Publications

Greetings, Court Fans!

Hope you enjoyed a meaningful Juneteenth! We’re back with summaries of some of last week’s decisions:

• Health & Hospital Corp. of Marion County v. Talevski (No. 21-806), where the Court held that §1983 allows plaintiffs to enforce rights created by the Federal Nursing Home Reform Act, even though that legislation was enacted under Congress’s spending power;

• Lac du Flambeau Band of Lake Superior Chippewa Indians v. Coughlin (No. 22-227), where the Court held that the Bankruptcy Code abrogates the sovereign immunity of all governments, including federally recognized Indian tribes; and

• Smith v. United States (No. 21-1576), where a unanimous Court held that a criminal defendant may be re-prosecuted in the right venue after being convicted in the wrong one.

We’ll be back later this week to summarize the rest of last week’s bounty. We’re also expecting the Court to issue additional decisions this week on Thursday and Friday, so keep an eye out for a quick rundown of those cases.

First up is Health & Hospital Corp. of Marion County v. Talevski (No. 21-806), where the Court beat back an attempt to narrow the scope of §1983, reaffirming that private plaintiffs can use the civil-rights law to enforce federal statutory rights created under the Spending Clause.

Enacted as the Civil Rights Act of 1871, §1983 provides that “[e]very person who, under color of [state law], subjects … any citizen of the United States … to the deprivation of any rights, privileges or immunities and laws, shall be liable to the party injured in an action at law.” Private plaintiffs commonly use §1983 to enforce constitutional rights, but the Constitution is not the only source of federal “laws.” The Court has thus long held that statutes that “unambiguously” create federal rights can be enforced by private parties under §1983, so long as private enforcement does not interfere with other statutorily designed enforcement mechanisms. In Maine v. Thiboutot (1981), the Court rejected an argument that “laws” enacted pursuant to Congress’s spending power fall outside §1983, because they are akin to a contract and hence not enforceable by third-party beneficiaries (the general public that benefits from such legislation).

In Talevski, the Court confronted the Thiboutot argument again, this time in the context of the Federal Nursing Home Reform Act of 1987 (FNHRA). FNHRA (enacted under the spending power) requires “nursing facilities” that accept Medicare and Medicaid funds to “protect and promote the rights of each resident” as a condition of receiving those funds. In particular, it requires nursing facilities to respect the rights of residents “to be free from …any physical or chemical restraints imposed for purposes of discipline or convenience and not required to treat the resident’s medical symptoms” and prohibits facilities from “transfer[ring] or discharge[ing] [a] resident” unless certain enumerated preconditions are met. The statute also creates a detailed administrative scheme for government inspections of nursing facilities and authorizes government actors to sanction noncompliant facilities or exclude them from the Medicaid program. But does it permit private enforcement?

The family of Gorgi Talevski thought so. They brought an action under §1983 against Health & Hospital Corp of Marion County (HHC), the county-owned nursing home that Talevski was moved to in 2016, claiming that HHC’s treatment of Talevski violated the rights guaranteed him under FNHRA. In particular, they alleged that HHC had violated his right to be free from unnecessary chemical restraints and the right to be discharged or transferred only when certain preconditions are met. The District Court dismissed their complaint, reasoning that no private plaintiff can enforce the provisions of the FNHRA through §1983. But the Seventh Circuit reversed, holding that these provisions of the FNHRA “unambiguously confer individually enforceable rights on nursing home residents,” and that nothing in the statute indicated a congressional intent to foreclose §1983 enforcement.

The Supreme Court affirmed. Writing for a 7-2 majority, Justice Jackson began by rebuffing HHC’s attempt to call into question the entire notion that Congress can create privately enforceable rights through legislation enacted under its spending power. That argument seized upon Spending Clause decisions observing that legislation premised on the spending power is “much in the nature of a contract,” because, “in return for federal funds, the States agree to comply with federally imposed conditions.” That means, HHC contended, that a private party suing to enforce a contractual obligation between Federal and State Governments is essentially a “third-party beneficiary.” But under common-law contract principles at the time §1983 was enacted, third parties were “generally” barred from suing to enforce contractual obligations. Because a third-party beneficiary in 1871 could not sue to enforce a contract, the Talevskis could not sue to enforce rights under the FNHRA.

