The Supreme Court of the United States issued decisions in six cases today:
FERC v. Electric Power Supply Assn., No. 14-840: The Federal Energy Regulatory Commission (FERC), the petitioner here, is authorized under the Federal Power Act (FPA) to regulate “the sale of electric energy at wholesale in interstate commerce,” including both wholesale electricity rates and any rules or practice “affecting” such rates. 16 U.S.C. §§824(b), 824e(a). Under the FPA, however, States alone have the power to regulate “any other sale,” which includes the retail sale of electricity. 16 U.S.C. §824(b). At issue in this suit is FERC’s regulation of “demand response,” whereby operators of wholesale markets pay electricity consumers for commitments to not use power at certain times. Under FERC’s rule, market operators were required in certain circumstances to pay the same price to demand response providers for conserving energy as to generators like power plants for making more energy. The rule was challenged and the D.C. Circuit vacated it, holding that FERC lacked authority to issue the order because it directly regulates the retail electricity market, and alternatively holding that the rule’s compensation scheme is arbitrary and capricious under the Administrative Procedure Act. Today, the Court reversed, holding that FERC’s statutory authority under the FPA extends to FERC’s rule addressing wholesale demand response, and that in choosing a compensation formula, FERC met its duty of reasonable judgment.
The Court's decision is available here.
Amgen Inc. v. Harris, No. 15-278: Respondent stockholders are former employees of Amgen Inc. who participated in plans offering ownership in employer stock. After the value of Amgen’s stock fell, the stockholders filed a class action against petitioner fiduciaries alleging breach of their fiduciary duties, including the duty of prudence, under the Employee Retirement Income Security Act of 1974 (ERISA). The District Court granted the fiduciaries’ motion to dismiss, and the Ninth Circuit reversed. While the certiorari petition was pending, the Court decided Fifth Third Bancorp v. Dudenhoeffer, 573 U.S. __ (2014), which set forth the standards for stating a claim for breach of the duty of prudence, holding that ERISA fiduciaries are not entitled to a presumption of prudence, but are “subject to the same duty of prudence that applies to ERISA fiduciaries in general, except that they need not diversify the fund’s assets.” On remand from the Court to consider Fifth Third, the Ninth Circuit held again that the complaint states a claim. Today, in a per curiam opinion, the Court reversed, holding that the complaint had insufficient facts and allegations to state a claim for breach of the duty of prudence under Fifth Third.
The Court's decision is available here.
Menominee Tribe of Wis. v. United States, No. 14-510: In this dispute concerning the statute of limitations and equitable tolling, petitioner Menominee Indian Tribe of Wisconsin, which like other tribes has contracted with certain federal agencies to take control of federally funded programs, brought a suit against the Federal Government for failing to reimburse it for reasonable “contract support costs” such as administrative and overhead costs associated with carrying out the contracted programs. These claims were first presented to the Indian Health Service (IHS), which denied some of the claims as untimely under the six-year statute of limitations in the Contract Disputes Act of 1978 (CDA). The District Court in turn denied that equitable tolling applied, and the D.C. Circuit affirmed, over the Menominee Tribe’s argument that the limitations period should be tolled for the period in which a related putative class action had been pending. The Court today affirmed, holding that equitable tolling’s requirement that “some extraordinary circumstance stood in [the litigant’s] way and prevented timely filing,” Holland v. Florida, 560 U.S. 631, 649 (2010), is met only where the circumstances that caused a litigant’s delay are both extraordinary and beyond its control, a standard not satisfied in this case.
The Court's decision is available here.
Montgomery v. Louisiana, No. 14-280: Petitioner Henry Montgomery was 17 years old when, in 1963, he killed a deputy sheriff in Louisiana. He was convicted and sentenced to life without parole. In 2012, however, the Supreme Court in Miller v. Alabama, 567 U.S. __, held that a juvenile convicted of a homicide offense could not be sentenced to life in prison without parole absent consideration of the juvenile’s special circumstances in light of the principles and purposes of juvenile sentencing. Montgomery then sought collateral review, but the Louisiana Supreme Court held that Miller does not have retroactive effect in cases on state collateral review. The Court today reversed, holding that, in light of what the Court has said in previous decisions about how children are constitutionally different from adults in their level of culpability, prisoners like Montgomery must be given the opportunity to show their crime did not reflect irreparable corruption; and, if it did not, their hope for some years of life outside prison walls must be restored.
The Court's decision is available here.
Musacchio v. United States, No. 14-1095: Petitioner Michael Musacchio resigned as president of Excel Transportation Services, and then formed a rival company, where both he and another employee continued to access their old company’s computer system without permission. Musacchio was charged under 18 U.S.C. §1030(a)(2)(C) which makes it a crime when a person “intentionally accesses a computer without authorization or exceeds authorized access,” and in doing so “obtains . . . information from any protected computer.” He was also charged with a related conspiracy count. At trial, the District Court erroneously instructed the jury that Section 1030(a)(2)(C) instead made it a “crime for a person to intentionally access a computer without authorization and exceed authorized access.” Musacchio was convicted and appealed to the Fifth Circuit, arguing sufficiency of the evidence under Section 1030(a)(2)(C), but arguing that it should be assessed against the erroneous jury instruction. He also for the first time argued that the conspiracy count was barred by the five-year statute of limitations. The Fifth Circuit rejected these arguments. Today, the Court affirmed, holding that the sufficiency of the evidence should be assessed against the elements of the charged crime, and that the statute of limitations defense could not be successfully raised for the first time on appeal.
The Court's decision is available here.
James v. Boise, No. 15-493: A federal statute, 42 U.S.C. §1988, grants courts discretion to “allow the prevailing party, other than the United States, a reasonable attorney’s fee” in a Section 1983 civil rights lawsuit. The Court has in turn interpreted Section 1988 to permit a prevailing defendant recovery of fees only if “the plaintiff’s action was frivolous, unreasonable, or without foundation.” Hughes v. Rowe, 449 U.S. 5, 14 (1980). Here, the Idaho Supreme Court held that the limitation in Hughes was merely a limit on the discretion of lower federal courts, and did not have any applicability to state courts’ application of Section 1988. It then awarded attorney’s fees to a defendant without determining whether the action satisfied Hughes. The Court today reversed in a per curiam decision holding that the Idaho Supreme Court, like any other state or federal court, is bound by the Court’s interpretation of federal law.
The Court's decision is available here.