Former Solicitor General Garre on New SCOTUS Term

the controversial nomination of a new justice. The terms docket already includes a number of significant cases, perhaps the most consequential being the challenge to Obamacare. The docket covers a wide spectrum of issues, religious rights, gay rights, federal agency powers, voting rights, robotexting, and even a suit over looted Nazi art, just to name a few. Joining me to discuss the new term is Gregory gar the global chair of Latham

and Watkins Supreme Court and Appellate Practice. He served as the what do you Force Solicitor General of the United States. It's wonderful to have you here. Let's start with the challenge to Obamacare, which is coming up right after the election, in which the Trump administration and Republican led states are arguing to invalidate the law. The decision below seemed like such an outlier, but now the question is will Obamacare

survives well. I think the challengers face an uphill battle here, and I really think what's important to understand about the cases there are three separate questions. The first is whether the mandate itself is constitutional now that Congress has been invalidated to financial penalty associated with it. The second is, even if the mandate is unconstitutional, is it severable from

the Act? And on that there's a strong majority of the Court that has seemed reluctant to invalidate acts as a whole and instead look for ways to sever the unconstitutional provisions and leave as much of the Act in place. And so I think that's going to be a challenging argument for the challengers here, even if they succeed on the argument that the mandate is no longer constitutional given

that the tax associated with it has been validated. And then there's actually a third question which is pretty interesting, which is whether or not the challengers here even have standing given that the mandate no longer applies to the individual plainists and the states themselves aren't directly regulated under the Affordable Care Act. There's a major religious rights case on the docket where religious rights collide with gay rights.

The question is whether Catholic Social Services can be excluded from Philadelphia's foster care system because it won't place children with same sex couples. And this case has already gotten a lot of attention the latest class between religion and same sex couples or gay rights. And you know, it's interesting, I mean, both sides take a quite different view of

what's going on here. The City of Philadelphia claims that it's simply applying its general policy against discrimination, including discrimination on the basis of sexual orientation, to the private contractor here, which is the Catholic Social Services organization nonprofit organization which helps the place children in the city with foster parents and declines to do so in the case of foster

parents who are same sex couples. And so the city argues it is just applying that generally applicable and neutral principle to this particular organization, and the Catholic Social Services and the individual plantiffs claimed that, you know, the city really doesn't have a generally applicable policy here, that it carves out lots of individual exemptions and has discretion to do so with respect to other groups, and it's simply declined to do so in permissively here with respect to

the Catholic Social Services, and so the failure to do so to draw an exemption here violates the Catholic Social

Services free exercise rights. And the case also presents, you know, what could be a hugely consequential question, and that the petitioners here have asked the Court to reconsider it decision and Employment Division versus Smith, And that was the decision written by Justice Scalia, which held that the application of neutral and generally applicable laws against religiously motivated conduct generally

does not violate the free exercise rights. The government in the United States in this case claims that that the Court doesn't have to reconsider Smith, that it can simply recognize that the city has carved out these exemptions for other groups and so therefore is violating the free exercise rights of the Classolic Social Services by not allowing an exemption in this case. But the question of whether the Court would revisit Employment Division versus Smith is certainly one

that's important to follow. Another factor here is that the Court has been expanding religious liberties. Even last terms. Think there were three cases involving religion, and they ended up with seven to two or five to four votes in favor of expanding religious liberties. So can we expect more of that same kind of expansion in this case? I think you're absolutely right that we've seen in recent terms

a court that is more protective of religious liberties. And interestingly, even the more liberal justices like Justice Kagan and Justice Brier have gone along with the conservative justices in protecting religious liberties. So I think that this city here probably does face an uphill battle in persuading the Court to leave the lower court decision in effact. And the fact that the Court agreed to hear this case probably singles at least sound concerned with the challenges free exercise clause

claim here. You may remember a case last term when the Supreme Court broadened the federal ban on robocalls to mobile phones, with Chief Justice John Roberts opining that no one likes robocalls, nobody wants to get robocalls on their cell phone. The idea that Congress would embrace that result simply to save this government debt collection. Uh, they'd have to be very anxious to be more unpopular, uh than they otherwise would be. Well, there will be a reprise

of sorts this term involving Facebook robotexting. I've been talking to former US Solicitor General Gregory gar a partner at Latham and Watkins, about the Supreme Court's new term. So, Greg, this is a class action lawsuit accusing Facebook of sending unwanted text messages in violation of federal law. And I remember last term during oral arguments that all the justices seem to agree that nobody likes robocalls, So what about this? Now,

this is an interesting case. I mean, I think one of the justices referred to as one of the most popular laws that Angress has ever passed. But it's also popular with planeff floors because we've seen a number of class actions that you get a single person who receives an unwanted text message, and then all of a sudden, you've got sort of a multimillion dollar class action in federal court. And the question in this case is sort of a very technical statutory question, but is what device

qualifies as an automatic telephone dialing system? Which is the phrase that Congress used in the statute. Is it enough if the device has of the capacity to store numbers and then dial them automatically, which is what the Ninth Circuit held in this case, or does the device also have to use a random or sequential number generated to actually make the calls? Is Facebook argues in this case.

