Tuesday, July 14, 2015

When does statutory purpose matter to statutory meaning, and why?

Two Supreme Court statements about the role of a statute’s purpose in its interpretation:

From Baker Botts LLP v. Asarco LLC, a case decided on June 15, 2015 that finds that bankruptcy attorneys are not entitled to court-ordered attorneys’ fees to compensate them for the time they spent in litigating their right to attorneys’ fees for their work on the underlying bankruptcy itself, this observation by Justice Thomas for a majority of the Court:

Our job is to follow the text even if doing so will supposedly “undercut a basic objective of the statute….”

And from Texas Department of Housing and Community Affairs v. Inclusive Communities Project, the case decided June 25, 2015 that holds that the Fair Housing Act prohibits not only intentional discrimination but also other conduct, not necessarily meant to discriminate, that has discriminatory effects, this comment by Justice Kennedy, again for a majority of the Court (which I quoted in my earlier post about this case):

[A]ntidiscrimination laws must be construed to encompass disparate-impact claims when their text refers to the consequences of actions and not just to the mindset of actors, and where that interpretation is consistent with statutory purpose.

Why does statutory purpose matter in one case, and not in the other? The question is especially pointed because Justice Kennedy, the author of the Inclusive Communities decision, was also one of the justices concurring in Justice Thomas’ opinion in Baker Botts. Hasn’t he just endorsed two contradictory views of the importance of congressional purpose?


No. The crucial distinction (not the only one, but I’ll leave a more complete account for some other day) between the cases is the one Justice Kennedy himself points to in the Inclusive Communities passage: in this case he is explaining how “antidiscrimination laws must be construed.” This case tells us that Justice Kennedy, and the Court, will not read the words of a discrimination statute – a race discrimination statute in particular – without attention to what that statute means in our society, with its agonizing history of race discrimination. He, and the Court, are prepared to insist on the full rigor of an exclusive focus on the text when what’s at issue is merely the distribution of money between powerful private actors like Baker Botts and Asarco. But when the stakes, the constitutional stakes, are truly high, a majority of the Court will keep them in mind as it reads and interprets Congress’ words. And that is good news.

Sunday, July 5, 2015

The Supreme Court's decision on housing discrimination

Texas Department of Housing and Community Affairs v. Inclusive Communities Project, Inc., decided on June 25, 2015, understandably received much less attention than the Supreme Court’s same-sex marriage decision the following day.  But Inclusive Communities is an important case nonetheless. (Disclosure: I assisted two New York Law School colleagues who, together with students, wrote an amicus brief broadly supporting the result the Court reached.)

The question the case addressed was whether the Fair Housing Act forbids both action that deliberately discriminates based on race, and also action that has a racially discriminatory effect. Deliberate discrimination in this context is called “disparate treatment”; action with racially discriminatory effects, but no proven discriminatory purpose, is described as having a “disparate impact.” As lawyers would put it, then, the question was whether the Fair Housing Act creates liability not only for “disparate treatment” but also for “disparate impact.”

It’s been settled since Griggs v. Duke Power Co., decided by the Supreme Court in 1971, that the following language of the Civil Rights Act of 1964 forbade both disparate treatment and disparate impact in employment discrimination cases:

            Section 703(a): It shall be an unlawful employer practice for        an employer …

(2) to limit, segregate, or classify his employees or applicants for employment in any way which would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee, because of such individual’s race, color, religion, sex, or national origin.

That case is settled law. The Inclusive Communities case was about two sections of a different statute, the Fair Housing Act. The language of the two sections varies a bit, but the central words at issue can be seen here, in section 804(a), which makes it unlawful:

To refuse to sell or rent after the making of a bona fide offer, or to refuse to negotiate for the sale or rental of, or otherwise make unavailable or deny, a dwelling to any person because of race, color, religion, sex, familial status, or national origin.

The Supreme Court, by a 5 – 4 vote with Justice Kennedy writing the majority opinion, concluded that this language did encompass “disparate impact” as well as “disparate treatment” liability. Justice Kennedy writes (at 10) that Griggs and the plurality opinion in a subsequent case, Smith v. City of Jackson (2005), show “that antidiscrimination laws must be construed to encompass disparate-impact claims when their text refers to the consequences of actions and not just to the mindset of actors, and where that interpretation is consistent with statutory purpose.”

Here, the Court says, the language that “refers to the consequences of actions” is the phrase “otherwise make unavailable” (11). That’s a possible reading, but not, it seems to me, an inevitable one. “[O]therwise make unavailable” might be meant, as the Court is suggesting, to refer to acts of unintentional discrimination – in contrast to deliberate “refusals” or “denials.” But one might instead say that “otherwise make unavailable” refers to intentional acts that just aren’t the same intentional acts as “refusals” or “denials.” A “failure to respond” – unaccompanied by an express refusal or denial – might be an example.

