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Greetings, Court fans!

 

We’re back to finish up the October 2007 Term . . . and as always, the Court saved some of the best, and most controversial, opinions for last. Please bear with us – with five opinions and some orders to summarize, this Update is not short. (Not that an e-mail should have a table of contents, but we’ll begin with the two most newsworthy opinions – Heller on gun control and Davis on campaign finance – and then turn to an administrative agency case on energy regulation, Morgan Stanley. Next will come two criminal cases – Giles v. California on hearsay rules and the Confrontation Clause, and Rothgery v. Gillespie County on the Sixth Amendment right to counsel. Lastly, we’ll summarize the Court’s final order list. Then we’ll get some sleep.)

 

We’ll begin with one of the most talked-about cases of the Term, District of Columbia v. Heller (07-290). In Heller, the Court ruled that D.C.’s ban on handguns, as well as its requirement that other lawful firearms be kept disassembled or trigger-locked, violated the Second Amendment (“A well regulated militia, being necessary to the security of a free State, the right of the People to keep and bear Arms, shall not be infringed.”). The decision, easily the most important Second Amendment decision ever, deeply divided the Court, and it is sure to spur litigation over all sorts of other gun-control regulations. Led by Justice Scalia (who was joined by the Chief and Justices Alito, Thomas, and Kennedy), the majority adopted an individual-rights interpretation of the Amendment, holding that it protects the right to bear arms for personal use (e.g., self-defense, hunting) and not just for militia service. The dissenters would have limited the right to militia-related gun use, leaving the states and the federal government wide latitude to regulate personal firearm possession and use.

 

How did the majority and dissent reach such opposing views? The majority first dissected the Amendment’s grammar, dividing it into two distinct pieces. The prefatory clause (“A well regulated militia, being necessary to the security of a free state . . .”) simply stated one purpose of the right and did not contract or expand the scope of the right itself. The operative clause (“. . . the right of the People to keep and bear Arms, shall not be infringed”) was unambiguous and not nearly so narrow. As used in the Bill of Rights, the term “People” referred broadly to all people, not just a subset such as those (young, able-bodied men) eligible for militia service. Similarly, the phrase “to keep and bear Arms” historically included the use of weapons for personal defense and hunting. The Court scoured the historical record to reach this conclusion, citing period legal treatises, similar arms-bearing rights in state constitutions of the time, court decisions, and even the “Gentleman’s Monthly Intelligencer.” (We will not bore you with the details. Suffice it to say that the dissent pointed to the same types of materials to support its interpretation. And as we made our way through 150+ pages of opinions, we felt sorry for the law clerks who had to wade through the musty archives for some ray of clarity.) For the majority, there was no disconnect between the prefatory and operative clauses because ensuring that individuals can bear arms makes possible a citizen militia to protect the nation from outside forces and from an oppressive federal government “if the constitutional order br[eaks] down.” The individual-rights view also found support in English law, which recognized an ancient right to bear arms for self-defense and hunting; the Bill of Rights merely codified this preexisting right. Moreover, post-Amendment legal commentary, court decisions, and legislation generally interpreted the right to bear arms as individual in nature. Having dealt with text and history, the Court then turned to its own precedent – namely United States v. Miller (1939), where the Court upheld two criminal convictions for transporting sawed-off shotguns because possessing such weapons had no “reasonable relationship to the preservation or efficiency of a well regulated militia.” The majority concluded that Miller did not purport to limit the scope of the Second Amendment, only to limit the types of weaponry protected. The majority also denigrated Miller as short on analysis and uncontested: The respondents had not even briefed the Second Amendment issue, leaving the Court with only the government’s view. Miller thus did not stand in the way of an individual-rights interpretation of the Second Amendment.

