Tag: 330

Like Nevada, many states rely very heavily on sales tax income to fund government services. In the olden days, states required businesses within their borders to remit a percentage of their sales as taxes to the state government. These taxes, of course, are passed along to the customer, who often sees them added on to total purchase prices on their sales receipts.

When the vendor of the product lives out of state, this poses a big problem for the state government. As of the Court’s decision in Quill Corp. v. North Dakota (1992), states have been stymied in their attempts to force vendors to collect and remit these taxes. In-state consumers are still required to pay the taxes, of course. But it is incredibly difficult to enforce this kind of requirement when the state has no idea how much money any particular individual rightly owes.

Enter Direct Marketing Association v. Brohl. The Supreme Court has just granted certiorari in this case, which deals with Colorado’s attempt to get around the restrictions in Quill. The SCOTUSblog page for the case lays out some of the details. Although the Court of late has denied certiorari on direct tax remission law challenges, the Court’s willingness to hear this case is an important development.

Paper Topic #24: Are the case facts in Brohl different enough from those in Quill to mandate a different finding? Given the holding in Quill, coupled with the changing nature of the internet economy, is it likely that the Court will feel pressure to adopt a new strategy here? If Congress stepped in to force remote retailers to remit state sales taxes, would that change the calculus in Quill?

Suggested Reading: Haile, A. J., Gamage, D., & Shanske, D. (2013). A Potential Game Changer in E-Commerce Taxation. State Tax Notes, 67(10).

Late in the Obama administration, a very interesting separation of powers issue developed out of the saga over the chemical weapons attack in Syria. The issue arose after President Obama asserted his authority to conduct military action in Syria without congressional approval, but decided to seek such approval anyway.

There is a good deal of debate as to whether the president actually has to go to Congress for approval. One member of the Obama’s own party seemed to think so …

Some prominent Republicans stepped in to defend the President Obama’s power to initiate such actions:

There’s an update to this, of course. President Trump has also launched military strikes against Syria, also without any updates to the original AUMF. Earlier this year, a new Senate resolution was initiated that would limit President Trump’s war powers. Learn more about that here.

Paper Topic #13: How much power does the President have to go around the wishes of Congress in the war on Terror? How much power does the President still have to deal with issues of fighting ISIS and dealing with the enemy combatants from the various campaigns in the war on terror? Does the Court’s recent jurisprudence on the separation of powers issue in foreign policy give us any hints?

Suggested Reading: Vladeck, S.I. 2011. “The Supreme Court, the War on Terrorism, and the Separation of Powers. Human Right Magazine 38(1).

The Supreme Court’s decision in MBZ v. Clinton (2012) is an example of a three-way separation of powers battle. Amanda Frost over at SCOTUSblog summarizes the debate this way:

“Federal law requires the Secretary of State to record the birthplace of an individual born in Jerusalem as “Israel,” which is at odds with State Department policy. The question for the Court in M.B.Z. v. Clinton … is whether that law interferes with the President’s constitutional authority to recognize foreign nations, and whether that dispute between the branches is a political question beyond the power of the courts to decide.”

More details can be found in this National Journal article.

The Court’s decision in MBZ v. Clinton (2012) did little to clear up the dispute between the executive branch and the legislative branch; however, it did assert the power of the judiciary to decide the dispute. Read Lyle Denniston’s astute commentary on the Court’s decision.

Paper Topic #12: As Lyle points out, the question remains as to whether Congress has the power to legislate about how a birthplace is listed on a passport. How will the lower courts answer this question? Is § 214(d) of the Foreign Relations Authorization Act constitutional? What implications will the decision have for striking a balance in this foreign policy separation of powers game?

Suggested Reading: Hand, A. (2012). Forbidden Territory or Well-Defined Boundaries-MBZV Clinton and the Overzealous Application of the Political Question Doctrine. Duke J. Const. L. & Pub. Pol’y Sidebar, 7, 61.

In the arena of domestic affairs, there has been a lot of separation-of-powers debate surrounding the attempts of Congress to reform the financial system. In Free Enterprise Fund v. Public Company Accounting Oversight Board (2009), the Court struck down an arrangement in Title I of the Sarbanes-Oxley Act. Here’s a quick summary of the act from the SEC’s website:

“On July 30, 2002, President Bush signed into law the Sarbanes-Oxley Act of 2002, which he characterized as “the most far reaching reforms of American business practices since the time of Franklin Delano Roosevelt.” The Act mandated a number of reforms to enhance corporate responsibility, enhance financial disclosures and combat corporate and accounting fraud, and created the “Public Company Accounting Oversight Board,” also known as the PCAOB, to oversee the activities of the auditing profession.”

