U.S. Supreme Court faces many controversial cases

(This article originally ran in Lawyers Weekly USA, Boston, MA, another Dolan Media publication.)

With a new justice in the line-up for the first time in 11 years, the U.S. Supreme Court will begin its new term on Oct. 3.

After ending its last term with a bang, with controversial decisions in eminent domain and Ten Commandments cases, the Court spent the summer in the spotlight.

The retirement of Justice Sandra Day O'Connor and the death of Chief Justice William H. Rehnquist, as well as the subsequent nomination and confirmation hearings of John Roberts, have overshadowed the schedule for the next term.

But with cases running the gamut from search and seizure and arbitration to abortion, assisted suicide and campus military recruiting, the term ahead will be one to watch.

Here's a look at some of the important cases the Court has agreed to hear this term and their potential impact:

Miranda Revisited

Does an officer's comment to a defendant about talking to the police after he has invoked his right to counsel constitute interrogation in violation of Miranda, even if the defendant later waived his right to counsel?

The Court will review a decision from Maryland's highest court suppressing Leeander Jerome Blake's statement to police.

The defendant was arrested and charged with murder. He was given his Miranda rights and invoked his right to counsel. An officer then gave the defendant a computer print-out listing the charges against him and the possible sentence. Although the defendant was a minor at the time, and therefore not eligible for the death penalty under state law, DEATH was listed as a penalty. Another officer then said to him, I bet you want to talk now, huh!

About one-half hour later, the defendant asked to speak to officers and, after being re-Miranda-ized, waived his right to counsel.

He later sought to have his incriminating statements suppressed.

Maryland's highest court agreed.

[A]ny reasonable officer had to know that his comment was reasonably likely to elicit an incriminating response. ... The officer's statement to [the defendant] could only be interpreted as designed to induce [him] to talk and it was improper. This statement was the functional equivalent of interrogation, and it was custodial interrogation. Actions taken by the police that [they] should know are reasonably likely to elicit an incriminating response from a suspect amount to the functional equivalent of interrogation, the court said.

Further, in this case [t]here was no break in custody or adequate lapse in time sufficient to vitiate the coercive effect of the impermissive interrogation. ... The delay of twenty-eight minutes before [the defendant] asked if he could talk to the officers is insufficient to constitute a waiver of his right to have counsel present before he made any statement. The break in time from [the officer's] improper interrogation to [the defendant's] inquiry was very short, indicating that the latter was a continuation of the former, the court said.

James J. Tomkovicz, a criminal law and procedure professor at the University of Iowa College of Law, said a waiver of Miranda rights under these circumstances is clearly suspicious.

The law is clear: if a suspect invokes the right to counsel, the government cannot interrogate him, but also may not initiate interrogation, he explained.

Allowing the police to try to cure the problem as they did here would eviscerate the protections of Miranda.

While a suspect sits around waiting, the police could stir something up, then immediately turn around and 'cure' and just wait for the suspect to react and start talking, said Tomkovicz, who has filed an amicus brief on behalf of the National Association of Criminal Defense Attorneys.

Maryland v. Blake, No. 04-373. Certiorari granted April 18, 2005. Ruling below: 849 A.2d 410 (Md. 2004).

Spousal Consent to Search

Can one spouse give valid consent for a police search of the common areas of the marital residence when the other spouse is present and objects?

The Court will review a Georgia Supreme Court decision invalidating a search and suppressing the evidence seized.

The defendant, Scott Fitz Randolph, and his wife had equal authority to give consent for a search of the home. The wife agreed, but the defendant, who was also present, refused. The police went ahead with the search.

The Georgia Supreme Court said that because the defendant was present and objected, the evidence seized had to be suppressed.

While a co-habitant has authority to consent to a search of joint premises, 'a present, objecting party should not have his constitutional rights ignored [due to a] property interest shared with another.' 'Where the police have obtained consent to search from an individual possessing, at best, equal control over the premises, that consent remains valid against a cohabitant, who also possesses equal control, only while the cohabitant is absent. However, should the cohabitant be present and able to object, the police must also obtain the cohabitant's consent. Any other rule exalts expediency over an individual's Fourth Amendment guarantees,' the court said.

It cited similar decisions from Florida and Washington.

Tomkovicz thinks the Supreme Court may hold differently because cohabitatants give up some Fourth Amendment rights.

