Thurgood Marshall

In Burns v. United States, the petitioner pled guilty to theft of government funds, false claims, and tax evasion after defrauding the government of over $1.2 million through his position at AID, with a presentence report recommending a Guidelines range of 30-37 months and no departure. The district court instead departed upward to 60 months' imprisonment without prior notice, citing the duration of the conduct, disruption to government functions, and use of tax evasion to conceal other crimes; the D.C. Circuit affirmed, but the Supreme Court reversed. The Court held that Federal Rule of Criminal Procedure 32 requires a district court to provide notice and an opportunity to comment before departing upward from the Sentencing Guidelines range on its own initiative. This requirement follows from the rule's mandate that parties have an opportunity to comment on matters relating to the sentence, the need for accurate and fair resolution of disputed sentencing factors under the Guidelines system established by the Sentencing Reform Act, and the absence of any indication that Congress intended to allow sua sponte departures without notice.

criminal lawprocedure

This case concerned whether a debtor could include a mortgage lien on farm property in a Chapter 13 bankruptcy reorganization plan after the underlying personal debt had been discharged in a prior Chapter 7 liquidation. The Supreme Court held that the lien survives as a "claim" under the Bankruptcy Code that can be modified in the Chapter 13 plan. The reasoning centered on the broad statutory definition of "claim," which encompasses the creditor's in rem rights against the property even after personal liability is extinguished, consistent with the Code's provisions allowing modification of secured claims and the principle that liens pass through bankruptcy.

business & regulatoryproperty

This case involved whether federal admiralty jurisdiction extended to a claim by Exxon against Central Gulf Lines and its vessel for an unpaid bill for bunker fuel that Exxon procured as Waterman's agent from a local supplier in Saudi Arabia under a long-term marine fuel contract. The lower courts dismissed the action for lack of jurisdiction, applying Minturn v. Maynard as establishing a per se rule that agency contracts are excluded from admiralty. The Supreme Court overruled Minturn and held that no such categorical exception exists. The Court reasoned that admiralty jurisdiction under 28 U.S.C. §1333(1) turns on whether the contract's subject matter relates to the protection of maritime commerce, so courts must examine the nature of the services performed rather than the agency form of the agreement.

procedurebusiness & regulatory

This case involved an animal welfare lawsuit filed in Louisiana state court by organizations and individuals seeking to protect monkeys used in federally funded medical experiments, based on state laws regarding animal cruelty and tort damages. The National Institutes of Health (NIH), a federal agency and defendant, removed the case to federal court under a statute allowing certain federal defendants to remove state suits. The Supreme Court held that removal was improper, ruling that 28 U.S.C. § 1442(a)(1) permits removal only by federal officers, not by federal agencies themselves, and therefore the case must be remanded to state court. The Court reasoned that the statutory language distinguishes between officers and agencies, and petitioners had standing to challenge the removal as it affected their choice of forum.

procedurefederal power

This case involved a shareholder derivative action under the Investment Company Act of 1940 alleging that an investment adviser obtained approval of its contract through a materially misleading proxy statement. The plaintiff did not make a pre-suit demand on the board of directors, asserting that it would have been futile under the circumstances. Lower courts dismissed the claim by adopting a federal common law "universal demand" rule that eliminates the futility exception to the demand requirement. The Supreme Court reversed, holding that state law governs the scope of the demand requirement in such federal derivative actions because it embodies the incorporating state's allocation of corporate governance powers and a futility exception does not impede the Act's purposes.

business & regulatoryprocedurefederal power

The case concerned whether a savings and loan association could claim tax-deductible losses under the Internal Revenue Code by exchanging participation interests in one set of residential mortgages for interests in a different set of mortgages held by other lenders, as facilitated by a Federal Home Loan Bank Board regulation allowing such swaps without reporting book losses. The Supreme Court held that the exchanges produced realized losses eligible for deduction. The Court reasoned that under § 1001(a), realization occurs upon a "sale or other disposition" of property when the exchanged assets are materially different in kind or extent, meaning the parties receive distinct legal entitlements; here, the mortgages were secured by different properties and obligors, satisfying that standard and triggering recognition of the losses based on the difference between adjusted basis and fair market value.

