -- REBUTTAL

Michael H. Gottesman: Thank you, Mr. Chief Justice.

Unidentified Justice: Mr. Gottesman, may I ask you a question before you commence?

If there were a nuclear disaster and hundreds of people were injured or killed and their claims exceeded the $560 million, I assume that each of the claimants would be entitled to a pro rata part of that sum.

Michael H. Gottesman: That's correct, Your Honor.

Unidentified Justice: And would they then be entitled to bring punitive action suits?

Michael H. Gottesman: Well, punitive damages would be part of the very cause of action, but the statute has in it, Price-Anderson has in it a provision that where the total recoveries of all elements of damage exceed the $560 million limit of liability the court will make apportionments based on which elements of recovery are the most deserving.

And we would certainly assume that compensatory would come before--

Unidentified Justice: Does the statute make that clear, drawing a distinction between the two?

Michael H. Gottesman: --No.

The statute simply says that the district court shall make such allocations or priorities of allocation as in its judgment it deems just.

Unidentified Justice: And there's nothing in the legislative history that sheds any light on that?

Michael H. Gottesman: There is some discussion in the legislative history that personal should come before property.

That discussion does not have a reference one way or the other to punitive.

And that, I believe... I don't know if it was in a report.

I think it was during the hearings somebody asked that question; they had that discussion.

This is, as we stated at the outset, solely a question of legislative intent.

And I think it's worth noting that throughout the arguments on the other side no one is prepared to crack the binder and look at what Congress said.

All of the arguments on the other side flow from a logic, it would make sense for Congress to do this or it would make sense for Congress to do that.

As we've indicated, Congress told us what it did, and that is the answer here.

But the logic wouldn't work, and I want to focus on the government's argument about the scope of NRC regulations and how since the NRC is punishing, why do we need juries punishing as well... an argument that I assume would extend as well to the state criminal law, that anything--

Unidentified Justice: Why?

Michael H. Gottesman: --I'm sorry.

Unidentified Justice: Why?

You said it would extend--

Michael H. Gottesman: Why would it extend?

Because I don't know how one could attribute to Congress, at least from the legislative history we've got, a dividing line that says the state can take the same malicious conduct or reckless conduct and if it calls it a crime, then it is free to punish it, but if it calls it punitive damages, then it is not free to do it.

I'm not saying Congress couldn't make that distinction.

That I'm saying is there is absolutely nothing in this statute or in the logic of the legislative history that could allow one to conclude that that was the line that Congress actually drew here.

But the point I want to make is that it isn't true that two punishments are the same.

The federal government is punishing violations of its regulations.

The deterrent purpose is that so people won't violate the regulations again.

The state, through punitive damages, is punishing outrage, outrageous conduct motivated outrageously that inflicts injury on its citizens.

Its deterrent purpose is to get this wrongdoer to stop hurting people.

Now, that isn't limited.

In this case it happens that the outrage was perpetrated with plutonium, but the deterrent purpose of the state extends to everything that Kerr-McGee does.

Kerr-McGee doesn't just handle plutonium.

And even this plant has other ways that people can be hurt.

The state's concern is that it has found a defendant that proceeds with a reckless disregard for the safety of its citizens, and the function of punitive damages is to make that defendant stop doing what it does with reckless disregard.

It isn't in any way confined to plutonium or limited to.

Unidentified Justice: --That does divide the regulation of the production of atomic energy, does not it not, between the state and the federal?

Michael H. Gottesman: The act defines the... that it assigns certain functions to the Atomic Energy--

Unidentified Justice: Your response, your analysis puts the jurisdiction in two places at the same time.

Michael H. Gottesman: --We don't think so, Your Honor.

The regulation that we understand Congress to have given to the federal government is the federal government's alone.

That regulation... and we acknowledge that it is in at least some sense regulation... this Court said so in the Garman case... that flows both from compensatory and from punitive damages.

There is no evidence that Congress passed in the federal government alone.

Now, I want to end by pointing out one other thing, and that is, if you read Mr. Kepler's testimony... he's the AEC man... the description of their role is not as indicated here.

Chief Justice Warren E. Burger: Thank you, gentlemen,--

The case is Submitted.

Featured:

City Of Mesquite v. Aladdin's Castle, Inc. - Oral Argument

Fri, 09 Jan 2009 14:47:35 +0000

Case:

City Of Mesquite v. Aladdin's Castle, Inc.

Media File:

80-1577_19811110-argument.mp3

Related Transcript:

1981_80_1577_argument.xml

Transcript:

IN THE SUPREME COURT OF THE UNITED STATES

CITY OF MESQUITE, Appellant, v. ALADDIN'S CASTLE, INC., Appellee

No. 80-1577

November 10, 1981

The above-entitled matter came on for oral argument before the Supreme Court of the United States at 1:04 o'clock p.m.

APPEARANCES:

ELLAND ARCHER, Esq., City Attorney, Mesquite Texas; on behalf of the Appellant.

PHILIP W. TONE, Esq., Chicago, Ill,; on behalf of the Appellee.

PROCEEDINGS

CHIEF JUSTICE BURGER: We will hear arguments next in City of Mesquite against Aladdin's Castle, Incorporated.

Mr. Archer, I think you may proceed whenever you are ready.

ORAL ARGUMENT OF ELLAND ARCHER, ESQ. ON BEHALF OF THE APPELLANT

MR. ARCHER: Mr. Chief Justice and may it please the Court:

The primary question in this case is whether or not the playing of coin-operated machines is a fundamental right. There are other questions, of course. The second important question is which rules of law are applicable to adults and which are applicable to children.

With your permission, I'd like to discuss the fundamental right question first. We think in finding a fundamental right on a par with freedom of speech and religion, right to travel and other important rights that the Court of Appeals used an extremely broad interpretation of the term "association."

Of course, in its broadest terms "association" would encompass all commercial transactions. We realize that. If you rent an automobile, of course, there may be some associational aspects. If you rent a boat, if you rent a motel room, you may have guests in.

QUESTION: Well, if you associate together to fix prices, I suppose that's freedom of association.

MR. ARCHER: Yes, yes. What we're saying is that you can't just take the term "association" in its ordinary sense and apply it as the association that is protected by the Constitution. We feel that there is something more than just mere physical proximity to constitute association protected by the Constitution.

For instance, if you go in a bank to make a loan you're going to talk with people, you're going to meet friends and acquaintances. When you go in the supermarket, when you're at work, you have association with your fellow workers. But these are all matters governed by the law of contract.

I'd like to discuss for just a moment the nature of the transaction that is regulated. What we have here is a simple rental agreement. Generally a customer pays 25 cents for use of a machine, generally from one to three minutes or whatever time it takes. No different from renting a lawn mower or renting a power saw or any other machine.

Now, if this type of transaction is the association that is protected by the Constitution under the decisions of this Court, then every commercial transaction known to man becomes a First Amendment activity. This we feel will weaken the values that have traditionally been upheld by this Court.

Going to the question of which rules of law are applicable to adults and which are applicable to children, we say children are simply not the same as adults. We don't mean to imply that children have no constitutional rights. Certainly they do. But the rights of children are not always the same as the rights of adults.

I think in the words of Justice Frankfurter's concurring opinion in May versus Anderson, he said it much better than I can: "Children have a very special place in life which law should reflect. Legal theories and their phrasing in other cases readily lead to fallacious reasoning if uncritically transferred to a determination of a state's duty towards children."

As we read the opinion of the Court of Appeals, we feel that the Court of Appeals has relied upon cases that are good cases, but they are cases dealing with something other than children. They deal with race, they deal with adults, they deal in suspect areas, they deal with the right to decide whether or not to bear a child. But they don't deal with the facts at hand. Therefore we feel that these cases are inapplicable.

QUESTION: Mr. Archer, is it the City's position that playing these games is per se harmful to children?

MR. ARCHER: No, I don't think that's our position. That may be correct, but I don't know that that's our position. I don't know that we have evidence to that effect.

We think that playing them, playing the machines in the actual setting in which it takes place in many cases is harmful, not in every case. We don't claim that in every case there is harm. But we also say that we cannot tailor a law that will fit every establishment in town. There's just no way it can be done.

QUESTION: Is the age matter still in this case?

MR. ARCHER: Yes. In fact, we consider the age question --

QUESTION: The paramount question?

MR. ARCHER: -- the paramount question. We do have a question regarding some language in the ordinance and I don't intend to waive that --

QUESTION: Let me ask you: Didn't the -- wasn't the ordinance declared unconstitutional on both state and federal grounds?

MR. ARCHER: On the language part? No.

QUESTION: On the age, on the age, on the age part.

MR. ARCHER: No, the state court has never reviewed the age question -- or, I'm sorry. Maybe I misunderstood your question.

QUESTION: I thought the claim was being made in this case by your colleague that we can't reach the age issue because it was declared unconstitutional under the state constitution.

MR. ARCHER: Oh, I understand. I thought you meant the state court.

QUESTION: Well, what about that? What about that?

MR. ARCHER: All right. The provision of the state constitution is identical to the federal Constitution. The words may be slightly different, but there's no --

QUESTION: Well, so what if they are? But nevertheless the court -- it was nevertheless held that the state constitution invalidated this position.

MR. ARCHER: Well, but that's not an independent state ground.

QUESTION: Why isn't it an independent ground?

MR. ARCHER: Well, because it's identical. In other words, if a state adopted a constitution --

QUESTION: You wouldn't say that the state court -- would you say the state courts have a rule that they will always interpret their constitutional provisions identically with the federal? Is there such a rule?

MR. ARCHER: Texas has such a rule.

QUESTION: So that they're just forbidden independently to construe their own constitution?

MR. ARCHER: Oh, I don't think they're forbidden to, but I think since they are similar and since they were patterned after the federal Constitution --

QUESTION: Well, I know. But would you say that it would be a departure from the regular Texas rule if the Texas court said, well, I know the federal courts are holding -- would permit this kind of an ordinance, but we just construe our constitution differently?

MR. ARCHER: I think that would be a substantial departure, because one constitution is patterned after the other and the cases construing one are authorities for the other, and that is the rule of law in Texas. And I think I've covered that in my brief, but I can go into that further if you'd like.

QUESTION: No.

QUESTION: Well, here in any event the holding that both the federal and state Constitutions were violated was a holding of the Fifth Circuit, wasn't it?

MR. ARCHER: Yes.

QUESTION: Not of any Texas court?

MR. ARCHER: No, that's correct.

QUESTION: Does that make a difference on whether or not this rests on an adequate state ground?

MR. ARCHER: I don't think so, because again I think the Fifth Circuit was simply stating that the two constitutions were identical and that, of course, if it violated one it would obviously violate the other.

QUESTION: Well, to the extent that the judgment rests on the holding that it violates the state constitution, what's the case doing here?

MR. ARCHER: Well, again I don't think it's an independent state ground. I think that they are identical. The state constitution and the federal Constitution mean exactly the same thing. So you couldn't have a federal question without it also -- I mean, you couldn't have violation of the federal Constitution without it also violating the state constitution.

But I don't think that that is the meaning of the jurisdictional statute. I don't think it's --

QUESTION: Well, you're not suggesting, are you, that if indeed you had a state, Texas state court determination of a state constitutional question solely based on the state constitutional question, that that would raise a federal question because the state constitutional provision was the same as the federal Constitution?

MR. ARCHER: Oh, no. I think the state court would have to actually rule on a federal question before it could come to this Court, obviously.

QUESTION: Well, how about a federal court? Would an action lie under any of the jurisdictional provisions were a federal court to invalidate an ordinance such as this on the grounds that it violated the constitution of a state?

MR. ARCHER: Well, in a diversity case, yes.

QUESTION: Was this case a diversity case?

MR. ARCHER: Yes, this was a diversity case.

Again, the federal question -- the federal rule of law involved is the application of the strict scrutiny test. Now, that is not a state question. There is no state rule of law to that effect.

The Court of Appeals, even in their discussion of the "rational basis," first found that there was a fundamental right, that of association, and then reasoned backwards by placing the burden of proof on the City, saying the City failed to produce evidence to show this and that. Therefore throughout the opinion -- and I realize that we're not appealing from the opinion, we're appealing from the judgment. But I think the judgment is incorrect because of a body of federal law that the Court of Appeals misapplied, not any state law.

There's no state law, strict scrutiny test versus rational basis test doctrine.

Looking at the application of law to children, as I say, I think the Court of Appeals improperly applied rules of law pertaining to adults or to race and other matters, instead of confining it to children. Obviously, children do not have all the rights that adults have. Children do not choose their domicile. They do not choose the school they wish to attend. They do not in all cases choose the church that they wish to attend.

And while this may be considered private action, it is buttressed at every point by state action. For instance, if a child refuses to reside in the domicile chosen by his parents, he's treated by the state as a runaway. If he refuses to attend the school that his parents choose, he's treated as a truant. If he refuses to do the other things that his parents require him to do, the state makes an exception and allows physical punishment that wouldn't be permissible for an adult.

Of course, many states require a parent's signature for the issuance of a driver's license. Others require a parent's signature for a minor to marry. This is all state action. Of course, there are countless other things in which the state buttresses the action of the parent in not allowing the same rights to minors as adults.

I think the failure of the Court of Appeals to give consideration to these facts is what caused the improper judgment.

QUESTION: Well, this ordinance I gather does make the distinction, doesn't it, between this kind of entertainment center and other centers where teenagers gather?

MR. ARCHER: This ordinance itself does not. This ordinance simply does not deal with those other questions. But this Court has said many times that we were not required to address all the ills existing in one law or one enactment. I don't think we single out any particular establishment and say, this establishment cannot do this but all others can. We just fail to say anything about the others.

QUESTION: Well, the ordinance does make a distinction, though, doesn't it, between teenagers who play these games and teenagers who are present in the same establishment?

MR. ARCHER: Well, yes. The ordinance does not address the question of being present, but we don't deny that denying them the right to play the games will discourage their presence. We've never denied that.

QUESTION: What is the interest, then, that the City is trying to achieve with the ordinance?

MR. ARCHER: Well, I think it's twofold. I think the first is a financial impact. I think the city fathers feel that the children are spending money on these games that they can ill afford, money that they need --

QUESTION: It's to prevent the children from spending their money?

MR. ARCHER: We think that that is one concern. I think another concern, and the concern that was emphasized by our police department, was some of the things that take place at these establishments, such as drug transfers, fights, contacts by runaways.

QUESTION: But the ordinance doesn't prevent them from going to the centers, right?

MR. ARCHER: Well, not directly. But we assume they go there because they want to play the machines. I don't think they'd go there if they couldn't play the machines, or not in any large number.

QUESTION: Mr. Archer, I want to be sure about a statement I thought you made. You take the position this ordinance is not directed at Aladdin's?

MR. ARCHER: Well, no. It's directed at every establishment in the city.

QUESTION: Isn't it really directed at Alladdin's, period?

MR. ARCHER: No. We had this ordinance in 1973, before we had ever heard of Aladdin's. Now, if they're talking about the amendment, the amendment probably affected Aladdin's and one other place in the city, Funfare, I believe, in another shopping center.

QUESTION: I'm speaking of 1353, enacted just two days after a significant event.

MR. ARCHER: Yes, that ordinance -- there had been a previous ordinance that made an exception to places located in a shopping center. Now, to the extent that it closed that loophole, if you may, then I guess it would be directed to all establishments in shopping center malls, which Aladdin's and I believe one other at that time were the only ones there. Now there are several. At that time Aladdin's and one other were the only ones.

Now, the age regulation that we're seeking to uphold applies to every establishment in town, the Seven Eleven stores that maybe only have one machine and where there are no other customers present, where there's no association involved whatsoever.

QUESTION: Then you can't justify that on the fact that you don't want the children to go to these places where there are drug transactions.

MR. ARCHER: Well, I think that -- well, of course, I say one. You know, I don't know that there's cases where there's never more than one present.

QUESTION: But your point is, the ordinance applies to the Seven Eleven stores, the hotel lobby, and everyplace there's one of these?

MR. ARCHER: Yes. And that would be based more on the financial impact. But I think most of the establishments have more than one machine, to be candid with you.

But what I'm saying is that there doesn't have to be any association involved because it could just be one machine and it could just be one person present. And I don't know how you'd read association into that.

Frankly, I don't know how you read association into a hundred people being present unless they go there for a common purpose, they're acquainted with each other or they become acquainted after they get there or something.

QUESTION: Well, I wasn't really as concerned with the association point as the reason for the ordinance. The reason for the ordinance has to be, I think, limited to the fact that you don't want the under 17-year-olds to spend 25 cents without the consent of their parents.

MR. ARCHER: Well, unfortunately that's the term that the Appellee uses, spending 25 cents. But there's nothing in the record --

QUESTION: Well, over and over again, maybe they'll spend 25 cents.

MR. ARCHER: Right. In other words, just like if you smoke one cigarette you may smoke another cigarette. If you take one drink you may take a lot of drinks.

QUESTION: Well, why doesn't that rationale apply to miniature golf courses and the like?

MR. ARCHER: Well, I don't know that we have negated regulation of miniature golf courses. This particular ordinance does not. But I don't think that we have said we do not have the power to regulate miniature golf courses.

I can see distinctions, and again the record is not as strong in this case. We thought we were trying it on the rational basis question rather than the higher level test. But officers can drive by and see people playing on the miniature golf course. They're exposed to public view at all times. I don't know how much difference that makes, but our police department says it makes a difference.

Now, that's not in the record and I don't know if I should even be saying it. But those are some of the things that could have been in the record had we known that we would be held to this type of test.

QUESTION: Well, I can understand that if you're talking about an amusement center. But the ordinance isn't limited to amusement centers. That's why I made the analogy to the miniature golf course. It seems to me it's amusement machines, wherever located -- Seven Eleven, hotel lobbies, pizza joint, whatever it might be.

MR. ARCHER: Yes, I think where it applies to just one machine it is primarily the financial impact. But I think you'll find in most cases it'll be more than one machine. I don't think any of the places just have -- well, there may be a few. But I think most of them have from two to four, you know, that are not arcades.

QUESTION: Counsel, do you have any doubt that a state or municipality could totally outlaw the use of coin-operated machines?

MR. ARCHER: The state could under the holding of this Court, I believe, in Murphy versus California. The state has not seen fit to do so, and of course we're merely a part of the state. And until we are given permission by the state to totally outlaw them, I don't think we can. The state has given us permission to "regulate" them.

QUESTION: But the Fifth Circuit didn't base its holding of unconstitutionality on the grounds that you had exceeded your power under state law, did it?

MR. ARCHER: Well, to the extent that the state constitution is identical to the federal Constitution, I guess I'd have to say yes. But I don't think they indicated that there was an independent state law grounds, but merely that it was the same as the federal Constitution.

QUESTION: Suppose over a period of time, counsel, the police reported to the authorities, to the council, that a great deal of drug traffic was taking place in three city parks, and there were only three city parks in the city. Could the council pass an ordinance saying that 17-year-olds could not be in the city parks?

MR. ARCHER: I think we would be a lot closer then to what they're saying here. For one thing, when they go into the park it's not a financial transaction, it's not a business matter. I think that that is more closely akin to, say, being on the streets, a curfew. I doubt that we could. I think we could regulate our parks and we certainly do regulate our parks, regardless of whether anyone may say that we've neglected that area. But we do regulate our parks.

I'd like to speak just a moment on the vagueness question. I think both the District Court and the Court of Appeals failed to read the language "connections with criminal elements" in the context in which it's used.

QUESTION: Has that provision been stricken from the ordinance?

MR. ARCHER: It has, Your Honor. But we do agree with Appellee that it's not moot. We would like to have it --

QUESTION: Why isn't it moot? What controversy is there now about it?

MR. ARCHER: Well, we would like to put it back in if this Court sees fit to allow us to.

QUESTION: Do you want an advisory opinion from us on that?

MR. ARCHER: Well --

QUESTION: Well, the ordinance just doesn't exist in the form that it was when this case began.

MR. ARCHER: Well, that is correct. But it --

QUESTION: And when the Court of Appeals rendered its judgment.

MR. ARCHER: Yes. But it's only because we're not allowed to by the order of the District Court, and then in turn which was made an order of the Court of Appeals.

QUESTION: Well, you were still appealing. You're the one who brought this case up, aren't you?

MR. ARCHER: Well, we brought it from the --

QUESTION: Court of Appeals to here.

MR. ARCHER: -- Court of Appeals to here.

QUESTION: But meanwhile you amended your ordinance.

MR. ARCHER: Yes, we had already amended the ordinance because we were prohibited from using it.

QUESTION: Well, but certainly you didn't have to amend the ordinance. You could simply comply with the Fifth Circuit's opinion and seek certiorari and get a judgment from this Court seeking to overturn the Fifth Circuit.

MR. ARCHER: Well, yes. But in the meantime we would have other applications and it would be unclear as to what the status of these applications were.

QUESTION: If you thought you had to obey the order, you didn't need to repeal the ordinance to do it. You could just not have enforced this, that particular criminal elements provision.

MR. ARCHER: That is correct. I realize we could. We felt at the time that that was the best thing to do. But as I say, we would like to reinstate it if this Court should find either that the Appellee had no standing to question the language or that the language is not vague, or both.

The reason we say they have no standing in the context in which this is used, this is not a standard upon which a license is granted. The standard upon which a license is granted is good character. This is simply a direction to the chief of police as to how he is to gather certain intelligence, no different from Laird versus Tatum.

QUESTION: Is there any dispute about that, Mr. Archer, from the other side, your present analysis? It is directed to the chief of police?

MR. ARCHER: Yes. They claim that -- well, no. But they claim because it is directed toward the chief of police that his recommendation in turn will influence the city manager, which in turn will influence the city council and the District Court and ad infinitum.

We also say, of course, in the context in which it's used it's not unconstitutionally vague because nobody has to know what it means except the chief of police, and he obviously knows what it means.

If there are no further questions, I'll save the rest of my --

QUESTION: Do you -- well, I can ask the other side. Where is the principal place of business of the Appellee?

MR. ARCHER: The home office? Chicago.

QUESTION: All right, thank you.

MR. ARCHER: Thank you.

CHIEF JUSTICE BURGER: Mr. Tone?

ORAL ARGUMENT OF PHILIP W. TONE, ESQ., ON BEHALF OF THE APPELLEE

MR. TONE: Mr. Chief Justice and may it please the Court:

With the Court's permission, I would like to first address the matter of the existence of independent state grounds for the decision. The judgment of the Court of Appeals on the age restriction claim is supported not only by the federal constitutional ground, but by independent state law grounds. The court expressly that the ordinance violated the equal protection and due process clauses of the Texas constitution.

QUESTION: Well, Mr. Tone, suppose that the only claim that you had made or that your client had made in the federal District Court was under the laws of Texas. Now, certainly in a diversity suit there would be jurisdiction.

MR. TONE: Yes.