 

The Court recognized that it was radically altering the gun-control playing field, but it made clear that it was not throwing all gun regulations out the window: Prohibitions on possession by felons or the mentally ill, laws forbidding guns near schools and government buildings, and conditions on the commercial sale of guns are still fine. In addition, while the Court interpreted “arms” to include all “bearable arms, even those that were not in existence at the time of the founding,” it suggested that regulations on “dangerous and unusual weapons” are permitted. (So don’t go buy your own rocket launcher just yet.) As to the D.C. laws at issue, the Court concluded that banning an entire class of weapon (the handgun), which happens to be the most popular type for self-defense, is unconstitutional. Requiring all other firearms to be kept in an unusable manner (disassembled and/or trigger-locked) is also unconstitutional, especially since the law had no self-defense exception. Notably, the Court did not determine the relevant standard of review for gun-control regulations, concluding that the D.C. laws would fail under any “potentially applicable” standard. (It did rule out deferential rational-basis review as insufficient protection for a constitutionally enumerated right; expect new lawsuits on what stricter standard of review should apply in the very near future.) In the end, the majority recognized that gun violence is a real problem in our society and that the Second Amendment may well be “outmoded,” but it concluded that “it is not the role of the Court to pronounce the Second Amendment extinct.”

 

Justice Stevens dissented, along with his three more liberal colleagues. In their view, the Second Amendment protected the right of the people of each state to form a militia, responding to concerns that the federal government’s army could usurp state sovereignty. Read as a whole (not chopped into artificial pieces), the aim of the Amendment was protecting those militias, not enshrining a common-law right to self-defense. Further, hundreds of courts have relied on Miller and adopted a militia-based view of the Second Amendment, and gun regulation has been commonplace and uncontroversial for centuries. He would have upheld the D.C. laws (and just about any other gun regulation). Justice Breyer wrote a separate dissent, which the other dissenters all joined, where he explained that even if the Second Amendment encompassed an individual right, D.C.’s laws were reasonable regulations of that right because they focused on the “life-threatening” dangers posed by handguns in high-crime areas.

 

The next biggie came in Davis v. Federal Election Commission [“FEC”] (07-320), where the Court (in the same 5-4 split) struck down the so-called “Millionaire’s Amendment” to the Bipartisan Campaign Reform Act of 2002 (“BCRA”). BCRA caps the amount an individual can give to a House candidate as well as the amount that a party can devote to campaign expenditures; usually, the same limits apply to all candidates for a seat. The Amendment, however, changes these rules where there is a significant funding disparity (over $350,000, measured at various times) caused by a candidate’s use of personal funds. The self-financing candidate still faces the ordinary BCRA limits, but his opponent can accept individual contributions up to three times the BCRA limit, and his party contributions are not capped at all. The Amendment also requires self-financing candidates to disclose how much of their own money they plan to spend and to make additional disclosures as their expenditures exceed certain benchmarks. Davis, an unsuccessful self-financed challenger for a congressional seat in 2004 and 2006, argued that the Millionaire’s Amendment violated the First Amendment. The Court agreed, led by Justice Alito. It first rejected two FEC procedural arguments: (1) that Davis lacked standing because his opponent never utilized the Amendment’s asymmetrical funding limits (when Davis filed suit, his opponent had qualified for the higher limits, and this prospective threat of injury was enough to give Davis standing); and (2) that the suit was moot because the election was over (Davis’s claim was capable of repetition since he might run again). On the merits, the Court held that the Amendment impermissibly burdened Davis’s First Amendment right to spend his own money on his campaign, which the Court recognized in Buckley v. Valeo (1976) by invalidating personal expenditure limits. In effect, BCRA forced wealthier candidates to choose between fettering their own speech or giving their opponents a fundraising advantage. The Court found no compelling state interest justifying this burden. Fighting corruption was a recognized interest, but it did not apply here (indeed, allowing personal expenditures should reduce the risk of corruption). The Court rejected any interest in leveling the playing field for poorer candidates, noting that the government cannot restrict the speech of some to enhance the voices of others; candidates have different strengths, wealth among them, and BCRA essentially was making a judgment better left to voters as to which strengths should matter in a campaign. Finally, the Amendment’s disclosure requirements serve to implement the asymmetrical funding scheme, so they too were unconstitutional.

 

There were two dissents on the merits. Justice Stevens (joined by Justices Souter, Ginsburg, and Breyer) argued that the Amendment did not burden speech at all because self-financing candidates could spend as much as they wanted; the law merely helped their opponents get their voices heard, actually enhancing speech. The dissenters also thought that minimizing the effect of wealth on campaigns and reducing the perception that seats were for sale were legitimate state interests justifying the Amendment. In a second part of his dissent (which the others did not join), Stevens argued that the Court should revisit Buckley and allow across-the-board limits on personal campaign expenditures. Ginsburg wrote a separate dissent, joined by Breyer, in which she distanced herself from Stevens’s position on Buckley. (Souter did not join Stevens’s assault on Buckley, but, perhaps out of deference to the most senior Justice, neither did he join Ginsburg’s disclaimer.)

