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Greetings, Court Fans!

It’s the First Monday of June, meaning the Court’s about to step on the gas with respect to decisions. Despite the Court’s somewhat lethargic output to date, we’ve still managed to find ourselves buried beneath a pile of decisions. Here’s a quick run-down, beginning with the most recently decided:

• In Cantero v. Bank of America (No. 22-529), the Court unanimously clarified that the standard for determining whether a state law that regulates national banks is preempted is whether the law “prevents or significantly interferes with the exercise by the national bank of its powers.”
• In National Rifle Association v. Vullo (No. 22-842), the Court unanimously held that (assuming the truth of the NRA’s allegations) the former Commissioner of the New York Department of Financial Services violated the First Amendment by coercing regulated entities to terminate their business relationships with the NRA in order to punish or suppress its pro-gun viewpoint.
• In Thornell v. Jones (No. 22-982), a 6-3 Court reversed a decision of the Ninth Circuit granting habeas relief to an Arizona death-row inmate, concluding inmate’s former counsel’s failure to present certain mitigating evidence did not rise to the level of ineffective assistance of counsel because that evidence was unlikely to have affected the death sentence.
• In Coinbase v. Suski (No. 23-3), the Court unanimously held that, where parties have agreed to two contracts with contradictory directions on arbitrability, it is up to a court, not an arbitrator, to decide which contract controls.
• In Brown v. United States (No. 22-6389), the Court held (6-3, with an interesting breakdown) that, for purposes of the Armed Career Criminal Act, a state crime constitutes a “serious drug offense” if it involved a drug that was on the federal drug schedules when the defendant possessed or trafficked in it, even if it was later removed.
• In Alexander v. South Carolina State Conference of the NAACP (No. 22-807), a more typical 6-3 majority upheld South Carolina’s redrawing of District 1 against a racial-gerrymandering challenge, in the process making racial-gerrymandering suits much more difficult for challengers;
• In Harrow v. Department of Defense (No. 23-21), the Court unanimously held that the 60-day deadline for appealing decisions of the Merit Systems Protection Board is not jurisdictional;
• In Smith v. Spizzirri (No. 22-1218), the Court unanimously held that, when a district court finds that a lawsuit involves an arbitrable dispute and a party requests a stay of the litigation pending arbitration, the Federal Arbitration Act requires the Court to issue a stay, rather than dismiss the suit;
• In Consumer Financial Protection Bureau v. Community Financial Services Assn. of America (No. 22-448), the Court held (7-2) that the CFPB’s funding mechanism satisfies the Constitution’s Appropriations Clause;
• In Culley v. Marshall (No. 22-585), the Court held (6-3) that, in civil forfeiture cases involving personal property, the Due Process Clause does require a “timely” forfeiture hearing, but it does not require a separate preliminary hearing;
• And in Warner Chappell Music, Inc. v. Nealy (No. 22-1078), the Court held (again 6-3) that the Copyright Act entitles copyright owners to monetary relief for any timely infringement claim, regardless of when the infringement itself occurred.

We’ll begin digging out today with summaries of CFPB, Vullo, Warner Chappell, and Culley. Stay tuned throughout the week as we chip away at the backlog and try to keep up with decisions likely to be announced on Thursday.

We’ll start with Consumer Financial Protection Bureau v. Community Financial Services Association of America, Ltd. (No. 22-448), one of the big administrative-law decisions of the term. There, a 7-2 majority of the Court reversed a Fifth Circuit panel’s conclusion that the funding structure of the Consumer Financial Protection Bureau (CFPB) violated the Constitution’s Appropriations Clause, a decision that threatened to derail just about everything the CFPB has done in the decade and a half since its creation. Justice Thomas’s majority decision finding for the CFPB, which focuses on the Founding Era understanding of the Appropriations Clause, is significant in its own right, as it amounts to essentially the first Supreme Court analysis as to the meaning of the Clause. But perhaps even more important is Justice Kagan’s concurrence, where she and the unusual group of Justices Sotomayor, Kavanaugh, and Barrett conclude that “long-settled and established practice” in the two centuries of U.S. history since the founding is also highly relevant and leads to the same place as Thomas’s purely founding-centric approach. Is that concurrence meant to send a message to lower courts (we’re talking about you, Fifth Circuit) that they should be more reluctant to call into question the validity of federal statutes based on a strict originalist methodology? Is it a hint at how these Justices (two of whom we would categorize as part of the Court’s current three-justice-median vote) might come out in some of Court’s other closely watched administrative-law cases? Only time will tell.