If the phrase “otherwise make unavailable” is ambiguous, we might look a few words further to the phrase “because of race.” What does it mean to make housing unavailable “because of race”? The dissent’s answer is that “because of” means “by reason of” or “on account of,” and if there’s any ambiguity in those definitions, the dissent goes on to cite a lower court case spelling out that “the terms [after] the ‘because of’ clauses in the FHA supply the prohibited motivations for the intentional acts … that the Act makes unlawful.” (Dissenting opinion of Alito, J., at 5). Alito maintains that this is simply what “because of” means in our language – and to make his point he cites 14 articles using the phrase in the Washington Post on the day this case was argued. (Id. at 4 – 5 n.2.)

If he’s right that the words “because of” have this meaning, and can only have this meaning, then the FHA must be insisting on actions “motivated by” race – “disparate treatment” – and must not be making actions with merely “disparate impact” unlawful.

But it’s quite clear that “because of” in our law does not always mean “motivated by.” We know that from Griggs itself, where the same “because of” language appears – and did not stop the Supreme Court from finding that the Civil Rights Act of 1964 prohibited employment decisions that had “disparate impact” on particular racial groups.

Still, one might say that Griggs was mistakenly decided, and that its mistake should not be propagated – and this is exactly what Justice Thomas does say in his separate dissent. So it is important to ask whether “because of” could possibly mean, as a matter of English language usage, something other than “motivated by.”

The answer, it seems to me, is clearly yes. Suppose we ask, for instance, why black students as a group do less well than whites on the SAT exam. We might answer, “because of race.” What we would mean is not that the SAT deliberately discriminated against black people, but that the SAT’s negative impact on black students as compared to whites results from the many ways that race in our society contributes to social and educational disadvantage. “Because of race,” when used this way, is shorthand for “as a result of the interaction between the action taken and the social conditions that race has shaped.” And this is anything but fanciful: the massive, systematic socioeconomic disadvantages facing black people in the United States today can’t plausibly be explained as the sum of acts of conscious, purposeful racial discrimination, persistent as that kind of discrimination is; there’s much more to it than that, and that “much more” is encompassed in the words “because of race.”


There’s also more to the Inclusive Communities case, but it’s important to recognize, right away, that speakers of English do use the words “because of race” to refer to “disparate impact” and not only to “disparate treatment.” So the plain meaning of the statute’s words did not rule out the Court’s interpretation.

Friday, July 3, 2015

The same-sex marriage case and the role of the Supreme Court in a democracy

Justice Kennedy’s opinion for the Court is not, everyone would agree, a classic of doctrinal precision. But I’m not as disturbed about that as some people may be.

Brown v. Board of Education, after all, was not a classic of precise legal reasoning either. One leading scholar of the day felt the case for desegregation hadn’t been made; another wrote an article offering the opinion that he felt the Court should have written. It’s striking, even today, that the Brown Court managed to avoid ever saying what everyone knew, namely that the reason segregated schools existed in many states was that whites ran those states and viewed blacks as inferior. Nevertheless, Brown remains a key to modern American constitutional law.

Obergefell is squarely in the tradition of Brown. It discerns a constitutional right in words that had not been thought to contain this guarantee. Clearly the men (women could not vote at the time) who adopted the Fourteenth Amendment did not understand it to guarantee same-sex marriage; and it seems unlikely (at any rate the Brown court evidently thought it unlikely) that the adopters of that amendment understood it to forbid the segregation of schools either. In each case, the Court concluded that it could articulate the meaning of American values in ways that many or most Americans, at least in referenda and legislative votes, had not yet done.

Today’s conservative justices believe themselves opposed to the courts’ playing this role as the conscience of the country. Whether this is self-delusion on their part is an interesting question, but not one I want to take on today. (Incidentally, an earlier generation of conservatives, the ones who wrote decisions early in the twentieth century upholding the “liberty of contract” against such outrages as laws regulating the maximum number of hours in a workday, had no such hesitations.) But how can this current reluctance be squared with Brown? Perhaps the easiest way is simply to accept Brown as already decided, and uphold its result while “forgetting” the jurisprudential approach that led to that result. But Obergefell is a big problem for this strategy, because it just happened. There is now simply no way to deny that the Court does, even today, play this role.

It’s of course still possible to deny that the Court should do this, in particular on the ground that when nine justices, from elite backgrounds, shift the meaning of the constitution they are depriving the people of the country of their right of democratic self-governance. There are a lot of ways to respond to this charge, but perhaps the strongest is this point, articulated many years ago in a book review by Jerry Lynch, then a young faculty member at Columbia and now a judge of the U.S. Court of Appeals for the Second Circuit: this supposedly undemocratic institution is in fact an integral part of our particular democracy.

Or to put the point as Justice Kennedy does: 
[C]hanged understandings of marriage are characteristic of a Nation where new dimensions of freedom become apparent to new generations, often through perspectives that begin in pleas or protests and then are considered in the political sphere and the judicial process. (Obergefell, majority opinion at 7.)
The Supreme Court in Obergefell spoke to the deep values of the American people. To some extent, it spoke for the many, many people who have rapidly come to approve of same-sex marriage. To some extent, it spoke to others who had not yet reached the same conclusion. To some extent, it constrained still others who may never agree. All of this was true in Brown as well.