In a 5-4 decision, the Court held that the Act violated the separation of powers doctrine. This is because it gave broad powers to the PCAOB (an entity of the executive branch) while simultaneously keeping the President from appointing or removing the members of the PCAOB. Read this CS Monitor article decribing the separation of powers issue in Free Enterprise Fund v. PCAOB.

As a 2012 article in Compliance Week explains, the most recent attempt at financial sector regulation, known as “Dodd-Frank”, is facing a similar legal challenge. The suit’s main points are that the CFPB was established with too much independence—that Congress cannot set the CFPB budget (its funding is determined as a total portion of the Federal Reserve’s budget); that the president cannot remove the CFPB director except in special circumstances; and that the courts must give CFPB decisions extra deference.

“As a whole, Dodd-Frank aggregates the power of all three branches of government in one unelected, unsupervised and unaccountable bureaucrat,” said former White House Counsel C. Boyden Gray, attorney for the plaintiffs and founder of Boyden Gray & Associates.

“Dodd-Frank is to financial reform like a tsunami is to a slightly dry lawn—all-enveloping, hugely destructive, and pretty much unaccountable to whoever unleashed it,” said Sam Kazman, CEI’s general counsel. (The rest of the article is here.)

Part of the problem with Dodd-Frank, according to its critics, is that it violates the nondelegation doctrine in much the same way that Sarbanes-Oxley did. Read this short analysis by Professor Bainbridge.

Indeed, a lawsuit challenging the constitutionality of Dodd-Frank on separation of powers grounds is in the works. As one conservative analysis explains,

“The challenge to Dodd-Frank is … serious. As former White House Counsel C. Boyden Gray and his co-author, Adam White, wrote in a recent Weekly Standard cover story: “Dodd-Frank is a gift to big banks,” and “Even if we take President Obama, Sen. Dodd, Rep. Frank, and the rest of Dodd-Frank’s supporters at face value when they protest that they actually intended to rein in Wall Street banks, the laws they passed accomplish the opposite result. Intentional or not, a kiss is still a kiss.”

“Dodd-Frank’s kiss is intensified by an unconstitutional regulatory structure. The Consumer Financial Protection Bureau grants its director czar-like power, combining the authority with little legislative, executive or judicial oversight. Similarly, Dodd-Frank’s Orderly Liquidation Authority authorizes unaccountable corporate death panels, which are unrestrained by meaningful judicial scrutiny, while the Financial Stability Oversight Council has unchecked power to define “too big to fail.” In each instance, Dodd-Frank ignores our Constitution’s mandate for separation of power into three branches of government, housing it instead in one unaccountable agency.” (The rest of the article is here.)

The case State National Bank of Big Spring v. Mnuchin is currently at the U.S. Supreme Court awaiting a decision on a petition for a writ of certiorari. Here is a summary of the case and links to relevant court documents from the perspective of one of the challengers of Dodd-Frank, the Competitive Enterprise Institute.

The decision to keep the new agencies independent from the Fed and other executive agencies accountable to the President was a conscious one. As this HuffPo article explains:

“Specifically, Dodd’s bill takes away the Fed’s regulatory power in some key areas. “I really want the Federal Reserve to get back to its core enterprises,” Dodd said. “We saw over the last number of years when they took on consumer protection responsibilities and the regulation of bank holding companies, it was an abysmal failure. So the idea that we’re going to go back and expand those roles and functions at the expense of the vitality of the core functions that they’re designed to perform is going in the wrong way.” …

“Dodd said that despite removing a fair amount of regulatory authority from the Federal Reserve, the bill shouldn’t be seen as a criticism of Chairman Ben Bernanke himself. “This is not about ego,” he said. “It’s about putting together an architecture that works.” …

“Dodd’s bill protects the independence of financial accounting standards …”

Topic #11: Given what we know about the Supreme Court’s separation of powers and nondelegation jurisprudence, will these independent agency provisions from Dodd-Frank survive judicial review? Is it even possible for the Congress to develop a mechanism for creating truly independent watchdog groups?

Suggested Reading:

• Hills Jr, R. M. (2013). Exorcising McCulloch: The Conflict-Ridden History of American Banking Nationalism and Dodd-Frank Preemption.
• Steinmeyer, D. J. (2014). Does State National Bank of Big Spring v Geithner Stand a Fighting Chance. Chi.-Kent L. Rev., 89, 471.
• State National Bank of Big Spring v. Lew (2015) [No. 13-5247, D.C. Circuit].