QUESTION: And certainly the Court of Appeals could have reviewed it.

MR. TONE: That's correct.

QUESTION: And certainly we could review it here.

MR. TONE: You could on certiorari, Your Honor.

QUESTION: Yes.

MR. TONE: The problem here is that this is here on appeal under Section 1254.

QUESTION: Well, would you say it's an improper appeal?

MR. TONE: No, not so long as this Court --

QUESTION: So the adequate state Ground argument is a jurisdictional argument?

MR. TONE: Yes, it's a jurisdictional argument and it says --

QUESTION: But we surely have jurisdiction in a diversity case to pass on state law questions. We hardly ever do. I don't know since I've been here where we ever --

MR. TONE: Your Honor is quite right. But the mechanism by which you would reach the state law question, I submit, would be to dismiss the appeal under 1254(2) and treat the jurisdictional statement as a petition for certiorari --

QUESTION: Why is that? In a diversity case the Court of Appeals has stricken down a state law.

MR. TONE: Right.

QUESTION: Now, why isn't that a proper appeal here?

MR. TONE: It is a proper appeal. But Section 1254(2) provides specifically that in such an appeal the review on appeal shall be restricted to the federal questions presented. So Congress in 1254(2) has prohibited the Court from considering the state ground.

QUESTION: I see. But if we dismissed the appeal and granted cert?

MR. TONE: Then Your Honors could -- in fact, if the appeal is dismissed, the appropriate procedure according to Stern and Gressman, and I think that's correct, would be to treat the jurisdictional statement as a petition for certiorari under 2103, which commands the Court to do that.

QUESTION: Well, don't you want it both ways, though? You don't want us to consider that, to be able to reach the state ground here, but you want to use the state ground to say we shouldn't reach anything.

MR. TONE: Well, I want to rely on the state ground, Your Honor, because I --

QUESTION: To avoid reaching any ground, to say that we haven't any jurisdiction.

MR. TONE: No. I say you don't have jurisdiction on appeal. I say also that you do have jurisdiction, if you choose to exercise it, to grant certiorari.

QUESTION: But then have we not, on granting certiorari, on treating it as a cert, denied on the grounds that it was supported by an adequate state grounds?

MR. TONE: Adequacy in that sense, Your Honor, simply means that it is sufficient to support the judgment if correct. It doesn't mean that you have reviewed the merits of the state ground. The point I make is illustrated, if the Court please, by the Hastings case, in which Chief Justice Hughes addressed this very point in the context of a statute allowing appeal by the Government from an order dismissing an indictment where the indictment -- where the order held the indictment invalid either on the ground of the invalidity of the underlying statute or the construction of the statute on which the indictment was based.

And the Chief Justice said in that case that in order to -- that the Court should first examine whether there was an independent ground for the order of the district court. If there was an independent ground that didn't relate to either the validity of the statute or the construction of the statute, he said the Court would be rendering an advisory opinion by ruling on the questions that were appealable.

And he said that review of a judgment we cannot disturb because it rests on grounds we cannot examine would be an anomaly. And then he used as an analogy the appeal statute which provides for appeal from the highest court of a state. And he said the practice of this Court with respect to such appeals when there is an independent state ground on which the judgment -- which adequately supports the judgment, is to dismiss the appeal.

QUESTION: Do you think Cox Broadcasting has changed that analysis at all?

MR. TONE: I do not think it has, Your Honor. I believe, as I said, Stern and Dressman's position is consistent with mine, and I think that's a correct reading. It seems to me the analysis has to be that it has to be that way.

We are, as the Appellee -- we're entitled to rely on whatever state grounds are available to support the judgment. We're entitled to rely on state grounds even though the Court of Appeals didn't rule on them. And yet when it comes up here under 1254(2) we would be precluded from relying upon state grounds that support the judgment because this Court is not allowed to examine those grounds under this proviso of 1254(2) that we've been talking about.

QUESTION: What do you think the proper disposition is if we agree with -- if we happen to agree with you? To dismiss the appeal and then, treating it as a cert, to deny cert and dismiss it?

MR. TONE: That's correct, Your Honor.

QUESTION: Dismiss it as improvidently granted?

MR. TONE: Yes, Your Honor.

QUESTION: Or just deny it?

MR. TONE: Deny it, right. Yes.

Your Honor is correct, the correct disposition in our view would be to dismiss the appeal, to treat the jurisdictional statement as a petition for certiorari, and deny certiorari on the grounds that there are adequate state grounds.

QUESTION: Mr. Tone, that means that we just have no jurisdiction to grant the cert and decide and review the question of state law.

MR. TONE: No, it doesn't, Your Honor, because you could elect in your discretion, if you chose to do so -- the case is properly in the federal court as a diversity case. And this Court has discretion to review state questions that come up that way if it chooses to do so.

As Mr. Justice White pointed out, it rarely if even does. But it would have authority to do that under its certiorari jurisdiction.

QUESTION: And you urge in this case what?

QUESTION: Deny it, just deny cert?

MR. TONE: Yes, just deny cert.

QUESTION: And if we disagree and grant it, then we go on and review the state law question?

MR. TONE: If you disagree and grant cert, then I submit to the Court that you would and should review the state law question, because as Respondents --

QUESTION: Well, also, could we not if we took it as a cert -- I understand you're arguing we must dismiss the appeal. But if we took it as a cert, could we not do what we did in the Ohio-Zacchini case and say, well, the state and federal law is parallel and we will decide the federal question and send it back to the Court of Appeals to review the state law question in the light of what we say about the federal law? We'd have power to do that.

MR. TONE: You would have power to do that, Your Honor. I would question, however, whether that disposition would be consistent with the Ashwander admonition about no reaching federal constitutional questions unless necessary to do so.

QUESTION: Mr. Tone, is there some evidence -- in the Zacchini case, the evidence was, or there was indication, that the state courts felt compelled by the federal rules. But here is there any evidence that Texas feels bound to follow the federal Constitution in applying its own?

MR. TONE: No, there is no indication that Texas feels bound to follow the federal.

QUESTION: And the Court of Appeals didn't say so.

MR. TONE: That's correct. The Court of Appeals treated the state law and the federal law --

QUESTION: As independent.

MR. TONE: -- questions as independent questions.

QUESTION: And incidentally, to follow my Brother Stevens' suggestion, it's only to get them to do over again what they've already done.

MR. TONE: That's correct.

QUESTION: They've already said what the state law is.

MR. TONE: That is correct.

QUESTION: There's nothing to suggest that they'd change their minds because we decided the federal question one way or another.

MR. TONE: That's exactly correct. They've already decided the state law question.

QUESTION: If they're wrong about the federal law and if they think the state and federal rules are the same, as your opponent argues -- now maybe he's wrong -- then if we corrected their analysis of federal law, conceivably they could say, well, that means that the state law result will be different.

MR. TONE: They could, Your Honor.

QUESTION: This is all hypothetical. But it's at least conceivable.

MR. TONE: But there is nothing in the opinion of the Court of Appeals, I submit, to suggest that they felt that state law and federal law were identical on these issues.

QUESTION: Or different. Really, all they do is have a phrase in there saying it violates both provisions.

MR. TONE: That's correct.

We, however, have cited some state law cases in our brief which indicate that the Texas courts, although they phrase the standards approximately the same as this Court does and cite this Court's cases, nevertheless reach results which I think this Court would not reach on the same facts. So I think that the Texas law, although it was not analyzed by the Court of Appeals, is not identical with the federal law, and the Court of Appeals did rule on that grounds.

There are also, I might add, two other grounds of Texas law, one a Texas common law ground which the Appellee has so far not been able to get a ruling upon. The Court of Appeals deemed it unnecessary to reach these two other state law grounds which we argue in our brief. And if this Court were to take the case we would at some point be entitled to an adjudication on those grounds which defend the judgment. And ordinarily we would be able to argue those grounds to this Court because they are grounds for affirmance. This Court can affirm on any grounds that it finds supported in the record.

QUESTION: That you urged below.

MR. TONE: Yes.

QUESTION: That you did urge and they didn't pass upon.

MR. TONE: That's correct. Both were urged below.

QUESTION: Mr. Tone, you say if we were to take the case. Probable jurisdiction here was noted in May.

MR. TONE: Yes, Your Honor.

QUESTION: You mean take it as a cert.

MR. TONE: I was speaking to the supposition suggested in the colloquy with Mr. Justice White and Mr. Justice Brennan and the Mr. Chief Justice that if the Court agrees with our position that the appeal should be dismissed for the reasons stated earlier and treats the jurisdictional statement as a petition for cert, then it would have -- then it was on that basis that I said, if the Court takes the case, my view is that the case should not be here on appeal for the reasons I've stated previously.

QUESTION: You would be quite content, I take it, if we held that this was not an appropriate appeal, but treated as cert we would deny it? I want to be sure.

MR. TONE: Yes, Your Honor, that is the relief we ask for in the first point in the brief.

QUESTION: Just to be sure I understand one point, you're also arguing that unless we treat it as a cert and if we just act on a noting of probable jurisdiction under 1254(2), you would agree then we don't have the power to listen to any state law argument?

MR. TONE: Then you do not have the power to listen to the state law arguments. But then I submit you don't have power to decide the federal question either, because your decision would be an advisory one.

QUESTION: Yes, I understand that.

MR. TONE: Right. And as to the state law questions the Court of Appeals didn't rule on, it would be unfair to the Appellee because we would never have a chance to present those arguments anyway.

Now I should like -- although, as I have said, it's our position that the Court should not reach the federal constitutional question, I am sure the Court does not want me to argue the Texas law points and so I think I should proceed to discuss the federal constitutional question as if it were to be reached on this appeal. And I shall proceed to do that.

This Court has recognized that entertainment is a form of communication and expression protected by the First Amendment. It has also recognized that the communication and expression need not be verbal to be protected. Thus, musical compositions and dancing, including nude dancing, are protected.

The First Amendment protects both the right to communicate and the right to receive the communication.

QUESTION: Mr Tone, do you question that a state could totally outlaw pinball machines which require insertion of coins to operate?

MR. TONE: I do question that, Your Honor. I do question that. I think that these games, at least, involve First Amendment expression on the part of the author of the game and on the part of the player of the game. They are complex electronic devices that present a series of audio and visual effects through complex electronic circuitry. They call upon the player to respond --

QUESTION: Mr. Tone, who is the author, the mechanic?

MR. TONE: Pardon?

QUESTION: Who is the author?

MR. TONE: The author, Your Honor --

QUESTION: The mechanic?

MR. TONE: -- is the person who designs the electronic circuitry.

QUESTION: That's a mechanic.

MR. TONE: I think he's more than a mechanic, if the Court please. He is -- I guess it depends on how broad one's definition of "mechanic" is. But he is a person skilled in electronics and in the visual and the video arts.

QUESTION: Well, suppose this factory also puts out adding machines. Would they also be protected?

MR. TONE: I don't think so, Your Honor.

QUESTION: But say it is the author -- they had the same author.

MR. TONE: I think an adding machine does not convey a message to anyone.

QUESTION: But it's the same author. I'm just worried about your word "author."

MR. TONE: Well, let me call him the originator of the game. He does get a copyright on it. The federal courts have uniformly recognized that these games are protected by copyright.

QUESTION: But so is the adding machine.

MR. TONE: I'm not sure about the adding machine. I would not dispute Your Honor's statement, but I --

QUESTION: I'm not sure. I just raise the question.

MR. TONE: All right.

QUESTION: Likely a patent, would it not be?

MR. TONE: The adding machine might have a patent.

QUESTION: Well, Mr. Tone, supposing that in the electrical antitrust cases, certainly the person who thought up the phase of the moon element of that and the complicated parts of it in the early 60's was putting in a good deal of intellectual input and confiding it to a number of other people who were in the same position he was. Were their activities protected against the Sherman Act?

MR. TONE: Well, Your Honor, I think his right to communicate what he had dreamed up was protected. Their conspiracy was forbidden by other laws. But the right to communicate I think would be protected.

Our position is that these games do involve communication. They involve a receipt by the player of the ideas of the designer of the game. He has -- the game responds in certain ways, in very complicated ways, to matters that the player does. These are not -- the games I am describing now are not so-called pinball machines, but those machines which make up most of the market now, audio-video games, which are very complicated affairs.

And there is a very complicated interrelationship and interaction between the machine and the player. And I would submit to Your Honor that these are a form of expression and communication.

One of the amicus briefs quotes at length from Marshall McLuhan. We have a small quote from his statement about games being communication. And he says, speaking of all games generally, that they are a media of communication and that that should now be plain. And as media of communication, we submit that they fall within the protection of the First Amendment.

Like the composer of a musical composition or dance, the author of the game has a protected right to present his creation to people who want to receive it, and they have a right to receive the expression.

QUESTION: How about the Red Lion case, where certainly people are communicating, but a Government agency is telling them that they have to present the other side too?

MR. TONE: That much is true. But there is a special governmental interest in regulation of speech over the restricted channels available for radio and television.

QUESTION: That's because they're using the public highway, is it not? Isn't that the rationale of the Red Lion and related cases?

MR. TONE: Yes, Your Honor.

QUESTION: Well, is there any other place, any place in the city that people under 17 can be entertained?

MR. TONE: The record in this case, Your Honor, is very skimpy, but there is an indication that there is one other coin-operated game center in the city. And I think there isn't any real dispute that --

QUESTION: Well, certainly reasonable time and place restrictions are available, are legal, or not necessarily invalid, anyway?

MR. TONE: That's correct. And a reasonable time limitation would be valid here. But this regulation --

QUESTION: What about a place limitation?

MR. TONE: If it were a zoning ordinance limiting the places where commercial establishments, including games, could be played, that would be reasonable.

QUESTION: You mean a half a mile prohibiting games, a half a mile from a school, that sort of thing?

MR. TONE: That might well be reasonable, although that's somebody else's case and I wouldn't want to --

QUESTION: Or prohibiting 17-year-olds to go in and play these machines in a bar, a barroom?

MR. TONE: I think that would be reasonable, for a different reason, because the state has a right to prohibit 17-year-olds from going into a bar.

QUESTION: It's a place.

QUESTION: It would also survive First Amendment analysis.

MR. TONE: Well, but remember, the fact that it is a fundamental right does not mean that the state has no power whatsoever to regulate it. It merely means that it must regulate it only based upon a compelling state interest, and that the regulation must be reasonably tailored to protect that interest and must not be unnecessarily intrusive on the fundamental right.

QUESTION: Do you think that rule applies, that every time, place and manner restriction has to satisfy that test?

MR. TONE: I guess that would be too broad a statement, Your Honor. I don't think it would. But this is more than a time, place and manner statement -- or restriction before you at the present time. As to youths who are unable to persuade their parents to accompany them or who cannot -- whose parents both work, it's a flat prohibition. They can't play the games at all.

QUESTION: Can one gamble on these games?

MR. TONE: No, Your Honor. Gambling is expressly forbidden, and these are not gambling devices under Texas law. There is no -- you do not have the old free games or anything, and so on. They are not gambling devices.

And one could gamble on the games only in the sense that he could gamble on any competitive endeavor.

QUESTION: You could bet on the outcome?

MR. TONE: You could bet on the outcome, just as you could bet on the outcome of a football game or on who can run faster. Some of these games are played by individuals alone, some are played by more than one or a group of individuals. So it is possible to gamble with the games, but that is not their purpose and there is no evidence in the record that these games have been used for gambling, and they are not gambling devices under Texas law, which does prohibit gambling devices.

I submit that the only distinction that can be made between these games and various other forms of expression, including some that this Court has held to be protected, is in their social utility. And that is a matter of value judgment. It's easy to deprecate or ocularly put down the social utility of various forms of expression, including some form this Court has held protected.

But the Court has also held that the level of protection to be given any form of expression does not turn on its importance or its social utility.

QUESTION: Well, how about a chug-a-lug contest. Could a state or a city forbid that?

MR. TONE: I'm sorry, Your Honor, I missed the first part.

QUESTION: A chug-a-lug contest, who could chug-a-lug the most glasses of beer.

MR. TONE: I guess I would not view that as rising to the level of protected expression.

We also --

QUESTION: There may be some 17-year-olds who would disagree with you.

(Laughter.)

MR. TONE: That's possible.

Also --

QUESTION: Mr. Tone, these games are very lucrative.

MR. TONE: Are very?

QUESTION: Lucrative.

MR. TONE: Your Honor is correct.

QUESTION: Even at 25 cents a shot.

MR. TONE: Yes, that's correct, they are lucrative. That is to say the owner and operator of the game collects 25 cents for each play.

QUESTION: Do I understand that more than twice as much money is spent on these in this country today than on motion pictures?

MR. TONE: I have read those statistics, Your Honor, and I understand them to be correct.

QUESTION: That's a powerful speech.

MR. TONE: Pardon? It's powerful speech, yes, sir.

QUESTION: Would you say -- in seriousness, who is doing the speaking there, the player or the originator?

MR. TONE: Well, Your Honor, I think both.

QUESTION: It's a colloquy, is it?

MR. TONE: The player has to respond to a great variety of challenges that the game presents which are invoked by what the player does. So there's an interplay between this computer-programmed game and the player. So it's an expression by the designer of the game of the idea of the game, and there is interaction by the player to the various, numerous variables that are presented by the game.

And of course, the owner and operator of the game I suppose is in a position analogous to the movie theater operator. He too is in the stream of communication. He's the conduit through which the communication goes.

QUESTION: What about the little one at home? Same kind of machines you have at home now.

MR. TONE: It's essentially -- Your Honor is correct. It's essentially the same as the videogame that you play on the television set, except that it is much more elaborate. It's a heavier and more durable --

QUESTION: And much more expensive.

MR. TONE: -- machine, and more expensive, exactly. It's much more expensive. The ones that are sold at home I think are sold on the order of a few hundred -- the cost is a few hundred dollars, while these games --

QUESTION: These machines are several thousand.

MR. TONE: That's correct, that is correct.

We also have argued in our brief that the right of association is implicated, and the court -- the case came here on the question stated in the jurisdictional statement of whether there exists a right of social association. That was the principal issue stated.

I submit that there is. This Court has -- although it hasn't ruled on that point expressly, I submit that there ought to be such a right, just as there is -- just as entertainment enjoys First Amendment protection as expression.

And in the case at bar, at least the stated purpose of the ordinance is to prohibit young people from congregating. The preamble says in fact that congregation of youthful patrons creates problems of policing due to the need to protect the patrons from the influence of those who promote gambling, sales of narcotics, and other unlawful activities. So the purpose of this, although as Justice Stevens points out it's directed to individual games as well as places where there are more than one game, the purpose, the stated purpose, is to prevent congregating, which is an exercise of the right of association.

The method chosen is to prevent them from playing the games when they get there. So it's perhaps an ineffectual method of preventing them congregating, but that is its purpose.

I should also like to say in the few minutes left available that constitutional guarantees apply to minors as well as adults. The scope of the particular right may be reduced in the case of a minor by one or more of the factors identified by Justice Powell in Bellotti II. These factors are taken into account in defining the state interest to justify the regulation limiting a fundamental right.

But nevertheless, even though minors are involved, the fundamental right should enjoy the strict scrutiny -- the protection of the strict scrutiny test, having in mind that the state may have a stronger interest or a different interest in regulating the conduct of children than adults.

But nevertheless, the strict scrutiny test should apply and the restriction should bear some -- should serve some substantial purpose in regulating the evil to which it's directed, and it should be reasonably limited -- the means should be limited to that which is necessary to protect the interest.

QUESTION: How about truancy laws, Mr. Tone, where a group of youths say, we want to congregate at this particular pool hall during school hours rather than go to school?

MR. TONE: I would say, Your Honor, that the state's compelling interest in requiring children to attend school is sufficient to justify the truancy law and prohibiting children from congregating elsewhere during school hours. But that doesn't mean that their congregating is not a fundamental right. It just means that that fundamental right has to be balanced against the compelling interest of the state, and in that instance I believe the state -- the compelling interest prevails.

As we point out in our brief, if the Court agrees that the games involve expression and a fundamental right, then there is, in addition to the fundamental right analysis, strict scrutiny analysis that I have already stated, a similar analysis under the equal protection clause.

I think I shall leave to my brief the vagueness issue.

QUESTION: Let me just ask you something about that. If you think the issue is moot, which I take it you do -- do you?

MR. TONE: No, Your Honor. We've argued that it is not moot.

QUESTION: Well, why is that?

MR. TONE: Well, we say that there is a reasonable expectation of recurrence, and we argue that there is some indication of that from the fact that the city has never seen fit to tell any court that it repealed the old ordinance and replaced it with another one. And the city says it would like to go back to it.

Now, that's the --

QUESTION: Do you know of any other instances where, in a situation like that, we've recognized this exception to the mootness doctrine, capable of repetition, yet evading review; is that it?

MR. TONE: That's it -- no, not -- I'm sorry. The tests are, under the Los Angeles County case, whether there is any reasonable expectation of recurrence of the violation or whether events during the pendency of the litigation have completely eradicated the effects of the violation. That's the test of mootness.

QUESTION: Let me ask you, suppose that, however, we disagree with you and say that it's moot. Shouldn't we then to that extent vacate the opinions below and dismiss the case to that extent?

MR. TONE: We argue that you should not, Your Honor, and the reason is explained in the very last section of our brief. That would be the more usual disposition.

QUESTION: If we thought it was moot.

MR. TONE: If you thought it was moot, yes.

QUESTION: But unless we do that, if I understand it, the City is now disabled from re-enacting the ordinance it wants to enact, by the Court of Appeals' judgment.

MR. TONE: That would be correct, the Court of Appeals' judgment would stand. The alternative --

QUESTION: If we vacate everything, presumably they'll just reinstate it.

MR. TONE: That would be -- they would be free to reinstate the ordinance all over again. And they apparently would like to do that. So I think there is good reason to treat this as the exceptional case in which determination of mootness should not result in the vacating of the judgment of the Court of Appeals.

QUESTION: It really isn't -- it's a jurisdictional question.

QUESTION: It's a case or controversy question.

MR. TONE: I think the question of whether -- the question of whether this Court decides the case is a case or controversy question. The question of whether this Court leaves standing the judgment of the Court of Appeals is not, in our submission.

QUESTION: Well, I don't know. There's no longer a -- the Court of Appeals judgment isn't final.

QUESTION: We have to do something. We've noted probable jurisdiction, so we have to do something with the case.

QUESTION: That judgment isn't final, and it's moot.

MR. TONE: You could dismiss the appeal on the ground the issue is moot, Your Honor. We're speaking now of the vagueness issue.

QUESTION: But there's nothing then to -- there's nothing then for the Court of Appeals' judgment to operate on. The issue it decided is gone.

MR. TONE: That's -- there's nothing for it to operate on, but the ordinance was in existence. And at least there is a determination that that ordinance, which has now been replaced, was void for vagueness. So at least the city can't re-enact that ordinance.