 

Moving on to energy regulation, in Morgan Stanley Capital Group, Inc. v. Public Utility District No. 1 (06-1457), a rare 4-3 majority (the Chief and Justice Breyer sat this one out) held that the Federal Energy Regulatory Commission (FERC) must presume that rates set out in a freely-negotiated wholesale energy contract are “just and reasonable” under the Federal Power Act unless they “seriously harm the public interest.” The case stemmed from the 2000-01 California energy crisis, during which western utilities entered into long-term contracts with suppliers pursuant to “market-based tariffs.” Traditional bilateral energy contracts must be filed with FERC, which by statute can suspend the agreed-upon rates and investigate their reasonableness. Under the “market-based tariff” system, certain sellers (who prove to FERC that they have mitigated their market power) need file only a declaration of intent to enter into market-rate contracts and quarterly reports summarizing those contracts. The contracts themselves are not filed and are outside FERC’s investigative authority. The crisis-era tariff contracts set rates that were high by historical standards ($105/MWh, versus an historical average of $24/MWH), but that were a bargain at the time (some prices hit $3300/MWh). When the dust settled, market rates headed back towards the historical average, and the utilities (surprise, surprise) had second thoughts and asked FERC to declare the rates unjust and unreasonable. FERC refused. On appeal, the Ninth Circuit found flaws in FERC’s analysis and remanded to the agency.

 

Although the Court disagreed with much of the Ninth Circuit’s analysis, it agreed that the case should go back to FERC for review with better guidance, which it tried to provide. Taken together, the FERC and Ninth Circuit decisions revealed confusion on multiple points, including: (1) whether contracts formed pursuant to a market-based tariff, and therefore not filed with FERC for inspection, are entitled to a presumption that they are just and reasonable as soon as they are formed, or only after FERC has reviewed the rates; (2) whether showing that contract rates harm the public interest is different from, and harder than, showing that the rates are unjust and unreasonable; (3) whether purchasers can invalidate rates merely by showing that they exceed a “zone of reasonableness;” (4) whether “market dysfunction” at the time of formation is a sufficient reason for modifying rates; and (5) whether the reasonableness of rates should be assessed only as to the conditions prevailing at the time the contract was made.

 

Assuming (without deciding) that FERC’s “market-based tariff” system was lawful, the four more conservative Justices, led by Justice Scalia, answered “Yes” to the first question and “No” to the rest. First, the presumption of reasonableness (the “Mobile-Sierra presumption,” based on the names of two cases in which it arose) has nothing to do with whether FERC has reviewed the rates; it applies to freely-negotiated contracts from the get-go because the parties are sophisticated businesses enjoying presumptively equal bargaining power. Second, there is only one standard of review for rates – whether they are “just and reasonable”: the “serious harm to the public interest” formulation merely expresses what it means for rates to be unjust and unreasonable in the contract context (as opposed to the tariff system). Third, the just-and-reasonable standard applies equally to challenges by purchasers and sellers and there is no “zone of reasonableness” test. Fourth, the mere fact that markets are imperfect is not a reason to undermine the sanctity of contracts, but where “unlawful market activity” like fraud and duress “directly affects” contract negotiations, the Mobile-Sierra presumption fails. (Justice Ginsburg joined this part of the opinion.) Fifth, changed conditions can matter: Public necessity may justify modifying a contract even if it was reasonable at formation if the disparity between contract rates and post-dysfunction market rates is an “excessive burden” on consumers. (Ginsburg joined this part too.)

 

The dissent – penned by Justice Stevens for himself and Justice Souter – claimed that the Mobile-Sierra presumption “mangles both the governing statute and precedent” and thwarts Congress’s desire “to give FERC, not the courts, wide latitude in setting policy.” Stevens also took issue with the Court’s requirement of “serious harm” to the public interest, asserting that public interest was “shorthand” for consumers’ interest in paying the lowest possible reasonable rate consistent with adequate service. FERC should not, “through the expedient of a heavy-handed presumption,” ignore even “a small dent in the consumer’s pocket.”