Blog Post #10

You may remember hearing about the ATF’s controversial program, nicknamed “Fast & Furious.” Here’s John Stewart to give you the rundown:

As you might imagine, this controversy has made its way to the courts. The case is Committee on Oversight and Government Reform, US House of Representatives v. Holder.  The district court judge denied a motion to dismiss the case. Read this story from Politico summarizing the judge’s reaction to the administration’s arguments. Most recently, the Judge has allowed the Department of Justice more time to show why these particular documents should be subject to the “deliberative process” privilege (or, executive privilege to keep secret the deliberative process the DOJ went through in regards to this program). The current situation is summed up nicely in this article Daniel Wilson, which you should read.

Paper Topic #10: Given what we know from previous cases like U.S. v. Nixon (1974), will this claim of executive privilege hold up? Does it matter that the president himself has (as far as we can tell) very little to do these documents, personally?

Suggested Reading: Klukowski, Kenneth A. 2011. “Making Executive Privilege Work: A Multi-Factor Test in an Age of Czars and Congressional Oversight. Cleveland State Law Review, 59:31.

PS. In the midst of the case, the Attorney General moved to certify a question in the case to the Court of Appeals. 

Blog Post #9

Article II § 2 of the U.S. Constitution anticipates the president’s need to appoint a member of the executive branch while Congress is out of session. It reads:

“The President shall have Power to fill up all Vacancies that may happen during the Recess of the Senate, by granting Commissions which shall expire at the End of their next Session.”

The use of the power dates back to the early days of the republic. This made a great deal of sense, of course, because legislative sessions were shorter and more infrequent than they are now. In addition, communications and travel were much more difficult. Together, this meant that, in the absence of the recess appointment power, important positions could be left empty for long periods of time.

Of course, this process has, like most things, become more politicized over time. Presdients who were unable to get their nominees confirmed by a hostile Senate would often use the recess appointment as a way to circumvent the Senate’s “advice and consent” role. But the Senate learned to fight back against this. In the waning years of George W. Bush’s final term, Senate Majority Leader Harry Reid regularly held pro forma sessions during any breaks in order to prevent Bush from using his recess appointment power. Something similar happened during the winter break between 2011 and 2012, when the Republican-controlled House of Representatives declined to assent to a recess. Instead, both the House and the Senate held pro forma sessions, this time preventing President Obama from making appointments.

This did not stop Obama from making appointments to the controversial Consumer Financial Protection Bureau and the National Labor Relations Board. On the advice of White House Counsel, the President argued that pro forma sessions were an unconstitutional attempt to block the use of an explicit power given to the executive by the Constitution. The NLRB appointment was challeneged in court, and the Supreme Court heard the case in NLRB v. Noel Canning et al. (2014). For a Plain English summary of the case, read this SCOTUSblog article.

Paper Topic #9: What is the impact of the Court’s recess appointment ruling on the balance of power between Congress and the President when it comes to administrative law? Was the Court just cleaning up the mess that came from years of politicizing the recess appointment power?

Suggested Reading: Corley, Pam. 2006. “Avoiding Advice and Consent: Recess Appointments and Presidential Power.” Presidential Studies Quarterly, 36(4): 670-680.

Blog Post #8

Since before the beginning of the Trump presidency, the FBI has been investigation whether and how the Russian government interfered in the 2016 election. For some background, make sure to read this timeline from factcheck.org. Part of the task of this investigation is to determine whether there was collusion between the Russian government and the Trump campaign.

Early on, Attorney General Jeff Sessions recused himself from the investigation. For the purposes of this investigation, then, Deputy Attorney General Rod Rosenstein became the point person. Soon after, Rosenstein appointed Robert Mueller as special counsel to carry out the investigation, which as of this writing is still ongoing.

In late September of 2018, the New York Times reported that Rod Rosenstein had acted in ways that contradicted President Trump’s wishes. In the aftermath of this report, the question of whether President Trump could (or should) fire Rosenstein or force him to resign. If Rosenstein is ousted, the person to take his place is likely to be Solicitor General Noel Francisco. Read this article from Slate that explains Francisco’s take on the executive’s power to remove government officials.

Among the specific powers and duties of the president, the Constitution specifies that:

“… he shall take Care that the Laws be faithfully excecuted.” (Art. I § 3).

The constitutionally-mandated oath of office makes a similar command:

“Before he enter on the Execution of his Office, he shall take the following Oath or Affirmation:—’I do solemnly swear (or affirm) that I will faithfully execute the Office of President of the United States, and will to the best of my Ability, preserve, protect and defend the Constitution of the United States.'” (Art. I, §1).

