The Supreme Court heard argument on November 7 in Zivotofsky v. Clinton, No. 10-699, a case involving the “political question” doctrine and the scope of the President’s authority over the conduct of foreign relations.

In 2002, as part of the Foreign Relations Authorization Act, Congress enacted Section 214, entitled “United States Policy with Respect to Jerusalem as the Cpaital of Israel.”  Subsection 214(d) provides that, for purposes of issuing a passport to a United States citizen born in Jerusalem, the Secretary of State, upon request, must record the citizen’s place of birth as “Israel.”  In a statement issued at the time he signed the bill, the President took the position that Section 214 is merely advisory because, if it is instead directory, Section 214 would impermissibly infringe upon the President’s constitutional authority to formulate the United States’ position on the recognition to be given to foreign states.

Menachem Zivotofsky, who was born in Jerusalem in 2002 to U. S. citizens, applied through his mother for a passport, requesting that the place of birth be listed as “Jerusalem, Israel.”  The State Department responded that its policy precluded listing “Israel” as Zivotofsky’s birthplace, and issued a passport listing the place of birth as “Jerusalem.”  Menachem, through his parents, then filed an action for declaratory and injunctive relief, seeking an order compelling the State Department to comply with Section 214(d).  Both the district court and the Court of Appeals held that the issues presented by Zivotofsky’s action raised non-justiciable political questions. The Supreme Court granted certiorari to consider both the political question and whether Section 214 is an unconstitutional infringement of the President’s authority.

During oral argument, Zivotofsky’s attempt to defend Section 214 met with skepticism.  Zivotofsky took the position that Congress has authority to legislate in the area of foreign policy, and that Congress acted appropriately in concluding the designation on a passport of “Jerusalem, Israel” as an American citizen’s birthplace would do no harm to U. S. foreign policy.

However, Chief Justice Roberts, and Associate Justices Kennedy, Ginsburg, Scalia, Sotomayor and Kagan, all expressed doubt that Congress could legislate in this area without encroaching upon the President’s authority to conduct the foreign relations of the United States.  As Justice Sotomayor put it:

“[W]hat entitles Congress to trench on a presidential power that has been exercised virtually since the beginning of the country?”

The Court was more receptive to the Solicitor General’s argument that the President’s authority over foreign affairs, including the extent to which foreign governments are recognized, is exclusive, and that Section 214 necessarily infringes upon that authority.  Justice Breyer suggested that the Court might want to abstain from entering this controversy between the legislative and executive branches by upholding the Court of Appeals’ conclusion that this case involves a non-justiciable political question. However, Justices Kennedy and Sotomayor suggested that the Court should reach the merits of the controversy in order th eliminate uncertainty concerning the allocation of responsibility for the conduct of foreign affairs.

A decision in this case is expected by the end of the current Supreme Court term.

David Axelrad is an attorney with Horvitz & Levy in Los Angeles.  Contact David here.

Ad Age recently posted an article addressing the meteoric rise and overwhelming dominance of the smartphone.  At the end of this holiday season, over 50 percent of mobile phone users will be using a smartphone.  A year from now, that figure is projected to almost double, to 90 percent of mobile users.  Moreover, smartphone capabilities are growing almost as fast as their market saturation.  I regularly use my phone as a search tool, GPS, communications device (most of which centers on e-mail) and social hub, and I do not consider myself to be a “power user.”  Despite the amazing smartphone developments of the past 5 years, there are more on the horizon.  If the experts are right, we will soon be using our phones in place of our wallets, for identification and point of sale purchases.  Phones could be used to unlock and start our cars and to open our garage doors and set our home thermostats.  This week, conference attendees will be using the DRI smartphone App to keep track of their schedule and contact other attendees.  However, like most any “smart” device, the more we use our phones the more data we generate regarding our whereabouts, activities and lifestyles.

Attorneys used to subpoena cell phone records to see if litigants were on their phones at the time of an injury or during an auto accident.  Already, Historical Cellular Reconstruction (HCR) can be used to provide the history of a phone’s probable location, regardless of whether a user was actually on their phone.  HCR is not based on GPS data, but upon data and information maintained by the cellular provider related to a particular cell phone’s connection to a given cell tower.  Although HCR does not result in pinpoint precision, it can often place a phone within a very small vicinity.  If a user’s cell phone is turned on and the GPS is in operation, the precision increases dramatically.