It’s certainly possible for the Supreme Court to overplay this hand. I doubt that it did so here; the Court’s decision instead feels to me like part of a broad and unstoppable wave of change and justice. But in any case, we live in a democracy in which some of the fundamental decisions, decisions that determine the reach of our constitutional liberties, are made by nine unelected people. We just do.

Sunday, June 28, 2015

Preserving Obamacare with a prescription of common sense

It was a busy week for the Supreme Court, and a very good one for liberals.

But let’s not focus on human rights, including the profound and welcome decision to recognize a right to same-sex marriage. Instead let’s discuss statutory interpretation!

In the Affordable Care Act (Obamacare) case, Kingv. Burwell, the Court had to decide whether a provision of the statute, which allowed tax credits – essential for the overall plan’s viability – to be paid to a taxpayer who had purchased insurance through “an Exchange established by the State,” actually authorized tax credits not only for taxpayers in the states that did establish these Exchanges but also for taxpayers in the many states – a large majority – that did not. In those states, as the statute provided, the federal government had filled the void left by state inaction and established an Exchange itself.

So the precise statutory question was “does ‘Exchange established by the State’ mean “Exchange established either by the State or the federal government’”? It might seem obvious that the answer is "no" – the federal government is not a state. For Justice Scalia, the answer was obvious, and it was indeed "no." Scalia says that the Court's answer -- "yes" -- "is of course quite absurd, and the Court's 21 pages of explanation make it no less so." (Dissenting opinion at 1.) That's pretty sharp -- though not the sharpest language Scalia has ever used. 

Despite Scalia, six justices said "yes," in an opinion by Chief Justice Roberts. In fact the question wasn’t quite as obvious, even as a technical matter, as Justice Scalia believed. For example, as Roberts says, the statute “defines the term ‘Exchange’ to mean ‘an American Health Benefit Exchange established under section 18031.” Section 18031 is the section telling states to set up these exchanges, but the states weren’t obliged to do so, and another section, 18041, tells the Secretary of Health and Human Services to “establish and operate such Exchange” if the state doesn’t. Then, since “Exchange” is defined as an Exchange established under section 18031, and section 18041 tells the Secretary to establish “such Exchange,” actually the Secretary is being told to establish “an exchange … under section 18031,” which, again, is the section authorizing states to set up exchanges. So it’s possible to parse the language to say that the federal government has been instructed to set up state exchanges. (Majority opinion at 11-12.)

It turns out there are a number of anomalous sections like this. Perhaps the most striking is the one that says that all exchanges are to report to the IRS the information necessary for the calculation of each person’s tax credit – a provision hard to understand if in fact people who purchased insurance on federal exchanges couldn’t get any tax credits at all. (Majority opinion at 13-14.)

But the real point, I believe, is not these technicalities, though they help Chief Justice Roberts to establish that the statute has enough ambiguity to be open for interpretation. The real heart of the Court’s decision is evident in this penultimate paragraph:

            Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them. If at all possible, we must interpret the Act in a way that is consistent with the former, and avoids the latter. [The relevant section] can fairly be read consistent with what we see as Congress’s plan, and that is the reading we adopt. (Majority opinion at 21.)

Roberts appears to believe that where the constitution does not set the courts at odds with the other branches of government, then the courts and those other branches are partners in governance. This is an old idea, dating back to the “legal process” school of the mid-twentieth century. It is by no means a charter for unchecked, freewheeling judicial rewriting of the statutes enacted by Congress; there will surely be many, many cases where the clarity of a statute’s words overwhelms arguments for reinterpretation that are less cogent than those in the Obamacare case.  

But this case does indeed create a precedent for the proposition that language by itself, however seemingly clear, should not be understood in a way that “destroys” what Congress meant to do. To this extent Scalia is clearly right: this case “will be cited by litigants endlessly,” though I don’t share his belief that the result will be “the confusion of honest jurisprudence.” (Dissenting opinion at 21.)

In fact the case is already not unique – this is at least the third decision Roberts has written or joined in the past two years in which the Supreme Court has departed from what arguably was the clear import of statutory words if read by themselves. The earliest  was Bond v. United States, decided in June 2014; there the Court decided, in an opinion written by Roberts, that a woman’s effort to cause a romantic rival to “develop an uncomfortable rash” by putting “two toxic chemicals” on the rival’s doorknob did not amount to the use of a “chemical weapon.”  The next was Yates v. United States, decided in February 2015, in which the Court held (though without a majority opinion) that a statute aimed at financial fraud, one of whose provisions punished the destruction of a “tangible object” with the goal of interfering with a federal investigation, did not cover the destruction of illegally-caught oversize fish.  The Supreme Court appears to be experiencing an epidemic of common sense!

These common-sense decisions reject an alternative approach that almost taunts Congress for its imprecisions. Instead, they tell us that we can, at least broadly, understand what Congress seeks – despite the skepticism with which some have come to greet this proposition. Just as clearly, they say that when we understand it we should support it (of course within the bounds of the constitution) even if the words Congress used don’t readily lend themselves to such a supportive reading. 


Thank goodness.