CSX Transportation, Inc. V. Hensley (08-1034), Bobby v. Bies (08-598), Caperton v. A.T. Massey Coal Co., Inc. (08-22) and United States ex rel Eisenstein v. New York (08-660)

June 10, 2009 Supreme Court Update

Greetings, Court fans!
On Monday, Justice Ginsburg put the Chrysler-Fiat sale briefly on hold so that the Court could consider a request by certain opponents of the sale for a stay while they challenged the bankruptcy court's order approving the sale. Just a day later, the Court issued a two page per curiam opinion finding that petitioners hadn't satisfied their burden under the relevant stay factors; thus allowing the sale to move forward by the June 15th deadline. This came in the midst of what is already the Court's busiest month. June began with a trickle last week when the Court issued two short decisions: CSX Transportation, Inc. v. Hensley (08-1034), on jury instructions in a Federal Employees' Liability Act case, and Bobby v. Bies (08-598), addressing the review of death sentences imposed on mentally retarded defendants before the Court determined that the execution of mentally retarded offenders was unconstitutional. This week, the deluge began in earnest, with the Court handing down six more decisions. To break things up, I'll discuss only two of them in this Update: Caperton v. A.T. Massey Coal Co., Inc. (08-22), addressing recusal of a judge for potential bias, and United States ex rel Eisenstein v. New York (08-660), considering the time limit for filing a notice of appeal in a False Claims Act case.
Since Caperton is the most entertaining, I'll start there. In a contentious 5-4 ruling, the Court held that due process required an elected judge to recuse himself from cases in which one of the parties made large contributions to the judge's election campaign, because of the "probability of bias." The Grisham-esque facts of the case are as follows: A group of small coal companies run by Hugh Caperton brought suit against coal industry giant A.T. Massey Coal Co. ("Massey"), alleging that Massey used unfair tactics to drive Caperton's companies out of business. A West Virginia jury agreed, and awarded Caperton $50 million. After the verdict, but before the appeal, West Virginia held its 2004 judicial elections. Knowing that he would appeal the verdict, Don Blankenship—the chairman, CEO and president of Massey—made it his mission to replace sitting Justice McGraw with his opponent, Benjamin. Blankenship contributed the statutory maximum to Benjamin's campaign committee, donated almost $2.5 million to a political action committee that supported Benjamin, and spent over $500,000 on direct mailings, letters, and television and newspaper ads. Benjamin won by a slim margin and was the deciding vote in a series of 3 to 2 decisions reversing the jury verdict. Benjamin rejected Caperton's repeated recusal motions because he had no "direct, personal, substantial, pecuniary interest" in the case—the long-established common-law standard for when a judge must recuse himself.
The question for the Court was whether Caperton was denied a "fair trial in a fair tribunal" in violation of the due process clause, even though Benjamin had no direct pecuniary interest in the case. Justice Kennedy, joined by the liberal wing of the Court, concluded that the due process clause required recusal in this extreme case, even though the common law would not, placing this case alongside two already-established exceptions. The first exception involved situations where the judge had an indirect financial interest—such as where an appellate judge was reviewing a case where he was the lead plaintiff in a nearly identical pending case. The second exception involved criminal contempt proceedings, where the judge issuing the criminal contempt citation had no pecuniary interest in the case, but due process still required a different, unimpassioned judge to preside over the criminal contempt trial. Both exceptions were driven by the Court's concern that the temptations the average judge would face could undermine the judge's ability to "hold the balance nice, clear and true." Similarly, here, while Benjamin had neither been bribed nor criminally influenced by Blankenship, the majority was concerned that Benjamin would nonetheless feel a debt of gratitude towards him for the "extraordinary" efforts Blankenship undertook during the campaign. Under the facts and circumstances of this "exceptional" case—including the disproportionate size of Blankenship's contributions and their timing—the Court concluded that there was a serious risk of actual bias. Just as due process cannot allow a man to be a judge in his own cause, the majority concluded that due process cannot allow a man to choose the judge in his own cause.
Chief Justice Roberts, joined by Scalia, Thomas, and Alito dissented. Their primary beef was that the majority's standard was unworkable. (How much of a contribution is too much? What if a party's brother gave the money instead of the party himself? Etc.) The dissent also worried that such a standard would invite numerous groundless allegations that judges are biased, which will "do far more to erode public confidence in judicial impartiality than an isolated failure to recuse in a particular case." Justice Scalia dissented separately to echo the Chief's sentiments that the majority decision will undermine public confidence in the judicial system, as crafty lawyers will spend countless hours pouring through campaign finance reports in order to gin up recusal motions. In his inimitable style, Scalia mocked the majority's "quest to right all wrongs and repair all imperfections through the Constitution." After quoting a maxim from the Talmud that—with respect to sacred texts—one should "Turn it over, and turn it over, for all is therein," Scalia suggested that while divine texts "may contain all the answers to all earthly questions," the due process clause does not.

