Astrue v. Ratliff (08-1322), Dolan v. United States (09-367), Holland v. Florida (09-5327) and Carachuri-Rosendo v. Holder (09-60)

June 17, 2010 Supreme Court Update

Greetings, Court fans!

The Court issued 5 decisions today, with the biggest news coming in New Process Steel, L.P. v. NLRB (08-1457), where an unusual 5 member majority of the Court (Justice Stevens, plus the conservatives) held that the NLRB acted without statutory authority during a two year period when it issued decisions without the required number of members. The question left unanswered: What happens to the hundreds of Board decisions issued during that period?

I'll be back soon with more analysis of New Process Steel and the other decisions released today, but first I need to catch up from Monday, when the Court granted cert in 3 cases and issued 4 decisions in: Astrue v. Ratliff (08-1322), holding that an award of attorney's fees under the Equal Access to Justice Act is paid to the litigant and is therefore subject to administrative offset if the litigant owes an unrelated debt to the United States; Dolan v. United States (09-367), finding that a court retains power to order a criminal defendant to pay restitution even after the court misses the statutory deadline for making such orders; Holland v. Florida (09-5327), concluding that the 1-year statute of limitations for filing a federal habeas petition may be equitably tolled by, among other things, attorney misconduct; and Carachuri-Rosendo v. Holder (09-60), determining that a second state conviction for simple possession cannot constitute an "aggravated felony" under the Immigration and Nationality Act if the state conviction is not based on the fact of a prior conviction.

In Astrue v. Ratliff, the Court considered whether attorney's fees awarded under the Equal Access to Justice Act ("EAJA") are payable to the litigant or directly to the litigant's attorney – an important issue because the litigant in this case (and many others) owed an unrelated debt to the United States and the Government was entitled to an offset for that debt if the fee award was payable to the litigant. Justice Thomas authored the Court's brief and unanimous decision. Section 204(d) of the EAJA provides that "a court shall award to a prevailing party . . . fees and other expenses . . . in any civil action . . . brought by or against the United States . . . unless the court finds that the position of the United States was substantially justified." The term "prevailing party" is a term of art that is understood to mean the prevailing litigant, not the prevailing litigant's counsel. And the EAJA specifically refers to attorney in other parts of the Act when it wishes to do so. Additionally, in the Social Security Act, fee awards are explicitly made payable directly to the litigant's attorney, demonstrating that when Congress intends for fee awards to be paid directly to counsel, it knows how to say so. The Government has statutory authority to use administrative offsets under 31 U.S.C. § § 3711(a) and 3716(a) to recover debts owed to it. Though Congress has provided for a number of items that are exempt from offset, fee awards are not among them. Therefore, the Government is within its right to use administrative offsets against attorney's fees it is found to owe. Justice Sotomayor, joined by Justices Stevens and Ginsburg, agreed with the Court's analysis, but issued a separate concurrence. The concurring Justices did not believe Congress intended, or even considered, this result and were concerned that it would undercut the purpose of the EAJA. Nonetheless, they agreed that the EAJA's text did not admit another interpretation. They therefore urged Congress to take up the issue.

Next, we turn to the Mandatory Victims Restitution Act, which requires courts to order defendants convicted of certain specified offenses to make restitution to their victims for the full amount of the victims' losses. The Act provides that if a victim's losses are not ascertainable 10 days before sentencing, the court "shall set a date for the final determination of the victim's losses, not to exceed 90 days after sentencing." In Dolan v. United States, the trial court received information from the probation office about the victim's losses 67 days after sentencing, but set the hearing date for some three months after the 90-day deadline. At the hearing, the court ordered restitution over the defendant's objection that the court no longer had authority to do so. The Tenth Circuit sided with the district court, as did the Court in an odd 5-4 split. Justice Breyer, joined by Justices Thomas, Ginsburg, Alito, and Sotomayor, held that a sentencing court's failure to observe the 90-day deadline, "even through its own fault or that of the Government," did not deprive the court of the power to order restitution. For starters, the Act did not specify any consequences for noncompliance with the deadline. In fact, the Act set no time limit on the court's ability to issue an amended restitution order if the victim subsequently discovered further losses. Reading the provision to bar restitution orders after 90 days would run contrary to the main purpose of the Act: to assure that crime victims received full restitution. In this case, any harm to the defendant was mitigated by the fact that the court had informed the defendant at sentencing that he could anticipate a restitution award to be "made in the future," and the fact that the probation office had informed all the parties of the likely loss amount well before the expiration of the 90-day time limit. In most cases, a defendant can avoid delay by reminding the court of the 90-day deadline and asking the court to set a timely hearing. In the unlikely event that the trial court deliberately fails to comply with the statute, the defendant may seek mandamus.