One of the key powers of the president is contained in the appointments clause. Here, the president is given the power to nominate people for appointment for certain government positions, including positions in the executive branch. This is important, of course, because the leaders of the major bureaucratic entities in the executive branch are the key to the president’s ability to faithfully execute the law.

However, in the context of the “Russia investigation,” these questions take on some important new meaning. Because Rosenstein oversees the special counsel’s investigation, replacing him with a “Trump loyalist” could shut down the investigation completely, or at least hinder its progress substantially. This article from vox.com helps to explain the ways in which the Justice Department and the Muller investigation are linked.

Paper Topic #8: In this current situation, does President Trump have the authority to fire Rosenstein (or force him to resign)? What does the existing case law say, and how might this situation be significantly different from the case facts at play in the prior cases? 

Suggested Reading: Breker-Cooper, Steven. 1992. “The Appointments Clause and the Removal Power: Theory and Seance.” Tennessee Law Review 60:841-904.

Blog Post #7

The Court’s decision in South Carolina v. Katzenbach (1966) lays out the case for why Congress has broad amendment enforcing powers under the 15th Amendment. In this case, the Court relies on arguments dating back to the Marshall Court. Specifically, the Court held that the word “necessary” in the Supremacy Clause should be read rather broadly, so as to encompass legislation rationally in service of reaching a permissible legislative goal.

 

The Court in Katzenbach also noted that “exceptional conditions can justify legislative measures not otherwise appropriate.” This qualification was probably intended to emphasize the pervasiveness of voting rights restrictions based on race. This qualification was invoked by the Roberts Court in Shelby Co. v. Holder (2013). Read the excerpt of the majority opinion in the content area of WebCampus (in the “Online Readings” folder).

Although the Supreme Court struck down the reauthorization of the original formula, it did leave room for Congress to develop a new, more modern formula. Congress tried to do this, getting support from a surprising figure. But the efforts failed, and the 2016 federal elections were the first in decades to be conducted without these protections. 

Paper Topic #7: In your view, how does the majority opinion treat the amendment enforcing power of Congress? How does the Court go about explaining its holding that the preclearance formula, which was held to be constitution in the 1960s, is no longer constitutionally permissible? What is the status of the amendment enforcing power of Congress in the wake of Shelby Co.?

Recommended Reading: Katz, Ellen D. 2014. “Dismissing Deterrence.” Harvard Law Review, 127(6): 248-52.

 

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Blog Post #6

The Speech or Debate Clause is intended to protect members of Congress from harassment on the basis of the things they say on the floor of the chamber. As the textbook notes, this originated as a way to promote the independence of the English Parliament from the Crown. Read this detailed annotation of the Speech or Debate Clause from the Legal Information Institute. Of course, sometimes members of Congress are up to no good, so it’s important to draw the line between harassing members of Congress for their speech and allowing them to hide evidence of corruption behind the protection of the Speech or Debate Clause.

This is essentially what happened in the case of Rep. William Jefferson. The background of this case as recounted by the Justice Department in its petition for a writ of certiorari in the case, US v. Rayburn House Office Building (2007).

 In the spring of 2005, the government began investigating whether Representative Jefferson had accepted payments for undertaking official acts as a Congressman to promote business ventures in West Africa. The government also investigated whether, in furtherance of those efforts, the Congressman planned to bribe officials in Nigeria and elsewhere.

The government discovered, among other things, that Representative Jefferson’s family had received an equity stake in a Nigerian company and more than $400,000 in cash in exchange for the Congressman’s promotional efforts. The Congressman also accepted a briefcase containing $100,000 with the understanding that he would forward it to a high-level Nigerian official. During a search of Representative Jefferson’s Washington, D.C., residence, $90,000 was found inside the Congressman’s freezer. Two individuals, including one of Representative Jefferson’s former staff members, have pleaded guilty to bribing and conspiring to bribe the Congressman.

In the summer of 2005, subpoenas were issued to Representative Jefferson and his chief of staff. The government worked for months to obtain the responsive records, but none was ever produced. See App., infra, 29a n.7; C.A. App. 314-315. Having “exhausted all reasonable and timely alternative means of obtaining the evidence sought,” the government applied to the United States District Court for the District of Columbia for a warrant to search Representative Jefferson’s Capitol Hill office. The warrant sought paper documents and computer files relating to the crimes under investigation. It did not seek any “legitimate legislative material that would be considered privileged under the Speech or Debate Clause.” The district court found probable cause to believe that evidence of criminal activ ity would be found in Rayburn House Office Building, Room 2113, and issued the warrant.