taxesbusiness & regulatory

The case concerned the federal income tax liability of Centennial Savings Bank, a mutual savings and loan, specifically two 1981 transactions. First, Centennial exchanged participation interests in one set of residential mortgages for interests in another set held by FNMA, claiming a deductible loss based on the difference between the loans' face value and fair market value. Second, it collected early withdrawal penalties from CD depositors and sought to exclude those amounts from gross income under 26 U.S.C. §108 as income from the discharge of indebtedness. The Supreme Court held that the mortgage exchange produced an immediately deductible loss because the loans were materially different for tax purposes despite regulatory treatment, but that the penalties did not qualify for exclusion under §108 because they did not result from any cancellation or forgiveness of debt. The Court therefore affirmed in part and reversed in part the Court of Appeals' judgment.

taxesbusiness & regulatory

This case involved passengers on an Eastern Airlines flight that experienced multiple engine failures and was prepared for ditching in the ocean before landing safely, who sued the airline solely for mental distress under Article 17 of the Warsaw Convention. The Supreme Court held that the Convention does not permit recovery for purely mental or psychic injuries unaccompanied by physical injury. The Court's reasoning centered on interpreting the French term "lésion corporelle" in the authentic text as referring to bodily injury, supported by the treaty's negotiating history, the goal of uniform liability rules among signatories, and the absence of evidence that mental injury alone was intended to be covered.

torts & liability

This case involved a dispute over whether a court should defer to the Secretary of Labor's or the Occupational Safety and Health Review Commission's interpretation of an ambiguous OSHA regulation regarding respiratory protection programs for coke-oven emissions. The Supreme Court reversed the Court of Appeals' decision to defer to the Commission, holding that deference is owed to the Secretary's reasonable interpretation. The Court reasoned that the Secretary, who promulgates the regulations and enforces them, is better positioned to provide authoritative interpretations based on policy expertise, while the Commission's role is primarily adjudicatory. On remand, the lower court was directed to assess the reasonableness of the Secretary's view.

labor & employmentbusiness & regulatory

The case concerned whether a plaintiff injured abroad by a U.S. military physician could sue the physician personally after the Federal Tort Claims Act's foreign-country exception barred recovery against the government. The Supreme Court held that the Federal Employees Liability Reform and Tort Compensation Act of 1988 makes the FTCA the exclusive remedy for torts committed by federal employees within the scope of their employment, thereby immunizing the individual employee from suit. The Court reasoned that the statute's text provides no exception allowing alternative recovery when an FTCA exception precludes government liability, and that Congress enacted the law to establish absolute immunity for such employees following the Court's prior decision in Westfall v. Erwin.

federal powertorts & liability

This case concerned whether a notice of appeal filed after a district court's oral bench ruling granting summary judgment but before formal entry of the written judgment was effective under Federal Rule of Appellate Procedure 4(a)(2). The Supreme Court held that the bench ruling qualified as a 'decision' under the rule, allowing the premature notice to be treated as filed on the date of the later judgment entry. The Court reasoned that Rule 4(a)(2) codifies the practice of saving appeals from prematurity when the announcement is a final resolution that would be immediately appealable if judgment had been entered, and the district court's ruling here definitively disposed of the contract claims despite the request for proposed findings. The decision reversed the Tenth Circuit's dismissal for lack of jurisdiction under 28 U.S.C. § 1291.

procedure

In Moskal v. United States, the petitioner was convicted under 18 U.S.C. § 2314 for receiving vehicle titles in interstate commerce that incorporated fraudulently lowered odometer readings, as part of a "title-washing" scheme where altered Pennsylvania titles led to issuance of Virginia titles with false mileage figures. The Supreme Court affirmed the conviction, holding that the washed titles qualified as "falsely made" securities because the statute covers documents containing fraudulent content that were procured and transported with knowledge of their falsity. The Court reasoned that the plain language and purpose of the provision prohibit the knowing interstate transport of such documents regardless of whether state authorities issued them without awareness of the fraud, and it rejected a narrower construction limited to forgery or alteration in execution as well as application of the rule of lenity in the absence of genuine ambiguity.

criminal law

In Sisson v. Ruby, the owner of a pleasure yacht filed a petition in federal district court to limit his liability under the Limited Liability Act after a fire aboard his vessel, docked at a marina on Lake Michigan, damaged neighboring boats and the marina. The Supreme Court held that 28 U.S.C. § 1333(1) confers admiralty jurisdiction over the action. The Court reasoned that the incident had a significant relationship to traditional maritime activity because a fire on a vessel in navigable waters could disrupt maritime commerce, applying and extending the test developed in Executive Jet Aviation and Foremost Ins. Co. v. Richardson to pleasure craft.