Following the 2008 financial crisis, Congress enacted the Dodd-Frank Wall Street Reform and Consumer Protection Act. Among Dodd-Frank’s many components was the creation of the CFPB, a new agency tasked with regulating financial products and services available to ordinary consumers. The creators of the CFPB (largely Senator Elizabeth Warren) were concerned that this new agency would be unduly responsive to political influence, so they structured the agency in several unusual ways to give it greater independence. A prior Supreme Court decision, Seila Law LLC v. Consumer Financial Protection Bureau (2020), invalidated one of those independence-creating mechanisms: the removal protections Dodd-Frank gave to the CFPB’s director. This case concerned another: the agency’s funding structure. You see, unlike most agencies, which are funded by annual appropriations bills giving the agency a precise budget for the coming year, the CFPB is empowered to “requisition” the amount “determined by [its] director to be reasonably necessary” to carry out its duties directly from the Federal Reserve, which provides the requisitioned amount out of the fees it charges banks for Fed deposits. But while the director has the discretion to decide how much to request, Congress established an inflation-adjusted cap on the agency’s annual requisition, which in 2022 amounted to about $734 million.

Since its creation roughly fifteen years ago, the CFPB has discharged its statutory duties by (among other things) enacting regulations that prohibit banks, credit-card companies, and other lenders from engaging in certain practices. This case arises from one of those regulations, a 2017 regulation that prevents payday lenders from placing a third automatic withdrawal on a customer’s account after two unsuccessful withdrawal attempts. Payday lending companies and trade associations didn’t like that rule, so they challenged it on various grounds. One of those grounds was that the CFPB’s funding mechanism violated the Constitution’s Appropriations Clause, which provides that “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law.” The District Court rejected that argument, concluding that the Clause only requires an act of Congress authorizing the appropriation, which Dodd-Frank itself provided, as it authorized the agency to requisition money each year in the manner discussed above. But the Fifth Circuit reversed, reasoning that the Appropriations Clause essentially requires a law appropriating a specific amount of money to fund the agency over a defined time period. And because the CFPB’s promulgation of this rule came about as a direct result of the money it obtained through this unconstitutional funding mechanism, the Fifth Circuit also invalidated the payday lending rule itself. Because the Fifth Circuit’s holding as to both the Appropriations Clause and the remedy for any Appropriations Clause violation threatened to unravel just about everything the CFPB had done since its creation, the Court granted cert to review both issues.

Writing for a seven Justice majority (all but Justices Alito and Gorsuch), Justice Thomas reversed, focusing on what the Founders understood the Appropriations Clause to mean. Textually, the Clause doesn’t say much: It says only that money can’t be paid out of the Treasury unless appropriated by an act of Congress. To the extent the Court’s prior decisions had addressed the Clause’s meaning at all (and to be honest, they really hadn’t except in dicta), they had assumed that all the Clause really requires is that there be some statute authorizing the appropriation; the Court had never previously suggested that the appropriation must take any particular form. But now the payday lenders (and the Fifth Circuit) asked the Court to do just that, arguing that the basic purpose of the Appropriations Clause was to give Congress the power of the purse, and no matter where exactly one sets the boundary between permissible and impermissible appropriations, the discretionary and open-ended appropriation to the agency authorized by Dodd-Frank was too broad to count as an “Appropriation made by Law.”