QUESTION: Well, so you think that our practice of vacating moot judgments in moot cases is just prudential?

MR. TONE: I think it is prudential, yes.

QUESTION: Would your first option take care of all these problems?

MR. TONE: I'm sorry, Your Honor?

QUESTION: Your first option that you argued today.

MR. TONE: The first option would take care of all of the problems except for the vagueness issue. The first option takes care of the age restriction. On the vagueness issue, I would submit that the Court, if it determines that the case is moot since the ordinance is no longer in existence, then simply has to decide whether to vacate the judgment or simply dismiss the appeal.

We argue in our brief -- and I do not, of course, have time to argue it here -- that the judgment is not moot because it meets the tests of the Los Angeles County case.

QUESTION: Well, do you have anything further, Mr. Archer? You have a few minutes.

ORAL ARGUMENT OF ELLAND ARCHER, ESQ. ON BEHALF OF THE APPELLANT -- REBUTTAL

MR. ARCHER: Mr. Chief Justice, may it please the Court:

I don't agree with counsel's idea of how the case may be treated as the only alternatives either to dismiss the appeal and then deny certiorari or grant it. I think this Court could remand the case back to the District Court or to the Court of Appeals for clarification as to whether they are making a decision based upon an independent state ground or whether they consider the provisions identical.

I think that it would be a terrible thing if the case does go off on that point, because even though you're reviewing a judgment and not an opinion, that opinion of the Court of Appeals is in the books. And that means that the cities throughout the Fifth Circuit that desire to have this type of ordinance, whether there's any diversity jurisdiction between their operators in the city or not, are going to be harmed by this opinion on the books, assuming of course that you disagree with it.

Of course, if you agree with the opinion I assume that that would become the law of the land and it wouldn't make any difference which circuit you were in. But assuming that you did disagree with the opinion of the court, but you felt that you must deny certiorari, then as I say I don't think that's the only alternative. I think it can be remanded back for clarification as to whether or not this was an independent state ground or whether it was just mere verbiage to the effect that, yes, the state constitution is similar to the federal Constitution.

I think the overriding question was federal law, and I think that's how the Court of Appeals decided the case, based on the level of review to be accorded this type of activity. In other words, whether it should be a rational basis --

QUESTION: Let me ask you, under your view if this problem of state-federal law had been threshed out more fully in the Court of Appeals during argument, which -- should it have based the decision on state law or federal law, if it had to choose between the two?

MR. ARCHER: Well, I think they could have based it on both, all right, if they --

QUESTION: No, if they have to choose. They decide they ought to take one. Is there a doctrine they should take the state law ground in order to avoid the unnecessary decision of a federal Constitution question?

MR. ARCHER: I would think that they should, yes. I think this Court does that and I would think that the Court of Appeals -- maybe they're not required to, but I would think that would be a proper disposition. But I don't think it was their intent to determine that there was separate state and federal law. I think they just mentioned that, yes, there --

QUESTION: They really just cited federal cases except for one state case that had nothing to do with the issues .

MR. ARCHER: Yes, I think that's correct.

I would yield the remainder of my time. Thank you.

CHIEF JUSTICE BURGER: Thank you, gentlemen. The case is submitted.

(Whereupon, at 2:07 o'clock p.m., the case in the above-entitled matter was submitted.)

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Hicks v. Miranda - Oral Argument

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Hicks v. Miranda

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74-156_19750324-argument.mp3

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74-156_19750324-argument

Transcript:

Argument of Oretta D. Sears

Chief Justice Warren E. Burger: We'll hear arguments next in 74-156, Hicks and others against Miranda.

Ms Oretta D. Sears: Mr. Chief Justice --

Chief Justice Warren E. Burger: Mrs. Sears.

Ms Oretta D. Sears: -- may the Court please.

I think listening to the contempt case I have somewhat lost my voice but hopefully as I proceed it will become clear.

What is before the Court today is a many issued case, however, I do believe that the Court indicated by the postponement of the jurisdiction to this day that it wish to hear argument on whether or not there was jurisdiction in this Court.

In directing myself to that issue, I would like to proceed by arguing that both of the orders issued by the court below, be it the order of June 4th which required the people to return the movies or the films and the order of due of September 30th which ordered the -- defendant -- defendants in “good faith” petitioned the state court for the return of the film are injunctive in determining.

First of all, I would like to argue that a declaratory judgment in the sense in an action that involves a state statute is to my way of thinking per se injunctive within the context of 1253, within the context of 2281 and 2283.

A look at the birth of these statutes brings us back to ex parte Young.

But when I read the ex parte Young and I started from there and I went back and reread a lot of the very brilliant decisions by members of this Court and by past members of the Court, I was impressed by one thing, that what ex parte Young dealt with was one portion of the Eleventh Amendment.

Not really, not at all, the portion of whether or not the Court or the judicial, the federal court per se as the judicial system had jurisdiction over seven causes of actions.

For indeed that's the first portion of the amendment but what that case dealt with I think is expressed best in the -- in Justice Harlan's dissent.

It dealt with that second portion which said, ”And in those cases in which a state is a party, jurisdiction -- original jurisdiction shall be in the United States Supreme Court.”

It was that second limitation that was argued in that case.

The question was when there is a state statute that is at that through the Attorney General or through the state personnel representative is it the state that's being attacked or is the individual and the majority with an opinion --

Chief Justice Warren E. Burger: We'll resume there 1 o'clock Mrs. Sears.

Mrs. Sears you may continue.

Ms Oretta D. Sears: Yes.

What I was trying to or attempting to point out is that in a very real sense what ex parte Young did was to take away a suit against the Attorney General of the state or state officer in which the declaration or a statute is being attacked for unconstitutionality from the original jurisdiction provision inherent in the Constitution which states that whenever the state is a party to a proceeding the jurisdiction of the Supreme Court is original jurisdiction.

It was to remedy this particular ill that in 1911 the original three-judge court provisions were enacted.

I think the -- probably the clearest showing of the intent of Congress at that time to provide full direct appeal in all of those cases where a decision was to be made by the three-judge court and where a finding of unconstitutionality was added, is found in the original provision in 1911th provision in which the three-judge court which was sought to be a panel was intended to be made up of at least of one judge plus two additional judges, at least one of whom was going to be either a Supreme Court judge or a Circuit Court judge.

Now, quite obviously once the decision is issued from a three-judge court, at least one of whom but possibly two of whom are Supreme Court judges it would be rather in Congress.

At that point to go to a Ninth -- or a Circuit Court to have that decision reviewed.

Now, true today the Act has been modified so that it does not anymore say at least one of whom can be either a Supreme Court or a Circuit Court but it does still say at least one of whom and again at least one of whom shall be a Circuit Court judge.

Arguably therefore one could have a three-judge court with two Circuit Court judges.

I suppose one could go and go to the Ninth Circuit that demand a hearing and then but I would question the wisdom of trying to overrule a two-judge court decision with two judges from the Ninth Circuit sitting on it and deciding the case, it would make it somewhat in Congress.

That's one of the points.

The other point is that interestingly enough the Act does not say prohibit.

It defines injunction within the Act.

It says an injunction to restrain the enforcement and so on and so forth.

It would restrain as this Court has recognized does not mean to just prohibit.

It means anything less than an actual prohibition.

It means anything which makes it difficult, which inhibits.

I think this is true of the First Amendment cases and of all cases.

It's certainly true that a bill quia timet for indeed that is what declaratory judgment is a restraint especially in view of some of the new decisions which have stated that recently I believe it was the Second Circuit or the Third Circuit stated that a -- after the declaratory judgment, a proceeding against the person involved contrary to the declaration of unconstitutionality was automatically an action which was in bad faith.

Now, had I read that opinion, I would have been a lot more cautious if before ever bringing a state proceeding after the declaration of the three-judge court.

So long as that opinion exists, I am restrained in the future from ever doing it again, even though in good faith I believe I am right.

I still couldn't.

So it is a real restraint.

Finally, if we speak about a case in which the three-judge court is properly convened and if -- excuse me, and if we have a valid request for injunction and if the request for injunction is denied but the declaratory relief is granted.

What are the results?

The practical result is that the state who is the one that was sought to be protected, whose procedures was not to be speeded all the way to this Court will be the one defendant that will not be able to reach this Court directly.

Whereas, if the relief had been denied, all of it and the Act had been found constitutional, the defendant, the individual, would be able to come directly to this Court.

And I think this inconsistency is -- was not intended.

I think that a declaration of unconstitutionality unless this Court is willing to say that beyond 1201 we take 1202 and destroy it.

It is there.

A Court who has the power to issue declaration also has the power to enforce that declaration under 1201 and probably within the purview of 2283 as well.

And it seems to me that then in that case we have a bypassing of the totality of the procedures.

Now, a point that is also somewhat important is the fact that there is another strength, there is a possibly res judicata restraint.

Now, that too is a restraint because if the state court feels that -- if the people feel that the declaratory judgment is going to be res judicata in the state court really there isn't much point in bringing the proceeding.

So therefore, I would submit that if we are going to allow a declaratory judgment to be given in these cases and I think we have to, I don't think that's open for question then I think that the Court must preserve the rights to appeal by declaring that the declaratory judgment is per se in these type of cases injunctive and that it restraints.

The second point of course is that both of these as far as the first order, the order to return it's obvious under the Ledesma rationale that it is injunctive but the second order is probably even more injunctive to my mind.

It opens me to a contempt to which I almost find inescapable.

I cannot in good faith, that's the impossibility in good faith do that which I do not believe in, how do I in good faith petition my Court whom I have asked to do something and who has issued a valid order and has rendered a valid judgment.

Now I have to go back and say “I don't believe I'm wrong but they tell me I have to do it in good faith so Your Honors, I will do it!”

Justice Potter Stewart: Now you're talking about the second order.

Ms Oretta D. Sears: That's correct.

This type of a situation puts an immediate burden upon the individual and upon the Office of the District Attorney.

In California, the District Attorney is an elected official.

In California, the District Attorney shall file all complaints.

If a complaint, the people of the State of California under our Constitution have the right to have the discretion of the District Attorney exercised and my Government says, “I shall attend the Court, the Superior Court, the trial court on the help of the people.”

How can I go into one of those courts representing a party not the people and in this case if I go in petition I would be representing a party not the people.”

Justice Potter Stewart: The District Attorney in -- there's one District Attorney in each California County?

Ms Oretta D. Sears: That's correct.

Justice Potter Stewart: Elected by the people for about a four-year term of office?

Ms Oretta D. Sears: That's correct Mr. Justice.

Justice Potter Stewart: And then the deputies and the assistance are appointed by him?

Ms Oretta D. Sears: That's correct, and that only with his -- in his name.

They are alter egos totally.

Those are the considerations that I felt were probably most important.

I do realize that there had been problems, procedural problems, rule problems.

A petition was filed under Rule 60 noticed however for July 1, unless I have read as much as time and physical limitation allowed as many of the opinions and I came to the conclusion that the rule part of the problem did not seem to be so achieved perhaps I am wrong but I felt that since the case is here totally and there is nothing more to be done downstairs at any event, I did not feel that that I need to go too much into that point.

And if the Court feels that I should quite then I will address it more specifically.

Now, the one point that I would like to make is the facts of this case.

The state court magistrate issued for search warrants for I as the head of the written appeals section automatically direct my deputies.

They will issue it over the weekend however, or a Thursday or Friday any weekend interferes on Monday.

I felt very strongly that the mandate of this Court require an immediate hearing as soon as possible and I felt very strongly that under Rule 41 analogy, Rule 41 and 1538.5, I should premise are almost identical, if not identical in scope and language and I know many cases the Second Circuit cases and other cases that have held that Rule 41 does allow the Court to have that kind of a hearing at the instance of the District Attorney.

And so I asked for that kind of a hearing.

The defendants in the state action or in -- at that hearing arrived and said “begging your pardon Court you have no jurisdiction, goodbye!”

Well, at that point we proceeded with the hearing.

Right or wrong, I feel very strongly that that kind of issue belonged in the state court.

And that the Court in granting relief actually showed itself totally opposed to allowing the courts to do their job, the state courts.

In addition, if we are ever going to have the resolution of this issue, I tried it again and again.

They come in and said “begging your pardon, but we don't feel bound by this Court.”

I think the hearing of August 12 which has been brought up as part of the record by the appellees is graphic of what has been happening.

The federal court in that case although it did not pursue the issue further asked the defense or the plaintiff's counsel, “Why didn't you appeal?

Did you -- don't you think the Courts of the Supreme Court of the State of California would have gone your way?”

He says, “Yes!”

He thought that he would have won.

He thought that this procedure was something that was wrong and that the state courts would have gone his way and he was asked, “Well, why didn't you do it?” and he said, “Because I have a choice and I choose to go to the federal court; I just didn't want to proceed in this Court.”

And that is part of the problem.

I would submit that this type of action does frustrate the relationships between the courts especially when then you have a proceedings that in the Municipal Court at the same time.

Now, there are many factual points that counsel has made.

I don't think they're relevant.

First of all, there are points of California law and they are points that should have been made in the state court but were not made.

I don't know under what provision he has a choice to argue the validity of a search warrant either prospective or already issued before a federal court rather than before a state court.

I have found no case that indicates that this is the law.

Perhaps I have overlooked something.

Since I would like to retain a few minutes for rebuttal and I would like to defer to the Attorney General list to the questions, I would --

Chief Justice Warren E. Burger: Very well.

Mr. Smith.

Argument of Arlo E. Smith

Mr. Arlo E. Smith: Mr. Chief Justice and may it please the Court.

This is a complex case.

In fact, there would be a public plot for a Gilbert and Sullivan parody on the administration of justice and by that I mean no disrespect for either the federal court or the state court because it presents the very fundamental problem of the jurisdiction in authority of federal courts to interfere with the administration of state justice.

Mrs. Sears has briefly outlined the facts and I hope to outline them a little more fully.

I would like to address myself to two problems.

First, the application of the doctrine of the cases of Younger versus Harris to this matter, since that the three-judge court felt that this was not that type of case.

Secondly, I would like to address myself to the question of harassment which the Court found without a hearing.

Let's start as Mrs. Sears did, on Friday, November 23rd, a magistrate California in this four-court judge issued three warrants.

In each instance on sufficient affidavits and twice on the viewing of the films involved here as to their obscenity, a practice under California law which indeed was brought about by a case Flack versus Municipal Court which counsel for the plaintiff's here instituted.

Justice Potter Stewart: Did the magistrate had herself viewed the film?

Mr. Arlo E. Smith: Himself.

Justice Potter Stewart: Yeah.

Rebuttal of Oretta D. Sears

Ms Oretta D. Sears: That's correct.

There are two occasions and this is the procedure under California law which is designed to protect the defendant and particularly protect the possibility of a First Amendment right.

He cannot -- in California an officer may not seize a film as obscene on an arrest.

It must be pursuant to a search warrant.

Secondly, the magistrate cannot issue that warrant without either one, personally viewing the film or other material or two, without an affidavit that is specific in terms of the nature of that material.

On Saturday, a fourth warrant was issued and in each instance the warrant were sited that there were differences in these films.

Justice Potter Stewart: Same title though?

Rebuttal of Arlo E. Smith

Mr. Arlo E. Smith: Of the same titles --

Justice Potter Stewart: Yes.

Mr. Arlo E. Smith: But different content.

On Monday the 26th the District Attorney instituted a proceeding which has been characterized variously as injunctive restraining whatever but a proceeding quasi-criminal in nature designed to lead to an order of seizure of these films.

Justice Potter Stewart: Under statutory proceedings?

Mr. Arlo E. Smith: No, it is not.

No it is not but our -- the California law on that I think is unclear that's quite correct.

But the point is that under the procedure has alleged in this complaint, the defendants here Miranda Walnut Properties, Pussycat Theatres, have an opportunity to come into the Superior Court of California and raise every objection that they made in the Federal District Court, the constitutionality of the state statute, the validity of the procedures in that Court, the validity of the seizure, the validity of the -- the question of the identity of the films, indeed they could raise the obscenity question.

They refused to take part in that proceeding.

They appeared and contested the jurisdiction of the Court and walked out.

Justice Potter Stewart: And the object -- the element object of that proceeding would have been the permanent what, the destruction of the film?

Mr. Arlo E. Smith: It would have been.

It read, no.

Indeed it will result in the seizure of those films and held that the Pussycat Theatre.

Justice Potter Stewart: As ancillaries to some other proceeding or is it end of itself?

Mr. Arlo E. Smith: Well, either way.

I don't think it makes any difference.

The question presented here, there was an adversary hearing offered under this proceeding prior to the restraining order issued.

There are questions of California law.

I can see that that is precisely why the federal court should have abstained precisely why.

All of these questions could have been raised in the appellate courts of California and including the Supreme Court of California.

Finally of course, one of the -- and they make the complaint that it is completely unfounded, they refer to some abatement cases and it's correct that our courts have held that the Red Light Abatement Action is not applicable to films, only live conduct.

But of course, they don't point out that the California Supreme Court has before it now a case involving the nuisance type injunctive proceedings under 370 of our penal code, Basic Nuisance Action.

The Los Angeles Court of Appeals in Los Angeles for the second appellant district held the procedures utilized by the Los Angeles District Attorney to be proper under California law.

Two weeks ago our Court, Supreme Court granted a hearing in that case, some of the very issues that they raised here.

Finally, two days after this hearing of which counsel walked out, they filed a complaint in the federal court.

The allegations are that this proceeding that we have just discussed violated their rights.

Secondly, they complained that the seizures pursuant to the warrants violated their rights.

It was assigned to and immediately prior to that, of course complaints were filed against the theatre manager of Pussycat Theatre, the managers who were exhibiting the film.

A hearing was held before Judge Lydick Federal District Judge on the temporary restraining order and he determined that there was no bad faith, no harassment that the officers had acted pursuant to the valid state warrants.

However --

Justice William J. Brennan: Mr. Smith, somewhere can you straighten out for me the juxtaposition of Judge Ferguson and Judge Lydick?

Mr. Arlo E. Smith: Oh yes, I'm glad you raised that.

The case was originally assigned to Judge Ferguson.

And the record reveals that he recused himself on the ground that of possible bias.

It was then assigned to Judge Lydick who heard the temporary, the request for a temporary restraining order.

Now, on December 28, 1973 issued an order denying the temporary restraining order and finding no bad faith, finding no harassment, finding no irreparable injury.

He did, however, and I -- we suggest on our brief that he erred, because he found that the question was not wholly without merit.

Some substance and some perhaps federal questions but he also determined that the question of abstention he felt was a question for the three-judge District Court.

We feel that at that point, he should simply deny the action dismissed and the appeal here would have been to the Ninth Circuit Court and of course if he were wrong it would have been back to the three-judge District Court.

But the -- thereafter, he then issued --

Justice William J. Brennan: Who certify, what --

Mr. Arlo E. Smith: He certified it --

Justice William J. Brennan: He certified the --

Mr. Arlo E. Smith: -- on that date, same day.

Justice William J. Brennan: He certified the --

Mr. Arlo E. Smith: Yes he did.

Justice William J. Brennan: -- necessity for the three-judge court.

Mr. Arlo E. Smith: Correct.

We suggest to hear in spite of the correctness of this decision overall procedural error.

However, the order appointing the three-judge District Court did not include Judge Lydick, the district judge to whom it was assigned.

Justice William J. Brennan: And who petitioned?

Mr. Arlo E. Smith: And who certified, rather it was assigned to Judge Ferguson another U.S. District Court judge and a Circuit Court judge and a third judge.

We raised the question that that is jurisdictional under the statute and I refer not to devote additional time to that question.

Justice Thurgood Marshall: Why not?

Mr. Arlo E. Smith: Why not, because I feel that there are maybe misjudged but I feel there are more critical issues in the case than that.

Then that when we feel that we have a right to have the -- we feel that it's important and we've raised it but we feel that that we have the right to have the district judge who heard this matter sit, indeed if it's referred back obviously who to whom do you refer, is a very good point, Justice Marshall.

We certainly aren't conceding the point.

The statute is very explicit.

It says it shall include the district judge who certified the matter before whom the case was brought.

Justice William H. Rehnquist: Did you --

Mr. Arlo E. Smith: What?

Justice Thurgood Marshall: (Inaudible)

Mr. Arlo E. Smith: Yeah.

Justice William H. Rehnquist: Did you ever object to the three-judge court that was actually convened that you thought there had been a jurisdictional error?

Mr. Arlo E. Smith: I can't say that we did.

No, I don't believe the record reveals that we did.

Justice Lewis F. Powell: Or do you think this came about Chief Judge Chamber surely knows what the statute says?

Mr. Arlo E. Smith: Well, I think it came about if you look at proceedings on December 5th, 1973, six days after this action was filed, you'll notice that the same panel was assigned to consolidate -- a number of consolidated cases and in those cases they discussed abstention California statute.

There are a number of cases, seven or eight involving other counties in California and other defendants and other plaintiffs.

Justice Lewis F. Powell: Also obscenity cases?

Mr. Arlo E. Smith: Also obscenity cases and apparently they were assigned apparently by the Ninth Circuit to handle these issues.

That's the only explanation I have but I -- it's a mystery to me other than that.

Justice Lewis F. Powell: If you prevail on this point, you win your lawsuit, don't you?

Mr. Arlo E. Smith: Yes and we urge it we've urged it into the briefs.

Chief Justice Warren E. Burger: Are you going to touch on the question that Judge Ferguson's changing position about the recusal?

Mr. Arlo E. Smith: Well, I think it speaks for itself.

I think it's -- he says he was biased when he recused himself.

He then sits on the very same matter.

I don't wish to infer beyond that.I think it's improper.

Justice Potter Stewart: Well, it's not unheard of any judge that has a misapprehension about whether or not he owns the stock in some company or whether or not he thinks he may know some of the persons involved and it turns out to be another person by the same name?

Mr. Arlo E. Smith: No, that is not so here.

It's that the -- if you'll notice the order of the recusal, it refer specifically with the fact that he has knowledge of it and acquainted with and otherwise biased in reference to parties in this action.

They happen to be officers of the City of Buena Park who some of the defendants here.

And that you may draw any inference that the bias was perhaps in their favor.

But I suggest that that may not be the correct inference to be drawn on the record to this case and on the record of the incident to which this recusal referred.

Justice William H. Rehnquist: Well isn't it conceivable too that Judge Ferguson this could have come to me or one of the other 15 judges of the central district would say I -- there's not, possibly I'm biased, I won't sit.

Then it goes up and it's certified by the chief judge of the Ninth Circuit who comes back and says you, you and you will make up this Court.

Well, that that thing is a little further advanced along the road at that and you might take another look and say, “Well in most circumstances as long as Judge Chambers have said so I'm going to sit!”

Mr. Arlo E. Smith: That's possible, apparently he did.