And you know, the one thing that Facebook really has going for it here is that if the answer is that the use of a random or sequential number generator is not required, then basically every smartphone in America is an automatic telephone dialing system and any call to a wrong number or text is a t c P A violation.

And so you know, particularly since the justicism sells have their own smartphones, I don't think that that result is necessarily going to sit well with them, and it really would be an extraordinary burden for Congress to have created generally, So I think here the argument of the Ninth Circuit simply construed the statute too broadly has a lot of force.

So perhaps advantage Facebook there. Let's turn down to a high stakes dispute involving Fannie Mae and Freddie Mack and the hundreds of billions of dollars in their profits that have gone into the U. S. Treasury. This case involves a challenge to the Federal Housing Finance Agency, much like

a challenge to the Consumer Financial Protection Bureau less term. Really, this case falls on the heels of the failure Law case last term, in which the Court held that the CFPBS structure, which included having a single director in which this great authority was vested in insulating the president's ability to remove that director, violated the structural protections of the separation of powers. And the Federal Housing Finance Agency it

has a very similar structure. It was creating in the wake of the two thousand and eight economic crisis, and they gave you a single head, enormous authority for an independent agency. And so I think, especially in the light of failure Law, it's hard to see how that structure and the fore cause removal provision could survive intact. But

then the question again is, Okay, what's the remedy. You just sever the fore cause removal provision or do you take a more drastic approach and invalidate the actual administrative action in this case, which is the focus of the litigation and a massive transfer of economic interest from Fannie Mae and Freddie Mack into the United States Treasury. Could the outcome be different because of the difference between the Consumer or Financial Protection Bureau and what it does and

what Fannie May and Freddie Matt do. The history there, the interests of shareholders and investors and some people wanting to unwind them for years. Well, I think it's the particular structure of this new agency doesn't survive because of the absence of the ability to the President to remove the director for reasons that wouldn't qualify as cause. Then I think the agency would have to be altered in

that respect, at the least. In terms of the broader implications of the case for Freddie Mack and Fanny May, it's harder to say. I mean, the government in this case is, you know, taking a somewhat different tack and is arguing that the challengers here really can't sue for the relief that they're seeking the invalidation of this transfer under the provisions of the statute, and so you know,

that presents another interesting and fairly statute specific question. But I think that's the signal that the government doesn't feel as though its arguments on the structure of the Statute as a whole are as strong. The Court is going to intervene in this long running fight over whether the Federal Communications Commission can loosen ownership restrictions that affect TV stations and newspapers. And the SEC has been trying to do this since two thousand two and has been foiled

by the Third Circuit Court of Appeal. So tell us what's that issue here? So this is a seventeen year back and forth epic match between the FCC and the Third Circuit. And basically, this time the Court held that the FEC's new media ownership rules had to be set aside because the FEC had failed adequately to analyze the potential effect of its regulatory changes on female and minority

ownership of broadcast stations. And so basically it sets up a challenge to the deference owed by federal courts to the essentially policy decisions made by agencies in the course of rulemaking. And it come at an interesting time because we've seen in recent cases like the Census case, in the Data case last term that the Court has taken I think a harder look at the reasons that administrative agencies give for their decisions and has generally been willing

to scrutinize administrative decisions a little bit more carefully. And here the SEC in the government is arguing straight up for more deference under the arbitrary and capricious standard and arguing that the Third Circuit here, you know, failed reasonably to defer to the agencies, you know, own judgments about how to best serve the statutory purposes. So where do you think the Court might come out, Well, I don't think it will be happy with this sort of back

and forth between the Third Circuit and the SEC. And you know, my guest is generally this may be a case where it would be willing to defer and and maybe sort of set out an an outpost of of you know what arbitrary and capricious review means. But it's tough to say. I mean that the Court in recent years, you know, has gotten more receptive to UH challenges that we're not going to defer to agency decision making. So