The dissent, led by the Chief, started from the position that, as a general rule, restitution must be imposed at sentencing. The 90-day provision created a narrow exception to the general rule, but did not, as the Court appeared to believe, justify further delay. The fact that Congress chose to allow courts to amend a restitution order upon newly discovered losses did not mean that Congress allowed courts to miss the 90-day deadline for the initial restitution order. The dissent accused the Court of proposing a judicial power to alter sentences at any time, leaving defendants vulnerable to orders of additional fines, conditions of release, or even imprisonment after serving what they believed to be their sentence. The onus should not be on defendants to invoke the "drastic and extraordinary" remedy of mandamus to speed up a hearing, especially given that some defendants may not even be aware that they are in danger of an increased sentence. With regard to victims' interests, the Chief wrote that he was "mindful" that "victims may suffer" when a trial court blunders under the dissent's reading of the Act. But, "[c]onsequences like that are the unavoidable result of having a system of rules."

In Holland v. Florida, the Court held that the 1-year deadline for filing a habeas petition in federal court under the Antiterrorism and Effective Death Penalty Act of 1996 ("AEDPA") may be equitably tolled. In this capital case, petitioner claimed that his attorney's professional misconduct required equitable tolling. Instead of rehashing the things the attorney did, I will turn them into a helpful list of "don'ts" for the attorneys in the audience. Don't wait until 316 days after your appointment and 12 days before the limitations period ends to file the state court habeas petition. Don't let three letters be your sole communication with your client for almost three years while the petition and subsequent appeal are pending in state court. Don't ignore your client's repeated requests for information and reminders about the AEDPA deadline, prompting the client to ask the state Supreme Court for new counsel and to file a complaint with the bar association. Don't overlook the state supreme court's decision rejecting your client's petition, leaving your client to discover the mandamus order for himself five weeks later in the prison library. Don't plan to file a cert petition on the state habeas petition, and force your client to remind you that such a petition will not toll the AEDPA time limits. Don't then tell your client for the first time that you think (erroneously) the AEDPA period ran out 1 year after the state decided his direct appeal, before you were even appointed. And when your client corrects you again on the law and asks you to act on his behalf as soon as possible, don't ignore that letter. Failure to observe these "don'ts" could cause the federal district court to remove you as counsel, and a group of legal ethics professors to file an amicus brief with the Supreme Court opining that your conduct violated fundamental canons of professional responsibility.

Turning back to the case at hand, the petitioner filed a pro se habeas petition with the district court approximately five weeks after the AEDPA period ran out. Under established case law, a party may be entitled to equitable tolling only if he shows that he had been pursuing his rights diligently, and that an "extraordinary circumstance" stood in the way of his timely filing. Here, the district court acknowledged the principle of equitable tolling in AEDPA cases, but held that the petitioner had not demonstrated the "due diligence" necessary to invoke equitable tolling because he had not sought the help of the court system or "outside supporters" to ascertain the date of the state habeas mandate. The Eleventh Circuit affirmed on the different ground that "[p]ure professional negligence" on the part of a petitioner's attorney (as opposed to dishonesty, divided loyalty, or mental impairment) could never constitute an "extraordinary circumstance" justifying equitable tolling.