Justice William O. Douglas: Mr. Smith what is your position as to the finding by the District Court of harassment?

Mr. Arlo E. Smith: Well, if the District Court Judge Lydick is on that three-judge District Court --

Justice William O. Douglas: The three-judge court?

Mr. Arlo E. Smith: The three-judge court simply resided the facts of reference to the warrant and said they speak for themselves.

Judge Lydick of course had found that this was good faith, execution of a lawful warrant by a judge, a magistrate in the California Court.

I think that that question of harassment does deserve extended discussion here.

To begin with of course, the burden is upon the plaintiff here to establish it.

It must be beyond by clear and convincing evidence because the presumption under federal and all of the cases is presumption of validity and proper action by the state officers.

There are a recitation of these facts that I just recited in reference to the search warrant is the only basis apparently for the three-judge court's determination of bad faith.

It's simply the enforcement in our view of good faith the performance of the duty by the officers, a duty compelled by the statutes in California by the valid warrant in California, the valid enforcement of our state laws.

But really there are --

Justice William O. Douglas: Mr. Smith, was there any hearing on this issue of harassment?

Mr. Arlo E. Smith: Well no, except into the extent that there was a hearing on the TRO by Judge Lydick prior to the convening of the three-judge court.

He held a hearing and he found good faith.

It was submitted to the three-judge court on the affidavits before Judge Lydick.

That question is expressly submitted.

Justice William O. Douglas: Are you saying Mr. Smith that the three-judge court which now did not include Judge Lydick overruled --

Mr. Arlo E. Smith: That's precisely what I'm saying, yes and correct.

That's precisely what happened.

Justice Thurgood Marshall: But they have nowhere to go, they have affidavits.

Mr. Arlo E. Smith: They had no, indeed the very same affidavits --

Justice Thurgood Marshall: The same affidavits.

Mr. Arlo E. Smith: The same, in fact the counsel were present before Judge Lydick and argued the matter, the same affidavits were presented.

No, they held no hearing of any kind or character.

Justice William O. Douglas: They didn't hear the counsel at all?

Mr. Arlo E. Smith: No, they did not, they did offer counsel the opportunity to present additional affidavits and additional materials but no additional material was in fact presented.

Now, but involved in this question of harassment, here's a question which another question of state law and procedure which was presented to the state court because you know it mean while back in the state court we, the proceeding is going on.

A complaint was filed against the employees of Pussycat Theatre --

Justice William J. Brennan: You said there are complaints --

Mr. Arlo E. Smith: Criminal complaint.

Justice William J. Brennan: When was that filed in relation to the day of the filing of the federal lawsuit?

Mr. Arlo E. Smith: The criminal complaint against the employees was filed prior to the federal action.

The criminal action in reference to the plaintiffs here was filed, it was signed three days before that was in January.

To be specific January 9th and January 14th that was filed which was three days before service of the summons on the district attorney.

It was filed the day after and signed two days before.

But the proceedings were held in the meanwhile under our statutes, the 1538.5 or Rule 41 procedure to suppress the evidence and return the property was in fact heard by the municipal Court in Orange County.

That Court ruled in their favor as to two counts.

I want to make it clear that we're dealing here with each film is a subject of a separate count.

We're not talking about four films in one count.

We're talking about four films which are alleged to be and are in fact different.

The Municipal Court judge ruled in their favor.

He ruled that it violated Heller versus United States, that in fact two of these films were sufficiently identical that they should be suppressed.

And in fact an affidavit was filed before the three-judge District Court by counsel for plaintiffs to that effect.

Justice William H. Rehnquist: Were the appellees in this case parties to the Municipal Court per se?

Mr. Arlo E. Smith: Oh, absolutely!

At that point they have been named as parties and that they had been named as defendants in the criminal action.

The -- that matter was certified and this is in the record was certified appeal was taken by the people on those two counts.

Justice William J. Brennan: But were they -- are different prints of the same film?

Mr. Arlo E. Smith: No, they were different.

They were of same title but they were obviously not identical prints, it was “Deep Throat.”

Justice William J. Brennan: Deep Throat.

Mr. Arlo E. Smith: But apparently what happened was as pointed out here on page 48 that what they did was -- is in another instance came on with what they call a “soft virgin” first.

And then the warrant was issued.

I want to make it clear that these records here make it clear that the procedure at Orange County is that after one seizure on the same film that the procedure is to be the issuance of a citation for every subsequent violation and not an additional search warrant in seizure.

However, the officers here as indicated by -- at page 48 it went back the second time.

It was a harder version if you please.

It contained additional acts of sexual intercourse etcetera.

They were not contained in the first film.

It was to where the harder version of the same film or the same type if you please and the same thing happened on the third and the fourth instance.

And that issue was before the municipal Court in California and they prevail on that question.

However, the people appealed and they want to appellate department of the Superior Court in Orange County.

And the appellate department ruled to the contrary.

They reversed the Municipal Court, holding that on the affidavits and the material presented and that the motion to suppress that in fact their contention was not well taken.

The appellees here, the plaintiffs in this federal action pursue their remedy in the state courts.

They could certify the question to the appellate Court for San Diego.

No, they did not.

They come back to the three-judge District Court with the same contention that all of these violate state law.

So we have a ruling in the state court which they did not appeal.

We have two rulings that they did not appeal or seek to review; one, this restraining order if you please or order of seizure.

They refuse to participate, they refuse to appeal.

Secondly, they decline to further appeal the determination concerning the identity of these films.

And they've consistently refused to present to the state courts the question of obscenity and it's set out here in the record very plainly.

They say we are not presenting and do not intend to present the question of obscenity to the state court.

Now, I would like to read in connection with that I think the basic issue here one portion of the proceeding on August 12 is in the appendix here before Judge Ferguson sitting presumably as a member of the three-judge District Court.

The question presented, have you taken that order up to the California Court of Appeals referring to the order here of seizure of the additional copies as quasi criminal actions?

Justice Potter Stewart: Referring to the State Court of Appeals --

Mr. Arlo E. Smith: State Court of Appeals.

Justice Potter Stewart: In San Diego?

Mr. Arlo E. Smith: In San Diego.

He says, the answer by Mr. Brown, “No, we have not.”

Why not?

“Because, Your Honor, initially back in November when this first occurred the day after the hearing, we filed a complaint in this action, this federal action.”

And one of the basis for relief alleged in the complaint was a deprivation of a constitutional rights.

He goes on to say that once we had invoke the jurisdiction that this Court properly we sought relief in this Court, we did not pressed the matter further in this California state courts.

Another point he says, the judge asked them when you go halfway shouldn't you be required to go all the way, referring to the same proceedings.

Mr. Brown said, it was our -- this is at age 15, "It was our purpose in the beginning, not to litigate these claims in the state court.”

I submit Your Honor that that's precisely the problem created in this type of litigation where --

Justice Thurgood Marshall: (Inaudible)

Mr. Arlo E. Smith: Yes, it's in the appendix.

In fact, we're very happy that was brought to the attention of this Court by the other side.

It was -- it's not printed yet.

Justice Thurgood Marshall: (Inaudible)

Mr. Arlo E. Smith: I'm reading from the transcript to the proceedings of August 12, 1974 before Judge Lydick.

Justice Thurgood Marshall: (Inaudible)

Mr. Arlo E. Smith: Yes it is.

It's in the -- it's not in the appendix, I'm sorry.

It was after we requested it.

Justice Thurgood Marshall: It was filed.

Mr. Arlo E. Smith: Yes it is filed.

There's a part of the record in this Court, but it's not the printed appendix as what I wish to say, because the appellees here requested that this be made part of the record and was not part of the original printed record.

It's filed, yes indeed.

I regret that I didn't.

Thank you Your Honor.

Chief Justice Warren E. Burger: Mr. Fleishman.

Argument of Stanley Fleishman

Mr. Stanley Fleishman: Mr. Chief Justice, may it please the Court.

I will address myself to the District Court holding in which the Court declared the California obscenity statute as construed by the California Court unconstitutional.

Mr. Rosenwein --

Chief Justice Warren E. Burger: Would you address yourself to the question of personnel competition, three-judge court.

Mr. Stanley Fleishman: Yes, Your Honor.

Although that is Mr. Rosenwein's domain I know that and I can and I will.

Chief Justice Warren E. Burger: Very well, we'll wait for it.

Mr. Stanley Fleishman: No, I will do that because I was there.

The way we do it in California Your Honor is a -- you file a case and you draw by lot a judge.

We drew Judge Ferguson at that time.

At that time, we had a complaint in which we asked for injunctive relief and for money damages.

Judge Ferguson stated that he had been the city attorney of Buena Park where all of this occurred that he in fact had founded the charter of the city and did not want to do anything that would seem improper under the circumstances.

And therefore he reclused himself.

Subsequently, after the three-judge court was convened, we withdrew from our complaint all request for money damages, so that damages were then out of the case.

And within that framework, where there was no longer being any money asked against the chief of police whom Mr. Judge Ferguson had previously represented, Judge Ferguson felt that there was then no longer any reason for him not to sit.

Chief Justice Warren E. Burger: Well, in the interim has Judge Lydick were into the case?

Mr. Stanley Fleishman: Yes, when Judge Ferguson withdrew, it was assigned to Judge Lydick, but then as I say the complaint was amended to withdraw from it, the money damage aspect and again in this connection Judge Chambers selected the Court and gave to the parties an opportunity to object that they had any objection to the composition of the Court and no objection was filed at all.

So, Judge Ferguson was in fact the correct judge.

It had been assigned to him in the first instance by line and whatever objection that had been in the first instance by reason of the fact there were money damages, no longer existed once we amended our complaint.

Justice Byron R. White: Quite end up that Ferguson-Lydick and Ellie is that it?

Mr. Stanley Fleishman: No, it was Ferguson, Ellie and Easton.

Yes, Your Honor.

Justice Byron R. White: And Lydick was out?

Mr. Stanley Fleishman: And Lydick was out.

Justice William J. Brennan: What do you have Mr. Fleishman of the requirement statutes.

Mr. Stanley Fleishman: The statute was --

Justice William J. Brennan: He certified -- Judge Lydick certified the necessity for the three-judge court.

Isn't the practice ordinarily if the certifying judge is a member of the the three judge panel?

Mr. Stanley Fleishman: The practice is the judge to whom the case is originally assigned and Judge Ferguson was originally assigned to the case.

Judge Ferguson was no stranger to the case.

Justice William J. Brennan: No, that's not my question.

Mr. Stanley Fleishman: Yes sir.

Justice William J. Brennan: I'm trying to find that out Judge Ferguson could've been appointed by Chief Judge Chambers.

Mr. Stanley Fleishman: I think part of the explanation Mr. Justice Brennan is --

Justice William J. Brennan: Under the statute may he do that, isn't he required to assign the certifying judge?

Mr. Stanley Fleishman: I think not Your Honor.

Justice William J. Brennan: I see.

Mr. Stanley Fleishman: I would like to --

Justice William J. Brennan: I guess we'll have to decide that Mr. Fleishman.

Mr. Stanley Fleishman: That maybe a question although I hope that in deciding if Your Honors keep in mind that Judge Ferguson was drawn by lot, Judge Ferguson was no stranger to this litigation at all.

Chief Justice Warren E. Burger: But he was drawn by lot as a single judge, was it not?

Mr. Stanley Fleishman: And under the three-judge court statute then he should be one of the members of the three-judge court.

Chief Justice Warren E. Burger: Even though himself, there maybe a question of whether it is not out of the case then for all purposes.

And Judge Black had (Inaudible) the authority attached to Judge Lydick (Voice Overlap).

Mr. Stanley Fleishman: That I -- yes that is a question, our answer to the question as I have indicated.

Justice William J. Brennan: But you rely also that no objection was made when opportunity was given.

Mr. Stanley Fleishman: Absolutely.

Justice William J. Brennan: That both sides I gather to object and not to the panel as composed.

Mr. Stanley Fleishman: Exactly, Your Honor.

Chief Justice Warren E. Burger: If it's very simple, although that would make no difference, would it?

Mr. Stanley Fleishman: Ordinarily jurisdictional questions are not waived although that is not a universal rule either as I've been learning.

Coming to -- if I may go to the substantive question, Mr. Justice Marshall because Mr. Rosenwein will handle all of the procedural of problems.

The important question on the substantive question, is whether the specificity requirement announced by this Court in Miller just two years ago, has any continuing viability.

Miller held as we read it, that to meet due process requirements, a statute must specifically enumerate a carefully itemized list of various forms of sexual conduct, the depiction of which may be prohibited.

Justice Brennan expressed the sentiments of the Court I believe when he said that under the Roth Memoirs test, the situation had become intolerable, not only because it makes book selling, has it as profession, but as well because it invites arbitrary and erratic enforcement of the law.

There were other problems arising out of the vagueness of the law of obscenity.

Appellate courts including this Court had been forced to act as a board of census and nobody was pleased with that decision.

Law itself came into disrespect because courts were acting arbitrarily in this area of obscenity because nobody knew what it was.

It was against this background that Miller was decided and by a five to four vote, it was decided that it was possible to define obscenity in a manner which would at the same time afford protection to First Amendment material and give fair notice to those subject to provisions.

Four the justices of course felt that it was impossible to do this and that 16 years of experience had demonstrated the unquestioned that obscenity was in fact not a definable concept.

It's important as we see it to remember that at the same time, that this Court abandoned Roth Memoirs as unworkable and indeed is being vague, the Court set in motion a test which it thought would cure the vice.

Justice William H. Rehnquist: If we held in handling that we had not said in Miller that Roth Memoirs was vague, didn't we?

Mr. Stanley Fleishman: I had read that it's saying that Roth Memoirs with the specificity, with the Miller specificity read into it was not vague.

I have always read Miller and indeed Hamling as saying that a statute without the specificity in it did not meet the due process requirement which Miller said was necessary --

Justice William H. Rehnquist: You don't mean written in the statute itself, you mean construed in one way or another.

Mr. Stanley Fleishman: Construed it, oh yes, I don't mean -- attack here is not that's it's not in the statute everybody concedes it's not in the statute, but what was involved here is that even as it was construed by the California courts there was no itemized lists of sexual conduct indeed --

Justice William H. Rehnquist: But what if there been an itemized list in the construction of Section 1461 by this Court?

If there hasn't.

Mr. Stanley Fleishman: Well, the A and B that have been given as plain examples of kind of material.

Justice William H. Rehnquist: But there's been no itemized list and surely these courts of California have as much freedom in administering obscenity statue written by the California legislature as this Court does in administering one written by Congress.

Mr. Stanley Fleishman: I haven't any doubt about that.

The problem is this Mr. Justice Rehnquist, in Hamling, this Court read into the statute, the A and B given in Miller, in California, the Court of Appeal and Enskat said, we don't engage in that kind of judicial legislation.

We will not read into our California statute something that the legislature did not put into it, so that there was no attempt made in Enskat which is the authoritative phase decided in California after Miller was decided.

There was no attempt there to say we are going to put specificity into the law if it was not otherwise there, so that there is no question, but that if the California courts had chosen to give specificity to the statute similar to the kind of specificity that Your Honors gave to 1461 by reading Miller into 1461, it would be an entirely different case.

But here, the California Court conceded that it didn't have really conceded that there wasn't the requisite specificity either in the statute or in the prior decisions.

And what they said in Enskat was, you don't need that kind of specificity because California retains in its law the memoirs utterly without redeeming social value test and because that memoirs test was retained the Enskat decision said there was a fair tradeoff.

We got more than the Constitution required in having a memoirs value test therefore we didn't have to get all that we were entitled to under Miller.

So that the question comes back to the fact that the statute on its phase plainly is defective.

It does not have any itemized sexual conduct and the decisions that existed in California at the time that Enskat looked at the statute did not have particularization.

What we have in California are generalizations not particularizations and this is what the Court said in Enskat.

They said for example that Miller was satisfied because in California we have a hardcore pornography test because it had been ruled previously that only graffiti fictions of sexual conduct could be reached and because nudity without sexual activity would not be deemed to be obscene.

Those are the guidelines --

Justice William H. Rehnquist: Well, is that any less of a guideline in our construction of 1461 in the Reel's case and in Hamling?

Mr. Stanley Fleishman: I would say so, if Miller's requirement of specificity Mr. Justice Rehnquist.

Justice William H. Rehnquist: But we said in Hamling that Miller wasn't a legislative drafting manually that you didn't have to do exactly what Miller has said.

Mr. Stanley Fleishman: No, but you also said that Miller was a constitutional requirement that as a constitutional requirement that due process required that there be specific sexual conduct itemized either in the statute or by judicial construction.

Otherwise, I submit Your Honors that the attempt to cure the vagueness by Miller was nothing at all, it was a mirage because in other respects, in every other respect, Miller made the obscenity law more vague not less vague.

For example, in Miller we shifted from national standards which was generally thought to be applicable to local standards.

Now, local standards are less certain and are more vague.

In Miller, the requirement that the prosecution come on with expert evidence to prove its case was withdrawn rendering a possible for finders of fact, judges or jury, to make determinations based on personal trade elections rather than some kind of objective standards.

In Miller, there was a shift to the jury as the Board of Census instead of having an appellate court acting as board of census.

Now, it's true that Boards of Census be they appellate courts or juries are not in high esteem, the fact of the matter is that censorship by juries is less certain.

It's less predictable than censorship by an appellate court which everyone can look to, and know what the law is.

Justice William J. Brennan: A similar case has not yet been taken by Supreme Court?

Mr. Stanley Fleishman: As a matter of fact, after this Court had taken this case and I have called it to the Court's attention just about two or three weeks ago, the California Supreme Court has taken the case called People against Nisenoff (ph) where that is issue is finally coming up to the --

Justice William J. Brennan: Well, would that -- what Court have decided this --

Mr. Stanley Fleishman: Nisenoff (ph) was decided by another intermediate court, Enskat had been decided by a Court of Appeal down in Los Angeles and Nisenoff (ph) was decided by Court of equal level up north.

Justice William J. Brennan: Did the Nisenoff (ph) Court follow Enskat?

Mr. Stanley Fleishman: Exactly.

Justice William J. Brennan: I see, so the very Enskat issue is now before the Supreme Court?

Mr. Stanley Fleishman: Exactly.

Justice William J. Brennan: That hasn't been argued?

Mr. Stanley Fleishman: That has not been argued Your Honor.

Now, after and only after the California Court construed its statute and found that it did not violate constitutional requirements, did the District Court consider the validity of the California statute as it was construed by the California courts.

And in rejecting the Enskat argument that there had been the requisite specificity, the District Court said exactly what I was saying to you a moment ago Mr. Justice Rehnquist, that all that Enskat said was that the statute reached hardcore pornography, graphically fictions of sexual activity and did not reach nudity without sexual activity.

The Court said quite properly so that the cliché hardcore pornography added nothing.

Hardcore pornography has all the vagueness that we find in the term obscenity.

The court -- the District Court quoted the statement made by Chief Justice Warren in Jackabellas, where Chief Justice Warren stated we are told that only hardcore pornography should be denied the protection of the First Amendment, but who can define hardcore pornography with any greater clarity than obscenity.

In the case of Commonwealth against Horton a case where the Highest Court in Massachusetts declared the Massachusetts obscenity statute unconstitutional in light of Miller.

The same argument was made.

It was argued before that Court that in Massachusetts only hardcore pornography could be condemned and the Court so that's a mere cliché.

That doesn't mean anything and struck down the Massachusetts statute.

Similarly, the District Court found that the requirement of graphic fictions of sexual activity clearly did not meet the requirement of some kind of a list which would give some kind of guidance to everybody so that you would know if it was in the troubled waters and if it wasn't that kind of conduct you were not in trouble.

The Court pointed out that there were many acts of sexual activity that may even be utterly without redeeming social value which is so innocuous as not to be included on the list enumerated by a legislature, example to come to mind of course.

Since in California we say that it's nudity with sexual activity the question comes to mind, can you reach a nude couple kissing mouth to mouth, that would not seem to fit the plain examples that we find in Miller and yet it would fit the general language of the California statute.

One thinks in terms of kissing toes, fingers, nose, neck, ears, hair, breast, all of which under the plain examples of Miller would not be covered and yet which could be covered under the general language that we find in the statute.

Now, the Attorney General takes the position quite out front and says that we do not need a blueprint, we do not need a blueprint of sexual activity.

Use the language of the Attorney General says, “Miller's demand for specificity does not require a detail statutory enumeration and description of all other types of sexual activities sought to be protected, such detail is not required under Roth" and then were back again, would Roth without Miller read into it satisfy the due process requirements today in light of Miller.

And I submit with all deference that Roth without Miller read into it is unconstitutional under the Miller group.

And then the Attorney General says, “relying on a statement of this Court that the Constitution does not require ultimate godlike precision," he says, therefore it is unnecessary that to avert the constitutional infirmity of vagueness, the statute must reside a detailed blueprint of the proscribed conduct.”

So the question that we have here is, when concededly the state statute does not have any itemized list and when concededly the prior decisions of the state court do not have any itemized list and where the state court does not seek to correct the statute in any fashion because the state courts recognized that that is a legislative function and not a judicial function whether under those circumstances the statute was correctly found to the unconstitutional as it was by the District Court and we believe that the Court plainly was correct in its conclusion.

The Court stated, the District Court stated that this Court in Miller set forth important First and Fifth Amendment principles central to a fair and recent system of criminal law when it insisted that an obscenity statute have an itemized list of the types of sexual conduct that may be reached under the obscenity law.

We respectfully submit that unless that portion of Miller is to be overruled, the District Court was plainly correct in its conclusion and I would say to Your Honors that if that specificity portion of Miller is to be overruled, then we are worse off than we were before when this Court said that Roth and Memoirs had created the state of chaos because then we would have even more chaos than we had before.

Thank you Your Honors.

Chief Justice Warren E. Burger: Mr. Rosenwein.

Argument of Sam Rosenwein

Mr. Sam Rosenwein: Mr. Chief Justice, may it please the Court.

My responsibility is to take care of the procedural matters.

I do think that perhaps it would be helpful to make a statement, a very brief statement of the facts which appeared to have been overlooked by my colleagues on the other side.

And it's simply this, what happened here was that in the City of Buena Park that came the news that “Deep Throat” was going to be shown in that city.

Unwilling to have that film shown in the city, the District Attorney sent the two offices to look at the film in Hollywood where it was showing and has shown to over 8,000 papers.

They viewed the film, came back and prepared an affidavit which stated all tight up, which stated that they saw the film watched it for 60 minutes and it was nothing but one sexual act after another.

No mention has made of theme or anything else, that's what they saw.

They then presented that to a Municipal Court judge and with the judge together with the officers proceeded to the theater in Buena Park.