Justice Thomas concluded that nothing in the Constitution’s text, history, or the congressional practice immediately after ratification supported this more restrictive interpretation. At the time of ratification, “appropriation” simply meant a law authorizing the expenditure of funds for a particular purpose; nothing in the ordinary meaning of those words denoted a particular form a bill must take in order to be classed as an “appropriation.” And pre-founding practice suggests nobody understood “appropriations” as having to be time-limited or of defined amounts: Both in England and in the colonies, legislatures frequently appropriated money through open-ended and discretionary laws. Were there any doubt remaining, the practice of the First Congress would settle it: Just as with the CPFB, that Congress enacted several laws that appropriated an undefined amount money to the executive branch for certain purposes up to a certain cap, leaving the executive with discretion to decide how much of that cap to draw. Also similar to the CFPB: The early Congress chose to fund some agencies not by appropriating money directly from the Treasury but instead using a fee-based model tied to the agency’s activities. Thus, while the CFPB’s funding mechanism may be open-ended and somewhat discretionary, and the money may come from fees charged by the Federal Reserve rather than directly from taxpayers, those features of the CFPB’s funding scheme are supported by historical practice. The Court thus reversed the Fifth Circuit’s conclusion that the CFPB’s funding scheme violated the Appropriations Clause, and with it, its conclusion that the payday lending rule issued as a result of that scheme was invalid.

Justice Kagan wrote a short concurrence, joined by Justices Sotomayor, Kavanaugh, and Barrett. And as we suggested above, given that Appropriations Clause hasn’t historically been the focus of much constitutional litigation (this, after all, is more or less the first case ever on what it means), we suggest that what this concurrence suggests about constitutional methodology more generally may end up being the lasting legacy of CFPB. That’s because unlike Justice Thomas’s majority decision, which looked only at what the Founders would have thought the Appropriations Clause meant, Kagan and her fellow concurrers looked at what “long settled and established practice” in the centuries since ratification had to say about the meaning of the Appropriations Clause. That history shows countless examples of Congress authorizing open-ended appropriations (both in duration and in amount). And that practice was particularly common “in the sphere of financial regulation,” where Congress has authorized all sorts of agencies to be funded through fees they generate out of their ordinary activities. While it is perhaps not surprising that Justices Kagan and Sotomayor would give weight to Congress’s historical practice in the post-founding era as a guide to what the Constitution means, it is a bit striking that two more moderate conservatives—Justices Kavanaugh and Barrett—would join in with this less originalist approach. Does that suggest that these Justices—at least one of whom would be required to form any conservative majority—might take a skeptical eye toward other challenges to established legislative or agency practices based on purely originalist approaches (such as in the yet-to-be decided Jarkesy case)? We might know by the end of June.

Justice Jackson also concurred, writing only for herself. She agreed with the majority that the plain meaning of “appropriation” is “simply a law that authorizes expenditures from a specific source of money for designated purposes.” And because the statute creating the CFPB met that definition, she would stop with the plain text. To go further, by reviewing the history of how “appropriation” was understood before, during, and immediately after ratification, suggests that any limits one might draw from that history on the form an appropriation must take are baked into the Appropriations Clause. And that itself may run afoul of separation of powers by inserting the judiciary into the legislative branch’s power to decide exactly how best to structure appropriations.

Justice Alito, joined by Justice Gorsuch, dissented, in an opinion about as long as the majority opinion and the concurrences combined. Focusing largely on “the British experience”—that is, the struggle between Parliament and the Crown in the 17^th and 18^th Centuries over the power of the purse—he contended that by the time of ratification, “appropriation” had acquired a specialized legal meaning, best understood as authorizing the spending of a designated amount of money for a specific purpose within a time-limited (often single-year) window. That understanding is reinforced by contemporary practice, as before, during, and shortly after ratification, both state and federal legislatures overwhelmingly appropriated funds in just this manner. And while there were some exceptions—exceptions the majority relied heavily on—Alito viewed those exceptions as limited to contexts where agencies were funded with fees they charged in exchange for services they provided to the public. Applying that historical standard, the CFPB’s funding scheme fails, because the statute authorizing an appropriation of money to it is (1) perpetual; (2) discretionary; (3) consists of funds that come to the CFPB from other entities, which in turn draw them from private parties rather than the government; and (4) the CFPB is not required to return any unused funds to the Treasury, but can instead set them aside to fund future operations (as a quasi-endowment). While certain aspects of that funding structure may have historical analogs, Alito saw no parallel for an agency (particularly one as powerful as the CFPB) having the whole set. So without precisely defining just what it was in this group of features that made the CFPB’s funding mechanism unconstitutional, Alito would have hold that the amount of autonomy it gave the agency from Congress could not be squared with the congressional power of the purse embodied in the Appropriations Clause.