Now attorneys look for information and material addressing whether a litigant was texting, surfing the web, on Facebook or taking one of virtually countless actions on their cell phones during the time of a given event, or in the hours and days leading up to a significant event.  Lawyers can use cell phone records to compare the location of a litigant to their claimed location.  This is particularly relevant where litigants, such as commercial drivers, are required to routinely log their position.  Records may indicate that an allegedly injured party went to an amusement park, or that an allegedly incapacitated person made a purchase.  The possibilities already seem endless, and as smartphone services continue to expand, so will the potential for using the resulting data in litigation.  As more and more opportunities are created by smartphone data, attorneys need to remain mindful of the fact that there may be data available that will impact their case.  

The Supreme Court heard oral argument on two consolidated cases, Florence v. The Board of Chosen Freeholders of the County of Burlington.  Two well-known and experienced members of the United States Supreme Court appellate bar, Thomas C. Goldstein and Carter Phillips, squared off as the Court considered whether the Fourth Amendment permits a jail to conduct a suspicion-less search whenever an individual is arrested, including for minor offenses.  DRI, which has an active committee for lawyers engaged in representing local governments, filed an amicus brief in support of the county jails.  Written by Mary Massaron Ross, the brief focused on the difficult problems of administration that would arise with a “reasonable suspicion” rule as urged by the class action plaintiffs and reminded the Court of past precedent adopting a bright line rule for Fourth Amendment searches in some categories of cases.  DRI argued that a bright line rule was necessary to give guidance to jailers, to facilitate their efforts to ensure that contraband is not introduced into jail, to help with prison security by identifying those with gang tattoos, and to ensure that lice and other health issues are identified and addressed. 

A South Carolina Senate subcommittee currently is considering a proposed bill that, like Arizona's recently-enacted law, would allow local law enforcement to check the immigration status of anyone they stop or detain.

Because the legislative session is winding down in South Carolina, the bill likely will not be introduced to the full Senate this year. Nevertheless, the subcommittee's timing is interesting, considering the huge amount of negative publicity and controversy that the Arizona law created.

In 2008, South Carolina passed an immigration law that requires all employers, at the time of hire, to use the federal E-Verify system or confirm that the new hire has a valid driver's license from a list of approved states (or is otherwise eligible to receive a driver's license).

On Friday, March 13, 2009, the NAACP sued HSBC and Wells Fargo alleging that these lenders forced African Americans into subprime mortgages while whites with identical qualifications got loans on more favorable terms (the “NAACP Lawsuits”). The original complaints in the NAACP Lawsuits are available at http://www.naacp.org.
Such claims are commonly referred to as “reverse redlining.” Redlining is the practice of denying credit to specific geographic areas based on the income, race, or ethnicity of its residents. Reverse-redlining, on the other hand, occurs where a lender unlawfully discriminates by extending credit to a neighborhood or class of people on terms less favorable than would have been extended to people outside the particular class at issue.

The NAACP Lawsuits allege that HSBC and Wells Fargo violated the Fair Housing Act, 42 USC § 3601, the Equal Credit Opportunity Act, 15 USC § 1691, and the Civil Rights Act, 42 USC §§ 1981, 1982. Specifically, the NAACP Lawsuits allege that HSBC and Wells Fargo “engaged in institutionalized, systematic racism” in connection with the sale of residential mortgage loans to members of the NAACP. The NAACP Lawsuits further allege that the “pervasiveness of this discrimination has been documented in numerous empirical studies that all confirm that African Americans are substantially more likely to receive higher-rate residential mortgage loans than Caucasian borrowers with the same qualifications.” The NAACP Lawsuits do not seek an award of damages. Instead, the complaints seek various injunctive and declaratory relief barring HSBC and Wells Fargo from continuing their alleged “predatory behavior.”

Counsel for lenders should be aware of claims based on discriminatory lending practices under federal law and, frequently, parallel state law equivalents. At the outset of any litigation, counsel for lenders should analyze the lender’s sales policies and procedures manuals and the lenders’ HMDA data. HMDA, or the Home Mortgage Disclosure Act of 1975, requires financial institutions to maintain and annually disclose data about home purchases, home purchase pre-approvals, home improvement, and refinance applications involving 1 to 4 unit and multifamily dwellings. HMDA was passed to identify discriminatory lending practices by, among other things, requiring lenders to keep records concerning the race of their customers and applicants and the lending decisions they make.