They went in and saw the film, the findings of the district court below is that they stayed there 45 minutes, did not wait to see the entire film, came out and in the street, the judge directed the issuance of the warrant and at the same time where a camera was being -- a cameraman was taking a photograph of the scene ordered that the film be taken out of that cameraman because the Municipal Court judge was performing a judicial function.

Now, after that, they proceeded to seize the film and this was now at about the first showing on November 23, 1973.

Two hours later, another print of the film is at the theater and is being shown.

They had been told by the District Attorney, look for any difference, any difference at all and then you can get another warrant to seize.

Justice Potter Stewart: So whose there?

Mr. Sam Rosenwein: The police officer.

Justice Potter Stewart: They have been told?

Mr. Sam Rosenwein: They had been told by the District Attorney.

Justice Potter Stewart: They who have been told were the?

Mr. Sam Rosenwein: Police officers.

The police officers had been instructed before they went out and this is in the record, they've been instructed, look for any difference and then seize it.

They now take the same affidavit, they go and view the film now assumingly now for the 60 minutes.

They view the film now, and use exactly the same form, the same type form that they had originally with the respect to see if viewing the Hollywood film and then they write in themselves, in hand their own handwriting, you're affiant for the state that such film was seized --

Chief Justice Warren E. Burger: What page are you on?

Mr. Sam Rosenwein: I'm on page five of my own brief, but they actually -- it also appears in the findings of the Court and you'll find that in the appendix to the jurisdictional statement.

Anyway I'm on five -- page four and five of my brief, we recited the findings, in fact four, five, six and seven.

I should point out that at the first seizure, they not only seize the film, but they took out of the cash box all the receipts of that day, $305.00.

Then they come back and write, your fine for the state that said film was seized on November 23, 1973 at approximately 1:30 PM after being viewed by Judge Smith, it was the name, with the exception of certain portions being edited different in the first film seized.

Your affiant states that this copy of the film Deep Throat consists of one additional act of sexual intercourse and numerous small changes at different portions of the film where this was the second, a minute one doesn't know.

They had set 60 minutes of nothing but sexual acts, the first time they look at only 45 minutes.

Now they're saying they found one more.

That is the finding of the district.

Having seized those two, there's now a third film, Your Honors will recall of course the decision in Heller against New York on which of course my colleagues were entirely aware.

My colleagues who are -- cannot do some things in good faith and go to the Court etcetera.

In any event they come with the third one now and they seized the third one, and what do they put in their affidavit?

Exactly the same language, not a change, they don't even say the third is different from the second.

Chief Justice Warren E. Burger: But that's because their conclusion was after viewing that the pictures were essentially the same.

Mr. Sam Rosenwein: Exactly.

The pictures were the same and they had not seen anything addition.

I'm going to come Your Honor, finally, to their concession that they were identical, but I just want to point out here --

Justice William J. Brennan: Mr. Rosenwein I hope you're going to give some time to whether or not we have jurisdiction of this case and weather Younger should've been filed.

Mr. Sam Rosenwein: Well, alright then let me just see.

Let me just -- and I will come to that part.

Justice William J. Brennan: Because I gather these things were all irrelevant if we've decided we don't have jurisdiction in this appeal.

Mr. Sam Rosenwein: Yes, but these four seizures were all done, we say of the identical film and in addition, some month or two later at the criminal trial and pretrial proceedings for the purposes of the trial, they conceded that these films were identical and they needed only one.

There was therefore here a massive seizure, the theater was closed after the fourth seizure, there was a massive seizure before any prior adversary hearing, clear violation of Heller.

Now, Your Honors question is --

Justice William J. Brennan: What's the appeal here is from?

What or where?

Mr. Sam Rosenwein: The appeal -- there's only -- I think --

Justice Harry A. Blackmun: May I emphasize what Mr. Justice Brennan is asking, there seems to be a great desire on the part of both sides of the council table to avoid this issue.

Would you direct yourself to it.

Mr. Sam Rosenwein: Now, let me start just from the beginning then on that.

You have the selection of justice -- Judge Ferguson by lot.

You have him then recusing himself.

Now, I want to make clear that he didn't recuse himself because he was biased.

There is an implication there, that's really unfair.

What he did say, you'll find it on page 20 of the record all he said was that he had been a city prosecutor in Buena Park, helped to organize and the chief of police there was someone whom he had helped at the point.

Now the chief of police is defendant of the state.

Justice William J. Brennan: Well as I understood, if I may tell you what bothers me.

Mr. Sam Rosenwein: Yes.

Justice William J. Brennan: This is direct appeal from an order to this Court and if it's properly here that's because there was some kind of injunctive order below.

Was there or wasn't there an injunctive order below?

Mr. Sam Rosenwein: There was an injunctive order, but I don't think I'd say literally there was of course an injunctive order.

They -- the --

Justice William J. Brennan: I'm speaking of the two orders and what these two have said?

Mr. Sam Rosenwein: There's only one really before this Court I think.

The amended judgment, what they did say was that the District Attorney should in good faith petition for the return of three, in that sense it was.

Justice William J. Brennan: And that's an adjunctive order?

Mr. Sam Rosenwein: Yes.

Justice William J. Brennan: You think you'll agree and an appeal was taken from that order here.

Mr. Sam Rosenwein: Yes and I am saying and I --

Justice William J. Brennan: Now, the next thing I'm interested in, if we have jurisdiction should the three-judge court had followed Younger and this --

Mr. Sam Rosenwein: No, I don't think Younger was applicable here, I think this was Steffel.

Justice William J. Brennan: There was a pending as I understand it, at least at the time of any order in the three-judge court.

There was a pending criminal proceeding was there or not in the California state law?

Mr. Sam Rosenwein: At the time the amended judgment was filed, yes at that time there was.

Justice William J. Brennan: And when with relation to the firing of the federal suit was that state criminal proceeding begun?

Mr. Sam Rosenwein: The state criminal proceeding against the two employees was begun first, then came the federal complaint six weeks later; six weeks later after service of the complaint, they amended to include these two appellees.

Justice William J. Brennan: Right, but as after that, before you had the first judgment order of the three-judge court.

Mr. Sam Rosenwein: And I think that -- I think that's correct --

Justice William J. Brennan: And meanwhile there had been additional proceedings involving these appellants in the state courts?

Mr. Sam Rosenwein: Yes, but those were -- those had nothing to do with the problems that were then in the federal court.

Justice William J. Brennan: Why do you say in that circumstance that Younger does not apply?

Mr. Sam Rosenwein: Well, for this reason, first, if we follow Steffel, we had filed first our compliant filed by these two appellees was filed first.

In the second place, the predicate for Younger has always been that one could get a disposition of the case in the state court on some question of construction of the state law which might not be clear.

Here Enskat they came into the District Court and said, Enskat has decided this.

Justice William J. Brennan: May I suggest I don't understand Younger that way.

This is not the classic abstention situation in which a construction of the state statute might avoid the federal constitutional questio.

That's not the circumstance to which Younger was limited, is it?

Mr. Sam Rosenwein: Well, we couldn't have I would say relegating us to that Court would have not resulted and the answer to the Constitution.

It would've been just one way Enskat governed all Courts at that time and they said so.

Justice William H. Rehnquist: Well, you might told us to a petition for hearing to the Supreme Court of California at the San Diego Court of Appeals decided against on your constitutional claim, didn't you?

Mr. Sam Rosenwein: In which case are you referring to?

Justice William H. Rehnquist: Well, had you taken your case up through the California Court System.

You say that's -- that the Court of Appeals would've decided on the basis of Enskat.

Mr. Sam Rosenwein: Yes.

Justice William H. Rehnquist: But you could've then asked the Supreme Court of California for him if you'd lost in the Court of Appeals.

And you could've petitioned this Court if you'd lost in the Supreme Court of California.

Mr. Sam Rosenwein: Yes, I assume one can say that one could go through the entire situation again, but Enskat had just been decided, the defendant the appellants here themselves come and said to the District Court, Enskat has decided this and there's nothing that you can do about it.

And moreover, the Court found as it was a finding made by the three-judge court, that this was a deliberate attempt.

Justice Thurgood Marshall: Mr. Rosenwein.

Mr. Sam Rosenwein: To --

Justice Thurgood Marshall: Oh, I'm sorry, finish it.

I'm sorry.

Mr. Sam Rosenwein: I just want to say that the three-judge court found was a deliberate attempt to circumvent.

Justice William J. Brennan: With an exception.

Mr. Sam Rosenwein: They wanted to circumvent the jurisdiction of the Court.

Justice William J. Brennan: Well, you mean that was -- it was the finding of harassment within the Younger exception is that what you say?

Mr. Sam Rosenwein: No, I mean that there was a finding that the filing of this amendment to their criminal complaint to include these appellees six weeks after they had started that action was intended in bad faith to circumvent the jurisdiction of the federal court which we had invoked and we had invoked simply a violation of the Heller rule.

The Heller opinion and were entitled to the return of our three films.

That's what before this Court.

Justice William J. Brennan: Well Mr. Fleishman has told us that some other litigators exceeded in getting the Enskat issue before the California Supreme Court.

Had you proceeded through the Court of Appeals , I guess the same third provision would it in Los Angeles?

Then perhaps you might have succeeded as to this other litigant in getting Enskat before the Court.

Mr. Sam Rosenwein: Mr. Justice Brennan, here is our situation on that, you have an Enskat decision, you have this -- all of these people coming in and saying this is a binding law, we understand to be the binding law.

I might say a writ of -- a petition for writ of habeas corpus was filed prior to the recent taking of this case and was denied by the supreme Court citing Enskat Hamling.

Now, everybody and I agree that the Courts can always change their mind, this Court has itself changed his mind.

Justice William J. Brennan: Well, I gather you're suggesting that means the Supreme Court is going to follow Enskat, but then you've come here wouldn't you or try to get here.

Mr. Sam Rosenwein: Well, what I'm saying is the time nine months ago when we were there before the District Court it had a clear situation of an attempted circumvention, it had an Enskat case, that the binding law everybody agreed that it was and we had filed our complaint first and had not -- has invoked the federal court's jurisdiction before.

And we had a --

Justice Byron R. White: Do you suggest that the Younger doctrine is limited to where the state law or where state courts having decided the federal question that was in the case, but if the state courts have already taken a position on the federal question of the case, you may ignore Younger, is that it?

Mr. Sam Rosenwein: No, what I'm saying is that we had one other reason.

I'm not saying that we mustn't show bad faith and show harassment -- I'm just saying that --

Justice Byron R. White: You say we don't need to go to the state court because they've already decided the issue.

Mr. Sam Rosenwein: We simply said that one of the reasons why it would be purposeless for federal court to relegate us back to the state court is you've had a ruling from the state court today, yesterday which says, our statute as we construe it is constitutional.

Now there the federal court what is the federal court to do?

They are asked by appropriate plaintiff who says to them under the civil rights act of 1871 congress has passed the law, the law of the United States and the supreme law of the land, we claim a violation of our constitutional rights.

And we ask that there'd be a declaration that this statute is unconstitutional.

Justice William J. Brennan: This is a 1983 suit?

Mr. Sam Rosenwein: Yes it's a 1983 suit.

Justice Thurgood Marshall: Mr. Rosenwein, did your original application asked for a three-judge court?

Mr. Sam Rosenwein: Yes it did.

Justice Thurgood Marshall: It did.

Which judge asked for it?

Mr. Sam Rosenwein: Judge Lydick certified.

Justice Thurgood Marshall: Well the statute says that on the filing that he shall immediately notify the chief judge of the circuit, that was Judge Lydick right?

Mr. Sam Rosenwein: Yes.

Justice Thurgood Marshall: Who shall designate two other judges to sit with it, does this comply with the statute?

Mr. Sam Rosenwein: Well, if this is were to be considered mandatory and I consider it directory not mandatory, but if because it would -- I know but Your Honor that it --

Justice Thurgood Marshall: It's not mandatory.

Mr. Sam Rosenwein: If it's not mandatory, we have a situation -- I'll tell you what the situation it's in the record there have been --

Justice Thurgood Marshall: Who shall, is not mandatory?

Mr. Sam Rosenwein: Shall and may as Your Honor know is very often, vary in meaning.

What my point simply is we have had a number of three-judge court actions pending at the time and I think as a matter of judicial economy, the chief judge decided that he would refer it to the three judge court, Judge Ferguson, Judge Ellie, and Judge East and put in there as any objection to it, let yourself be known that there's never been an objection the first time they rate that is here on appeal.

Justice Harry A. Blackmun: Mr. Rosenwein are you departing now from your associates posture, I thought that he took the position that under the statute it was Judge Ferguson to whom the application for injunction or other relief was originally presented.

Mr. Sam Rosenwein: Yes but I think that would be another reason why it was appropriate for Chief Judge Chambers to point -- I refer as Judge Ferguson as one of the members.

But out objection, unless it be considered mandatory and that would be -- I've never considered I can visualize judges becoming ill, judges incapacitated for one reason or another would be I think --

Justice Thurgood Marshall: Actually I never heard of it before.

I know I haven't been on any Court too long, but I'd never heard of a three-judge court that didn't include the one who asked for it.

Mr. Sam Rosenwein: Yes, I think that this true.

I think in most cases that is true, but --

Justice Thurgood Marshall: Assume you could call that a statute.

Mr. Sam Rosenwein: Yes that would be ordinarily be followed, but unless it's mandatory I would not conceive it is something.

Now, I just wanted to say, counsel on the other side spoke of the declaratory relief action as being injunctive in character and therefore this Court has jurisdiction and made an incomplete argument for ex parte Young etcetera, but I had understood from decisions like Gunn and Mitchell and others that this Court had decided that if only declaratory relief was handed down by a three-judge court that that was appealable to the Court of Appeals.

And I might say that in this case, where questions of harassment and bad faith and so on are being mooted one way or the other, a mediating effect of a Ninth Circuit opinion might have been a very helpful.

But this Court has decided that the mere declaratory relief is not enough to warrant an appeal, now that's all we really have in this case, all we have is declaratory relief plus the direction to proceed to the Municipal Court who have had stipulations before returning all the money over $5000.00 were seized and who would assumedly if they asked would say in the light of the District Court's direction at the Heller violation was palpable would direct it to be retained would give back it's --

Justice Potter Stewart: Well that is injunctive, isn't it?

Mr. Sam Rosenwein: Yes it is, (Voice Overlap) but this Court has said that 1253 is kind of a statute that should not be literally construed that are there maybe cases where it would be helpful for judicial economy etcetera to commit the appeals to go to the Ninth Circuit, I think this is one.

This Court should decide it wants to take jurisdiction of course as a matter really of discretion policy whether this case involving basically the return of the three films is --

Justice William J. Brennan: Did I understand you to say that's either discretion whether we take this one.

Mr. Sam Rosenwein: What I understood from Gonzales, I understood from Gonzales that --

Justice Potter Stewart: Discretionary in Gonzales --

Mr. Sam Rosenwein: At least policy wise that one could say that we would not take this thing because this is not an injunction that restrains the enforcement of the statute because of its unconstitutionality.

Justice William J. Brennan: But it wouldn't matter, I should take in the place of the statute, unless as an injunctive order we have no jurisdiction --

Justice Potter Stewart: If there is and if there was a three-judge court that was required to be convened then we do and must.

Mr. Sam Rosenwein: You have jurisdiction but I thought from the cases there have indications that could if you wanted to refer to the Circuit Court.

Nevertheless, in spite all that, if this Court decides to take jurisdiction, our argument is that the district court below improperly decided that it could consider this case, that this was a situation, a Steffel situation, a situation of bad faith and that the subsequent amendment was intended to circumvent jurisdiction.

Justice William J. Brennan: Now, with that situation is one in which there has no criminal proceeding pending all over this --

Mr. Sam Rosenwein: This raises the question.

Justice William J. Brennan: Here you've got an actual criminal proceeding --

Mr. Sam Rosenwein: With a finding --

Justice William J. Brennan: That involves whether Young --

Mr. Sam Rosenwein: With a finding --

Justice William J. Brennan: That's within an exception.

You're suggesting that it's a finding that which brings --

Mr. Sam Rosenwein: Exactly.

Justice William J. Brennan: The harassment exception.

Mr. Sam Rosenwein: Exactly and in addition with respect to all of what has been said about the adversary proceedings so-called in which they went informed shock to a judge in Orange County, the Superior Court judge who had no jurisdiction, no statutory references, California as this Court well knows has only one way of trying an obscenity case and that's a criminal trial.

There is a specific provision that you cannot condemn any property and is so-called obscene material until there has been a final affirmance of the conviction.

They proceed to improvise this kind of a proceeding and get the order restraining us entirely from showing the film clear prior restraint and then proceed to say we are holding a hearing in which the husband of the prosecutor testifies as an expert that has no redeeming value and the judge says, "Well, I've see this stag movies before that this is no different human maybe but snap up every real and get rid to the whole thing and here's my order."

Now, is that bad faith or harassment, we submit the District Court properly held that there was properly intervened as a result to decide that the statute was unconstitutional.

Chief Justice Warren E. Burger: Judge Lydick had a different view at one time, did he not?

Mr. Sam Rosenwein: Yes, but Judge Lydick didn't have before him the evidence.

They keep on saying the same evidence, he didn't have the evidence that in the criminal trial two months later they stipulated.

They stipulated that the films were identical and they needed only one.

Now, if they need only one Your Honor knows under Heller against New York, that's all they are supposed to have.

We're supposed to show the film thereafter until they have a criminal trial and convict us.

Thank you, Your Honors.

Justice William H. Rehnquist: Mr. Rosenwein, at what stage did your Heller complaint in the federal court turn into an attack on the constitutionality of the California obscenity statute itself?

Mr. Sam Rosenwein: Well, when you say that -- well, let me just say this, when we came in, when we came originally before Judge Lydick and asked for temporary restraining order, and by the way at that time they already knew who the plaintiffs were.

They already knew who the plaintiffs were and they waited six months six weeks.

There has never been an explanation of why they waited before they brought this criminal action against them.

Well, when we came before that, there was the potential, there was simply potentially that --

Justice William H. Rehnquist: But when did you first pray for a declaration or injunction as to the unconstitutional --

Mr. Sam Rosenwein: In the complaint.

Justice William H. Rehnquist: In your original --

Mr. Sam Rosenwein: Original complaint.

Chief Justice Warren E. Burger: Very well.

You have minutes left Mrs. Sears.

Rebuttal of Oretta D. Sears

Ms Oretta D. Sears: Mr. Chief Justice, may the Court please.

I just wish to answer by referring the Court to certain passages of the appendix that I think the Court has been wondering about.

The appendix at page 82 shows the reason why we were not able to object to the three-judge court composition.

We were notified on February 8 of the existence of the three-judge court and the three-judge court order designating it where it was just found on pages 84 and 85 is dated January 8 and gave us two weeks from the January 8th date to complain about the three-judge court.

I found that was few time to attempt to do anything about that.

Number two, the appendix at page 89 shows that just this matter of course we did not have an evidentiary hearing because we were ordered to submit an affidavit and points in authorities and without oral argument.

As a matter of fact, I have never seen the three-judge court ever.

I know it exists but I've never seen it.

Page 20 of course do show the reason, page 36 Dr. John Smith's affidavit of that is the magistrate affidavit.

Pages 76, 77, 78 and 79 of the appendix show the true status as to the stipulation of the identity of the pictures, there was a stipulation for purposes of trial only.

We were going on appeal for two of the copies.

Page 45 of the appendix shows that which has been our consistent policy in these cases, one seizure and subsequently an adversary hearing and one more thing that I wish to correct, counsel states that the Court -- the state court is bound by Enskat only in the Superior Court only in the Municipal Court.

We are in the Fourth District Court of Appeals, Enskat in the Second District Court of Appeal has persuasive value.

It is not binding on the Fourth District Court of Appeal.

They could've done it.

They could've gone that way and obtained the decision.

Justice William O. Douglas: Mrs. Sears you said as I understood you, that you had never appeared before or even seen this three-judge court.

Ms Oretta D. Sears: That is correct.

Justice William O. Douglas: Did any counsel for Orange County had that privilege?

Ms Oretta D. Sears: No sir.

Justice William O. Douglas: There was no hearing of any kind nor argument of counsel.

Ms Oretta D. Sears: No sir.

Justice William O. Douglas: Were the files -- were briefs filed?

Ms Oretta D. Sears: Yes, by order of the Court.

On March 20th, we were notified that the matter will be submitted upon affidavits and the issue of harassment will be submitted upon affidavit and that the issue of the constitutionality of the state statute was ordered briefed and that was it.

Chief Justice Warren E. Burger: Thank you.

The case is submitted.

Featured:

Mtm, Inc. v. Baxley - Oral Argument

Thu, 23 Aug 2012 18:25:34 +0000

Case:

Mtm, Inc. v. Baxley

Media File:

73-1119_19741210-argument.mp3

Related Transcript:

73-1119_19741210-argument

Transcript:

Argument of Robert Eugene Smith

Chief Justice Warren E. Burger: We'll hear arguments next in 73-1119, MTM against Baxley.

Mr. Smith.

Mr. Robert Eugene Smith: Mr. Chief Justice and may it please the Court.

I think this case is a little different from the one you just heard.

In this case, there was an action brought by Mr. Jenkins who as an Assistant City Attorney in the City of Birmingham in Equity court seeking to permanently enjoin the maintenance of a nuisance at the Pussycat Adult Theater and a Bookstore.

The State of Alabama unlike the State of Ohio was proceeding under the Red Light Abatement Statute.

There was no provision for a one year closing.

There was no maximum or minimum set.

This was simply and purely going under the Red Light Abatement Statute.

The proof in this case was adduced by Mr. Jenkins was that, certain people who worked for the corporation had been convicted in the Recorder's Court which is the first level of court for violation of the obscenity laws of the City of the Birmingham.

They have a city ordinance for violation of obscenity laws.

There were approximately 15 cases which have been made most of which have been tried before the Recorder's Court.

All of which had been appealed at the -- or were in the process of being appealed.

Since that time, the only three cases with the appeal Your Honors goes to de novo to the next court -- Circuit Court and which there is a jury trial on issue of obscenity and parenthetically speaking the only three cases are going to trial all resulted in acquittals for the defendant.

But yet, it was this evidence of the violation of the -- alleged violation of the law before the Recorder's Court and instead of the other 12 that were still pending and have not yet been tried in the Circuit Court.

So, every -- what we have is the evidence of convictions that the lowest court when appeals were allowable in the next level with the Circuit Court.

That was the criminal process, what the prosecution or what Mr. Jenkins tried to do here was a civil proceeding and a purely civil proceeding which is not ipso facto or necessarily ancillary to the enforcement of the criminal laws because the criminal laws were proceeding and the rational is proceeding in the state court.

But what he did is attempt to go in and to close up the theater because yesterday they sold obscene books or films which they exhibited and tomorrow you may do so.

The --

Justice Byron R. White: Let's see, I gather that nuisance statutes are in Title 7 and the obscenity statutes are in Title 14 of the Abatement Code?

