Legal Docket: Suing a corporation


MARY REICHARD, HOST: All right, let’s get to work.

Justice Ruth Bader Ginsburg returned to work on Friday. She’d been away since before the holidays, needing to recover from cancer surgery. Pretty remarkable that she missed only 11 oral arguments. For comparison, back in 2004-2005, Chief Justice William Rehnquist missed 44 arguments due to thyroid cancer.

So if Justice Ginsburg’s absence was unusual in the scheme of things, it was unusual for how brief an absence it was.

NICK EICHER, HOST: Yes, in that Friday conference Justice Ginsburg attended, the court considered the challenge to a question the Trump administration wants on the next census form. The same question that was on the form mailed to every American household until 1950: Is this person a citizen of the United States?

State courts have fought this, so the administration asked the Supreme Court to fast-track the case. The forms need to be printed by summer, so time is a factor.

And just to clarify: After 1950, short and long census forms came out, and the citizenship question was only on the long form. The administration wants the question on all forms, long or short.

REICHARD: And Nick, I’ll add that late Friday, the court announced it will hear that case in late April, without waiting for a federal appeals court to weigh in first.

Now on to today’s oral arguments leftover from January.

The facts of this first one are tragic. The case dates back to 2013, with two men enjoying a fishing trip out on the Tennessee River.

Gary Thacker and his friend Anthony Szozda sped along the river in a boat on what seemed to be an ordinary day.

What they didn’t know was that a TVA power line had fallen into the river. TVA stands for Tennessee Valley Authority, which was aware of the downed line. So TVA coordinated with the Coast Guard to try to cordon off the area to keep boats away with radio warnings and patrol boats.

EICHER: They didn’t reach Thacker and Szozda. Their boat passed through the area at 60 miles per hour when the line whipped up and struck the men.

Szozda died instantly. Thacker survived but suffered severe spinal injuries. Thacker sued the Tennessee Valley Authority, claiming negligence.

TVA points out the river is a mile wide where the downed line lay and patrol boats just could not reach him in time.

REICHARD: But that’s not what the dispute is about.

It’s a narrower legal question whether TVA is liable in the first place, whether it is “immune” from this kind of lawsuit.

Thacker’s lawyer, Franklin Rouse, argued to the Supreme Court that of course TVA is liable.

ROUSE: Congress hasn’t given the Tennessee Valley Authority that immunity. It’s just said the Tennessee Valley Authority may be sued, period. And so, if the TVA’s going to get any immunity at all, it’s going to have to meet this court’s test.  It’s going to have to clearly show one of the three things that this court has said is required. It hasn’t done that. It didn’t do it below and it’s not doing it now.

Rouse argued the TVA’s action was no different than that of a private business.  It wasn’t making policy like a government. It was making electricity like a commercial enterprise. So, it can be sued like a private business.

The federal government created TVA in 1933 to help supply the area with electrical power and control flooding. Today, TVA operates 49 dams on the river and funds itself through power revenue.

And the TVA Act does say the TVA “may sue and be sued.” Justice Stephen Breyer thought this sounded like a whole lot of work for the courts to sort out.

BREYER: And so what you’re asking us to do is to have  each court decide each thing that the TVA and probably a hundred other government agencies that the sue and be sued clause does, and decide case by case which is what you said whether it does or does not fall within the discretionary exemption. Now that seems to me a very complex difficult decision that could end up with probably a hundred cases before this court…

“Discretionary exemption” is one of those exceptions to liability. Whether this means repairing the power line, or how the TVA did or did not secure the area properly, I don’t know.

TVA argues another law gives it immunity from suit.

That says the government isn’t liable even if a private party would be liable for the same thing. Besides, there’s no distinction to be made between government and commercial activity.

That didn’t go over well with Justices Samuel Alito and Neil Gorsuch. Listen to this exchange with TVA’s lawyer, Ann O’Connell Adams. Alito’s first in the sequence.

ALITO: So if TVA engages in an act of negligence in doing exactly the same thing that is done everyday by let’s say Pepco, the TVA is completely immune?

ADAMS: If it involves the exercise of discretionary judgment, yes. And that’s not different from agency….

GORSUCH: Shouldn’t —   shouldn’t we expect a little more clarity from  Congress than that? If — if the government wishes to compete in private industry and the commercial world, shouldn’t we expect the government to make it clear that it wishes to  retain its immunity a little bit more clearly than enacting a statute that says the entity may be sued?

ADAMS: I don’t think so.

GORSUCH: I mean those are the only words we have in the statute. You’re asking us to embroider them quite a bit, aren’t you?

And then this, which seemed persistent and painful as a hangnail:

GORSUCH: I’m going to try and pin you down just a little bit. Let’s assume  you’ve lost that argument… Does the government have any backup argument at all, or is that the end of it? And I’d really appreciate if it is possible to start with a yes or a no.