By sharing the privacy of your space, you have effectively given your cohabitant the power to consent to search, he said. They have an entitlement in their own right to let others in.

Georgia v. Randolph, No. 04-1067. Certiorari granted April 18, 2005. Ruling below: 604 S.E.2d 835 (Ga. 2004).

Student Loans and Social Security

Can the government offset a portion of a debtor's Social Security benefits against his outstanding student loans?

The Court will review a decision from the 9th Circuit allowing the offset.

James Lockhart took out federally guaranteed loans in the 1980's, but couldn't repay them because of health problems and economic difficulties. His only income was Social Security disability benefits, which the government used to offset his loan payments.

He filed for bankruptcy and argued that the collection of his student loans was time-barred by the 1982 Debt Collection Act's ten- year statute of limitations.

But the 9th Circuit disagreed.

It said that while the Debt Collection Act created a ten-year statute of limitations, the 1991 Higher Education Assistance Act eradicated that time limit, and a 1996 amendment to the Debt Collection Act specifically allowed for the offset of Social Security benefits.

A puzzle has been created by the codifiers. But it seems clear that in 1996, Congress explicitly authorized the offset of Social Security benefits, and that in the Higher Education Act of 1991, Congress had overridden the 10-year statute of limitations as applied to student loans. Because the Debt Collection Act's statute of limitation is inapplicable here, the government's offset is not time-barred, the court said.

While the intersection of these two statutes may seem somewhat arcane, the issue has a serious real-world effect, said Stuart Rossman, a staff attorney at the National Consumer Law Center in Boston.

What's happening here is that elderly consumers collecting Social Security who co-signed notes for students are suddenly finding that well into their dotage, a sudden offset of their benefits occurs, he explained.

Rossman, who filed an amicus brief on behalf of the debtor, said that abiding by the statute of limitations would not prevent the government from collecting the money.

If Mr. Lockhart was working, the government could collect against his wages, or they could bring a breach of contract action against him or even get a judicial lien against him, Rossman said.

Lockhart v. U.S., No. 04-881. Certiorari granted April 25, 2005. Ruling below: 376 F.3d 1027 (9th Cir. 2004).

Arbitration Clauses

When the validity of an entire contract is challenged, can its arbitration clause still be enforced?

The plaintiff, John Cardegna, sued a check-cashing company for allegedly making usurious loans disguised as check cashing transactions. The defendant sought to compel arbitration under a clause in its standard customer agreement which stated: Any claim, dispute or controversy arising from or relating to this agreement or the validity, enforceability, or scope of this arbitration provision or the entire agreement (collectively 'claim'), shall be resolved, upon the election of you or us by binding arbitration pursuant to this arbitration provision. The agreement expressly stated that it was governed by the Federal Arbitration Act.

The plaintiff argued that the arbitration clause couldn't be enforced because the underlying check-cashing agreements allegedly violated state law.

The Florida Supreme Court agreed.

In the case before us today the underlying contract at issue would be rendered void from the outset if it were determined that the contract indeed violated Florida's usury laws. Therefore, if the underlying contract is held entirely void as a matter of law, all of its provisions, including the arbitration clause, would be nullified as well.

Hence, [the plaintiff's] claim that the underlying check cashing contract is illegal and void ab initio as being usurious must be resolved by a trial court before arbitration of any other disputes may be compelled, the court said.

It noted similar decisions from state courts in California and Colorado, as well as from the 3rd, 7th, 9th, 10th and 11th Circuits.

Washington, D.C. Trial Lawyers for Public Justice attorney Paul Bland, who represents the plaintiff, said that if the court rules for the check cashing company, it could radically change the law that governs this area.

If the Supreme Court rules that arbitration clauses are more important than other contract terms and therefore enforceable even where the contract itself couldn't be enforced - that could potentially cause a lot of dislocations in the law, Bland said.

Buckeye Check Cashing, Inc. v. Cardegna, No. 04-1264. Certiorari granted June 20, 2005. Ruling below: 894 So.2d 860 (Fla. 2005).

Bivens Immunity

Can a businesswoman pursue a Bivens action against the U.S. government for violating her Fifth Amendment rights when her office computers were seized and damaged?

Susan Hallock operated a business out of her home. Federal customs agents involved in a child pornography investigation of her husband obtained a search warrant for the premises. The agents seized the plaintiff's business computers.