Justice Jackson was not impressed. She first stressed that the historical backdrop behind §1983 demonstrated that Congress had deliberately crafted an expansive right of action—without “modifiers”—precisely because Southern states were unwilling to fully protect federal rights. Moreover, as a number of contract-law professors pointed out in an amicus brief, “HHC’s key common-law plank—that third-party beneficiaries could not sue to enforce contractual obligations during the relevant time—is, at a minimum contestable.” Finally, quoting Justice Scalia, Jackson pointed out that “the cause of action created by §1983 is, and was always regarded as, a tort claim.” Thus, “HHC’s particular focus on 1870’s law governing third-party-beneficiary suits in contract is, at the very least, perplexing.” In short, HHC’s “ambiguous” historical evidence was not enough to overcome decades of precedent recognizing that spending-clause legislation can be enforced through §1983.

Having (re)established that Spending Clause legislation can create privately enforceable rights under §1983, Justice Jackson turned to the question of whether the FNHRA does in fact create such rights. There is a “high bar” to establishing that a federal statute creates a right enforceable under §1983, and that is particularly so with respect to Spending Clause legislation, which is typically enforced through termination of funds to the noncompliant State. But if the statute “unambiguously confers” individual rights, then those rights are “presumptively enforceable” under §1983, unless something else in the statute indicates that Congress intended to preclude private enforcement. The unnecessary-restraint and predischarge-notice provisions of the FNHRA cleared this high bar. Both use clear “rights-creating language,” speaking “in terms of the persons benefited,” and have an “unmistakable focus on the benefited class.” That makes them presumptively enforceable under §1983. And nothing in the FNHRA suggests that Congress did not intend the rights it created to be privately enforceable. Though the statute establishes a “detailed administrative scheme for inspections of nursing facilities” and “authorizes governments to sanction and correct noncompliant facilities,” this administrative scheme is not incompatible with private §1983 enforcement. The Court’s prior cases finding implicit preclusion have involved statutes where private enforcement under §1983 would have thwarted Congress’s scheme; here, private enforcement would complement the administrative scheme.

The Court thus rejected both HHC’s arguments—that Spending Clause legislation in general cannot create rights enforceable under §1983 and that the FNHRA in particular does not create such rights—and affirmed the Seventh Circuit.

As several commentators pointed out following arguments in Allen v. Milligan (2023), Justice Jackson may be emerging as the leader of a new(ish) “progressive originalism” movement on the Court, and she demonstrated those chops in her majority opinion. But, for good measure, Justices Gorsuch and Barrett piped in with brief concurring opinions.

Justice Barrett, joined by the Chief, agreed that HHC’s “novel contract-law theory” does not persuasively undermine the Court’s longstanding view that Spending Clause legislation can create rights enforceable under §1983. And she agreed that the FNHRA provisions at issue here cleared the high bar for determining when a Spending Clause statute confers individual rights. But she cautioned that Courts should tread carefully in this area, and stressed that “an actual clash—one private judicial remedy against another, more expansive remedy—is not required to find that a statute forecloses recourse to §1983.” Rather, a “wide range of contextual clues” could indicate a Congressional intent to foreclose §1983 enforcement.

Justice Gorsuch also agreed “with the Court’s disposition of the two questions we took this case to decide” (though he favored Justice Barrett’s reasoning for getting there). However, he suggested that “there are other issues lurking here that petitioners failed to develop fully.” In particular, while he agreed that the FNHRA and other Spending Clause legislation can create a federal right, he questioned “whether legal rights provided for in spending-power legislation like the [FNHRA] are ‘secured’ as against States in particular and whether they may be so secured consistent with the Constitution’s anti-Commandeering principle.” However, in his view, those questions were better left “for another day.”

Justice Thomas dissented, happy to fill in the gaps that Justice Gorsuch found in HHC’s arguments. In his view, Spending Clause legislation can’t confer rights enforceable under §1983 without commandeering the States in violation of the Tenth Amendment. An exercise of Congress’s spending power “is no more than a disposition of funds,” Thomas observed. As such, “a conditional exercise of the spending power is nothing more than a contractual offer; any ‘rights’ that may flow from that offer are ‘secured’ only by the offerees acceptance and implementation, not federal law itself.” Justice Thomas acknowledged that the Court had previously rejected the Spending Clause distinction, but insisted that this was a wrong turn resulting in a “constitutional quandary: If spending conditions that benefit third parties are laws and secure rights in the same manner as ordinary lawmaking under Congress’ sovereign legislative powers, then such conditions would contradict the bedrock constitutional prohibition against federal commandeering of the States.” The only way to escape this quandary is to recognize that Spending Clause legislation does not create privately-enforceable rights; otherwise, they would be unconstitutional direct regulations of the States.

