Insights

The Supreme Court of the United States issued six decisions today:

Ames v. Ohio Dept. of Youth Services, No. 23-1039: This case addresses whether majority-group plaintiffs are held to a heighted evidentiary standard in Title VII employment discrimination cases. Marlean Ames, a heterosexual woman, sued her employer after she was not hired for a new management position and later demoted. Citing the fact that the management position was filled by a lesbian woman and that the role Ames was demoted from was filled by a gay man, Ames claimed she was discriminated against because of her sexual orientation in violation of Title VII. The Sixth Circuit affirmed summary judgment in favor of Ames’s employer, applying Circuit precedent that required a majority-group plaintiff to make a prima facie showing of discrimination by presenting “background circumstances” to support a suspicion that “the defendant is that unusual employer who discriminates against the majority.” In a 9-0 decision authored by Justice Jackson, the Court reversed and held that the Sixth Circuit’s “background circumstances” requirement is inconsistent with Title VII’s text and Court precedent—instead all plaintiffs, whether members of a majority group or not, are held to the same evidentiary standard. Justice Thomas (joined by Justice Gorsuch) filed a concurrence, questioning whether courts should continue to apply the McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973) three-step test traditionally used Title VII claims like this case.

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BLOM Bank SAL v. Honickman, No. 23-1259: This case addresses the scope of relief under Federal Rule of Civil Procedure 60(b)(6), which is a catchall provision that permits relief from a final judgment for “any other reason that justifies relief” beyond the specific grounds in Rule 60(b)(1)–(5). The plaintiffs sued BLOM Bank SAL, alleging it aided and abetted terrorist attacks by providing financial services to Hamas-affiliated customers. The district court dismissed the complaint with prejudice, and denied the plaintiffs’ request to amend. Plaintiffs appealed and the Second Circuit held that the district court had applied too stringent a standard when analyzing the plaintiffs’ aiding and abetting claim, but dismissed regardless. After the judgment was affirmed on appeal, the plaintiffs asked the district court to vacate the judgment under Rule 60(b)(6) to permit them to file an amended complaint to meet the clarified standard articulated by the Second Circuit. The district court denied the motion, concluding it did not meet the “extraordinary circumstances” required for such relief under Rule 60(b)(6). The Second Circuit reversed, holding that in this context, Rule 60(b)(6)’s extraordinary circumstances standard must be interpreted in light of Federal Rule of Civil Procedure 15(a)’s liberal amendment policy. In an opinion unanimous as to the judgment, authored by Justice Thomas, the Court held that relief under Rule 60(b)(6) requires extraordinary circumstances, and this standard does not become less demanding when the movant seeks to reopen a case to amend a complaint. A party must first satisfy Rule 60(b) before Rule 15(a)’s liberal amendment standard can apply. Justice Jackson concurred in the judgment and joined most of the Court’s decision, but wrote separately to note that a party should not be prejudiced if they decide to appeal dismissal of their complaint rather than seeking to amend.

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Catholic Charities Bureau, Inc. v. Wisconsin Labor & Industry Review Commission, No. 24-154: This case addresses whether a Wisconsin statute exempting certain religious organizations from paying unemployment taxes, as applied to a Catholic social ministry group, violated the First Amendment. Catholic Charities Bureau, Inc. (the “Bureau”) is a nonprofit organization that serves as the social ministry arm of the Roman Catholic Diocese of Superior, Wisconsin. Neither the Bureau’s employees nor the recipients of its charitable services are required to ascribe to any particular religious faith, and participants in the charitable programs do not receive religious training or orientation. The Bureau and four sub-entities sought a determination from the Wisconsin Department of Workforce Development that they qualified for Wisconsin’s “religious-employer” exemption. Wis. Stat. § 108.02(15)(h)(2). The Department denied the request, holding that Petitioners were not “operated primarily for religious purposes,” as the exemption requires. An administrative law judge reversed the Department’s ruling, which was then appealed through the state administrative and judicial systems to mixed results. The Wisconsin Supreme Court held that Petitioners were not “operated primarily for religious purposes” because they did not engage in proselytization or serve only Catholics in their charitable work, and thus did not qualify for the exemption. In a unanimous decision by Justice Sotomayor, the Court reversed the Wisconsin Supreme Court, finding that Wisconsin’s application of the exemption to Petitioners violated the First Amendment. The Court held that the Wisconsin Supreme Court’s interpretation of the religious-employer exemption imposed a denominational preference by differentiating between religions based on theological lines, turning on inherently religious choices of whether to proselytize or serve only co-religionists in the course of charitable work. Because this regime explicitly differentiates between religions based on theological practices, strict scrutiny applies, placing the burden on Wisconsin to show that the law’s application is narrowly tailored to further a compelling government interest. Although Wisconsin claimed the law served a compelling state interest of ensuring unemployment coverage, the Court found the scheme underinclusive (and thus not narrowly tailored) because it exempted religious entities that provide similar services (i.e., without proselytizing or serving only co-religionists) when the work is done directly by a church. The Court further rejected Wisconsin’s claimed interest in avoiding entanglement with employment decisions based on religious doctrine, finding the lines drawn by the exemption overinclusive because they operated at the organizational level and would apply to employees who do and do not inculcate religious doctrine, such as a priest and a janitor. As a result, Wisconsin failed to carry its burden under strict scrutiny. Justices Thomas and Jackson filed concurrences.