The Court reversed, with Justice Breyer leading a six-Justice majority. The Court found that the AEDPA limitations period is subject to equitable tolling, consistent with the equitable principles that have traditionally governed the substantive law of habeas corpus. The Eleventh Circuit's categorical rejection of attorney misconduct as a ground for equitable tolling was inconsistent with general equitable principles. In some situations, including quite possibly in this case, professional misconduct could rise to the level of an extraordinary circumstance. And the district court's determination in this case must be set aside because it erroneously required the petitioner to exercise more than "reasonable diligence," to the point of requiring "maximum feasible diligence." The Court remanded the case with instructions to determine whether the facts in the record entitled the petitioner to equitable tolling, or whether further proceedings were necessary. Justice Alito concurred in part, and concurred in the judgment. Justice Alito observed that attorney misconduct generally is not an extraordinary circumstance warranting equitable tolling because mistakes of counsel are constructively attributable to the client, at least in the post-conviction context where prisoners have no constitutional right to counsel. Attorney misconduct that is not constructively attributable to the client, however, may serve as the basis for equitable tolling. In this case, the attorney's "near-total failure" to communicate with the petitioner and the petitioner's reasonable efforts to terminate the attorney supported a finding that the attorney was not operating as the petitioner's agent in any meaningful sense of the word.

Justice Scalia dissented, joined by Justice Thomas in part. In Justice Scalia's view (not joined by Thomas), the AEDPA left no room for equitable tolling. To the contrary, in enacting the AEDPA, Congress replaced the former default rule of equitable tolling with a discrete list of conditions meriting tolling (e.g., the pendency of a state habeas petition). Even if equitable tolling was available, Justice Scalia (now joined by Thomas) did not agree that it was warranted in this case. As a post-conviction petitioner, the petitioner had no right to counsel. Thus, he should be held fully responsible for his attorney's acts. The dissenters objected to what they saw as a "transparent attempt to smuggle [the right to effective counsel enunciated in] Strickland into a realm the Sixth Amendment does not reach."

Finally, in Carachuri-Rosendo v. Holder, the Court grappled with whether conviction for possession of a single tablet of Xanax without a prescription could constitute an "aggravated felony" for immigration law purposes, rendering Carachuri-Rosendo ineligible for discretionary cancellation of removal under the Immigration and Nationality Act ("INA"). Carachuri-Rosendo was a lawful permanent resident of the United States, who had lived here since the age of 5 and had a wife and children, all of whom were U.S. citizens. In 2004 and 2005 he was convicted in Texas state court of two misdemeanors, the first involving possession of less than two ounces of marijuana (for which he was sentenced to 20 days in jail) and the second involving the possession of one Xanax pill (for which he was sentenced to 10 days in jail). Although Texas law authorized a sentencing enhancement for the second crime if the prosecutor proved that Carachuri-Rosendo had been previously convicted of a similar offense, Texas did not seek the enhancement. Nevertheless, in 2006, on the basis of the second conviction, the Federal Government initiated removal proceedings against him. Carachuri-Rosendo did not dispute that he was removable based on the second conviction, but requested discretionary cancellation of removal. The Immigration Judge held that the second conviction was an "aggravated felony" under the INA, which made him ineligible for cancellation of removal. The Board of Immigration Appeals affirmed, following Circuit precedent, but disagreed with the analysis and indicated that in Circuits that had not yet ruled on this issue, it would not conclude that a second state court conviction for simple possession constituted an "aggravated felony" unless the conviction contained a specific finding that the offender was a recidivist. The Fifth Circuit affirmed, concluding that the Court's 2006 decision in Lopez v. Gonzales required that Carachuri-Rosendo's conviction be considered an "aggravated felony." The Court reversed, clarifying Lopez (somewhat) in the process.