Justice Alito also dissented (joined by Thomas) on the second point. While he didn’t wade into the debate over whether Spending Clause legislation can create §1983-enforceable rights, he maintained that the FNHRA didn’t. In his view, the FNHRA’s “reticulated remedial regime,” which “both balances federal and state enforcement and channels disputes through that regime” displaces any privately enforceable right. “Allowing §1983 suits will upend this careful balance,” he warned.

In the end, despite 74 pages of analysis, Taleveski doesn’t change much: A supermajority of the Court still believes that Spending Clause legislation can create rights enforceable under §1983—and thus refused to upend decades of precedent providing the foundation for much civil-rights litigation. Whether a particular Spending Clause statue does so will depend on whether it appears that Congress intended to create such a right, based on ordinary principles of statutory construction.

Next up is Lac du Flambeau Band of Lake Superior Chippewa Indians v. Coughlin (No. 22-227), where the Court addressed whether a federally recognized Indian tribe is among the “governments” whose sovereign immunity is abrogated by the Bankruptcy Code. An essential feature of the Code is the automatic stay of collection efforts against a debtor who files for bankruptcy. Here, the Tribe claimed that its sovereign immunity prevents courts from enforcing the automatic stay against it, allowing it (or rather, one of its businesses) to pursue a debtor notwithstanding the debtor’s bankruptcy filing. Although the Bankruptcy Court agreed with the Tribe, the First Circuit and now the Supreme Court did not. Over the dissent of just one Justice, the Supreme Court held that the Bankruptcy Code unambiguously abrogates the sovereign immunity of all governments, including federally recognized Indian tribes.

The Bankruptcy Code broadly abrogates sovereign immunity for any “governmental unit,” defined to mean “United States; State; Commonwealth; District; Territory; municipality; foreign state; department, agency, or instrumentality of the United States . . ., a State, a Commonwealth, a District, a Territory, a municipality, or a foreign state; or other foreign or domestic government.” But, as the Tribe argued, it did not expressly mention Indian Tribes, and the Court has generally held that tribal sovereignty can be abrogated only by unmistakably clear language in a statute that cannot plausibly be interpreted to preserve immunity.

The Court agreed with that standard, but not with the Tribe’s desired application, holding that the Code unequivocally abrogates the sovereign immunity of “any and every government that possesses the power to assert such immunity.” Writing for a seven-Justice majority, Justice Jackson observed that the Code provision abrogating immunity “exudes comprehensiveness from beginning to end,” including the catchall of “other foreign or domestic government.” That was enough to show an unmistakable intent to abrogate immunity for Indian tribes, as well as other sovereign governments. As Jackson emphasized, no “magic words” are required for sovereign immunity to be abrogated “unambiguously.” It thus made no difference that tribal governments are not listed, even if Indian tribes are in other contexts mentioned specifically in various statutory schemes. Jackson also brushed aside as “far-fetched” the Tribe’s argument that it was neither wholly foreign nor wholly domestic, and therefore not an “other foreign or domestic government.”  Overall, she insisted that a broad interpretation of the provision is consistent with the statutory scheme applying the Code’s basic provisions to all creditors, with only narrowly drawn exceptions for specific governmental functions.

Justice Thomas concurred only in the judgment, because in his view the Tribe had no sovereign immunity in federal court where the dispute arose from the Tribe’s “off-reservation commercial conduct.” Whether the Code abrogated its immunity is beside the point, because it had no such immunity in the first place. Thomas then proceeded to question the Court’s precedents generally regarding tribal sovereign immunity to the extent the Court “continues to artificially exempt tribes from generally applicable laws.”

In a lengthy solo dissent, Justice Gorsuch followed his pattern (evident, as well in his concurrence in Haaland v. Brackeen (No. 21-376)) of defending the sovereignty of Indian Tribes. He agreed with the Tribe’s argument—which Justice Jackson described as far-fetched—that tribes, due to their unique status, plausibly could fall outside the statutory language of both “foreign government” and “domestic government.” In Gorsuch’s view, that plausible interpretation suffices under the Court’s precedents to bring tribes outside the scope of the Code’s abrogation of governmental sovereign immunity.