Mr. Robert Eugene Smith: Yes, sir.

It's entirely different and I --

Justice Byron R. White: What -- is there any provision which interconnects the two?

Mr. Robert Eugene Smith: No, sir and the State of Alabama has not interpreted its Red Light Abatement statute to include or exclude.

Justice Byron R. White: Now, why do you call it Red Light Abatement Controller?

Mr. Robert Eugene Smith: Because that's the term that it was given at the time, it was originally passed Your Honor.

It was designed to close beer house, saloons, pool halls and places of prostitution where you punish somebody for having gone, committed prostitution, they go back and open up again and open up again and open up again, you try to close that business.

Justice Byron R. White: It's a fairly old statute then, is it?

Mr. Robert Eugene Smith: Yes, sir.

Yes, sir.

Chief Justice Warren E. Burger: Will you sort out for me what is the relationship of MTM Incorporated and Mobile Bookmart?

It's undoubtedly in here but I --

Mr. Robert Eugene Smith: There is a new address.

It has a theater that is operated by one corporation.

There is bookstore in the lobby that is operated by another corporation much like these Gem Department Stores where there are at least sections in the store.

This is what we had at this particular location, two corporations, one location, one operating the theater and one operating the bookstore.

Justice William H. Rehnquist: Mr. Smith, did I understand you say a moment ago that it's the Alabama Supreme Court has never decided whether it's Red Light Abatement Statutes apply to the theater showing what this type of (Voice Overlap, would you?

Mr. Robert Eugene Smith: It never interpreted that question of whether or not their statute applies to theaters, adult theaters and adult bookstores.

Justice William H. Rehnquist: Did you raise that argument in the Circuit Court proceeding -- the equity proceeding?

Mr. Robert Eugene Smith: We -- in the equity proceeding, yes sir.

That was raised but the judge issued a temporary restraining order that is all that is involved.

Here is the temporary restraining order which we have placed at the beginning of the appendix in this case, order upon prayer for temporary injunction.

Now, incidentally Your Honors --

Justice William H. Rehnquist: Now wait a minute, you say order upon prayer for temporary injunction.

My understanding with temporary restraining order is something that issued ex parte without notice --

Mr. Robert Eugene Smith: Yes, Your Honor that's true.

Justice William H. Rehnquist: If you -- is this a temp -- what I would call a temporary injunction either affidavits or some testimony but at least with after notice and hearing.

Mr. Robert Eugene Smith: This was notice and hearing.

Yes sir, much like our -- I think Rule 45 of the Federal Rules of Civil Procedure kind of thing where an attempt is made to notify the other people.

Now, in the -- what counsel then did on behalf of MTM and the other plaintiff is to file an action in federal court prior to the issuance of the temporary restraining order and which it asked for the convocation of three-judge court to determine constitutionality of the utilization of the Red Light Statute either as written or as applied by the prosecutor in this particular case.

The -- there was a co-defendant, I'm sorry -- a co-plaintiff separate case entirely different by the name of General Corporation which had faced the same problem and I think some Huntsville, Alabama and in that case, they also were closed by court order and the three-judge federal court joined both cases for the purpose of argument and disposition.

And thus, the decision in essence applies to both sets of cases.

Again, parenthetically speaking we proceeded remaining the MTM and the other corporation operating the theater and bookstore preceded by following a jurisdictional statement and sought to seek the relief for this Court from the denial of the injunction.

The other corporation -- General Corporation decided to go forward in the state courts after the three-judge court threw them out.

When they did so in spite of the comment by Judge Pointer in his decision that there is a procedure in Alabama where you can sort of expedite your -- that's on page A-99 of the appendix.

He said that in Alabama permanent injunctions are appealable and temporary injunctions may be made appealable by appropriate motions and both types of appeals are given expedited preferential treatment by statute.

Now, let me tell you about the preferential treatment by statute --

Justice William J. Brennan: Where do you say this is?

Mr. Robert Eugene Smith: That's on A-99 and A-100 Your Honor of the appendix of appellants.

I'm quoting from Judge Pointer's ruling.

Justice William J. Brennan: That's at the bottom, yes.

Mr. Robert Eugene Smith: Yes, sir and the -- what I said in to the Court is that the co-plaintiff General Corporation thereafter appeal to the Alabama Supreme Court.

Justice William J. Brennan: Now, let's see.

This is from the same judgment that you brought directly here.

Mr. Robert Eugene Smith: Yes, sir.

Justice William J. Brennan: Right.

Mr. Robert Eugene Smith: This -- it was a co-plaintiff in the same case.

It was not an appeal from the same judgment.

Justice William H. Rehnquist: General --

Mr. Robert Eugene Smith: That was in Huntsville.

Pardon me.

Huntsville.

Justice William J. Brennan: Well, let me see in the District Court?

Mr. Robert Eugene Smith: In the District Court.

Justice William J. Brennan: That we combined the Huntsville case and your case?

Mr. Robert Eugene Smith: Yes, sir.

Justice William J. Brennan: Separate judgments entered in each?

Mr. Robert Eugene Smith: Yes, that's correct.

Justice William J. Brennan: And you brought your judgment here?

Mr. Robert Eugene Smith: Yes, sir.

Justice William J. Brennan: And Huntsville did what?

Mr. Robert Eugene Smith: After the three-judge court denied the injunction, they then entered an appeal in the Supreme Court of the State of Alabama.

Justice William J. Brennan: Alright.

From the closing?

Mr. Robert Eugene Smith: Closing in Huntsville.

Justice William J. Brennan: And the closing was sought to a temporary or permanent injunction?

Mr. Robert Eugene Smith: Permanent injunction there sir. (Voice Overlap)

Justice Byron R. White: And argue in the appeal?

Mr. Robert Eugene Smith: No sir, we did not.

Justice Byron R. White: The time expired?

Mr. Robert Eugene Smith: There is no -- we suggest there is no appeal for a temporary injunction in the State of Alabama there is a -- you can file a separate motion to dissolve which is a separate proceeding but Your Honors we had filed our federal suit prior to that temporary injunction.

Justice Byron R. White: And thus, what happened to the Huntsville?

Mr. Robert Eugene Smith: Alright, --

Justice Byron R. White: He -- he did take an appeal directly from whatever this injunction was temporary.

Mr. Robert Eugene Smith: After the three-judge court said, we deny the injunction.

He then appealed to the Supreme Court for the State of Alabama and Your Honors that appeal was argued October 15, 1974 and there is no and has been no disposition --

Justice Byron R. White: What is dismissed anyway?

Mr. Robert Eugene Smith: The appeal was not dismissed, there was the appeal brought by general from a final order in their case --

Justice Byron R. White: From a permanent injunction?

Mr. Robert Eugene Smith: Yes, sir.

Justice Byron R. White: Not a temporary injunction?

Mr. Robert Eugene Smith: That's correct.

But what I'm pointing out is that although Judge Pointer says that these things can be given expedited preferential treatment by statute.

The truth of the matter is that case still has not been decided.

Justice William H. Rehnquist: Well, yours is being argued December 10, 1974 and it hasn't been decided.

Mr. Robert Eugene Smith: But I'm always saying sir that one of the reasons why the court said, “Well, maybe we ought not deal with this question.”

It's because there is a basis where you can go for an appeal that is expedited in preferential and I'm saying that although that may be true in theory is not true in fact.

Justice William H. Rehnquist: Could it be that the Supreme Court (Voice Overlap)?

Justice Byron R. White: Well, it may not be fact but they exist.

I mean the state -- there is a state to tell a process that is in working order?

Mr. Robert Eugene Smith: Yes, sir and that --

Justice Thurgood Marshall: And could it be there waiting for us to decide in this case?

Mr. Robert Eugene Smith: It could be Your Honor but I say that October 15th was the day of the argument and that's October 1974 and this decision by Judge Pointer was October 1973.

So, it took a full year after which to give it that expedited preferential treatment is what I'm talking about.

Justice Byron R. White: I think if you'd be hearing the same argument if that started the criminal case against your point?

Mr. Robert Eugene Smith: No, sir.

I think we have a different prospect here.

Justice Byron R. White: Well, different prospect but it would be just as slow in the state court process?

Mr. Robert Eugene Smith: Yes, but then we have the Younger versus Harris problem.

It will be (Voice Overlap).

Justice Byron R. White: Well, I know but let's assume the three-judge court is quite right as to the applicability of Younger here.

Mr. Robert Eugene Smith: Well, I just happen to think they're not.

Justice Byron R. White: Well, I hope but if they were you're in trouble I take it.

Mr. Robert Eugene Smith: Yes, sir.

Justice Byron R. White: Well, that's the issue we've got to decide it.

Mr. Robert Eugene Smith: We're not in trouble sir because we still have the permanent injunction which is not yet been heard.

Justice Byron R. White: But is it the only question we have here, the Younger issue?

Mr. Robert Eugene Smith: We think that that's the primary question, Your Honor.

Justice Byron R. White: The primary, I'm looking at the jurisdictional statement that's the only question (Voice Overlap).

Is that right?

And aren't we bound or we rarely disagree with the lower federal courts on their characterization of a state statute and here the three-judge court said this states statute is aimed, it's a quasi-criminal and it's in the service of the criminal law.

That's what it said anyway, is that it?

Mr. Robert Eugene Smith: That's what they said, yes sir.

However, the Court would disagree that it's quasi-criminal because this unlike the --

Justice Byron R. White: You may but don't we usually give great difference to the lower federal courts to their view of the state law?

Mr. Robert Eugene Smith: I think it was the view that they placed on it Your Honor because they took the Fifth Circuit decision of Palaio versus McAuliffe and I think they misapplied that particular case because if the court will look at that case.

What occurred there is there were independent seizures and aid of the criminal process which was the first step in making a criminal case to have a trial -- a criminal trial and counsel in that case rushed in the federal court and said this was improper and sought to seek the aid of the federal court.

Judge Edenfield denied that aid because he said, this is part of the criminal process, you can vindicate your right ultimately in the criminal process.

We cannot vindicate our right in a criminal process and I think that the Fifth Circuit case is not applicable to, I say, its good law.

But it is not applicable to this situation because the criminal process is going on independent Your Honors of what is attempted here in this particular case.

This Court has said that in even in a criminal case in Younger -- in Mitchum versus Foster referring towards Younger versus Harris doctrine.

It talks about the fact that even if in criminal case the court purely clear left room for federal injunctive intervention in a pending state court prosecution and certain exceptional circumstances where reputable injury is both great and immediate and where the state law has flagrantly and patently violative expressed constitutional provision or where there's a showing of bad faith, harassment, or other unusual circumstances that we call for equitable relief.

Justice Byron R. White: Well, that's only an argument isn't it Mr. Smith that even if in a relation as the three-judge court found that the statutes is what the three--judge court said it was as a matter of state law.

You say you still within the exception?

Mr. Robert Eugene Smith: Yes sir, that is correct.

Justice Potter Stewart: Mr. Smith, I hesitate to further complicate but seems to become rather a prolix argument here but are you familiar with the probably not with the decision of this Court announced this morning, Gonzalez?

Mr. Robert Eugene Smith: I had a brief moment to review it.

I know that the Court --

Justice Potter Stewart: That case of course cast a substantial doubt upon whether or not this appeal is properly here at all because this decision by the three-judge court was not a decision on the constitutional merits, was it?

Mr. Robert Eugene Smith: No sir, it was not.

Justice Potter Stewart: It's a decision to dismiss because of its understanding of a Fifth Circuit law, the law Younger against Harris?

Mr. Robert Eugene Smith: Right, but they did not say we do not have standing to be before the Court in that case.

In fact, --

Justice Potter Stewart: I beg your pardon?

Mr. Robert Eugene Smith: They did not raise -- say that we had no standing to be before the Court in that case that we had not raised substantial question. (Voice Overlap)

Justice Potter Stewart: Well, I -- I'm sure you're not -- I wouldn't possibly expect you to be familiar with the opinion announced this morning.

But the opinion at least raises questions of -- and suggest doubts as to whether or not the case like yours is of directly appealable to this Court whether it should go to the Court of Appeals since it was a decision -- an action dismissing your prayer for an injunction by the three-judge court on grounds short of a resolution of the constitutional issues that you raised.

Mr. Robert Eugene Smith: Yes, sir.

The Court did say and I point at A-100 of the appendix that there is a question as to whether the Alabama nuisance statute here in question are “flagrantly and patently violative of express constitutional prohibitions.”

In this particular concept, they go on to say it may be possible the Alabama Supreme Court might construe these statutes as in applicable.

So, they expressed no opinion on the particular merits to this particular case.

So, we say Your Honors that under the decision of Zwickler versus Koota authored by Mr. Justice Brennan.

We chose the forum of the federal courts.

We did so because there was no order against us at that time so to speak and this was a -- we think a purely civil case putting the title on quasi-criminal.

I think it's a misapplication of the decision of the Fifth Circuit in Palaio versus McAuliffe and we feel that even if the court agreed with the determination interpreting a statute is being quasi-criminal, we think that we still have demonstrated the extra ordinary circumstances and that is to say that the total closing and succession.

And the point is you can operate anything, I mean you can put in -- if you put in carnal knowledge and the Judge Barbour felt that carnal knowledge might have offended the law prior to this Court's decision in June.

He could've held the employees and contempt and put them in jail immediately for civil contempt because they had shown the movie which he later thought might possibly be obscene.

And the theaters have been closed from May 1973 to the present time.

Justice William H. Rehnquist: Was -- Mr. Smith, with the time sequence in this case that first, Mr. Jenkins filed his action in the equity court?

Mr. Robert Eugene Smith: Yes, sir.

Justice William H. Rehnquist: Then you filed your action three-judge District Court then the equity court issued with the temporary injunction?

Mr. Robert Eugene Smith: Yes sir, that's correct.

And of course we -- when we participated -- counsel participated in the proceedings before Judge Barbour, he did so in citing of course England versus Board of Medical Examiners where there because we have to be.

We -- we do not wish to abandon the jurisdiction of the federal court that we're trying to acquire and try to promote our cause that way.

Justice Potter Stewart: Have you filed a protective appeal in this case to the Court of Appeals?

Mr. Robert Eugene Smith: There is no need to sir.

Justice Potter Stewart: Well, that's a very open question as I suggest it to you.

Mr. Robert Eugene Smith: I pretend because we have a temporary restrain injunction.

There is no appeal from the temporary injunction.

We must do something affirmative that is to say file a motion to (Voice Overlap).

Justice Potter Stewart: You have a dismissal of your prayer for an injunction is what you have in the three-judge District Court.

And have you filed a protective appeal from that to the Court of Appeals for your Circuit?

Mr. Robert Eugene Smith: Yes, sir.

Justice Potter Stewart: Thank you.

Justice Byron R. White: Have you moved to dissolve the state court injunction?

Mr. Robert Eugene Smith: No sir, we took the position that under England versus Board of Medical Examiners if we took that affirmative action we might very well be then usurp it at the jurisdiction of the federal court.

And thus, we can't very well take the affirmative action in citing England versus Board of Medical Examiners at the same time in order to go for with them.

So, we did not for that reason, sir.

Justice Byron R. White: So, you took no action to dissolve a temporary injunction?

Mr. Robert Eugene Smith: No, sir.

Chief Justice Warren E. Burger: Mr. Smith, it is not likely that we'll finish this case today if you wish you may file any comments or observations you have about the applicability of the Gonzalez case to this case tomorrow morning.

Mr. Robert Eugene Smith: Yes, sir.

Chief Justice Warren E. Burger: But you won't be confined with that.

Would three or four days be enough if you can't do it tonight?

Mr. Robert Eugene Smith: Yes, I would appreciate that.

Chief Justice Warren E. Burger: It's not a long opinion but you can file it either in the morning or --

Mr. Robert Eugene Smith: I'd like to have till Friday, if the Court please.

Chief Justice Warren E. Burger: Very well.

Mr. Robert Eugene Smith: Thank you.

Chief Justice Warren E. Burger: Mr. Jenkins.

Argument of Herbert Jenkins, Jr.

Mr. Herbert Jenkins, Jr.: Mr. Chief Justice Burger and may it please the Court.

There have been several comments made in Mr. Smith's presentation that are misrepresentative of the procedures that occurred in this case.

I don't know where it -- I don't believe they are intentional but for one thing, first thing they did out file the injunction procedure in the Circuit Court on March the 7th and set up the hearing for March 13th and gave them notice of it.

In the next day or the morning of the hearing, their local counsel was in the federal courts securing a -- filing a removal petition and he came to the hearing and with the bond order-- the removal order and present it to the circuit judge who for some reason I forgot to take in the county wouldn't accept it but I had to go back to the court and get that perfected.

In the meantime, he said that we're going to have a hearing and we have the hearing and while he was over that getting a thing removed and so they did remove and I filed a motion to remand immediately.

And we had a hearing on that and got the case remanded to the Circuit Court and proceeded to set another hearing that we were going to have.

And in the meantime they filed this present action.

It involved -- there was already a pending another case as he talked about that is on appeal and it was argued at the Alabama Supreme Court which was separate from this case the City of Huntsville case.

And they had already been filed another case by Earl Morgan, the District Attorney of Jefferson County in a separate case which involved the Mobile Bookmart which is a store -- bookstore located downtown across the street from the federal building.

This theater that I filed an injunction against is located in eastern section City of Birmingham and contains in the front of little bookstore in addition to the theater and that's operated by MTM Incorporated.

This whole title of the case got switched around, the other party -- the Huntsville case did not appeal from the three-judge court order in this case electing to go ahead and perfect their appeal in the state court.

In this case was appealed Mr. -- Attorney General Baxley was named because he is required to have notice in this type of actions and Earl Morgan was named because he is the party from those relations in this case was filed on behalf of the bookstore downtown.

In that case, there was a motion to -- they removed that case also for the federal court and there was a motion filed to remand in that case which was never ruled upon because this hearing -- this case was filed in a consolidated and immediately all three of these cases.

And on the basis of this jurisdictional question of whether or not the federal court could intervene in the matter and set it down for hearing in due course.

Now, it's very complicated, the record is not here before the Court as to what exactly happened and of course, I guess they consider this particular narrow question of whether the Younger versus Harris principle applied in this particular case.

It wouldn't be necessary but in order that this Court might consider this principle of Younger versus Harris whether or not it involves the criminal prosecution.

I would like to state that the -- in my complaint, he made a statement that there were some 15 cases.

But on the contrary, we began this matter when the theater opened in September of 1970 and it went to March of 1973 when the injunction in this Circuit Court was issued and up to that time they showed something like a 125 to 130 movies.

And which everyone was named in my complaint before the Circuit Court and it was made in exhibit to their complaint in the federal court and started per date except for about two months when the newspapers refused to take advertisements.

But in disperse out of the internet time over 125 or 130-week period we made 30 cases.

Some was kept a few weeks but they were in dispersed between the whole period of time of 130 cases.

Some might they may go five weeks and some a month but we did get a good sampling of them.

Amd some of the titles were -- the Ranch and Interstellar, Sex and Single Vampire, Jim and Peg, The Other of the Bed, Class of '69, Dollars of Satan, Miles Falls in love, Harvey Swings, Bitter Cherry, Flash to Flash, I'll do Everything, Lolita's Lollipop, Man Blower, Sandra Bowler, Lowly Housewife, and so on and including the ones 30 cases we have.

Now, those 30 cases there were 30 convictions in Recorder's Court.

All of which were appealed to Circuit Court to the criminal division for trial de novo.

Now, of those 30, there are 18 cases that were tried and they were reconviction in every case.

There are some -- the rest of them are still pending except for three cases that he mentioned which did result in acquittal of the defendant just recently which of course I could explain to the Court but it's a the jury returned one verdict in case said it -- they were reluctant in and found them not guilty because of the Rulings of the Supreme Court of the United States.

In other words, that they didn't think our pre-Miller ordinance had defined that the man to the defendant exactly what he could and could not do or this best fits the matter.

But anyway the matter came on to be heard before the three-judge District Court and on the face of -- Bill filed in the District Court showed that this was a criminal matter that was filed in accordance with the state statute that's been mentioned which is in Title 7.

And it does has a different section and then I think Mr. Clansey read it and it require -- excuse me – it says, the nuisance established in the criminal action of the proceedings under this article in case the existence of such nuisance is established in a criminal proceeding in the court not having an equitable jurisdiction.

The solicitor or prosecuting officer shall proceed promptly under this article to enforce the provisions and penalties thereof and the findings of the defendant guilty in such criminal proceedings unless reverse are set aside shall be conclusive as against the defendant as to the existence of the nuisance and so forth.

Justice William J. Brennan: But it says I gather a separate equitable proceeding in that circumstance, does it?

Mr. Herbert Jenkins, Jr.: Sir?

Justice William J. Brennan: Does it take a separate equitable proceeding to get the injunction?

Mr. Herbert Jenkins, Jr.: It just says in a --

Justice William J. Brennan: And how about -- what's your Alabama facts?

Mr. Herbert Jenkins, Jr.: Yes, you do -- you have to go into the equity court after you have the convictions.

Justice William J. Brennan: Your Alabama judicial structure has a separate equity court, does it?

Mr. Herbert Jenkins, Jr.: Yes, sir.

Well, since July of 1973 we've adopted the Civil Rules of Practice which are similar to the federal and now they've done away with it but we still have (Voice Overlap).

Justice William J. Brennan: (Voice Overlap)-- put on its equity, doesn't it?

Mr. Herbert Jenkins, Jr.: That's right.

Justice William J. Brennan: Yes.

Mr. Herbert Jenkins, Jr.: But we still keep it divided, the equity judge is still lay and they still handle the automatic to refer him to the equity division anyway.

Justice William J. Brennan: So in any event, the statute contemplates a separate independent equitable proceeding even in the circumstances of the conviction?

Mr. Herbert Jenkins, Jr.: That's right.

Even after we had these 30 convictions that contemplates a separate action.

Justice William H. Rehnquist: Can the equity court or the chancellor take some sort of notice or is there some sort of res judicata effect, do I gather from your reading of that language as a result of the criminal conviction?

Mr. Herbert Jenkins, Jr.: Well, I play it safe, I introduced certified copies of the convictions are both and Recorder's Court and those that we had convictions in the Circuit Court.

And in addition, I have to Recorder's Court judge and the Circuit Court judge who heard all those cases testify.

Justice William H. Rehnquist: Were they admitted in the equity proceeding?

Mr. Herbert Jenkins, Jr.: They were admitted and there were evidence and proof of the convictions as previously mentioned.

Whereupon the judge issued a temporary injunction not a temporary restraining orders as Mr. Smith mentioned.

In the Title 7 in the other provisions of appeal from those types of injunction provides that within 10 days of the issuance of such an order, an appeal may be taken to the State Supreme Court.

And there is accelerated procedure for filing the transcript in the briefs.