 

In addition to the death-penalty ruling in Kennedy v. Louisiana, the Court issued two decisions in criminal cases last week. In Giles v. California (07-6053), the Court fielded yet another question about the application of hearsay rules in criminal cases in the wake of Crawford v. Washington (2004), which held instead that the Sixth Amendment bars out-of-court statements of a “testimonial” nature (don’t ask) unless there was an applicable exception to the right to confront witnesses recognized at the time of the founding. (Crawford overturned the understanding that out-of-court statements falling within a firmly-established hearsay exception could be admitted without violating the Confrontation Clause.) Before the Court issued Crawford, Giles was convicted for murdering his girlfriend (he argued self-defense). During the trial, the court admitted the girlfriend’s accusations of domestic violence made to police three weeks before her death, relying on a state law allowing the use out-of-court statements describing the infliction or threat of physical injury on an unavailable declarant. Crawford came down while Giles’s appeal was pending, but California’s appellate courts reasoned that admitting the statements was still proper under the doctrine of “forfeiture by wrongdoing.” If Giles killed his girlfriend, he was the reason she was unavailable to testify, and so he should not be able to invoke the Confrontation Clause to keep her statements out of evidence. Writing for a 6-3 majority, Justice Scalia agreed that forfeiture by wrongdoing was “an exception to the confrontation right recognized at the time of founding,” but concluded that the California courts had misapplied the doctrine. The Confrontation Clause permits admission of unconfronted testimonial statements by an unavailable witness only if the defendant committed a wrongful act causing her unavailability and did so with the purpose of keeping her off the stand. (That is, killing the person is not enough, you need to kill her to stop her from testifying.) The Court then hastened to explain why its opinion would not make it easy for domestic abusers to get away with murder: Where “an abusive relationship culminates in murder, the evidence may support a finding that the crime expressed the intent to isolate the victim and to stop her from reporting abuse to the authorities or cooperating with a criminal prosecution – rendering her prior statements admissible under the forfeiture doctrine.”

 

Justices Alito and Thomas agreed with the Court’s analysis of forfeiture by wrongdoing, but wrote briefly to express the view that the girlfriend’s statements were not “testimonial” and did not pose a confrontation problem at all. Justices Souter and Ginsburg teamed up to declare that they would ground the requirement for proof of specific intent (killing to stop testimony) in equity, rather than in Founding-era cases not “calibrated finely enough to answer th[at] narrow question.” The dissenters – Justices Breyer, Kennedy and Stevens – vigorously disagreed with requiring proof of an intent to stop testimony, disputing the majority’s reading of the case law and warning that the new rule will create evidentiary “anomalies” and “incongruities.” For them, Giles knew that murdering his ex-girlfriend would keep her from testifying, and that knowledge was enough “to show the intent that law ordinarily demands.” (In the one part of Scalia’s opinion that Souter and Ginsburg did not join – but which the Chief, Thomas, and Alito did join – Scalia attacked the dissent for “issuing a thinly veiled invitation to overrule Crawford” and reiterated that the Sixth Amendment “does not suggest any open-ended exceptions from the confrontation requirement to be developed by the courts.”)

 

Last up, the Court held in Rothgery v. Gillespie County (07-440) that the Sixth Amendment right to counsel “attaches” at the advent of adversarial judicial proceedings, including an initial hearing where a defendant is informed of the charges against him and is subject to deprivation of liberty. The holding, however, is narrower than it may appear: The Court only addressed when the right “attaches,” specifically declining to discuss the scope of the right (i.e., when the defendant is actually entitled to the assistance of counsel). Rothgery was arrested as a felon in possession of a firearm based on erroneous information that he had a prior felony conviction. He was brought before a Texas magistrate for an “article 15.17 hearing,” at which the magistrate found probable cause for the arrest, informed Rothgery of the charge against him, set bail and committed Rothgery to jail. The prosecutor was not present (and was not even aware of the proceeding). Rothgery, who was indigent, repeatedly asked for counsel during and after the hearing, to no avail. After six months of further procedural wrangling (including a formal indictment and Rothgery’s spending three weeks in jail), Rothgery was eventually appointed counsel, who got the charges dismissed. Rothgery filed a Section 1983 action contending that if Texas had provided counsel within a reasonable time after the article 15.17 hearing, he would not have been indicted and jailed. The district court dismissed and the Fifth Circuit affirmed, finding that the right to counsel did not attach at the article 15.17 hearing because, since the prosecutor was not aware of the hearing, there was no formal commitment by the State to prosecute him.