ADAMS: Yes…

So where to draw the line so as not to burden government with myriad civil lawsuits, yet still keep government accountable. This one doesn’t seem to break along ideological lines, so I’m not sure how this one gets resolved.

This next case is about how Medicare reimburses hospitals.

Basically, Health and Human Services changed the formula for reimbursement to hospitals. HHS’s change cost providers billions of dollars.

Hospitals were not happy. Many sued, arguing HHS violated both the Administrative Procedure Act and the Medicare Act in failing to do notice and comment.

HHS argues all it did was revise the formula. That fits under an exception to requirements about public notice and comment.

The lawyer for HHS said it’s too burdensome to insist on notice and comment for thousands of pages of Medicare manuals when it wants to change something.

Hospital attorney Pratik Shah countered that most of those pages don’t apply here. And he seemed to have an ally in Justice Samuel Alito.

ALITO: You — you explained away the last 5,000 pages of the manual.

SHAW: Yes.

ALITO: But what about the first thousand? [Laughter]

SHAW: Yes. The remaining 980 pages…

Justice Brett Kavanaugh recused from this matter. That’s because he wrote the opinion now on appeal. This looks like a nod to then-Judge Kavanaugh’s opinion below, and a win for the hospitals.

This final case today is a copyright fight.

It asks, just when can you sue for copyright infringement? Is it after you secure copyright registration, or is it just after you file all the paperwork with the Copyright Office?

Fourth Estate Public Benefit Corporation created content and licensed articles to a website called WallStreet.com. The content had to be taken down if the business account was canceled.

Well, WallStreet.com canceled the account but didn’t take down the content. So Fourth Estate sued the site for copyright infringement.

But Fourth Estate had not completed copyright registration, so WallStreet.com says no case.

Here’s the trouble. Courts can’t agree on what “registration” means: Filing the papers, or receiving confirmation?

Lawyer for WallStreet.com, Peter Striss, argued the Copyright Act’s plain text means the copyright office has to act on the copyright application before anybody can sue over it.

Fourth Estate’s lawyer, Aaron Panner, had a hard time of it. Listen to this exchange with Chief Justice John Roberts:

ROBERTS: So you could go back, the registrar hasn’t even registered the mark, and you can go into court and say, hey, I get the benefits of having registered my mark?

PANNER: The copyright claim, yes, Your Honor.  …Think about if you have a magazine article or a book or a piece of music, you know, a piece of sheet music that is being registered.  Those things are submitted. They are registered as a matter of course … — everybody agrees, Your Honor, that when those materials are submitted in a form acceptable for registration, that is the effective date of registration, even if the registrar acts a year later.

But that didn’t seem to convince a majority of justices. And WallStreet.com’s lawyer Striss seemed mighty confident:

STRISS: And so you may not like this policy but what I’m trying to do is not argue as a policy matter that I’m right. I’m trying to explain why you shouldn’t have any heartburn holding that Congress meant what it said in the provision.

And I think in this case, the plain meaning will prevail, and the good lawyer is right.

And that’s this week’s Legal Docket.  


(AP Photo/Jon Elswick, File) In this Feb. 13, 2016, file photo, people stand on the steps of the Supreme Court at sunset in Washington.

WORLD Radio transcripts are created on a rush deadline. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of WORLD Radio programming is the audio record.

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One comment on “Legal Docket: Suing a corporation

  1. Sayaka says:

    The TVA is a can of worms. The Tennessee Valley Authority is a “federally owned corporation” in the United States created by congressional charter, to provide navigation, flood control, electricity generation, but it is not actually apart of the federal government. Instead, the TVA operates exactly like a private corporation, and receives no taxpayer funding. As a matter of fact, it has a corporate monopoly in the area it serves, just like any other corporate utility anywhere in America. As the electric-utility industry moved toward restructuring and deregulation, TVA began preparing for competition. by cutting its operating costs of nearly $950 million a year, reduced its workforce by more than half, (none of whom are considered federal employees by the Office of Personnel Management), and increased the generating capacity of its plants. So, TVA can’t hide behind the government for liability protection.

    As for anything to do with America’s medical system, it is nothing short of a criminal racket,. Hospitals and doctors need to manage their costs to be more reasonable, and stop trying to fleece HHS or Medicare. Otherwise, the government should step in and put all doctors and hospitals under the authority of HHS. Universal Health Care, which was once proposed by Teddy Roosevelt in 1912, would be a good start. If you had that, then there would be little need to buy health insurance policies from health Insurance companies, and you would reduce the whole bureaucratic layer and costs of health care drastically. It makes it simple for the courts too.

    As for copyright infringements, it was silly of the Fourth Estate to publish anything before it had received confirmation from the copyright office. It is really surprising that the Courts didn’t bring this up, rather than get hung up on being unable to agree on what the term “registration” means. (That is a strong indication that we have some pretty incompetent judges sitting on the bench).

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