Next up is NRA v. Vullo (22-842), where the Court unanimously (albeit with a couple noteworthy concurrences) concluded that the superintendent of New York’s Department of Financial Services (DFS) violated the First Amendment by coercing regulated entities to terminate their business relationships with the NRA in order to punish or suppress its gun-promotion advocacy—at least if the allegations in the NRA’s complaint are true….

In that complaint, the NRA alleged that, in 2017, Maria Vullo, the former superintendent of DFS, began investigating its “affinity insurance policies,” which were offered to NRA members and underwritten by the Chubb and Lloyd’s insurance groups. Initially, the investigation focused on a particular policy (“Carry Guard”) that provided coverage for personal-injury and criminal-defense costs related to licensed firearms use. But after the February 2018 mass shooting in Parkland, Florida, Vullo began pressuring insurance companies to cut ties with the NRA in order to guard against “reputational risk.” The NRA alleged that Vullo met with senior executives at Lloyds a few weeks after the Parkland tragedy and “discussed an array of technical regulatory infractions plaguing the affinity-insurance marketplace,” while stating “that DFS was less interested in pursuing … infractions” unrelated to NRA business “so long as Lloyd’s ceased providing insurance to gun groups, especially the NRA.” Lloyd’s agreed to cease underwriting firearm-related policies in exchange for DFS focusing “its forthcoming affinity-insurance enforcement action solely on those syndicates which served the NRA.” Later, DFS issued guidance letters specifically encouraging insurance companies and other regulated entities to “review any relationships they have with the NRA or similar gun promotion organizations” and “take prompt actions to manage[] these risks.” A few weeks later, DFS entered into consent decrees with Chubb and a broker that managed the NRA’s affinity policies.

The NRA sued Vullo, alleging that she violated the First Amendment by coercing DFS-regulated parties to punish or suppress “the NRA’s pro-Second Amendment viewpoint.” The Complaint asserted both “censorship” and “retaliation” claims, though the parties and lower courts analyzed them together (a point to which a concurring opinion returned). Vullo moved to dismiss, arguing both that her alleged conduct did not constitute impermissible coercion and that, in the alternative, she was entitled to qualified immunity. The District Court denied the motion to dismiss, but the Second Circuit (on Vullo’s interlocutory appeal) reversed. It concluded that Vullo’s actions were permissible government speech and law-enforcement action, not unconstitutional coercion. The NRA filed a petition for certiorari specifically asking the Supreme Court to summarily reverse the Second Circuit. The Court granted cert, but only on the question whether the NRA had stated a First Amendment claim, not whether qualified immunity should apply.

The Court reversed the Second Circuit, in a unanimous opinion authored by Justice Sotomayor. As she noted, while government officials are free to engage in their own expressive conduct, they may not cross the line into using government power to punish or suppress disfavored opinions. That line was drawn in the Court’s 1963 decision in Bantam Books v. Sullivan, a decision the Court expressly reaffirmed. To state a claim for unlawful coercion under Bantam Books, a plaintiff must plausibly allege conduct that, viewed in context, could be reasonably understood to convey a threat of adverse government action in order to punish or suppress speech. While Sotomayor noted that lower courts have tended to apply a “multi-factor” tests to determine whether government communications could reasonably be understood to be coercive, she stressed that the ultimate rule is simply that “[a] government official cannot coerce a private party to punish or suppress disfavored speech on her behalf.”

Applying the Bantam Books standard, Justice Sotomayor found that the NRA had plausibly stated a coercion claim. Vullo had direct regulatory and enforcement authority over the insurance companies that did business with the NRA and had the power to investigate and sanction them or refer them for prosecution. Taking the NRA’s allegations as true, by telling Lloyd’s that DFS would “focus” enforcement actions “solely” on syndicates with ties to the NRA “and ignore other syndicates” that may be guilty of the same regulatory infractions, Vullo was sending a clearly coercive message: Cut ties with the NRA (and therefor effectively punish it for its viewpoint) or face adverse government action. The fact that Lloyd’s and Chubb did cut ties with the NRA only underscored that Vullo’s communications—whether seen as a threat or an inducement—were reasonably understood as coercive. The Second Circuit had reached a different conclusion, Sotomayor suggested, only because it failed to draw reasonable inferences in the NRA’s favor, as required on a motion to dismiss, and evaluated each of the complaint’s allegations in isolation rather than looking at the whole picture of alleged coercion in context.