The INA permits discretionary cancellation of removal if a lawful permanent resident has "not been convicted of an aggravated felony." "Aggravated felony" is defined to include a list of federal offenses, one of which is "illicit trafficking in a controlled substance . . . including a drug trafficking crime (as defined in section 924(c) of title 18)." 8 U.S.C. § 1229b(a)(3). Section 924(c)(2) defines a "drug trafficking crime" as "any felony punishable under . . . the Controlled Substances Act [("CSA")]." To constitute a felony, a crime must be punishable by imprisonment for more than one year. The CSA does punish simple drug possession, but in most instances as a misdemeanor, with a maximum sentence of less than one year. However, the CSA authorizes a sentence of up to two years (thus qualifying as a felony) for a simple possession offense "after a prior conviction under this subchapter [or] under the law of any State . . . has become final" – so-called "recidivist simple possession." If a prosecutor wishes to obtain the enhanced punishment available under the CSA for recidivist simple possession, he must charge the existence of the prior crime before trial or plea, providing the defendant notice and opportunity to challenge the validity of the prior conviction. Though the INA definition of "aggravated felony" does not list any state offenses, it does explain that the term applies "to an offense described in this paragraph whether in violation of Federal or state law." In Lopez, the Court construed this provision to mean that to qualify, a state drug conviction must be punishable as a felony under federal law. Relying on Lopez, the Fifth Circuit concluded that Carachuri-Rosendo's offense qualified because his conduct (simple drug possession after a prior drug conviction) could have been punished as a felony under federal law.

Led by Justice Stevens, the Court concluded that the Fifth Circuit misread Lopez. The Court began by noting that Carachuri-Rosendo's conviction for possession of a single anti-anxiety pill simply didn't comport with the everyday understanding of "aggravated felony" or "drug trafficking." Since "the Government argues for a result that ‘the English language tells us not to expect,' . . . we must be ‘very wary of the Government's position.'" For the Court, the result turned on the INA's text, which denies discretionary cancellation of removal only to those "convicted" of an "aggravated felony." Here, while Carachuri-Rosendo's conduct hypothetically could have resulted in a felony conviction for recidivist simple possession, that was not the offense with which he was charged and pled. Texas declined to seek the recidivism sentencing enhancement. Practically speaking, it is crucial to look at the elements and sentencing factors of the offense of conviction, not just the underlying conduct because prosecutorial discretion is a critical element in our sentencing structure. Therefore, since Carachuri-Rosendo's Texas Xanax conviction was not "based on the fact of a prior conviction," it did not qualify as a felony under the CSA.

Justice Scalia concurred in the judgment, writing separately because he had a simpler analysis: "[s]ince the elements of [Carachuri-Rosendo's] crime did not include recidivism, the crime of his conviction did not ‘correspond' to the [CSA] felony of possession-plus-recidivism. . . ." Justice Thomas also concurred only in the judgment, writing a separate opinion setting forth his view that Lopez was wrongly decided. In Thomas's view, two requirements are necessary to qualify as a drug trafficking aggravated felony. First, the crime must be a felony. Second, it must be punishable under the CSA. Here, Carachuri-Rosendo's crime met the latter requirement, in that it was punishable under the CSA, but his crime of conviction in state court was only a misdemeanor under state law. Therefore, it did not qualify, end of story.

Moving on . . . the Court granted cert in the following cases:

Matrixx Initiatives v. Siracusano (09-1156), which asks: "Whether a plaintiff can state a claim under § 10(b) of the Securities and Exchange Act and SEC Rule 10b-5 based on a pharmaceutical company's nondisclosure of adverse event reports even though the reports are not alleged to be statistically significant [evidence that the adverse events may be caused by, and are not simply randomly associated with, a drug's use]."

CSX Transportation, Inc. v. Alabama Dep't of Revenue (09-520), where the Court agreed to hear only the following question: "Whether a State's exemption of rail carrier competitors, but not rail carriers, from generally applicable sales and use taxes on fuel subjects the taxes to challenge under 49 U.S.C. § 11501(b)(4) as ‘another tax that discriminates against a rail carrier.'"

Cullen v. Pinholster (09-1088), which will require the Court to determine whether a federal court can grant habeas corpus relief to a state prisoner under 28 U.S.C. § 2254 (1) based on facts that could have been presented in earlier state court proceedings, but were not, and (2) based on allegedly ineffective assistance of counsel for failing to present mitigating evidence of organic brain damage and a difficult childhood notwithstanding that counsel consulted with a psychiatrist and certain family members.

I'll be back soon to bring you summaries of today's decisions. Until then, thank you for reading!


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