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CC/Devas Ltd. v. Antrix Corp.; Devas Multimedia Private Ltd. v. Antrix Corp., Nos. 23-1201, 24-17: These cases address the requirements for personal jurisdiction over a foreign state under the Foreign Sovereign Immunities Act of 1976 (“FSIA”). Devas Multimedia Private Ltd. signed a satellite-leasing agreement with Antrix Corporation Ltd., which is owned by the Republic of India. Antrix later terminated the agreement, and the parties proceeded to arbitration. The arbitral panel awarded Devas $562.5 million in damages plus interest, and Devas petitioned the U.S. District Court for the Western District of Washington to confirm the award. The District Court confirmed the award and entered a $1.29 billion judgment against Antrix, which the Ninth Circuit reversed for lack of personal jurisdiction over Antrix. The Ninth Circuit did not question that Antrix is a “foreign state” under the FSIA, that an immunity exception applies, and that Devas effectuated proper service. But the Ninth Circuit explained it was bound by Circuit precedent holding that the FSIA imposes an additional requirement, the “traditional minimum contacts analysis” from International Shoe Co. v. Washington, 326 U.S. 310, and its progeny. The Ninth Circuit found insufficient suit-related contacts between Antrix and the United States under International Shoe. In a unanimous opinion by Justice Alito, the Supreme Court reversed the Ninth Circuit, finding that the FSIA does not require proof of “minimum contacts” over and above the contacts required by the FSIA’s enumerated exceptions to foreign sovereign immunity. The Court clarified that personal jurisdiction exists under the FSIA when an immunity exception applies, which confers subject-matter jurisdiction on the district court, and the foreign state is served in accordance with the FSIA’s specialized service of process rules.

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Smith & Wesson Brands v. Estados Unidos Mexicanos, No. 23-1141: In this case the Government of Mexico sued seven American gun manufacturers, alleging that the companies aided and abetted unlawful gun sales that routed firearms to Mexican drug cartels. The gun manufacturers argued that the suit was prohibited by the Protection of Lawful Commerce in Arms Act (“PLCAA”), which bars lawsuits against gun manufacturers and sellers in lawsuits stemming from “the criminal or unlawful misuse” of a firearm by “a third party.” 15 U.S.C. 
§ 7903(5)(A). The PLCAA, however, does not bar suits where the manufacturer or seller “knowingly violated a state or federal statute applicable to the sale or marketing” of firearms, and the “violation was a proximate cause of the harm for which relief is sought.” 15 U.S.C. 
§ 7903(5)(A)(iii). This exception includes aiding and abetting violations of state and federal law. Id. Mexico alleged that the gun manufacturers aided and abetted unlawful retail sales by supplying firearms to retail dealers whom they know illegally sell to Mexican gun traffickers, failed to impose the kind of controls that would prevent illegal sales to Mexican traffickers, and made design and marketing decisions intended to increase cartel members’ demand for their products. The district court dismissed the complaint, but the First Circuit reversed. In a unanimous decision authored by Justice Kagan, the Supreme Court held that because Mexico’s complaint does not plausibly allege that the defendant gun manufacturers aided and abetted gun dealer’s unlawful sales of firearms to Mexican traffickers, the PLCAA bars the lawsuit. The Court reasoned that the complaint merely alleged the gun manufacturer’s indifference to potential unlawful conduct within their supply chain as opposed to assistance of that conduct. Further, the Court noted that omissions and inaction are rarely sufficient to state a claim for aiding-and-abetting liability. Justices Thomas and Jackson filed concurring opinions.

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Laboratory Corporation of America Holdings v. Davis, No. 24-304: In January 2025, the Court granted certiorari in this case to address the standard for certifying class actions seeking monetary damages under Federal Rule of Civil Procedure 23(b)(3). The question presented was: Whether a federal court may certify a class action pursuant to Rule 23(b)(3) when some members of the proposed class lack any Article III injury. Today, the Court issued a one sentence per curiam decision dismissing the writ as improvidently granted. Justice Kavanaugh filed a short dissent arguing that mootness concerns did not preclude the Court from ruling on the merits of the case, and stating that he “would hold that a federal court may not certify a damages class that includes both injured and uninjured members.”

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