Although the Court unanimously agreed that the NRA had stated a plausible claim, Justice Sotomayor stressed that the Court was not suggesting it could ultimately prevail on these claims. In particular, there remains a question on remand whether Vullo should be entitled to qualified immunity. Finally, Sotomayor emphasized that nothing in the Court’s opinion immunized the NRA from regulation or precluded government officials from expressing their disapproval of its views.

Two concurring opinions offered some additional insights on how this type of case should be addressed going forward. Justice Gorsuch wrote separately to stress that the “multifactor test” that the Second Circuit applied below may have led it astray. While multifactor tests can serve as a “useful, though nonexhaustive, guide,” here “the Second Circuit’s decision to break up its analysis into discrete parts and take the complaint’s allegations in isolation appears only to have contributed to its mistaken conclusion that the [NRA] failed to state a claim.” Gorsuch therefore urged lower courts to “heed this Court’s directive: Whatever value these ‘guideposts’ serve, they remain ‘just’ that and nothing more. Ultimately, the critical question is whether the plaintiff has plausibly alleged conduct that, viewed in context, could be reasonably understood to convey a threat of adverse government action in order to punish or suppress the plaintiff’s speech.”

Justice Jackson also concurred separately, as the only Justice to zero in on “the important distinction between government coercion, on the one hand, and a violation of the First Amendment, on the other.” In Jackson’s view, while the Government can violate the First Amendment through “coercion,” “the fact of coercion, without more, does not state a First Amendment claim.” It is not enough, in her view, to show that the Government crossed a line from persuasion to coercion; instead, courts must also assess “how that coercion actually violates a speaker’s First Amendment rights.” In some cases, the violation flows obviously from the coercion, as in Bantam Books where the government commission coerced book distributors into pulling certain publications from circulation, thereby violating the First Amendment rights of the books’ publishers and authors. As Jackson summarized: “Coercing an entity in the business of disseminating speech to stop disseminating someone else’s speech obviously implicates the First Amendment, insofar as it may result in censorship similar to the prior restraint identified in Bantam Books.” However, that “censorship” theory did not neatly fit the facts of the NRA’s complaint. The NRA did not allege that its insurance partners stopped disseminating its speech as a result of Vullo’s coercion; only that it was somehow punished for its views. In Jackson’s view, that made this case more of a retaliation case than a censorship case. However, “the lower courts in this case lumped these claims together and ultimately focused almost exclusively on whether Vullo’s conduct was coercive.” Jackson concurred in the Court’s opinion because the NRA had squarely raised a retaliation claim in its complaint; but she urged the parties and lower courts to “consider the censorship and retaliation theories independently” on remand, “mindful of the distinction between government coercion and the ways in which such coercion might (or might not) have violated the NRA’s constitutional rights.”

Turning now to Warner Chappell Music, Inc. v. Nealy (No. 22-1078), a quirky little case (the lead opinion is less than seven pages) holding that if the “discovery rule” applies to claims under the Copyright Act (an antecedent question the Court refused to consider), then there is no separate bar on a copyright owner obtaining monetary relief for alleged acts of infringement occurring outside the Act’s three-year limitation period.

The Copyright Act requires plaintiffs to file suit “within three years after the claim accrued.” That might mean that a claim must be brought within three years of an infringing act. But under the so-called discovery rule, a claim only accrues when “the plaintiff discovers, or with due diligence should have discovered,” the infringing act. The Supreme Court has never addressed whether the discovery rule in fact applies to claims under the Copyright Act, but most lower courts have assumed that it does, including the Eleventh Circuit, in which Respondent Sherman Nealy filed suit in 2018, alleging that Warner Chappell (Warner) had infringed copyrights that he held to various songs, dating back to 2008. Nealy alleged that he only learned of the infringements in 2016 (after his release from the second of two prison spells), so his claims were timely under the discovery rule. Warner did not challenge the application of the discovery rule but argued that even if Nealy could sue for infringements occurring more than three years before filing his complaint, he could only recover damages for infringements within the three-year limitations period. The District Court agreed, but the Eleventh Circuit (in a certified interlocutory appeal) reversed, concluding there was no separate three-year damages bar. In so doing, the Eleventh Circuit aligned itself with the Ninth Circuit and against the Second Circuit in a split over whether the Copyright Act precludes damages for infringements outside the limitations period.