 

The Court reversed, in an opinion drafted by Justice Souter and joined by all but Justice Thomas. In Brewer v. Williams (1977) and Michigan v. Jackson (1986), the Court had held that the right to counsel attaches at the “initial appearance before a judicial officer.” When a defendant is brought before a judge or magistrate, informed of the charges against him, and has restrictions imposed on his liberty, the State’s relationship with him has become “solidly adversarial.” The overwhelming majority of jurisdictions appoint counsel before, at, or shortly after such a hearing. Rothgery’s right to counsel thus attached at the article 15.17 hearing, and he was entitled to counsel within a “reasonable time” thereafter. The Court, however, declined to determine whether the six-month delay in appointing counsel prejudiced Rothgery’s Sixth Amendment right. Justice Alito concurred, in an opinion joined by the Chief and Justice Scalia, to stress the narrowness of the Court’s holding. “Attachment” refers only to the start of prosecution, and does not amount to an immediate substantive right to counsel. Whether a defendant is entitled to the active participation of counsel at a given pretrial proceeding depends on whether it is a “critical stage” where substantial prejudice could occur to a defendant’s rights. Generally, an initial probable-cause hearing at which no plea is taken would not qualify.

 

Justice Thomas dissented. Ever true to his history-based approach, Thomas attempted to discern what proceedings were covered by the Sixth Amendment when it was enacted. His conclusion: the type of pretrial hearings at issue here – where no confrontation occurred and no permanent consequences flowed –were not covered. Finally, the Chief, joined by Scalia, concurred to note that they found Thomas’s analysis compelling, but not sufficiently so to override Brewer and Michigan.

 

The Court’s final order list of the Term included cert grants in two new cases. In the consolidated cases of Coeur Alaska, Inc. v. Southeast Alaska Conservation Council (07-984) and Alaska v. Southeast Alaska Conservation Council (07-990), the Court will take up yet another question of agency deference in the context of environmental regulations. The wordy question presented is: Whether the Ninth Circuit erred in invalidating the longstanding regulatory interpretation of the U.S. Army Corps of Engineers (the “Corps”) and the Environmental Protection Agency (“EPA”) that discharges of dredged or fill material are subject to the exclusive permitting authority of the Corps under Section 404 of the Clean Water Act, rather than effluent limitations and standards of performance promulgated under Sections 301 and 306 and applied by EPA pursuant to its separate permitting authority under Section 402.

 

Finally, in Knowles v. Mirzayance (07-1315) the Court will get a second crack at a habeas petition claiming that defense counsel was ineffective in advising the petitioner to withdraw his not-guilty-by-reason-of-insanity plea. The Ninth Circuit had granted relief, but the Court sent the case back for further review in light of Carey v. Musladin (2006), which adopted a strict view of the “clearly established law” that must be violated for habeas relief to be warranted. On remand, the Ninth Circuit conceded that “no Supreme Court case has specifically addressed a counsel’s failure to advance the defendant’s only affirmative defense” but still granted relief. The questions presented are: (1) Did the Ninth Circuit again exceed its authority under § 2254(d) by granting habeas relief without considering whether the state-court adjudication of the claim was “unreasonable” under “clearly established Federal law” based on its previous conclusion that trial counsel was required to proceed with an affirmative insanity defense because it was the only defense available and despite the absence of a Supreme Court decision addressing the point? (2) May a federal appellate court substitute its own factual findings and credibility determinations for those of a district court without determining whether the district court’s findings were “clearly erroneous?”

 

So . . . you’ve made it all the way to the end of a very lengthy Update, and to the end of yet another Term. We’ve enjoyed sharing the Term with all of you and, as always, welcome your comments and suggestions. We’ll be back later this summer with our annual Term in Review, bringing you our views on the highs and lows of the Term as well as a compilation of the Term’s summaries.

 

Thanks again, as always, for reading!

 

Kim & Ken

From the Appellate Practice Group at Wiggin and Dana
For more information, contact Kim Rinehart, Ken Heath, or any other member of the Practice Group at 203-498-4400