This proceed -- this appeal was not taken as I stated this suit was filed in the federal court in the interim and so no appeal was taken from that order.

Then upon my having applied for a permit to injunction they wanted to wait the decision of this case and by agreement we continued and it's still being continued pending the outcome of this matter but he is still entitled to permanent -- on hearing on a permanent injunction.

And incidentally, after six months if no one does push for final hearing on ordinary circumstances the temporary injunction will expire.

But that was my agreement have continued also.

Justice William H. Rehnquist: But it takes a stipulation of the parties to the injunctive action in order to continue the permanent injunction beyond six months?

Mr. Herbert Jenkins, Jr.: Yes, sir.

Justice William H. Rehnquist: And that there was such a stipulation here?

Mr. Herbert Jenkins, Jr.: Yes, sir, because of the appendices of this litigation.

Justice Byron R. White: And not to the temporary injunction?

Mr. Herbert Jenkins, Jr.: No, sir, they loss that because they only had 10 days and they did not take advantage of it.

Justice William H. Rehnquist: I thought your 10 days to appeal the temporary injunction but that it will expire of its own force without any appeal in six month unless that was stipulated that be continued (Voice Overlap) --

Mr. Herbert Jenkins, Jr.: A temporary restraining order which was not issued in this case would've been issued to ex parte.

This was not issue, this temporary injunction was issued after a hearing and based on their filed complaint which they bypass by skipping in order to go to the court to get --

Justice William H. Rehnquist: What's the six months time that you --

Mr. Herbert Jenkins, Jr.: Well, after the temporary injunction is issued and there is no appeal taken from it within 10 days which is provided by the statute then after six months if the either party hasn't attempted to set it down for a final hearing on the question whether the injunction should be made permanent which is permanent until such a final hearing, then it automatically expires if no attempt is made to had it set down for a final hearing.

So it would not be in effect after six months.

So, in the District Court, three-judge court was appointed and the matter was taken under advice on us to Younger versus Harris principle is being applicable.

And we argued in brief that it was a quasi-criminal matter that it was in aid of the criminal statute -- the nuisance statute that I have mentioned under which it was proceeded on the procedure, it was instituted.

And the three-judge court ruled that it was on the basis of several things.

They talked about Mitchum versus Foster and said that they required irreparable injury or unusual circumstances which didn't exist in this case and they stated that in the order, that's in the appendix that he referred to previously.

And stated in fact that this case did not involve and I think it surmise it to the ordinary circumstance in here in this particular type of proceeding, that's the nuisance that is going to involve loss of profit and those things.

But the court deemed this to be an action in the nature of a criminal proceeding.

Of course the ruling that are residing for several Fifth Circuit case is mainly the one of Duke versus Texas, 477 F.2d and which the Fifth Circuit told that court that applications of the principles of Supreme Court as Younger versus Harris decision involved in the matter of the federal court enjoining a state court proceeding should not depend upon such labels or civil or criminal but rather it should be governed by analysis of the competing interest that each case presents.

And so, that is that the Younger principles of equity come in federalism applied to federal intervention in state civil as well as criminal proceedings even where they exercise the First Amendment rights is involved.

So, the question that has been raised here several times this afternoon on regarding the application of the Younger versus Harris.

I think it's pretty well covered in the order by the Fifth Circuit and in those cases cited and I adopt that argument and I supported and I think that the facts of this case indicate that if we don't have some kind of a stop to people running to the federal court in this particular instances that we're in a fact being precluded from stopping any kind of pornography because as indicated.

They showed this films over two-and-a-half year period and we undertook as much prosecution as we could and they wanted us to resort to individual prosecutions in each case where obscenity occurred which we did and it's voluminous, it's tedious, it's weary and it's exasperating --

Justice Byron R. White: And unpleasant.

Mr. Herbert Jenkins, Jr.: And unpleasant and you cannot stop pornography that way.

And if it is against the law as this Court says over and over again then I think the -- there is some equity and comity and federalism in upholding this Court's decision in this case.

This case was taken in institute in the name of the State of Alabama or my relation in my case known in relation to Earl Morgan and the other case and I think the Court overlooked my argument and that in regard to the fact the I think it's an action against the State of Alabama in one which would fit under then reasoning of Larson versus Domestic in Foreign Commerce Corporation Case 6 and in that Supreme Court 1457.

In that, I did not act ultra vires, I had the authority to do what I did.

Its -- Its fact, it says that I shall do it.

One of the reasons we didn't do it sooner it was because of this case has came up before Miller and some were afraid at that time that this Court not render the opinion making pornography legal for consenting adults.

They operate this theater within those that limit that is advertised for adults only.

And another -- and also that if it's unconstitutionality that our questioning in such an action they must state that they have illegal right, illegal protective right which is being denied by the state.

In this case, if the pornography is illegal, as I believe it is, then the ordinance that the statute has been held in 80 Drive-In Theatres versus Baxley and the state case that I cited in to go holding that this -- by the State of Alabama that this is quasi-criminal matter.

Then, it's not an unconstitutional statute, it's merely one that they claimed and may have been but applied unconstitutional.

And also, in attempt to avoid the state form from deciding the issue.

So, if this is a state matter, the state is not a person under Section 1983 and they would have to jump those two hurdles to get out from under that.

So I think that we're not really a proper part anyway and that we should been dismissed even on that ground, but the Kenosha versus Bruno case held was municipality case but it did hold that in this equity relief, our damages would be applicable to state or subdivision, I mean to municipality and I think that that also includes the state county or municipality or the reason it would.

And so, the equity relief that they're seeking even though they are not seeking damages would be improper against the State of Alabama.

So, the Gibson versus Berryhill case --

Justice Byron R. White: Do you want us to overrule ex parte Young?

Mr. Herbert Jenkins, Jr.: Ex parte, sir?

Justice Byron R. White: Young?

Mr. Herbert Jenkins, Jr.: No, sir.

I don't know ex parte you're speaking.

I'm not speaking about the Younger versus Harris.

I'm not sure I'm familiar with the ex parte Young.

Justice Byron R. White: But in your argument you might not be.

Mr. Herbert Jenkins, Jr.: And I -- I read, I just merely -- I alternate is an alternative to some extent to show that I think that of course I realize that state officials can be sued but I was trying to say that it was -- well, action against the state and not myself and that should -- could be consideration.

But the title of that Act is not a Red Light Act someone had mentioned.

I did want to clarify that it's a -- the title of it is Abatement of Certain Nuisances.

They defined the nuisance as a place upon which as defined above upon which lewdness, assignation or prostitution is conducted, permitted, or continued, or exists.

So it's not just that and definition of lewdness has been held to be, it's none as I believe with the obscenity and it's the word broader than assignation and prostitution, and involves open in public indecency and includes I think obscenity.

So, I think its action was properly brought and is a quasi-criminal matter and the principles of Younger versus Harris do applied to it.

Chief Justice Warren E. Burger: Thank you Mr. Smith.

We'll try to finish tonight in spite of what I said, you got about eight minutes left.

Rebuttal of Robert Eugene Smith

Mr. Robert Eugene Smith: Alright sir, thank you.

I'll only take about three.

The counsel referred to the decision of 80 Drive-in, Inc. versus Baxley, this was the decision of the Fifth Circuit Court of Appeals.

It's in the brief 468, F.2d 611.

In that case, the federal court -- Fifth Circuit held that the state has a right to use its nuisance law -- public nuisance law and a manner to where here there was drive-in theater, it was showing X-rated films, there were traffic problems being created and in that specific instance much like I think the case crime in Rabe from the State of Washington, Rabe versus Washington where Mr. Chief Justice Burger, I think pointed out that that could be a special problem that might be resolved by nuisance actions.

That is not involved here.

We have theater it's closed.

Chief Justice Warren E. Burger: The country wasn't confined to the traffic aspect?

Mr. Robert Eugene Smith: I know sir, there're young people going by and of course the same thing would be necessary true here.

So, I don't think that this decision of 80 Drive-in Inc. versus Baxley and I was referring to the Court's concurring opinion and there where you talked I believe about the fact that this could be dealt and might be dealt with this nuisance and I think that's what that decision holds for and I don't think it's applicable to the case here at bar.

Secondly, I understand from Mr. -- from counsel that there has been no stipulation entered into by the parties that the judge on his motion Judge Barbour on his motion has continued the hearing or any permanent injunction.

We are not going to ask for it unless we be usurp from our federal court jurisdiction and I suppose the prosecution is not asked for.

And we suggest in final conclusion that the Court dismissed our case and we feel that if they felt that the State Supreme Court should rule on the matter abstention and they abstained then they should've retained jurisdiction under the theory of law but this Court has espoused including more recently American Trial Lawyers Association versus the New Jersey Supreme Court.

We think the Court erred absolutely flat out dismissing the case and should have retained jurisdiction.

Justice William H. Rehnquist: Well, doesn't -- doesn't England type of abstention for a state law question mean retention of jurisdiction but Younger versus Harris has meant dismissal, hasn't it?

Mr. Robert Eugene Smith: Yes, but if the Court if you will remember the opinion of the judge they suggested and it was a mixed bag that in this instance we have not gotten to a Younger versus Harris problem but we hadn't got into the special circumstances there because the state court could construe the statute in a manner which would take the federal constitutional question out of it.

And if it did that, then the special circumstances in Younger v. Harris are not present.

So, that's why I'm saying it is relevant and that's the point I was making that I felt that under those circumstances then this is not -- they were not deciding it on pure Younger grounds and I think under this circumstance, they should retain jurisdiction even if not dismissed.

Thank you, Your Honors, and may have the Friday then to respond to the Court's latest decision?

Chief Justice Warren E. Burger: Yes, that will be on Friday.

Mr. Robert Eugene Smith: Thank you, Your Honor.

Featured:

Mclucas v. Dechamplain - Oral Argument

Thu, 23 Aug 2012 18:25:45 +0000

Case:

Mclucas v. Dechamplain

Media File:

73-1346_19741209-argument.mp3

Related Transcript:

73-1346_19741209-argument

Transcript:

Argument of Bork

Chief Justice Warren E. Burger: We’ll hear arguments next in 73-1346, McLucas against DeChamplain.

Mr. Solicitor General, you may proceed.

Mr. Bork: Mr. Chief Justice, may it please the Court.

This is a direct appeal from the District Court for the District of Columbia.

The posture of the case is changed considerably since the brief were filed and I believe the only issue which is now disputed is the question of the power of the District Court to intervene in a court martial for the purpose of controlling a pretrial discovery protective order.

The background of the case is this.

The appellee is an Air Force master sergeant who was charged by the Air Force with first, conspiring to communicate classified information to an agent of a foreign government, in this case the Soviet Union, in violation of Articles 81 and 134 of the Code of Military Justice and 50 U.S.C. 783 (b).

Secondly, failing to obey an Air Force Regulation requiring the reporting of contacts with foreign agents in violation of Article 92 of the Military Code.

And third, violating 134, the General Article by copying classified documents in violation of 18 U.S.C. 793 (b) and attempting to deliver such documents to an unauthorized person in violation of 18 U.S.C. 793 (d).

This court martial was about to commence when the appellee began an action in the District Court and that Court preliminary enjoined the Air Force from trying appellee Sergeant DeChamplain on any charges laid under Article 134.

I think that aspect of the District Court’s order is now out of this case as I discover from his counsel’s brief.

But secondly, what is in this case is the District Court’s order that the Air Force are not to try the DeChamplain on any charges whatsoever without granting full and unlimited access to certain classified documents.

Justice William H. Rehnquist: Well, the appealability to District Court’s orders to this Court is still on that case?

Mr. Bork: That is in the case and I intend to address it.

It is not however disputed any longer.

I was called by -- on Friday by Mr. Boudin who said that he now agrees that this Court has appellate jurisdiction and I will say a word on the subject because of course that is not a subject to Mr. Boudin and I can’t take out of the case, it’s necessarily in the case.

But the order which the background is an order for complete access to 15 documents from the sergeant’s prior trial which are no longer in this trial, the Government does not intend to rely upon those documents as well as to nine documents which are in this trial.

And the military order which the District Court found inadequate contemplates that Sergeant DeChamplain his military counsel, his civilian league counsel, one associate, one secretary, a foreign policy expert chosen by him and a classification expert chosen by him shall have access to these nine documents, may make notes but the notes must be left in Air Force custody.

And it may be --

Chief Justice Warren E. Burger: And the disclosure is to whom?

That is, after these people get them, make them available in the District Court or in the court-martial proceeding?

Mr. Bork: The District Court orders they may be made available in the court-martial proceeding on these terms.

Chief Justice Warren E. Burger: Not in the District Court?

Mr. Bork: No, Mr. Chief Justice.

The dispute is really about the degree of freedom.

The court martial allows in access to these documents and that’s this appeal followed.

Now, as I say 134 is no longer in the case, the general article but appellee did raise the question of this Court’s appellate jurisdiction under 28 U.S.C. Section 1252.

And we believe that this Court clearly has such jurisdiction.

This Court has discussed in the briefs and discussed it on the merits.

Section 1252 provides direct review from a District Court in any interlocutory order of any court of United States holding an Act of Congress unconstitutional and this Court did hold Article 134 unconstitutional in any civil action where an officer employee of United States is a party.

So, I think the language of Section 1252 covers our case exactly.

Now, the argument appellee made before which raised the issue was that he said that the jurisdiction of the District Court which he’d invoked was in fact faulty because a three-judge District Court was required to consider the constitutionality of Article 134.

And he then proposed that this case go forward on the merits in the Court of Appeals but I should point out of course that if a three-judge court was required the Court of Appeals would not have appellate jurisdiction either except for the purposes of the Idlewild Bon Voyage Liquor Corporation case cited in the brief makes clear to say that the three-judge court was required and send it back with instructions to convene such a court but it could not hear the merits.

Now, we’re not going into a lot of the argument we’ve had on this issue.

I think the central point we agree upon, the appellee agreed even on its prior position and we agreed that no three-judge District Court was required.

If the constitutional question as to the Article 134 was in substantial and I think that it was insubstantial either on the logic that appellee was then using or on the logic that we were using.

Justice William H. Rehnquist: Well, Mr. Bork, where you're appealing from a judgment holding a federal statute unconstitutional under 1252 you don’t find the counter part of 1253’s language where the right to appeal turns on whether or not three-judge District Court was required, do you?

Mr. Bork: Well, no I hope you find the counterpart in the language but I would assume that if there was no jurisdiction in the District Court there might well be a question about the jurisdiction here, perhaps not.

But I think the easiest and shortest way to the resolution of this issue is to show that no three-judge District Court was required and if the problem under the most expensive reading of the substantial question.

Justice Potter Stewart: But therefore the District Court clearly had jurisdiction and that the plain language of 1252 allows an appeal here?

Mr. Bork: That’s quite correct.

The appellee’s argument on this point before was that they did not convene a three-judge District Court because the average decision holding Article 134 unconstitutional was the decision of the DC Circuit and therefore whether it was a three-judge court or to single-judge court made no difference.

It must follow the Court of Appeals’ opinion.

I think if that’s true then there was no substantial question for a District Court to decide and there is no point in convening a three-judge District Court which must automatically a follow Court of Appeals’ decision.

Our argument was somewhat different and it was that -- there was no substantial question because the District Court misunderstood the question before it.

It was not a question about the first two sections of Article 134.

It was simply a question about the third section which is an assimilative crime statute and as to which nobody claims, there's a problem with constitutionality.

So that there was no substantial question before the District Court to decide whether or not the District Court thought so and I think it is indeed the nature of the question rather than the subjective perception of the judge that determine his jurisdiction.

But perhaps we need not even go as far as your question suggest Mr. Justice Rehnquist, but I think if one goes that far it’s quite clear that there is appellate jurisdiction in this Court and that -- as I say that is a subject no longer disputed by appellee.

And of the only question left as I say is the question of District Court control of the pretrial discovery process of the court martial.

And I think it’s quite clear that there is no such power in District Court to intervene at this stage for that purpose.

I think the military justice system has a freedom from intervention on such matter similar to that that the state justice systems have and that intervention is justified only when as Younger against Harris would put it -- various bad-faith or harassment and when the party seeking relief is threatened with irreparable injury that is both great in immediate.

And this case, the District Court made no such findings as a precondition of its intervention and indeed bad faith or harassment were not even alleged.

The fact that the appellee might have to be confined pending the outcome of the military prosecution in any appeals that follow does not constitute, it’s not cognizable as an irreparable injury that's an incident of any criminal process.

And if that were grounds for intervention, federal courts would be intervening all of the time in state and military justice appeals systems.

I think the decision of this Court rather uniformly show that this rule against intervention by Article III Courts in military proceedings as in state proceedings rest upon a cluster of policy factors.

I think some of them are of constitutional dimension and they’re summed up generally in the word exhaustion of remedies and comity.

And I think these policies are so strong indeed that the appellee has not been able to point to a single decision of this Court sanctioning an intrusion like this one into the military justice system.

It’s an intrusion both unique and as continuing because the terms the District Court’s order contain words which must be construed and the District Court could hold itself available for application to continue to supervise the access to document’s problem.

And all of that takes place before the appellee has even been tried much less exhausted his remedies within the military justice system.

Now, let me say here that a great deal of the argument in this brief rest upon I think unjustified denigration of the military justice system.

There is much argument in the brief in the appellee’s brief that military tribunals do not apply all of the procedures that civilian tribunals do which is quite true but that is not a statement that military tribunals are in anyway lax in applying those procedures which this Court and Congress has an appropriate for them.

Similarly, I think in an effort to avoid the plain thrust of cases like Gusik against Schilder and Younger against Harris.

The appellee has tried to argue that any remedy he may have in the military system will be futile.

And that seems to me a very hard claim for a man who’s been convicted ones by a court martial on an espionage charge and has appealed that conviction and has had it reversed by the Court of Military Review and has had that reversal sustained by the Court of Military Appeals.

His real complaint is that he has made three successive petitions for extraordinary relief prior to a second trial and that the Court of Military Appeals has denied them and said that that is extraordinary relief and is not to be use as a substitute for appeal.

There's no reason here to think that should he be convicted upon a second court martial that the Court of Military Appeals and indeed the entire military appellate system would not be fully sensitive to his constitutional claims.

I will discuss only briefly this Court’s opinion in Gusik against Schilder which is really a much stronger case for intervention by Article III Courts because the man there -- the serviceman there had been convicted and had exhausted all of his military remedies.

Afterwards, a new article gave him the right to ask for a discretionary new trial to be given by the Judge Advocate General and that was the only remedy available to him and his chances didn’t look very good, but this Court said that habeas corpus was not available to him until he had exhausted that remedy.

It seems to me that he had a much slimmer chance and adequate remedy at law than does the appellee here.

The Gusik case itself analogized the requirement of exhaustion of military remedies to the similar requirement of exhaustion of remedies within state court systems and I guess Younger against Harris recently decided by this Court shows the strength of that requirement.

There, it was a prosecution of a man under the California Criminal Syndicalism Act, an act of dubious constitutionality and he raised the First Amendment claim.

It would seem to me much more compelling than the appellee’s claim here because his conduct alleged is espionage which does not fall under any constitutionally protected area.

But I think if one analyzes Younger and this case will find them parallel in many respects, there is here not the policy of federalism which Younger found important but there is the constitutional power of Congress to make rules for the Armed Forces which are separate.

There is a same document of equity jurisprudence against restraining criminal prosecutions.

There is the same adequate remedy of law and there's the same absence of a showing of irreparable injury.

There is the same need I think to avoid friction and to avoid disruption of the court martial.

I think in considering this case, one ought to consider what the general principle at stake is.

The general principle is really one that would commence a general removal power from courts martial for constitutional issues.

And the court below when appellee here say that since military courts do not have special expertise on such issues, there is no reason to let them decide them without having a federal court intervene to decide them for them.

That would shell the cases back and forth between the Article III system and the military system in a way that it would be so disruptive and so costly for everybody concerned.

It would be better if the Article III Court simply took over court martial rather than did that.

Now the only reply, the appellee has to all of these occurred I think the heart of his reply is at page 51 of his brief where he strides a string of cases, Billings against Truesdell, Toth against Quarles, Reid against Covert, McElroy agianst Guagliardo, and he cites those for the proposition that this Court has repeatedly sanctioned interference with on going military proceedings to correct fundamental of the constitutional errors.

And I think not, I think not those are all cases in which the person seeking to have a federal court intervene successfully claimed not to be a member of the Armed Forces.

The integrity of the military trial process was not at stake and the intervention to prevent the court martial a person who is not even subject to military law is hardly the same kind of disruption.

In fact, those cases can be decided by the status of the person.

He is a civilian not a military in person and then a further legal question of, may a court martial constitutionally try a civilian under these circumstances which is not all the same of taking a person who is concededly subject to court-martial jurisdiction concededly subject to trial and constantly filtering his constitutional claims out of the military system into the federal system perhaps for full appeal and then back into the military system again.

So far as I can make out that’s about all there is to the appellee’s case that it is a constitutional issue and therefore there's no reason why should at the military courts decide before the civilian courts do.

And we’ve seen that the intention of Congress and all of the policy considerations underlying this Court’s decisions run to the contrary.

There is one thing perhaps I should mention and that is that appellees brief mounts in extents of attack upon the constitutionality of Article 76 of the Code which is the finality provision and says that it’s unconstitutional if it’s interpreted to mean that the only collateral attack possible upon a military conviction is by habeas corpus by persons in confinement.

That gets the appellee into Martin against Hunter’s Lessee and Ex parte McCardle in a very exciting group of cases to teach but I think not relevant for today’s discussion.

We cite Article 76 as evidence of congressional intent that the court martial system be generally free in interference, it clearly is that.

We have argued that habeas corpus is the only permissible form of collateral attack but that’s not necessary for decision of the present case because whatever form of collateral attack maybe available Younger against Harris and Gusik against Schilder for the proposition that it takes place after the exhaustion of remedies in the military system.

Justice Byron R. White: With Younger against Harris as we both know was a premise to great deal upon what the court opinion called in capital letters -- our federalism and that (Voice Overlap) that is not an ingredient here.

Mr. Bork: No, I think there is a comparable not a strong but there is a constitutional value which parallels that in Congress as constitutional power provide special rules and hence special courts for the military and I think all of the policy reasons that are mentioned in Younger against Harris as equally applicable here and I think Gusik against Schilder tends to equate the two systems: state system and the military system in terms of nonintervention -- premature intervention by federal courts by Article III courts.

So I have no doubt that the policy of Younger against Harris is fully applicable here and that policy of course was recognized recently in Parisi against Davidson, a case that appellee cites in that string which it’s distinguishable and which this Court takes particular pains to point out that the policy cited in Gusik against Schilder is not being breached.

And I might say, finally about this point that the appellee who is in confinement I think has no standing to raise the issue of whether Article 76 would be unconstitutional if it were applied to somebody who was not in confinement to prevent him from being habeas corpus.

