Why the Supreme Court was Right Last Week to Deny Review of the Pennsylvania Supreme Court Decisions Handed Down Prior to the 2020 Election

VIKRAM DAVID AMAR, JASON MAZZONE

Illinois Law dean Vikram David Amar and professor Jason Mazzone argue that the U.S. Supreme Court correctly denied review last week of the Pennsylvania Supreme Court decisions handed down before the 2020 election. Dean Amar and Professor Mazzone explain why the majority denied review and point out that the dissenting opinions unwittingly demonstrate the rightness of the majority.

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Cooper v. Ruane Cunniff & Goldfarb Inc.

Docket: 17-2805

Opinion Date: March 4, 2021

Judge: Susan Laura Carney

Areas of Law: Arbitration & Mediation

The Second Circuit reversed the district court's order compelling arbitration of plaintiff's claims for breach of fiduciary duty under section 502(a)(2) of the Employee Retirement Income Security Act of 1974 (ERISA). Plaintiff filed suit in 2016 as representative of an ERISA Plan and its participants, alleging that Ruane, a third-party investment manager and plan administrator retained by plaintiff's employer, DST, mismanaged the assets of DST's 401(k) profit-sharing fund, causing it to lose substantial value. The court concluded that plaintiff's ERISA claims for breach of fiduciary duty are not properly understood to be "related to" his employment because none of the facts he would have to prove to prevail on his claims pertain to his employment. Furthermore, other individuals and entities that were never employed by DST could have brought identical claims, including other Plan beneficiaries, the Secretary of Labor, and DST itself. Moreover, the court explained that Congress explicitly authorized plan beneficiaries and others to sue individual fiduciaries in federal court for breach of their duties under ERISA: to interpret the Arbitration Agreement as mandating arbitration of ERISA fiduciary claims would unacceptably undercut the viability of such actions. Therefore, this result is neither required by the Arbitration Agreement's express language nor acceptable in light of ERISA's protective purposes.

Pharaohs GC, Inc. v. United States Small Business Administration

Docket: 20-2170

Opinion Date: March 4, 2021

Judge: Park

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

In March 2020, Congress created the Paycheck Protection Program (PPP), which authorized the SBA to guarantee favorable loans to certain business affected by the COVID-19 pandemic. The SBA Administrator promulgated regulations imposing several longstanding eligibility requirements on PPP loan applicants, including that no SBA guarantee would be given to businesses presenting "live performances of a prurient sexual nature." Pharaohs, a business featuring nude dancing, sought a preliminary injunction directing the SBA to give it a PPP loan guarantee. The Second Circuit affirmed the district court's denial of Pharaoh's motion, holding that the district court did not abuse its discretion in finding that Pharaohs has failed to show that it is substantially likely to succeed on its claims that (1) the SBA exceeded its statutory authority to promulgate eligibility restrictions, and (2) the exclusion of nude-dancing establishments from the Program violates the First or Fifth Amendments. The court need not address the remaining preliminary injunction factors in light of its conclusion.

Chevron Corp. v. Donziger

Docket: 18-855

Opinion Date: March 4, 2021

Judge: Gerard E. Lynch

Areas of Law: Civil Procedure

Defendant appealed the district court's amended judgment awarding costs to Chevron under Federal Rule of Civil Procedure 54(d), several interlocutory orders declining to dismiss civil contempt proceedings against him and ordering compliance with post-judgment discovery, and a judgment and order finding him in civil contempt. The Second Circuit concluded that the district court did not err in awarding costs to Chevron. The court also affirmed the district court's finding that defendant violated the Injunction in several respects and its judgment of civil contempt relating to those violations. However, the court held that the Injunction, previously affirmed by this Court and clear and far-reaching on its own terms, was insufficiently clear and unambiguous, when read alongside the district court's explanation of that Injunction in a subsequent opinion, in prohibiting defendant from raising funds by selling interests in the Ecuadorian Judgment. Thus, the court concluded that the district court erred in finding defendant in contempt for engaging in that conduct. Accordingly, the court affirmed the district court's amended judgment awarding costs to Chevron; affirmed in part and reversed in part the district court's contempt finding and vacated the supplemental judgment awarding Chevron $666,476.34 in compensatory sanctions; and vacated the supplemental judgment awarding attorneys' fees and remanded to the district court to determine the fees reasonably expended to secure the contempt findings affirmed on appeal.

Vasquez v. Maloney

Docket: 20-1070

Opinion Date: March 4, 2021

Judge: William J. Nardini

Areas of Law: Civil Rights, Constitutional Law

The Second Circuit affirmed the district court's order denying defendants' motion for summary judgment based on qualified immunity on plaintiff's unlawful search and seizure claims. The court concluded that defendants violated clearly established law by detaining and frisking plaintiff based on nothing more than an officer's unconfirmed hunch that there might be an open warrant for plaintiff's arrest. In this case, police officers stopped plaintiff and his daughters as they walked out of a Target store. Although the officers admittedly had no reason to think plaintiff had committed a crime, one officer speculated that there "might be" a warrant for plaintiff's arrest. The court explained that the officers clearly lacked any facts giving them reasonable suspicion that plaintiff was involved in criminal activity (much less carrying a dangerous weapon) or wanted for a crime.