On May 20, 2006, the warrant was executed in accordance with special court-approved procedures designed to limit interference with congressional activity. Federal Bureau of Investigation (FBI) agents with no other role in the investigation conducted the search on a Saturday evening, outside of the office’s normal business hours. See ibid. The non-case agents reviewed paper documents in the office for responsiveness to the warrant and were to seize only responsive records. They were forbidden thereafter from disclosing any politically sensitive or non-responsive items inadvertently seen during the search. They ultimately seized two boxes of responsive paper documents. The agents also copied the computer hard drives in the office, without reviewing their contents, so that the computer files, along with the seized paper documents, could later be searched off-site by a filter team. The filter team, which consisted of persons with no other involvement in the investigation, was to review the paper documents and computer files for responsiveness and privilege and provide to the prosecution team only those documents that it found to be responsive and not potentially privileged. Potentially privileged documents would be given to the district court for review.

Following the execution of the warrant and before the filter teams gained access to the materials, Representative Jefferson moved for the return of all of the seized materials pursuant to Federal Rule of Criminal Procedure. In response, the government agreed to provide Representative Jefferson with copies of all of the seized materials so that he could raise speech or debate claims in the district court before any documents were transferred to the prosecution team. The day after Representative Jefferson filed his motion, the President directed that the materials be sealed, placed in the custody of the Solicitor General, and not reviewed by Executive Branch agents. That directive expired on July 9, 2006.

…

The district court found “no support” for Representative Jefferson’s assertion of a right to remove purportedly privileged materials before the search.  …

Representative Jefferson appealed and sought a stay of the district court’s order. …

While the appeal was pending, Representative Jefferson was charged in a 16-count indictment in the United States District Court for the Eastern District of Virginia. The indictment charges Representative Jefferson with, inter alia, soliciting bribes; depriving citizens of honest services; violating the Foreign Corrupt Practices Act, 18 U.S.C. 371; engaging in a pattern of racketeering activity; obstructing justice; money laundering; and conspiracy.

Following expedited briefing, a divided panel of the court of appeals held that the search of the paper files in Representative Jefferson’s office violated the Speech or Debate Clause and barred the contemplated further role of the filter team in identifying legislative- act materials.

The court then held that the Speech or Debate Clause includes an “absolute” “non-disclosure privilege.”  Acknowledging that no decision of [the Supreme] Court had recognized such a privilege, the court purported to ground its holding in circuit law that ad dressed a subpoena seeking legislative documents. Although this case involved a search warrant in a criminal investiga ion, not a subpoena in a civil action, the court subsumed its non-disclosure rule in the “testimonial privilege un er the Speech or Debate Clause,” despite acknowledg ng the district court’s view that “a seizure of documents did not involve a testimonial element.”

In the end, the Supreme Court denied the Justice Department’s petition for a writ of certiorari. As Ben Winograd for SCOTUSblog explains:

the Justices declined to enter a dispute involving the first ever executive raid of an office of a sitting member of Congress. As part of an ongoing corruption probe, FBI agents had discovered $90,000 in cash in a freezer at the Capitol Hill home of Rep. William Jefferson (D-La.). A year later, after receiving a tip from one of the Congressman’s aides, agents obtained a search warrant for his legislative office as well. To avoid separation of powers concerns, the warrant required a “filter team” of separate agents to screen all materials for legislatively privileged documents. But a D.C. Circuit panel held that under the Constitution’s “Speech and Debate Clause,” Rep. Jefferson should have received an opportunity to review the materials before, not after, their seizure by the Executive. The government’s petition argued the clause was designed to shield members of Congress from liability for legislative acts, not criminal investigations, and as a practical matter would impair corruption probes.  The petition was denied March 31.

The Supreme Court has essentially left the Circuit Courts to deal with the question of whether there are any real limits to the protection offered members of Congress by the Speech or Debate Clause. The 9th Circuit took up the mantle more recently in a case called US v. Renzi.

Paper Topic 6: Are there real limits to the protection offered by the Speech or Debate Clause? What kept the Supreme Court from granting certiorari in the Rayburn Office Building and Renzi cases? Is the Speech or Debate Clause living up to its original purpose?

Suggested Reading: Green, A. J. 2012. “United States v. Renzi: Reigning in the Speech or Debate Clause to Fight Corruption in Congress Post-Rayburn.” Brigham Young University Law Review 2012:493.

 

 

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