The Supreme Court will review at least three D.C. Circuit rulings in its 2018-19 term, and several other D.C. Circuit cases appear destined to be added to the high court’s docket in the coming months. Almost all of them have connections to Judge Kavanaugh at the circuit level, making it likely that he would recuse himself if confirmed to the Supreme Court.
The three cases out of the D.C. Circuit that are already slated for Supreme Court review all involve thorny questions of statutory interpretation. One is about Medicare payment policy. One is about the definition of a fraudulent securities scheme. One is about civil immunity for international organizations. None are blockbusters, but all will have major ramifications in their respective industries.
In addition to those three, several other important D.C. Circuit cases—including a net neutrality decision and a burgeoning First Amendment issue—are strong candidates to be granted cert in the Supreme Court’s new term, which began this week.
Kavanaugh had a hand in almost all of these cases as a judge on the D.C. Circuit. He was a member of the original panels that heard four of them, and in a fifth, he was not a member of the panel but wrote a fiery dissent from the full court’s denial of en banc review.
Here is a D.C. Circuit-centric preview of the Supreme Court’s 2018-19 term.
Cert Grants
The high court so far has chosen three rulings from the D.C. Circuit to review this term:
Azar v. Allina Health Services. This case, which the justices announced last week that they would take up, sounds technical: It’s about whether the federal Medicare statute allows the Department of Health and Human Services to issue certain types of legal interpretations without going through formal notice-and-comment rulemaking. But the result is likely to be much more than a technicality. It could have broad consequences for the health care industry because it could clarify how much leeway the government has to use “interpretive rules” to determine how much doctors and hospitals get paid by Medicare. At the D.C. Circuit, Kavanaugh wrote an opinion for a unanimous panel and ruled that the Medicare statute does not allow HHS to change hospitals’ Medicare reimbursements without going through notice-and-comment rulemaking. The Supreme Court granted cert to resolve a circuit split on the scope of the agency’s authority. No argument date has been scheduled.
Lorenzo v. Securities and Exchange Commission. This case is about emails that an investment banker sent to his clients at the request of his boss. The SEC found that the emails contained misleading investment information and concluded that the banker had violated securities laws. The D.C. Circuit, in an opinion by Judge Srinivasan for a divided panel, held that the banker was not liable for making fraudulent statements (because the statements came from his boss, not from him) but that he did commit a separate violation—participating in a fraudulent securities scheme. Kavanaugh dissented, arguing that the banker did not willfully commit any fraud because he merely followed his boss’s instructions in sending the emails. The Supreme Court will review the case to determine whether conduct that does not meet the elements of a fraudulent “statement” under the securities laws can nonetheless form the basis for liability as a fraudulent “scheme.” No argument date has been scheduled.
Jam v. International Finance Corp. Farmers in India accused the International Finance Corporation, a global development organization within the World Bank Group, of financing a power plant that polluted the local water supply. They sought to sue the IFC in U.S. federal court. The IFC argued it was immune from suit under the International Organizations Immunities Act, a 1945 law that granted international organizations the “same immunity from suit and every form of judicial process as is enjoyed by foreign governments.” The D.C. Circuit, in an opinion by Judge Silberman, followed longstanding precedent to uphold immunity for international organizations, but Judge Pillard wrote a concurrence arguing that the precedents were wrongly decided and should be revisited. Kavanaugh played no role in this one. It will be argued at the Supreme Court on Oct. 31.
Cert Candidates
Here are a few of the other cases Circuit Breaker is tracking that could be headed for the Supreme Court in the coming months:
Natural Resources Defense Council v. Mexichem Fluor. This case involves an industry challenge to an Obama-era environmental regulation meant to curb chemicals that contribute to climate change. The problem is that the relevant part of the Clean Air Act was meant to protect the ozone layer but had nothing to do with climate change. At the D.C. Circuit, Kavanaugh wrote an opinion for a divided panel concluding that the Environmental Protection Agency overstepped its authority when it tried to phase out certain chemicals that contribute to climate change but do not deplete ozone. Groups that support the policy are seeking cert, and the cert petition has been fully briefed. The Supreme Court is scheduled to consider whether to take the case at its Friday (Oct. 5) conference.
Berninger v. Federal Communications Commission. This is the case in which the D.C. Circuit issued its landmark decision upholding the Obama-era network neutrality policy. That ruling came from a panel decision co-authored by Judges Tatel and Srinivasan. The full D.C. Circuit voted not to review the ruling en banc—thereby letting it stand—but Kavanaugh wrote an emphatic dissent from the denial of en banc review, arguing that the net neutrality policy violated the First Amendment. The FCC has since repealed the net neutrality policy, and in light of that repeal, the Trump administration has asked the Supreme Court to vacate the D.C. Circuit’s ruling without considering the case on the merits. The justices will consider how to handle the case’s odd procedural posture at their Oct. 26 conference.
Archdiocese of Washington v. Washington Metropolitan Area Transit Authority. Religion, speech, D.C.’s much-derided public transit system, and two of the nation’s top appellate litigators—this case has it all. It involves a First Amendment challenge to a public transit policy that prohibits religious-oriented advertisements on the sides of city buses. The Catholic Church, which wanted to run a Christmas-themed ad promoting charitable giving, sued over the policy, and in July, the D.C. Circuit ruled against the church and upheld the policy. Kavanaugh was originally assigned to the panel and presided at oral argument in the case, but after his Supreme Court nomination, he stepped away from issuing any further rulings and thus played no part in the panel’s decision. The church’s lawyer, Paul Clement, and the transit agency’s lawyer, Don Verilli, are both former solicitors general who typically litigate at the highest court in the land. The church is currently seeking en banc review at the D.C. Circuit, but regardless of how that comes out, a cert petition to the Supreme Court is likely. If the justices are interested in revisiting the doctrine on the freedom of speech in nonpublic forums, this case could be a good vehicle.