Warner filed a petition for certiorari, asking the Court “whether the Copyright Act’s statute of limitations for civil actions precludes retrospective relief for acts that occurred more than three years before filing a lawsuit.” The Court granted cert, but reformulated the question to ask “[w]hether, under the discovery accrual rule applied by the circuit courts,” a copyright plaintiff “can recover damages for acts that allegedly occurred more than three years before the filing of a lawsuit.” Wiggin and Dana represented several artists’ rights groups in an amicus brief supporting Nealy’s position.

In a 6-3 decision, the Court answered that reformulated question in the affirmative, thereby affirming the Eleventh Circuit. Writing for the majority, Justice Kagan began by reminding everyone that the Court had reformulated the question to assume that the discovery rule generally applies to claims under the Copyright Act. Although the Court has never actually decided that question, Kagan insisted that it was “not properly presented here, because Warner Chappell never challenged the Eleventh Circuit’s use of the discovery rule below.” She therefore took Warner to task for “[d]isregarding the limit in the reformulated question’ and focusing its merits briefing “almost entirely on the discovery rule itself.” Turning to the narrow question on which the Court had granted cert, Kagan concluded that the Copyright Act “establishes no separate three-year period for recovering damages,” apart from the three-year “time-to-sue prescription.”

The Second Circuit’s contrary position, Kagan contended, lacks textual support and “is essentially self-defeating.” “With one hand, that court recognizes a discovery rule, thus enabling some copyright owners to sue for infringing acts occurring more than three years earlier. And with the other hand, the court takes away the value in what it has conferred, by preventing the recovery of damages for those older infringements.” Kagan rejected the idea that the Court’s decision in Petrella v. Metro-Goldwyn-Mayer, Inc. (2014) provided a basis for the Second Circuit’s rule. Though Petrella did say that the Copyright Act’s statute of limitations allows plaintiffs “to gain retrospective relief running only three years back from” the filing of suit, in context that statement was limited to situations in which a plaintiff “has no timely claims for infringing acts more than three years old.” That was the case for Petrella (who always knew about her claims), but not for Nealy (who invoked the discovery rule). In sum: If the discovery rule is legit, then it permits plaintiffs not only to raise infringement claims outside the limitations period, but also to collect damages for them.

Justice Gorsuch (joined by Justices Thomas and Alito) dissented, though his dissent was not focused so much on the majority’s answer to its reformulated question, but rather on why the Court was side-stepping the “logically antecedent question whether the [Copyright] Act” even permits the discovery rule in the first place. In Gorsuch’s view, the Act “almost certainly does not tolerate a discovery rule,” so it makes little sense for the Court to continue assuming, without deciding, that the rule applies. While Gorsuch acknowledged that the parties did not challenge the discovery rule below, he insisted that “[n]othing requires us to play along with these particular parties and expound on the details of a rule of law that they may assume but very likely does not exist.” He would have dismissed the petition as improvidently granted and awaited another that squarely presents the question whether the discovery rule properly applies under the Copyright Act to begin with.

Finally, in Culley v. Marshall (No. 22-585), the Court addressed whether Alabama violated the Due Process Clause by not providing the petitioners with a preliminary merits hearing when it commenced forfeiture proceedings to seize cars used in the commission of a drug offense. By a vote of 6-3, the Court held that the Due Process Clause does not require that sort of preliminary hearing, so long as the state provides a prompt hearing later.

The case began when petitioner Halima Culley loaned one of her cars to her college-aged son. While driving the car, he was stopped by Alabama police officers, who found marijuana and a handgun in the car, so they seized the vehicle incident to the son’s arrest. Around the same time, petitioner Lena Sutton loaned her car to a friend. It too was stopped by Alabama police officers, who found a large amount of methamphetamine. As with Culley, they seized the car incident to the arrest of the driver.

