Latest 3 Cases: Jackson v. Modly (Civil Rights), Government of Guam v. United States (Environmental Law), Gresham v. Azar (Government & ...

The Investors’ Control of Their Investment Advisers. Who Has the Final Word?

TAMAR FRANKEL

BU Law emerita professor Tamar Frankel discusses an emerging issue affecting financial advisers—when a client may exercise control over the actions of the adviser. Frankel relates the story of an investment adviser that did not follow the client’s orders to cease certain investments, at a cost of almost $5 million to the client. As Frankel explains, the Securities and Exchange Commission (SEC) got involved, resulting in the investment adviser’s settlement for a significant payment to the client and other conditions.

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Jackson v. Modly

Docket: 18-5180

Opinion Date: February 14, 2020

Judge: Henderson

Areas of Law: Civil Rights, Government & Administrative Law, Labor & Employment Law, Military Law

Jackson served in the Marine Corps, 1977-1991. Almost 30 years after his honorable discharge, Jackson filed a pro se complaint alleging that toward the end of his military career, his supervising officers discriminated against him because he is a black male, in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. 2000e. The district court inferred additional claims under the Administrative Procedure Act (APA), 5 U.S.C. 706(2)(A), and the Military Pay Act, 37 U.S.C. 204 but ultimately dismissed all of Jackson’s claims. The D.C. Circuit affirmed. The court noted the unanimous rulings of other sister circuits, concluding that Title VII does not apply to uniformed members of the armed forces. Jackson’s APA claim was untimely and, although the limitations period is no longer considered jurisdictional, the facts alleged were insufficient to apply equitable tolling. Jackson was able to manage his affairs and comprehend his rights; he alleged that at the time of the alleged discrimination, he knew that he “had been subjected to wrongdoing and strongly desired justice.” The court concluded that it lacked jurisdiction to review the dismissal of Jackson’s Military Pay Act claim; the Court of Appeals for the Federal Circuit has exclusive jurisdiction of such claims.

Government of Guam v. United States

Docket: 19-5131

Opinion Date: February 14, 2020

Judge: David S. Tatel

Areas of Law: Environmental Law

Since the 1940s, the U.S. Navy operated a landfill on the island of Guam, containing discarded munitions, chemicals, and everyday garbage. The Ordot Dump lacked any environmental safeguards. The EPA added Ordot to its National Priorities List in 1983, and, in 1988, designated the Navy as a potentially responsible party. The Navy no longer owned and operated Ordot—Guam did. The EPA ordered Guam to devise plans for containing and disposing of waste at the landfill and sued Guam in 2002 under the Clean Water Act. Guam and the EPA entered into a consent decree in 2004, which the district court approved; it required Guam to pay a civil penalty, close Ordot, and install a “dump cover system.” The Decree states that it is “binding upon the Government of Guam . . . and on the United States on behalf of U.S. EPA.” Cleanup continues; Guam closed Ordot in 2011. Guam sued the United States in 2017, seeking to recoup its closure and remediation costs, approximately $160,000,000. A suit against the Navy under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), 42 U.S.C. 9613(f) “contribution provision” was time-barred; a suit under section 107 (42 U.S.C. 9607), the “cost-recovery” provision remained timely. The D.C. Circuit concluded that the 2004 consent decree triggered Guam’s right to pursue a section 113 contribution claim, precluding it from now pursuing a section 107 claim and remanded the case with instructions to dismiss.

Gresham v. Azar

Docket: 19-5094

Opinion Date: February 14, 2020

Judge: Sentelle

Areas of Law: Government & Administrative Law, Health Law, Public Benefits

Kentucky and Arkansas residents sued the Secretary of Health and Human Services based on the approval under 42 U.S.C. 1315(a) of an “experimental, pilot, or demonstration projects which, in the judgment of the Secretary, is likely to assist in promoting the objectives” of Medicaid. The district court held that the Secretary failed to analyze whether the projects would promote the primary objective of Medicaid—to furnish medical assistance. Kentucky terminated its project and obtained voluntary dismissal. The D.C. Circuit affirmed with respect to the Arkansas Works program, which required beneficiaries aged 19-49 to “work or engage in specified educational, job training, or job search activities for at least 80 hours per month,” except beneficiaries who show they are medically frail or pregnant, caring for a dependent child under age six, participating in a substance treatment program, or are full-time students. Works proposed to eliminate retroactive coverage, to lower the income eligibility threshold from 133% to 100% of the federal poverty line, and eliminated using Medicaid funds to assist beneficiaries in paying the premiums for employer-provided health care coverage. Instead of analyzing whether the demonstration would promote the objective of providing coverage, the Secretary identified three alternative objectives. Congress has not conditioned the receipt of Medicaid benefits on fulfilling work requirements or taking steps to end receipt of governmental benefits