John E. Matter Jr.
Moye White
jake.matter@moyewhite.com

The ADA Amendments Act (“ADAAA” or “Amendments”) was signed into law September 25, 2008, with the intention of “restor[ing] the intent and protections of the Americans with Disabilities Act.” The Amendments became effective January 1, 2009, and greatly expand the scope of the ADA. The ADA outlaws discrimination, including employment discrimination, on the basis of one’s “disability,” as that term is statutorily defined. Congress believed the ADA had been narrowly interpreted by the courts, and sought in the Amendments to expand the statute’s coverage.

In the wake of the employee-friendly Amendments, plaintiffs have argued – and may be expected to argue – that they should apply in analyzing employment disputes that arose before their effective date. In the absence of express congressional direction that the ADAAA apply retroactively, and given that the Amendments could impose liability where none existed before, applicable Supreme Court precedent teaches that the Amendments should apply retroactively.

1. Retroactivity Arguments After the Civil Rights Act of 1991.

Employment discrimination plaintiffs raised similar retroactivity arguments following the Civil Rights Act of 1991, which amended Title VII of the Civil Rights Act of 1964. The Supreme Court, in a pair of decisions, concluded that the 1991 Act should not apply retroactively.

a. Landgraf v. USI Film Products

In Landgraf v. USI Film Products, 511 U.S. 244 (1994), the plaintiff claimed she was inappropriately physically harassed and constructively discharged from her employment. Following a bench trial, the court concluded that the plaintiff had been inappropriately physically harassed, but was not constructively discharged. The court found under then existing law that the plaintiff could not recover. During the pendency of Landgraf’s appeal, Congress enacted the 1991 Act, which expanded Title VII plaintiffs’ right to recover damages. Landgraf sought retroactive application of the 1991 Act.

The Supreme Court rejected Landgraf’s attempt and held there is a presumption against retroactive statutory application. The Court noted that “elementary considerations of fairness dictate that individuals should have an opportunity to know what the law is and to conform their conduct accordingly,” and that “[t]he presumption against statutory retroactivity has consistently been explained by reference to the unfairness of imposing new burdens on persons after the fact.” Id. at 265, 270.

Given these notions of fair notice and reliance, the Court held that retroactivity analysis depends first on whether Congress has clearly expressed an intention that the statute apply retroactively. If so, then Congress’ intention will control. Such a rule places the burden on Congress – where it belongs – to affirmatively consider the potential unfairness of retroactive application. Id. at 272-73.

If Congress does not clearly state an intent to apply retroactively, then a reviewing court must determine whether the statute would have “retroactive effect, i.e., whether it would impair rights a party possessed when he acted, increase a party's liability for past conduct, or impose new duties with respect to transactions already completed.” Id. at 280. If so, then the presumption against retroactive application applies. Id.

In Landgraf, the Court found that Congress did not expressly provide for retroactive application of the 1991 Act. Therefore, it was presumptively prospective only. Landgraf could not overcome the presumption.

b. Rivers v. Roadway Express, Inc.

Even more instructive in the ADAAA retroactivity context is Landgraf’s companion case, Rivers v. Roadway Express, Inc., 511 U.S. 298 (1994). In that case, two African-American workers sued their former employer, claiming racially discriminatory termination in violation of 42 U.S.C. 1981. The court dismissed the plaintiffs’ 1981 claims because Supreme Court precedent held that Section 1981 as then worded did not outlaw discriminatory terminations.

While the plaintiffs’ appeal was pending, Congress enacted the 1991 Act, which amended Section 1981 to prohibit discriminatory terminations. The plaintiffs argued for retroactive application. The Supreme Court stated that the presumption against retroactive application applied in Rivers with even greater clarity than in Landgraf because, like the ADAAA provisions, the amendment to Section 1981 “enlarged the category of conduct that is subject to § 1981 liability.” In other words, the amendment had “the effect not only of increasing liability but also of establishing a new standard of conduct . . . [and] new legal obligations . . . .” Rivers, at 303.