That may be an issue in some case someday when there is such a person who is blocked by Article 76 interpreted that way but I think the appellee has no standing to raise his case for his purposes in this case.

To return to the main point then what we have before us as I say is simply a question of federal court -- we have before the Supreme Court a question of pretrial discovery and a question in a court martial which hasn’t taken place yet and nothing could show more clearly what a massive disruption of a court and branch of military -- of justice we have here.

I think the clear intention of Congress in the clear policy of the cases of this Court is to let this court martial go forward without interruption.

There is no reason to believe that military tribunals will be insensitive to any of the appellee’s claims and should they -- all of them decide against him and incorrectly he has available habeas corpus as it does anybody wrongfully convicted in another system of justice.

Justice Harry A. Blackmun: General Bork, if this case were not pursued in the military system, where would it be venued if it were in the civilian side?

Mr. Bork: Well, I'm not quite clear where it would be Mr. Justice Blackmun because the offense took place overseas.

I don’t know how we would solve the jurisdictional problem if it were not a military took place in Thailand.

And I am not sufficiently versed to say whether or not we could solve the jurisdictional problem and get them into a civilian Article III Court.

I think that’s been tried before without success.

We think for these reasons of the case ought to be reversed in the complaint dismissed.

Justice Harry A. Blackmun: May I ask you one more question before you sit down.

It’s probably totally irrelevant.

But did anyone formally request Judge Parker for the convening of a three-judge court?

Mr. Bork: No, as I understand that appellee says that they thought it was not necessary because the three-judge court would be bound by the Court of Appeals decision in Avrech.

Justice Harry A. Blackmun: Yes.

Mr. Bork: So that it will have no substantial question to decide in any event.

Chief Justice Warren E. Burger: Mr. Boudin

Argument of Leonard B. Boudin

Mr. Leonard B. Boudin: Mr. Chief Justice and may it please the Court.

We have agreed that the issue in this Court’s jurisdiction should be resolved in favor of it for exactly the reason given by Mr. Justice Rehnquist while the application of Stratton and Idlewild in principle could have dictated a different result.

It’s quite true that 1252 is an ambiguous and in the thicket of three-judge court problems that have troubled the court for so long at least and we have come to the conclusion if this is an issue and which should be resolve in favor of the Court’s jurisdiction.

We see three issues here and the second of which is really not been touched upon by my brother.

The first issue is whether the court martial judges refusal to give civilian defense counsel full access to the prior trial record and to the very documents that other subject of these criminal charges with the violation of the Sixth Amendment right to the effect of assistance of counsel going to the question of the jurisdiction of the court martial under Johnson against Zerbst which we radically we did not cite though it seems the clearest case in point.

The second question which is I say, my brother did not develop an argument with whether or not any collateral review of a court martial decision of this kind, court martial action of this kind.

Other than habeas corpus is permissible at some stage of the proceeding and the third issue which is really the central issue as we see it is whether or not given the circumstances in this particular case, the appropriate remedy of collateral review was by injunction.

Now, the issues have to be decided in the reverse order of that dealt with in our brief and in the Government’s brief because the question of collateral review and the nature of it to with is an injunction needed at an early stage is a function of the nature of the constitutional right involved which we discussed in point one, orally three or five in our brief a function of that right and of what actually happened in this case.

So I turn to the first issue namely the effective assistance of counsel.

This is we know, it’s not an abstract issue.

It must be related to the crime charged 18 U.S. 793 and to the prior history of this case.

We must remember that Sergeant DeChamplain was arrested in July of 1971 charged with a violation of the espionage laws among other things in having conspired to deliver a package of 25 documents to a Russian agent in Indochina.

And that he has been since July 3, 1971 in pretrial confinement, in post-trial confinement and now in pretrial confinement and if the course of events follows which is suggested by the Government here he can very well be in three years more confinement until this case is finally adjudicated again by this Court.

Now, as I said the issue in the case of the effective assistance counsel is determined by the nature of the case.

There are some problems that we had in Powell against Alabama where we know the interference that occurred there.

There are other cases such as Moore against Dempsey where you have a mob scene interfering with the effectiveness of a court.

In the present case, so far as the nine documents are concerned just to take those away from the prior trial record.

We have the -- what may probably he’ll be called the core or the corpus delicti of the case.

These are the documents whose transmittal by conspiracy or attempt is the basis of the charges against DeChamplain.

It is these documents that like any other corpus of the crime whether it’s obscenity book or some other analogy that the Court may consider are being restricted so far as access are concerned.

Now, this would be true in any case as I say in which the very core of the case is being preventive from giving counsel full access.

But we have a very special case here and that is the complexity of 18 U.S.C. 793, the espionage laws.

Your Honors touched on the problem without adequate or virtually any briefing several of the opinion of this Court in United States against New York Times or New York Times against United States Pentagon Papers case.

The Supreme Court -- this Court has passed upon the issue in Garren where it said that the matter must be relate to the national offense to be a crime and in United States against Hunter, Chief Judge Learned Hand added another dimension to the problem, increasing the complexity whether or not the material and those documents were in the public domain.

Now, we had a star example a long-winded and notorious example in the Ellsberg case before Judge Byrne where the most elaborate briefing on the question of the meaning of 793 with engaged in was the subject to the very tentative decision by Judge Byrne and with the subject of our being given access to the documents involved the very top secret documents including many that were never given to the New York Times, that were never published anywhere and that Government consistently insisted, hence the charged to the crime related to the national offense.

We were given those documents as Your Honors will see from this record here without any limitation whatsoever except the word of counsel that the following persons not disclose to the Government were entitled to those -- to examine those papers so that they could advice us as consultants.

And so many of them could testify at the trial and not only where some 20 consultants, an experts testifying at the trial but some 40 people staff members, academician, mimeograph operators and a whole core of lawyers more than probably in any other trial were given copies of those papers -- the so-called national defense documents.

In contrast, the military judge here whose decision is final has said first as Your Honors will see from appendix 61 that he doesn’t think it important that the matters relate to national offense and he will not consider expert testimony on the subject strange ruling in light of the decisions of this Court.

And secondly, the military judge has says that I may examine these documents only in the presence of a person with security classification to include defense military counsel assuming that I retain them because it maybe that Mr. DeChamplain and I may decide to proceed alone.

And with case I will have to have a government security agents watch me as I examine these papers.

I may not have a copy of them.

I must examine them at a “secure” location.

I may not take notes or to be fairer I may take notes where they have to be read by the Government’s security people.

Now, this is -- in this day under our system of justice, with all due respect to the military establishment, I have a high regard for it.

I think the U.S. Court of Military Appeals and the uniformed system of justice are a great advancement over the days in Wellington when he referred to the soldiers are scum.

Great advancement but this is what we have today from this military judge in contrast to the whole procedure.

Now, I may say just to add something that the prosecution counsel are under those such limitation, they have a whole record.

They can examine the whole prior record, the nine documents without limitation and the 15 that made up the package of 24.

So, they and the trial judges of the Government can see these things and I may not.

The suggestion that my military counsel may have a recollection of what they saw before or may even reflect it, refresh it by looking at it.

It doesn’t help because they're not allowed to transmit to me.

I note or verbalism the information in these top security documents.

Now, I will have to contrast this with an obscenity case in which its obvious counsel can course many consultants as he wishes to and not being restricted to two consultants and to two lawyers.

I've selected and assisted in my office, I may not have my partner Mr. Rabinowitz.

Look at these papers whatever his advantages over me may be.

So the result is I'm restricted in number, I'm restricted in place, I'm restricted in making copies and the Ellsberg files are still in my office, I've examined them and the national security so far doesn’t seem to have been imperiled.

Now, with respect to the entire trial record, which is a separate but related point, the trial record as I said is available to the prosecution.

We would’ve the right at one time to look at it under Article 54 (c) which deals with appeals but that right no longer exists here.

These documents of the 15 documents in the prior trial record have to be considered as any lawyer would consider them in deciding to try a second case.

And the fact of the Government decides that it will remove in order to keep me from looking at them 15 documents, how do we solve the problem?

Because those documents may very well be important and the transcripts of the early record may very well to be important for me to decide not on the advice of the Government or in its judgment, for me to decide what is exculpatory.

For example Sergeant DeChamplain, they have and they say that the 24 documents to take a hypothetical thing.

The 24 documents were being taken overnight of people, that people have taken it from the national -- Department of Defense overnight for the purpose of studying them and the 15 happened to be very innocent and that the nine gotten there by error.

I don’t know of what am I hypothesizing.

The fact is that under any consideration of Brady and what it means and the Alderman where in many cases we were dealing with things ancillary to the case.

These are the -- this is the prior trial record of the prosecution of a man who spent three and a half years in jail now and promises than more.

Justice Byron R. White: Do I miss -- if I misrecollected Mr. Boudin and maybe you’ve mentioned this that in this second proposed trial the Government is not going to use that.

Mr. Leonard B. Boudin: The Government is not going to use them they can look at them, they may very well rely upon what was in the prior trial record Your Honor is quite right to determine how to cross-examine DeChamplain.

He may want to get out on the witness stand and testify with respect to the 15 because these were 15 separate entries this was a package deal, it was a conspiracy with respect to 24.

I don’t know what the Government is expurgated from the prior record.

Justice Byron R. White: Well, you do know that though they are not making the same charges.

They have eliminated similar charges.

Mr. Leonard B. Boudin: They have eliminated some of the documents and they say that no longer charging with respect to those 15.

Justice Byron R. White: Right.

Mr. Leonard B. Boudin: But the 15 were part of the original conspiracy and I have a right to direct myself to that original conspiracy which was the basis of the charges and to see what there is in the record that they taken away.

I have to depend on them to decide whether not only the documents have they removed it, they’ve deleted, they say, all references to the documents.

As a trial lawyer or appellate lawyer I'm not willing to rely on the Government’s decision as to what was in the prior record.

And that --

Justice Byron R. White: Now, that it is the entire, is the entire record of the first trial sealed?

Mr. Leonard B. Boudin: Sealed for the Government, my military counsel may look at it but they can’t tell me about it.

Justice Byron R. White: The entire record?

Mr. Leonard B. Boudin: Yes.

I'm only entitled to look at that part of the record which deals with the nine documents in this forthcoming procedure and under the limitations involved and of course I'm only allowed to show as I indicated to a few people.

Now this denial, if Your Honors please, isn’t a procedural matter.

It doesn’t go to the weight of the evidence which Your Honors will recall in Burns against Wilson.

A record that was examined very carefully by the Court of Appeals and this Court accepted that very careful judgment of the Court of Appeals from reviewing the evidence.

This is not a case of military expertise as in Noyd.

This is not even a case of a Fourth Amendment right involved in the Schneckloth against Bustamonte case 412 U.S. where the Court distinguished the Fourth Amendment Right from the right to a fair trial with the assistance of counsel.

This is not even the right of the case of an inability to put on a single particular defense -- the insanity one that was referred to in Wetzel.

This is very close, and I mean no adamant version on counsel for the Government.

We’re dealing here rather with civilize society.

This becomes a mask of a trial when counsel is not permitted to see the full record of a first trial that led to his client’s conviction and where all of these handicaps are placed upon counsel.

Now, Your Honors as I said before at the beginning there is one case that I think is critical here because it states basic principle and it was Mr. Justice Black’s very early opinion in the Johnson against Zerbst case where he said and we now go to the question of when you interfere with a court martial, a court’s jurisdiction at the beginning of trial may be lost in the course of proceedings to the failure to complete the court -- complete the court.

Justice William H. Rehnquist: Johnson against Zerbst was federal review of federal court?

Mr. Leonard B. Boudin: Precisely Your Honor and it is quite true.

Complete the court by pro -- but the issue of jurisdictions seems to be fundamental.

Complete the court by providing counsel for an accused was unable to obtain counsel etcetera, etcetera and repeatedly Your Honors will see the words where a counsel is limited as handcuffed one way or the other or counsel is isn’t supplied.

Then, jurisdiction of the Court is affected.

Now, I will pass from this point, passed over the question of collateral review generally which was very thoroughly dealt within our brief and turn to what is the problem raised by the Solicitor General namely why injunctive relief and wasn’t there in Younger case.

In answer to that, I call Your Honor’s attention not only to the majority opinion but to the opinion of Mr. Justice Stewart concurred in by another justice of the Court, Mr. Justice Harlan but limiting myself to the majority opinion or the moment.

First, the principle of federalism as Your Honor Mr. Justice Stewart pointed out was I think central.

I think equally relevant in the case was the fact that there was federal statute, which it didn’t have to decided an application which govern the question of injunctions against state courts.

I think thirdly if we take Younger --

Justice Byron R. White: Yes, but Younger wasn’t based on that statute at all?

Mr. Leonard B. Boudin: No, it was not.

Justice Byron R. White: It could have been?

Mr. Leonard B. Boudin: The court pointed out but it did not mention the statute at the beginning as an indication of federal policy.

Justice William H. Rehnquist: Well, Mitchum against Foster though held that the Civil Rights Act was an exemption to that statute and so it said nonetheless Younger applied independently of the statute and only Younger applied in that kind of a situation?

Mr. Leonard B. Boudin: Right.

That I can’t answer Your Honor because I don’t know the case but if I may pursue the Younger things, limiting myself for the moment to Younger.

In the Younger case, the Court did of course leave open the question of irreparable injury and I do not think one can read Younger as requiring malice on the part of Government to establish irreparable injury.

The Court in Younger was concerned about attacking a statute on its face where you are dealing with two problems as pointed out.

One, it was a statute and a statute of another sovereignty of the states.

And secondly, it was attacking on its face.

Justice Potter Stewart: Well, that was Boyle against Landry in which it was attacked in the United States.

Mr. Leonard B. Boudin: But and the Younger was likewise.

Justice Potter Stewart: Younger was trying to enjoin a trial?

Mr. Leonard B. Boudin: Yes.

It tried to enjoin a trial on a ground that a statute is unconstitutional and this Court said in the majority opinion that constitutionality of the combination of the relative remoteness of the controversy.

The impact on the legislative process of the relief sought and above all the amorphous nature of the required line by nine analysis of the statute used.

I'm quoting from the words of this Court and the problems that veto of a legislative process and I point out we’re dealing here not with the legislative process or the tribunal which should not have the same weight as a state legislature and we have nothing amorphous about this.

This Court knows now as Judge Parker did below exactly the extent of the ineffectiveness of counsel that is predictable in this case and as far as irreparable injury is concerned let us consider what will really happen.

There has already been a trial overturned very properly by the U.S. Court of Military Appeals for constitutional error.

There will be a second trial if this Court on analysis agrees with us at this kind of hampering of counsel which didn’t exist in Copeland, which didn’t exist in Garren, which didn’t exist in Ellsberg, which has existed in no other case, espionage case.

The Copeland was collateral they said before and this kind of limitation upon what counsel can do before a court martial is improper.

Then, they will ultimately be a third -- a second trial -- a third trial because that conviction will be set aside and we’ll be back with the third trial whatever new constitutional problems the Government may oppose by its behavior.

Now, I submit Your Honors --

Justice Potter Stewart: Of course, if they’re irreparable injury is enough then Younger is meaningless because you have to show irreparable injury to get ever get any injunction from any court of equity under any circumstances --

Mr. Leonard B. Boudin: I do not think so, Your Honor.

I rely on --– sorry.

Justice Potter Stewart: That’s just a foundation for ever getting an injunction you have to show irreparable injury and a lack of an adequate remedy at law.

Mr. Leonard B. Boudin: But we also have here the problem of the constitutional right of the defendant and whether or not he is to be tried before a tribunal.

Moore against Dempsey, Johnson against Zerbst and I suspect the Powell against Alabama to occur today this Court would recognize I think in any of those situations that an injunctive relief could be issued even as against the state court.

Your Honors’ opinion, on concurring opinion Younger against Harris which I remind Your Honor is based upon a statute and the concern of attacking a statute is very different here from the concern with respect to a military tribunal or any tribunal.

And Your Honor said, irreparable injury both great and immediate if the statute were patently and flagrantly unconstitutional on its face.

That’s what Your Honor said there in the concurring opinion.

Now, here we do not have the problem of a statute.

We have the problem of what a military tribunal is going to do.

This brings me to the point of the relationship between military tribunals and federal courts on the one hand and on the other hand the relationship between state courts and federal courts.

A different approach has been taken and I think will be taken or should be taken by since I may not predict by this Court when we deal with the question of military tribunals as against state tribunals.

We have to remember that the states as this Court has said and others have said where the original basic repositories of our constitutional rights.

With all the improvements that have occurred in military courts, they are still, they still have the military influence even up to the U.S. Court of Military Appeals.

With all of the tradition, this Court has said several times in Parisi, referred to by the Solicitor General and as said also in Noyd and elsewhere and that runs right through that the line that in terms of military expertise, the courts will defer it to the military.

Justice Thurgood Marshall: Well, as a matter of fact the court said no jurisdiction before Burns, did they?

Mr. Leonard B. Boudin: Exactly.

Justice Thurgood Marshall: Absolutely none in Burns as a recent case?

Mr. Leonard B. Boudin: Burns was a recent case in which the Court examined the record and --

Justice Thurgood Marshall: For the first time?

Mr. Leonard B. Boudin: Yes.

Justice Thurgood Marshall: In a military case?

Mr. Leonard B. Boudin: Exactly.

Exactly and in that case, the Court essentially agreed that there was no merit.

I don’t think the Court was right and I stand by the views expressed by Mr. Justice Frankfurters’ concurring opinion and by the dissenting justices.

I refer Your Honor is particularly that Mr. Justice Frankfurters’ concurring opinion where he adopted the view on jurisdiction that I have just suggested to Your Honors that the denial of counsel and those other errors Mr. Justice Frankfurter was concerned with effects that jurisdiction of a tribunal.

Justice Thurgood Marshall: But the Solicitor General said the habeas corpus is just fine even in this case.

Mr. Leonard B. Boudin: Well, the Solicitor General says habeas corpus is fine even here but we have just gone through to trial and I am suggesting that if collateral review is ever proper and I will accept this concession such as it is that is proper.

This is the time to have the collateral review because our client is presently in present, he didn’t have that Younger against Harris.

Our client has gone through one unconstitutional deprivation of right.

Our client will if Your Honors agree and I think Your Honors will on this substantive issue we are going into a trial and knowing that the tribunal does not have jurisdiction if you accept my premises.

And we are going to have a third trial and we've been denied the relief by the army from imprisonment even pretrial imprisonment under their system and a District Court in a case which we have appealed has affirmed to district judges’ decision even though there’s no danger of a client disappearing.

So, for these reasons, I submit to Your Honor that if you agree that these limitations on counsel unknown to any civilian court, federal or state without precedent at all dealing with the core of the case, dealing with the most complexes statutes, weeks was spent in preparing the proposed charges for Judge Byrne in the Ellsberg case on when 793 applies and bearing in mind the military judge statement that all of these is irrelevant despite Garren, despite Heine.

I submit that if there is a case in our universe in which an injunction is the proper remedy and sometimes it is the proper remedy this case against a military judge not a statute, not a state court this case against the military judge it calls for the injunctive relief we have sought.

I thank you, Your Honor.

Chief Justice Warren E. Burger: Thank you Mr. Boudin.

Do you have anything further Mr. Solicitor General?

Rebuttal of Bork

Mr. Bork: Just to make the observation Mr. Chief Justice that in this case, there is no charge that anything in military done has done has not been done in good faith and that what is being told to us here is that we must take this case in a rather hypothetical basis now and discuss the constitutional issue had we followed this procedural all the way through.

Mr. -- Sergeant DeChamplain’s original court martial would’ve been stopped while we litigate that the use of his statements in the first court martial up through this Court’s and then went back to the court martial.

Justice Potter Stewart: Is the entire record of that original trial under seal?

Mr. Bork: I believe it is Your Honor on a need to know basis.

Justice Potter Stewart: Everything?

Mr. Bork: It is and the -- nothing that the documents used in that original trial because of the access problem are not going to be use 15 that were not going to be use in this trial and that only nine documents are going to be used in this trial.

My point is simply is although Mr. Boudin complains about the necessity to go up to a court martial and have an appeal and come back and be retried.

That happens in many systems of the justice and the alternative he offers us is federal court intervention whenever the constitutional issue arises in a court martial.

So that you will have massive disruptions perhaps never complete these trials.

Chief Justice Warren E. Burger: Would it be fair to say Mr. Solicitor General unless has been said so far in this case that the more sensitive the material involved in an alleged espionage case the less possibility there is of successful prosecution?

Mr. Bork: Well, if the rule is, Mr. Chief Justice, that no limitation of any source upon the use of notes is ever possible then of course it follows that more sensitive the material the less possible it is ever to prosecute anybody because if sensible limitations can’t be use upon the review with which the documents flow to the world and which notes are allowed out to flows to the world then I think prosecution is often impossible.

I regret that I was not in the Ellsberg case and cannot draw parallels between the protective order there and the protective order here perhaps the documents were of different sensitivities.

Justice Lewis F. Powell: Mr. Solicitor General, what restrictions if any were imposed with respect to the nine documents that are to be used in the trial?

Mr. Bork: The restrictions as a matter stands now Sergeant DeChamplain -- the military restrictions imposed by Sergeant DeChamplain his military counsel, his civilian league counsel, one associate I believe, one secretary, one foreign policy expert and one classification systems expert may all have access to the documents.

They may not take the documents home with them, they can work on them under Air Force with the documents have remained in Air Force custody in that sense.

They may work on the documents there, they may make notes.

The notes if they are sensitive must be left in Air Force custody as I understand it.

I don’t think Mr. Boudin suggested that Air Force would be reading his notes.

I suppose that there can be a protective order worked out so that doesn’t happen.

But there is considerable access to these documents by a counsel, military and civilian by the client and by experts.

Now, it may turn out ultimately when if this case is tried and facts are all developed, it may turn out that some court will think that not an adequate access.

I don’t think that question and be decided on this kind of a record at this time and that’s a very strong argument against intervening -- having a federal court intervene to try to solve it that problem now before --

Justice Thurgood Marshall: General Bork, it’s not that it’s important but why have the secretary look at it, he can't copy it?

Mr. Bork: Well, you can --

Justice Thurgood Marshall: You have a call on that?

Mr. Bork: I think Mr. Justice Marshall that they can make notes and I suppose the secretary can take dictation from it if they wish and write the notes up.

I suppose that's the reason, I suppose it's a -- an effort to --

Justice Thurgood Marshall: Secretary has very low clearance of -- I just don’t understand why the secretary agreed, not that it’s important to this case.

Mr. Bork: Well, I don’t know why they negotiated the secretary into the deal Mr. Justice Marshall.

Chief Justice Warren E. Burger: Thank you gentlemen.

The case is submitted.

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