Publications
United States v. Grubbs (04-1414), Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Dabit (04-1371) and order list
Greetings, Court fans!
The Court appears to be enjoying a serious honeymoon period. The percentage of unanimous opinions so far has been astonishing, and even those with a dissent or concurrence lack the strident language we’ve seen in Terms past. This may be good for the Court and the country in a time of transition, but it’s a little dull for the readers – we’re ready for one of Justice Scalia’s zingers!
We won’t get one today, as the Court issued two more (mostly) unanimous opinions noteworthy for their brevity and collegiality. In United States v. Grubbs (04-1414), the Court, led by Justice Scalia, held that anticipatory search warrants are constitutional so long as there is probable cause to believe that (1) the event triggering the search (e.g., the arrival of a package) will occur, and (2) if the triggering event occurs, contraband (e.g., drugs or pornography) will be found on the premises. The case was largely unanimous, with all Justices (except Alito, who didn’t participate) concurring in the central holding and in the judgment finding the warrant valid. The majority further found that the warrant itself need not state the triggering event since the Fourth Amendment expressly requires only that the warrant contain a description of the property to be searched and the items to be seized. Justice Souter, joined by Stevens and Ginsburg, concurred to note that it would be better practice for the triggering event to be stated on the fact of the warrant – since the officer executing the warrant may not be the officer that provided the affidavit establishing probable cause and, thus, may not be aware of the trigger.
Next, in the significant (if bone dry) case of Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Dabit (04-1371), the Court held 8-0 that the Securities Law Uniform Standards Act (SLUSA) preempts state-law class actions by those who have been fraudulently induced to hold onto their stocks, even though federal law gives these plaintiffs no right to sue. In an effort to put a stop to duplicative and abusive securities class actions, Congress enacted SLUSA to bar state-law class actions for securities fraud “in connection with the purchase or sale” of securities. In a class suit by former Merrill Lynch brokers and clients, the Second Circuit construed SLUSA narrowly to cover fraud in “purchases and sales” only, but not fraud inducing clients to hold their stocks longer than they should. Justice Stevens, writing for the Court, disagreed. While a narrow construction “would not, as a matter of first impression, have been unreasonable,” the Court has always read the “in connection with” language in previous securities laws broadly to require only that the fraud “coincide” with a securities transaction involving someone, not just the plaintiffs. Congress had to have been aware of this broad construction when it used the phrase in SLUSA; moreover, reading SLUSA narrowly would undercut Congress’s goal of preventing class action abuse. Although this ruling may seem harsh since federal law does not give “holders” a cause of action, the Court noted that SLUSA applies only to class actions of 50 or more persons – so individuals and smaller groups can still sue under state law.
Finally, yesterday’s order list contained nothing major (Padilla was relisted for a sixth time), but the Court did ask the SG to weigh in on the cert petition in McGowan v. NJR Service Corp. (05-853), which asks the following riveting ERISA questions: (1) Should plan administrators covered by [ERISA] be mandated by federal common law to recognize a waiver of a beneficial interest? (2) Does a requirement that plan administrators consider external documents other than the plan documents in order to decide the validity of a waiver violate 29 U.S.C. § 1104(a)(1)(D)? (3) Does the recognition and enforcement of a waiver by a plan administrator undermine ERISA’s goals that plans be uniform in their interpretation and simple in their administration? (4) Does the recognition and enforcement of a waiver by a plan administrator contravene the anti-alienation provisions of ERISA?
That’s all for now. Thanks for reading!
Ken & Kim
From the Appellate Practice Group at Wiggin and Dana. For more information, contact Kim Rinehart, Ken Heath, Aaron Bayer, or Jeff Babbin at 203-498-4400