Even more important from an ADAAA perspective is the fact that the Rivers petitioners argued for retroactive application based on Congress’ intent in amending Section 1981 to restore its previous jurisprudence and return rights to plaintiffs that existed before the Supreme Court allegedly whittled them away. They claimed that Congress’ “restorative” intent meant the Section 1981 amendment should be retroactively applied.

The Court refused to find a retroactive intent solely from the fact that Congress intended to override the Court’s previous decisions. Even assuming Congress disapproved of the applicable decisions and intended to override them, there was no express statement that Congress intended the amendment to apply retroactively. Accordingly, the “prospective only” presumption arose, and the plaintiffs could not overcome that presumption.

Rivers is highly instructive in the ADAAA retroactivity analysis. There is no question that Congress intended the ADAAA to “restore” Congress’ original ADA intent. Congress expressly stated so in the text of the Amendments. Under Rivers, this intent to reverse course is insufficient for retroactive application. There must be a clear expression of congressional intent that the statute apply retroactively. Because there is no such clear expression in the text of the ADAAA, it is subject to the presumption that it does not apply retroactively. (Contrast the ADAAA with the Lilly Ledbetter Fair Pay Act of 2009, which President Obama signed January 29, 2009, and which expressly provides for retroactive application to all cases pending on or after May 28, 2007.) 

2. Application of 1991 Act Decisions to ADAAA Retroactivity.

Several courts have, since the effective date of the ADAAA, considered the question whether its provisions should apply retroactively. In EEOC v. Argo Distribution LLC, No. 07-60477 (5th Cir. Jan. 15, 2009), the Fifth Circuit refused to apply the Amendments retroactively and found that, under a pre-Amendments analysis, the complainant was not ADA-disabled. In Argo, Henry Velez suffered from a condition which precluded his ability to perspire. He claimed he was substantially limited in the major life activity of regulating body temperature. The court assumed for purposes of the decision that “regulating body temperature” was a major life activity, but held that the EEOC failed to present evidence that Velez was “substantially limited” in that activity. Accordingly, he was not disabled for ADA purposes.

In reaching that conclusion, the court stated that it was required to examine the impact of mitigating measures on Velez’s life, such as drinking cold liquids, sitting in front of a fan and spraying himself with water. These mitigating measures rendered his medical condition not substantially limiting. Had the court applied the Amendments retroactively, Velez likely would have been disabled under the ADA, because the Amendments prohibit consideration of mitigating measures.

A court in the Western District of Kentucky reached a similar conclusion in Rudolph v. U.S. Enrichment Corp., No.5:08-cv-46 (Jan. 15, 2009). In Rudolph, the court considered whether to apply retroactively the Amendments’ expansion of ADA coverage for individuals “regarded as” disabled. The Amendments provide that one is “regarded as” disabled if he is subjected to adverse employment action because of an actual or perceived impairment “whether or not the impairment limits or is perceived to limit a major life activity.” Prior to the Amendments, one was “regarded as” disabled only if the perceived impairment was one that substantially limited a major life activity.

Rudolph argued that she was “regarded as” disabled under the Amendments because her employer perceived that she was impaired in her ability to perform the major life activities of “walking and climbing stairs.” She claimed that under the Amendments, she was not required to prove that her employer regarded her as “substantially limited” in the asserted major life activities. The court correctly analyzed the retroactivity question and refused to apply the Amendments retroactively because they “would potentially increase [the employer’s] liability for past conduct.” The court held that Rudolph was not covered by the ADA because she failed to present evidence that she was regarded as substantially limited in a major life activity.

See also Schmitz v. Louisiana, No. 07-891 (M.D. La. Jan. 27, 2009) (refusing to retroactively apply ADAAA to Rehabilitation Act case); Kirkeberg v. Canadian Pacific Railway, No. 07-4621 (D. Minn. Jan. 26, 2009) (determining that retroactive application of ADAAA was not warranted).

The courts which have reviewed the issue have correctly concluded that the Amendments do not apply retroactively. This is the right result. To permit retroactive application of the Amendments could mean imposition of liability on an employer for discriminating against an employee who was not ADA-covered at the time of the challenged employment action. Fundamental notions of fairness dictate that an employer should not be exposed to liability for conduct that was not illegal at the time it occurred.

Robert J. Toy
Post & Schell, P.C.
Philadelphia, Pennsylvania
rtoy@postschell.com