federal powertorts & liability

In Begier v. Internal Revenue Service, a bankruptcy trustee sought to recover payments made by a debtor airline to the IRS for withholding and excise taxes in the 90 days before the bankruptcy filing, claiming they were preferential transfers under the Bankruptcy Code. The Supreme Court ruled that the trustee could not avoid these payments because the tax funds were not the property of the debtor. The Court reasoned that under 26 U.S.C. § 7501, such taxes are held in a trust for the United States, and thus payments of these trust-fund taxes do not involve property that would have been part of the bankruptcy estate under 11 U.S.C. § 541.

taxesbusiness & regulatoryprocedure

The case concerned whether criminal restitution obligations imposed as a condition of probation are dischargeable debts in a Chapter 13 bankruptcy proceeding. The Supreme Court held that such restitution payments qualify as "debts" under the Bankruptcy Code's definition of a liability on a claim and are therefore dischargeable in Chapter 13, even though they are not dischargeable in Chapter 7 under the exception in 11 U.S.C. § 523(a)(7). The Court reached this conclusion based on the plain language and structure of the Code, which defines "debt" and "claim" broadly to include rights to payment without distinguishing between civil and criminal obligations. The ruling reversed the District Court's decision and affirmed the Court of Appeals, emphasizing that Congress did not extend the Chapter 7 exception to Chapter 13.

criminal lawprocedure

The case concerned whether 18 U.S.C. § 3013, which imposes a monetary special assessment on persons convicted of federal misdemeanors, was enacted in violation of the Constitution's Origination Clause requiring all revenue-raising bills to originate in the House of Representatives. The defendant, convicted of aiding illegal entry by aliens, challenged the assessments on this ground after sentencing. The Supreme Court first ruled that the dispute was justiciable and did not present a nonjusticiable political question. On the merits, the Court held that the statute did not violate the Origination Clause because the assessments were not a "Bill[] for raising Revenue," as their purpose was to fund a specific victim assistance program rather than to generate general government revenue.

criminal lawfederal power

This case involved whether the Victim and Witness Protection Act of 1982 permits federal courts to order a defendant convicted of one offense to pay restitution for losses stemming from other alleged offenses that were dismissed or not charged. The Supreme Court held that the Act authorizes restitution only for losses caused by the specific conduct underlying the offense of conviction. The Court based its conclusion on the statute's repeated references to restitution for victims of "such offense" or "an offense," which it read as limited to the offense of conviction, along with the ordinary meaning of restitution as restoring losses from a particular event and the Act's overall structure tying damages to the offense. It rejected the government's broader view that would allow restitution based on related conduct or the defendant's course of action.

criminal lawprocedure

In this case, truck drivers sued their union for breaching its duty of fair representation under the National Labor Relations Act by allegedly mishandling grievances over layoffs, recalls, and seniority rights under a collective-bargaining agreement with their employer. After the employer went bankrupt, the only remaining claims were for compensatory damages including backpay and lost benefits. The Supreme Court held that the Seventh Amendment guarantees the plaintiffs a jury trial on these claims. The majority reasoned that the suit was akin to a legal action for breach of fiduciary duty or contract at common law, and that the monetary relief sought further supported the right to a jury rather than an equitable proceeding.

labor & employmentprocedure

This case concerned whether the National Labor Relations Board must adopt a presumption that employees hired to replace strikers oppose the union when assessing if an employer has a good-faith doubt about the union's continuing majority support. The Supreme Court held that the Board acted within its discretion by refusing to impose such a presumption and reversed the Fifth Circuit's contrary ruling. The Court explained that the Board has long applied varying approaches to striker replacements' union sentiments but ultimately treated them like other new hires, presuming support for the union in the same proportion as the employees replaced. The opinion emphasized that the Board's policy choice was rational and did not require employers to show actual evidence of replacement opposition in every case.

labor & employment

This case involved whether demand notes issued by an agricultural cooperative to fund its operations qualified as "securities" under Section 3(a)(10) of the Securities Exchange Act of 1934, thereby triggering the Act's antifraud rules in a lawsuit by note holders against the cooperative's auditor. The plaintiffs alleged that the auditor's faulty valuation of assets in its reports misled them into buying the uncollateralized, variable-interest notes marketed as an investment program, which lost value when the cooperative later went bankrupt. The Supreme Court held that the notes were securities, reversing the Eighth Circuit's contrary ruling. The Court reasoned that Congress defined the term broadly to cover notes and similar instruments used to raise money from the public on promises of returns, with only a narrow exception for certain short-term commercial paper having a maturity of nine months or less, which these demand notes did not meet under the applicable test.

business & regulatory