Win for H-1B Visa Holders & Circuits In Play Post-Election - podcast episode cover

Win for H-1B Visa Holders & Circuits In Play Post-Election

Aug 07, 202438 min
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Episode description

Immigration law expert Leon Fresco, a partner at Holland & Knight, discusses a recent ruling on work permits for spouses of H-1B visa holders. Matthew Schettenhelm, Bloomberg Intelligence litigation analyst, discusses which circuit courts could be in play after the presidential election. June Grasso hosts.

See omnystudio.com/listener for privacy information.

Transcript

Speaker 1

This is Bloomberg Law with June Brusso from Bloomberg Radio.

Speaker 2

Immigration will no doubt be a top issue in the presidential campaign.

Speaker 1

Donald Trump does not care about border security.

Speaker 3

He only cares about himself.

Speaker 2

Vice President Kamala Harris has come out swinging, trying to flip the script on former President Donald Trump on his favorite issue, blaming Trump for convincing Republicans to tank the bipartisan border deal earlier this year. For their part, Republicans are blaming Harris for the migrant crisis, calling her a failed border czar. GOP Vice presidential candidate JD. Vance went down to the southern border last week to make his point.

Speaker 4

They stopped deportations on day one. They stopped construction of the border wall on day one. We see the border wall sitting here ready to be completed behind us, and that can't happen because of Kamala Harris's administration.

Speaker 2

There are seemingly endless court cases around immigration issues, but one rule that's been litigated for almost a decade has sort of flown under the radar, but now it's withstood another federal appeals court challenge. The DC's Circuit Court has okay to rule extending employment authorization to spouses of H

one B visa holders. Joining me is immigration law expertly on Fresco, a partner at Holland and knight Lee, and I think we need to start with a basic understanding of what an H one B visa is and what an H four visa is.

Speaker 1

So an H to one B visa is a visa that people can obtain in the United States if they are providing what it's called high skill labor or what is actually in the statute called a specialty occupation, which is a job that requires at least a bachelor's degree to perform as designated by the Department of Labor, and the person has the exact specific degree required to perform

that job. So each year there's a lottery because there's many more companies that want these visas that exist, and there's eighty five thousand of these visas per year, and so what happens is about seventy percent of them are taken by people from India. Because of both the English language and the large population and the amount of high skilled education and training people from India tend to get.

This is the largest group of people who get it, and so they come to the United States on these Age one B visas, their spouses and their children can come with them, and the name of their visa is called an age four visa. So the principal worker is on the H one B, the spouse and the children are on the age four visa, And when you arrive, the people on age four visas are not allowed to work. But what happens is that the people then apply for

Green cards. And there was a regulation that the Obama administration did in twenty fifteen that said that if an Indian national and this is really only related to Indian nationals at the beginning, Now it's related to a lot of other people because what happened was there are only one hundred and twenty thousand employment based Green cards that are permitted each year, and there are many many more people in the pool waiting for green cards than are

permitted to apply each year. There's about a million people in the backlog right now. And what makes it worse is there's something called a per country limit on Green cards, which means that any one country can only get ninety eight hundred of the green cards each year, which means that the Indian line is about two hundred years long. It's really really long, and someone who gets in the line now won't get a Green card. They will be stuck here permanently on this quasi H one B status.

So what the Obama administration said is if you're stuck in that status, your spouse can work. So that's what this H four EAD case was about, was about this Obama regulation from twenty to fifteen that said that the spouses of people in this backlog, which is people who've been approved for a Green card ostensibly because they meet

the criteria. They came on an H one B, but they've been approved for a Green card as a matter of merit, but they cannot receive the green card because of the backlog, which is two hundred years long, so they will never receive it. That the spouse of this person who is an aged four can't work because what they didn't want is people just permanently here in flux with no rights. Ever, so the Obama administration did a

regulation that allowed these people to work. And then what happens is a restrictionist group who ostensibly designated itself as a labor union, but isn't really a labor you it's more of an association of members of people who want restrictionist trade policies called Safe Jobs USA file the lawsuit saying that regulation was illegal.

Speaker 2

This has been going on for nearly a decade, since twenty.

Speaker 1

Fifteen, correct, This case has been going on in various iterations. What happened was the lawsuit was filed in twenty fifteen, it worked its way through the Trump administration. The Trump administration was actually going to repeal the Obama regulation, but because this lawsuit happened, they decided to just let this

lawsuit play out. Well, it's very interesting was an immigration group called Immigration Voice, who represents the foreign nationals that are in this backlog, intervened which prevented the Trump administration from reaching a pollusive settlement with the folks who have filed the lawsuit, because otherwise the Trump administration would have just settled and said, you know what, this is illegal.