it's it's a new court in that respect. And you know, this case sort of tease up another opportunity to see where the Court is on administrative difference. Generally, the justices are going to consider a case that involves child slavery on Coco farms in the Ivory Coast. Six former child slaves accused Nesley and Cargo of giving Ivory Coast farmers financial assistance in the expectation that Coco prices would stay low,

which the companies deny. This case has been moving up and down the federal court system since two thousand five, and the question is whether they can sue that's right. In this case, you know, rises under the one of the country's oldest and really most confounding statutes, the Alien Towards Statute, which gives the federal courts generally juristic action to hear civil actions brought by aliens in a tourt

only for violations of international law. And you know, the court generally in recent terms have been scaling back the ability of plaintiffs to bring these claims. You know, it's held that the statute does not apply extra territorially, so that plaintiffs have to show a real connection with the United States. It recently held that foreign corporations could not

bring suits under the Alien Towards Statute. And so in this case, the questions are whether or not Number one, you can sue a domestic corporation even though you can't sue foreign corporation under the statute. And number two, if you can do that, is there a domestic aiding and abetting liability for a foreign violation? And does that overcome

the Alien Towards Statutes presumption against extra territoriality. Here the claim is that because certain funding decisions were made in the United States headquarters of the defendants that old to we touched upon the overseas violations, that there's a sufficient

enough connection for aiding invetding liability. And I think the plane of fear face an uphill battle given that the Court has seemed, you know, concerned about the scope of Alien Towards Statute in prior cases, and the court generally is reluctant to sort of imply or infer private remedies that haven't been expressly created by Congress, which would be the case here if it were to recognize the scope of the action would cover domestic corporations for aiding inbedding liability. Finally,

there's a case involving stolen Nazi art. The heirs of Jewish art dealers say their ancestors were forced to sell a collection of religious art to the Nazi government in ninety five for a fraction of its value. Those forty two pieces are now on display in a museum in Berlin and are estimated to be worth nearly a quarter of a billion dollars. The museum says the deal was legal and fair. Will this case go forward. The basic question in this case is that the scope of immunity

that foreign countries enjoined the Foreign Sovereign Immunities Act. As you mentioned, I mean the plans here are areas of Jewish art dealers who lived in Germany and the nineteen thirties and who claimed that the Nazi regime stole art from them, and they're seeking, like you know, others in their position have to sue in the United States court to reclaim the art, and the DC certain in this

case allowed the case to proceed. And it comes down to a technical question about the scope of the expropriation exception under the Foreign Sovereign Immunities Act, and in particular whether or not when the claim is that a foreign government took its own citizens property, as the claim is here with respect to the Nazi regime, that that can invoke the exception, even though as the government argues in this case that a claim that a foreign government took

its own citizens property in general, he doesn't violate international law. And so here importantly, while the United States goes out of its way to condemned the deplorable atrocities committed by the Nazi regime, it says that the DC Circuit had aired in allowing the suit to proceed, and that instead the foreign government, the Federal Republic of Germany, should have been entitled to sovereign immunity. So these are, you know, obviously very challenging cases and invoke strong emotions. So I

think they're difficult ones for the justices to resolve. Certainly one that will be interesting to follow. This case is likely going to draw a lot of attention. There have been so many movies and documentaries about stolen Nazi art, and there's such a sympathy factor here. Could that affect this decision in any way? I mean, look, I mean India and Jones said basically nobody likes Nazis, so and you know, I'm sure that goes for the justice too.

But look, they will be deciding technical legal questions here about the meaning of a statute, and that's what they do all the time, and I'm sure that they'll do their best to resolve this statutory question. Does it seem as if this term there are less hot button issues, less divisive issues that the Court is taken up than

in prior terms then last term. I think that's definitely right that this term, you know, at the beginning and there's a lot that lies ahead, you wouldn't say it has the sort of blockbuster potential that we've seen in the Court in recent terms. But that can change really quickly, particularly with the presidential election less than a month away

and only about probably about the courts docket filled. So as it's true, and you know, almost every term, the beginning of the term only provides a brief glimpse of what's going to be on the Court's docket, and we certainly could see consequential cases getting up to the court before the end of the term. Thanks for being on the Bloomberg Law Show. Greg that's former Solicitor General Gregory gar a partner at Latham and Walking. And that's it

for the edition of the Bloomberg Law Show. I'm June Grasso. Thanks so much for listening, and remember to tune to the Bloomberg Law Show every weeknight at ten p m. Eastern right here on Bloomberg Radio.