At the time of the seizures, Alabama law authorized the civil forfeiture of a car used to commit or facilitate a drug crime. The statutes also empowered officers to seize a car “incident to an arrest,” so long as they “promptly” initiated a forfeiture case. In both cases, Alabama filed forfeiture proceedings within a few days of the cars’ seizures. But both Culley and Sutton took a long time to respond to the complaints and to raise the “innocent owner defense” provided for in Alabama’s statute. While both petitioners ultimately prevailed on that defense, their delays in responding meant they didn’t recover their cars until more than a year after their initial seizures.

While their forfeiture cases were still ongoing (and before their cars had been recovered), Culley and Sutton filed purported class-action complaints in federal court, alleging that Alabama officials violated their due process rights by retaining their cars during forfeiture proceedings without holding preliminary hearings. Both District Courts where their suits were filed granted judgment to Alabama, concluding that while the Due Process Clause requires Alabama to provide a timely forfeiture hearing, it didn’t need to provide a separate preliminary hearing to retain the cars during proceedings. The Eleventh Circuit soon affirmed, but in doing so, it created a circuit split, as two other circuits have held that due process does require a preliminary hearing.

The Court affirmed the Eleventh Circuit’s approach in a 6-3 opinion written by Justice Kavanaugh. He began by clarifying what he (but not all) saw as the issue: All agree that due process requires the state to provide a timely post-seizure forfeiture hearing. In this case, though, Culley and Sutton did not challenge the timeliness of their forfeiture hearings (presumably because their own conduct contributed to the delay). Rather, they argued only that the Due Process Clause required a separate preliminary hearing soon after forfeiture proceedings were commenced, at which the State would have to demonstrate a likelihood of success in order to retain the vehicle during later proceedings.

Having clarified the question, Kavanaugh quickly concluded it was already answered by the Court’s decisions in United States v. $8,850 (1983) and United States v. Von Neumann (1986). Those cases, each of which involved seizure of personal property, held (at least in the majority’s view) that a timely forfeiture hearing “satisfies any due process right,” precluding the argument that due process also requires a preliminary hearing. And even if those cases weren’t controlling, Kavanaugh concluded that the Court’s general standard for deciding when additional process is due—Matthews v. Eldridge (1976)—would similarly counsel that a single, timely forfeiture hearing was enough. He also found historical support for this result, as since the Founding, state and federal statutes have generally authorized the seizure of personal property without providing for a separate preliminary hearing.

Justice Gorsuch, joined by Justice Thomas, concurred, in an opinion nearly as long as Kavanaugh’s majority opinion. They agreed with the majority that the Due Process Clause requires a prompt hearing in civil forfeiture cases and concluded that no legal authority required the government to furnish an adversarial merits hearing of the sort proposed by petitioners. But they also questioned whether modern civil forfeiture practices, such as the ones at play in Alabama, can be squared with due process more generally. As he noted, as part of the War on Drugs in the 1970s and 80s, civil forfeiture regimes became commonplace, allowing the government to seize vast amounts of personal property, which is often used to fund government operations. Both these regimes in general and the details of how they operate do not seem to fit with the traditional due process protections guaranteed by the Constitution. But because the petitioners did not litigate the case as a full-out assault on Alabama’s civil-forfeiture law, Gorsuch would let future cases probe those issues.

Justice Sotomayor (the author of the conflicting Second Circuit decision) dissented, joined by Justices Kagan and Jackson. After documenting the drastic expansion of civil forfeiture in recent decades, she characterized the issue in the case differently from Justice Kavanaugh’s majority opinion. Rather than deciding whether the Due Process Clause requires a preliminary hearing, the dissenters noted that the Court granted cert simply to decide which constitutional test governs the analysis: The “speedy trial” test used in $8,850 and Von Neumann or the three-part due process analysis of Mathews v. Eldridge. On that point, she found the majority’s reliance on $8,850 and Von Neumann unpersuasive, because those cases only addressed the argument that the government took too long to provide a post-forfeiture hearing. And while the majority suggested those cases held a prompt hearing was all that due process required, Sotomayor thought that dicta was taken out of context. Confining herself just to the question presented, then, she would have held that Culley and Sutton’s claims were governed by the Matthews v. Eldridge test and would have remanded the cases so the lower courts could decide how that standard applied to the specifics of Alabama’s civil-forfeiture laws.