When the allegations against the plaintiff's husband proved unfounded, the government returned the computers. Several were in an unusable condition, and business records on others had been irretrievably lost due to damaged hard disk drives. As a result, the plaintiff was forced to close her business.

She sued the government under the Federal Tort Claims Act for the negligent destruction of her property. A federal judge dismissed the claim for lack of subject matter jurisdiction, finding that it fell within an exception to the government's waiver of sovereign immunity.

The plaintiff then filed a Bivens action against the government employees involved in the search, alleging that seizure of her computer equipment violated the Fifth Amendment. The agents argued that the dismissal of the plaintiff's FTCA claim operated to bar her constitutional claim on the basis of the Act's judgment bar rule. That rule provides that [t]he judgment in an action under [the FTCA] shall constitute a complete bar to any action by the claimant, by reason of the same subject matter, against the employee of the government whose act or omission gave rise to the claim.

But the 2nd Circuit held the rule did not apply.

It said that an action brought under the FTCA and dismissed for lack of subject matter jurisdiction because it falls within an exception to the waiver of sovereign immunity does not result in a judgment in an action under the Act.

This is so because the action was not properly brought under the Federal Tort Claims Act in the first place and is a nullity. We hold that for the judgment bar to apply, the action must first be a proper one for consideration under the Federal Tort Claims Act. In other words, it must fit within the category of cases for which sovereign immunity has been waived. If it does not, then a judgment declaring a lack of subject matter jurisdiction denotes that sovereign immunity has not been waived and that the case is not justiciable in any event, the court said.

It noted a contrary holding from the 7th Circuit.

Will v. Hallock, No. 04-1332. Certiorari granted June 6, 2005. Ruling below: 387 F. 3d 147 (2nd Cir. 2004).

Slip and Sue

Can a woman who was injured when she tripped over letters and packages allegedly left on her porch by a U.S. Post Office employee sue?

The Court will review a 3rd Circuit decision holding the plaintiff's claim was barred by the Federal Tort Claims Act.

The FTCA provides that sovereign immunity is not waived for [a]ny claim arising out of the loss, miscarriage, or negligent transmission of letters or postal matters. (28 U.S.C. Sect. 2680(b).)

The plaintiff, Barbara Dolan, argued that this only retained immunity for claims involving mail lost or damaged in transit.

But the 3rd Circuit disagreed.

Congress intended to protect the government from lawsuits that might be generated by the unavoidable mishaps incident to the ordinary accepted operations of delivering millions of packages and letters each year. [T]he USPS's 'ordinary accepted operations' of necessity must encompass more than merely the mechanical sorting and transfer of the mail. Indeed, it is hard to imagine a more ordinary accepted operation incident to delivering millions of packages and letters each year than the ultimate act of delivery by USPS employees, the court said.

Here, there is nothing out of the ordinary about a USPS employee delivering the mail or placing the mail on the porch instead of the mailbox. [The plaintiff's] accident was incidental to the USPS employee placing the mail on the porch, the court said.

Dolan v. USPS, No. 04-848. Certiorari granted April 25, 2005. Ruling below: 337 F.3d 285 (3rd Cir. 2004).

Suing National Banks

Does diversity jurisdiction exist in a fraud suit against a national bank with branch offices in the state where the plaintiff lived and filed his complaint?

The defendant was a national bank with its principal place of business in North Carolina, while the plaintiff, Daniel G. Schmidt, III, lived in South Carolina.

He sued in South Carolina state court, alleging that the bank had fraudulently induced him and other investors to engage in a high- risk investment scheme.

The bank filed an action in federal court seeking to compel arbitration of the plaintiff's claims.

The plaintiff argued that diversity jurisdiction did not exist because the bank operated branch offices in his home state of South Carolina. 28 U.S.C. Sect. 1348 provides that, for purposes of diversity jurisdiction, [a]ll national banking associations shall be deemed citizens of the states in which they are respectively located.

The 4th Circuit agreed the bank was a citizen of any state in which it operated branch offices.

It is indisputable that a national banking association becomes physically present in a state when it opens branch offices in that state and conducts business there. It follows that, within the ordinary meaning of 'located,' a national banking association is 'located' wherever it operates branch offices, the court said.

A circuit split exists on this issue, with contrary holdings from the 5th and 7th Circuits.

Wachovia Bank v. Schmidt, No. 04-1186. Certiorari granted June 13, 2005. Ruling below: 388 F.3d 414 (4th Cir. 2004).

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