Finally, we turn to Smith v. United States (No. 21-1576).The general rule is that when a criminal defendant obtains a reversal of her conviction, the appropriate remedy is a retrial, not a judgment barring re-prosecution. This rule applies to violations of the Confrontation Clause, the Self-Incrimination Clause, the Public Trial Clause, and more. The only exception the Court has ever recognized is for violations of the Speedy Trial Clause, because there a retrial would only exacerbate the constitutional violation. In Smith, the Court was tasked with determining whether violations of two other clauses should get the usual treatment: the Venue Clause, which mandates that criminal trials be held in the state where the alleged crime was committed, and the Vicinage Clause, which guarantees the right to an impartial jury of the state and district in which the alleged crime was committed. In a unanimous decision, the Court held that they should, so the Government is free to retry in the proper venue defendants whose convictions are vacated based on violations of these related clauses.

Timothy Smith was indicted for theft of trade secrets after hacking the data of a company called StrikeLines, which sells the coordinates of artificial reefs built to attract fish. (Smith was an avid fisherman himself, as well as a software engineer, and he didn’t care for StrikeLines’s business model.) Smith was indicted in the Northern District of Florida, where StrikeLines is based. He moved to dismiss the indictment, arguing that trial in the Northern District of Florida would violate the Venue and Vicinage Clauses because StrkeLines’ servers are located in Orlando (Middle District of Florida), and he’d accessed them from Mobile (Southern District of Alabama). The District Court reserved decision until after trial. When Smith was convicted, he moved for a judgment of acquittal on the same grounds. This time, the District Court denied the motion, reasoning that StikeLines had felt the effects of the crime at its headquarters in the Northern District of Florida. The Eleventh Circuit reversed, however, and further held that the proper remedy was vacatur of the conviction (with leave to re-prosecute), not a judgment of acquittal or dismissal of the indictment with prejudice. Smith then sought review of the second conclusion in the Supreme Court.

On review, the Court unanimously affirmed the Eleventh Circuit in an opinion written by Justice Alito. Alito began by reviewing the text and precedent of the Venue Clause. After finding nothing in the Venue Clause’s text suggesting that a new trial in the proper venue is not an adequate remedy for its violation, he rejected Smith’s argument that the purpose of the Venue Clause is to prevent additional hardship to the defendant. As Alito pointed out, any retrial after a reversal can add to a defendant’s hardship and the mere burden of a second trial has never justified a blanket exemption from the retrial rule. Moreover, the most convenient venue for the defendant would likely be where the defendant lives, not necessarily the location of the alleged crimes (which could be in multiple states), as the Venue Clause requires. “[A]voiding hardship to a defendant” is thus not a core purpose of the Venue Clause. Alito reached the same result with respect to the Vicinage Clause, citing analogous precedent holding that retrial is the appropriate remedy when a defendant is tried by a jury that does not reflect a fair cross-section of the community where the crime was committed.

Next, Alito analyzed the history of the common-law “vicinage right,” which “presumptively entitled defendants to a jury of the ‘neighbourhood’ where the crime was allegedly committed.” Tracing it back to its pre-founding origins, Alito concluded that the vicinage right “undoubtedly” inspired the Venue and Vicinage Clauses. He further concluded that there is “no meaningful evidence that the Constitution altered the remedy prescribed by common law for violations of the vicinage right.” Against this background, and absent any decision “barring retrial based on a successful venue or vicinage objection in either the centuries of common law predating the foundation or in the early years of practice following ratification,” there was no reason to doubt the application of the usual retrial rule.

Finally, Alito dismissed Smith’s argument that the Venue and Vicinage Clauses are “inseparably interwoven” with the Double Jeopardy Clause, such that a violation of the former precludes retrial under the latter. When a jury renders a general verdict of acquittal, it resolves the question of culpability, which cannot be reviewed or altered. In contrast, retrial is permissible when a trial terminates on a basis unrelated to the defendant’s guilt or innocence (e.g., because of preindictment delay or juror deadlock). The reversal of a conviction based on a violation of the Venue or Vicinage Clauses does not resolve culpability. The Court thus affirmed the Eleventh Circuit’s holding that the Double Jeopardy clause did not bar Smith from being retried in the proper venue.