Next up, in United States ex rel Eisenstein, the Court unanimously concluded that the time limit for filing an appeal in a False Claims Act ("FCA") case in which the government has not intervened is 30 days. The Federal Rules of Appellate Procedure provide a 30-day time limit for filing a notice of appeal (FRAP 4(a)(1)(A)), but extend the deadline to 60 days when the United States is a party (FRAP 4(a)(1)(B)). The FCA creates civil liability where a person knowingly presents a false claim for payment to the government. A private individual, known as a "relator," may institute a qui tam action under the FCA, but the government is the "real party in interest" and will share in any recovery obtained. The government may elect to intervene in and take over the action. If it does not, it may still elect to receive pleadings and discovery. In this case, the government did not intervene, the relator's action was eventually dismissed, and the relator waited 54 days to appeal. The Second Circuit dismissed the appeal as untimely. Justice Thomas led the Court, which affirmed. While the government may be the "real party in interest" in a FCA case, it is not a "party" unless and until it intervenes. Otherwise, the intervention provision would make no sense, because the government would not need to intervene in a suit in which it is already a party. End of story.
CSX Transportation, Inc. v. Hensley (08-1034), was a pure error correction case. There, the Court considered whether trial courts were required to give a jury instruction stating that, under the Federal Employees' Liability Act ("FELA"), an asbestosis plaintiff who is claiming damages for fear of developing cancer in the future must demonstrate that his "fear is genuine and serious." No one disputed that was the law as announced by the Court in Norfolk & Western R. Co. v. Ayers (2003). The only question was whether the trial court erred in failing to give defendant's requested charge on the issue. The Tennessee Court of Appeals found no error because it construed Ayers as announcing only substantive law, not requiring jury instructions. It also believed there was little chance the requested instruction would make any difference, particularly since trial courts would serve as gatekeepers to ensure that fear of cancer claims without such evidence never got to the jury. The Court reversed, in a short per curiam opinion. Ayers held that plaintiffs could recover fear of cancer damages only where they established that the fear was "genuine and serious" and specifically stated that verdict control devices were available to trial courts to weed out nonmeritorious claims, including "on a defendant's request, a charge that each plaintiff must prove any alleged fear to be genuine and serious." CSX requested this instruction and the trial court, under Ayers, should have given it. Justice Stevens dissented. In his view, Ayers only authorized trial courts to give jury instructions, it didn't require them. Further, the general verdict rule should have precluded any review of the verdict here since it was not clear whether any portion was even related to fear of cancer. Justice Ginsburg also dissented because she believed the proposed jury instructions submitted by CSX (which included some additional provisions) did not track Ayers and thus were properly rejected by the trial court.
Finally, in Bobby v. Bies (08-598), the Court clarified the doctrine of "issue preclusion" while at the same time providing guidance on how courts can handle challenges to death sentences that were imposed on individuals with mental retardation prior to the Court's decision in Atkins v. Virginia (2002), in which the Court found that the execution of mentally retarded offenders violated the Eighth Amendment's guarantee against "cruel and unusual punishment." Michael Bies was convicted and sentenced to death in 1992. During the sentencing phase of his trial, the jury was instructed (consistent with the then controlling decision in Penry v. Lynaugh (1989)) that it could consider evidence of Bies' borderline mental retardation as a mitigating factor. The jury found that the aggravating factors outweighed the mitigating factors and recommended a sentence of death, which the trial court imposed. The Court's decision in Atkins did not come until a decade later, and did not spell-out how to determine when a person claiming mental retardation is so impaired as to warrant the shield against execution. The Court left it to the states to develop the substantive and procedural mechanisms to apply the protection afforded by Atkins and the Ohio Supreme Court did just that in State v. Lott.

Bies presented his Atkins-Lott claim to the state court and moved for summary judgment, arguing that the record from his trial established his mental retardation, and that the State was "precluded and estopped" from disputing it. Because the state court found that Atkins and Lott had materially changed the significance of a mental retardation finding and because "there [wa]s a serious issue as to Mr. Bies' mental status," it concluded that the state should have an opportunity to prove, in a full hearing, that Bies was not retarded and thus eligible to be executed. Bies then filed a habeas corpus petition in the District Court arguing that the Fifth Amendment's Double Jeopardy Clause barred the state from relitigating the issue of his mental condition. The District Court granted the habeas petition and ordered Bies' death sentence vacated. The Sixth Circuit affirmed.
The Court reversed, in a unanimous opinion by Justice Ginsburg. "Issue preclusion" bars successive litigation of "an issue of fact or law" that "is actually litigated and determined by a valid and final judgment, and . . . is essential to the judgment." If a judgment does not depend on a given determination, relitigation of that determination is not precluded. In addition, even where the core requirements of issue preclusion are met, an exception to the general rule may apply when a "change in [the] applicable legal context" intervenes. Here, it was far from clear that the issue of Bies' mental retardation under the Lott test was actually determined at trial or during Bies' direct appeal. Bies' mental abilities were claimed as a mitigating factor, but were found by the jury to be outweighed by aggravating factors, and any statements made by the Ohio courts regarding Bies' mental capacity were clearly not necessary to the judgments affirming his death sentence. Moreover, even if the core requirements for issue preclusion had been met, an exception to the doctrine's application would be warranted due to this Court's intervening decision in Atkins. Because the change in law substantially altered the State's incentive to contest Bies' mental capacity, applying issue preclusion would not advance the equitable administration of the law.
I'll be back in your inboxes shortly with highlights from the four remaining decisions from this week.
From the Appellate Practice Group at Wiggin and Dana
For more information, contact Kim Rinehart or any other member of the Practice Group at 203-498-4400