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liibulletin: The LII Supreme Court Bulletin

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contents and context

The liibulletin is a Cornell Law School electronic journal. Its editorial board comprises second- and third-year law students, who are responsible for every aspect of the journal's management, from selecting decisions for commentary to researching, writing, editing, and producing the journal content in HTML. Since 2004-05, the bulletin has covered cases currently before the US Supreme Court. Bulletin content is available on this site and by (free) email subscription. See the Cornell Chronicle's 2004 article and 2007 article on this liibulletin project.

(See all 2009-10 oral argument previews; term prospective)

Recent previews

United States v. Milavetz, Gallop & Milavetz (08-1225)

Consolidated with Milavetz, Gallop & Milavetz v. United States (08-1119).

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United Student Aid Funds v. Espinosa (08-1134)

Oral argument: Dec. 1, 2009

Appealed from: United States Court of Appeals for the Ninth Circuit (Dec. 10, 2008)

BANKRUPTCY, STUDENT LOANS, CHAPTER 13, DISCHARGE, RES JUDICATA, DUE PROCESS

Francisco J. Espinosa filed for Chapter 13 bankruptcy and proposed in his Chapter 13 reorganization plan that he would repay $13,250 in student loans to United Student Aid Funds (“Funds”). Although Funds claimed they were owed an additional $4,582.15, the U.S. Bankruptcy Court for the District of Arizona confirmed Espinosa's plan as proposed, and Funds did not object to the confirmed plan. Espinosa repaid all debts according to the Chapter 13 plan. Funds subsequently began to intercept Espinosa's income tax refunds, claiming that Espinosa had improperly discharged his student loans, because Espinosa had not initiated a statutorily required adversary proceeding to determine whether repayment of the student loans would constitute an "undue hardship." While the U.S. District Court of Arizona held that Espinosa had violated Funds' due process interests by failing to initiate an adversary proceeding and serve a complaint and summons upon Funds according to the statutory procedure, the United States Court of Appeals for the Ninth Circuit reversed, and Funds now appeals. The Supreme Court’s decision in this case will determine how student loans and other debts are collected in bankruptcy and will affect the overall relationship between debtors and creditors in America.

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Milavetz, Gallop & Milavetz v. United States (08-1119); United States v. Milavetz, Gallop & Milavetz (08-1225)

Oral argument: Dec. 1, 2009

Appealed from: United States Court of Appeals for the Eighth Circuit (Sept. 4, 2008)

BANKRUPTCY, FIRST AMENDMENT, FREEDOM OF SPEECH, DUE PROCESS

This case concerns the application and constitutionality of three Bankruptcy Code provisions applicable to debt relief agencies: 11 U.S.C. §§ 526(a), 528(a)(4), and 528(b)(2)(B). Minnesota law firm Milavetz, Gallop & Milavetz, P.A. claims exemption from the provisions, arguing that an attorney is not a “debt relief agency.” Furthermore, it claims that 11 U.S.C. § 526(a), which prevents a “debt relief agency” from counseling a client to incur additional debt in contemplation of bankruptcy, is an unconstitutionally overbroad restriction of free speech. Finally, Milavetz argues that 11 U.S.C. §§ 528(a)(4) and 528(b)(2)(B), which require a “debt relief agency” to make certain disclosures in their advertisements, violate the First Amendment. The United States argues that the statutes apply to attorneys and that they are reasonable and specific restrictions on speech. This case’s outcome will potentially affect bankruptcy laws, disclosure laws, and the legal advice that a lawyer may provide a client. 

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Merck & Co., Inc. v. Reynolds (08-905)

Oral argument: Nov. 30, 2009

Appealed from: United States Court of Appeals for the Third Circuit (Sept. 9, 2008)

SECURITIES EXCHANGE ACT, STATUTE OF LIMITATIONS, SCIENTER, Section 10(b)

Under 28 U.S.C. § 1658(b), a plaintiff must file a claim alleging violation of the Securities Exchange Act of 1934 no later than two years after the plaintiff discovers the facts constituting the violation.  The Courts of Appeals are in general agreement that the two-year period of limitations begins when the plaintiff had, or should have had knowledge of the facts constituting the violation.  What is at issue in this case is whether knowledge that defendant acted with the intent to deceive is a fact constituting the violation for purposes of triggering the two-year period of limitation.  The Supreme Court’s decision will resolve this question of statutory interpretation and, in so doing, will determine the delicate balance between allowing plaintiffs with meritorious claims access to the federal courts and providing certainty and repose to potential securities fraud defendants.

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Graham County Soil v. United States (08-304)

Oral argument: Nov. 30, 2009

Appealed from: United States Court of Appeals for the Fourth Circuit (June 9, 2008)

FALSE CLAIMS ACT, QUI TAM, RELATOR, SUBJECT-MATTER JURISDICTION

Respondent, the United States ex rel. Karen Wilson ("Wilson"), brought a qui tam action against two North Carolinian counties, Graham and Cherokee (collectively the “Counties”), for allegedly filing fraudulent reimbursement claims with the federal government. The Counties argue that, under the False Claims Act, no court has jurisdiction over Wilson's suit, because the State of North Carolina had previously publicly disclosed the information on which Wilson relies in her suit. Wilson counters that the False Claims Act’s public disclosure bar refers only to federal reports, audits, and investigations. In this case, the Supreme Court will decide whether, under the False Claims Act, a publicly disclosed state audit and investigation may preclude jurisdiction over a qui tam action.

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Stop the Beach Renourishment v. Florida Dept. of Envt’l Protection (08-1151)

Oral argument: Dec. 2, 2009

Appealed from: Florida Supreme Court (Sept. 29, 2008)

TAKINGS CLAUSE, JUDICIAL TAKINGS, ACCRETION, COASTAL PROPERTY, FEDERALISM

In order to combat beach erosion, the Florida Legislature passed the Beach and Shore Preservation Act. The act authorized local municipalities to restore the coastline by adding sand, creating a temporary buffer against erosion. Petitioner Stop the Beach Renourishment, Inc. (“SBR”) claims that Respondents Florida Department of Environmental Protection, et al.  (“Florida”) misused the statute in order to unconstitutionally appropriate private beaches for public use without just compensation. SBR alleges that the Florida Supreme Court violated the due process and takings clauses by suddenly and unpredictably changing state substantive law to deprive SBR of its private property without compensation. SBR asks the court, for the first time, to explicitly articulate a doctrine of “judicial takings” in order to address the growing problem of state judiciaries redefining property rights out of existence so that states can avoid compensating property owners. Florida argues that the U.S. Supreme Court should avoid interfering in state court interpretation of state law out of respect for federalism. Florida contends that, even if there were a situation where a doctrine of judicial takings should be imposed, this is not one of them, because the Florida Supreme Court properly followed common law precedent.

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