Were taking this away, but they couldn't because there was an intervention by a group called Immigration Voice that allowed this case to continue. So that group continued the case and they kept getting ruling after ruling saying that the regulation was lawful, until finally, in a different case called WASHTEC, which was about a different policy called optional practical Training,

which allows people on student visus to work. The Supreme Court basically said it is okay to create work permits for certain classes of immigrants, meaning that this power has been given by Congress to the administration. And because that's been given by Congress, there are no several issues, there's nothing to interpret. The law is very clear that the administration can designate different pathways for work for people who are illegally. That's not a question about people who are

here illegally. But the spy of an H one B recipient is here legally, and so the question is can they work. And the plaintiffs had said no, they can't because there was no statute saying that they could specifically work. But the Court held, and has now held many many different times, most recently now the DC Circuit yet again, after this Washteck case, has held yet again that there is no Major Questions doctrine. There's no Chevron doctrine, there's

nothing here Low or Bride. None of these things apply because there's a statue that, even though it doesn't say that H four thousands can work, it says that the Secretary of Homeland Security can declare any legal immigrant ability to work if they issue a regulation doing so, which had been indeed done in this case.

Speaker 2

This case seems to be the perfect example of endless litigation going in circles. I mean, how does this case keep going?

Speaker 1

Well, it keeps going because the Supreme Court itself hasn't shut down this specific case. So what happened was this case. It was denied on standing, Then the standing case was brought back by the DC Circuit back to the district court. Then it was granted on the merit. Then the case was pending and stayed for the wash Tech case. I was in the Supreme Court. Then the wash Tech case was decided in favor of the administration's ability to give

work permits. Then the DC Circuit case was reopened, and the plaintiff strikes to say, yeah, but that was just this opt that wasn't eighty four, and they didn't consider the major questions doctrine, and they didn't consider low per Bride. And what the DC Circuit said is, look, we're shutting this all down. None of these things have anything to do with anything, because what you're saying is that there's

some interpretation going on, and there isn't. There's a very clear statute that's in the Immigration and Nationality Act that literally says that the Secretary of Homeland Security has the ability by regulation to give any person who's here legally a work authorization. And so because of that, there doesn't need to be a specific statue that gives a specific

group of people a work permit. That's not needed because the Congress already gave the authority very clearly nothing to interpret for a regulation to be issued to give people work authorization status.

Speaker 2

And the decision here was written by a very very conservative Trump appointee, Justin Walker.

Speaker 1

Yes, I mean, I think the point here is if you really just look at the statute and now it's interpreted, you could be very angry that Congress wrote that statute, which is I think where the plaintiffs were in this case. But you can't deny that that statue was written, and so they were trying to get some sort of limitation on it. But if you are a strict textualist, you really have to read the strict text here, and that text does permit the employment authorization to be done as

long as there's a regulation which does it. And the Obama administration did do this regulation. In twenty fifteen, the.

Speaker 2

Attorney for the group Saved Jobs USA said they're going to petition the Circuit Court to rehear the case, which would be your quest for an on bank hearing. And if that fails, to appeal to the Supreme Court. Do you think the Circuit Court would take it on bank? Do you think the Supreme Court?

Speaker 1

I don't think. I think given the caliber of the judges that were on this three judge panel, there's no way that the DC Circuit will take this on bank. And I think the Supreme Court will do now, based off of what it has done in the past, just deny sirsiary because in these immigration cases where the government doesn't want circiary and you have a bipartisan panel the DC Circuit, it's very unlikely that the Supreme Court will

grant sirchiar area. If they were going to do something, they would have done it in the Washtec case, which was a case where Justice Kavanaugh had when he was a DC Circuit judge, I had actually argued the case in front of us Kavanaugh back when he was in the DC Circuit. He had thought, well, maybe it's a little bit ridiculous, even though there's this statue to give work permits to students because they should leave the country once they're done being students once. They didn't take that

one apart, and they let that one say. Then this other group, which is much more sympathetic, because they are literally people here in limbo until they die, and either they'll be allowed to work or not, it's going to be much more difficult to take those people's work authorizations away.

Speaker 2

Coming up next, I'll continue this conversation with Leon Fresco. A federal judge demands that Texas sanda high ranking lawyer in person to a hearing. None of that video conference stuff. This is Bloomberg. I've been talking to immigration law expert Leon Fresco of Holland and Knight about a DC Circuit Court decision that okays the rule allowing spouses of H one B visa holders to seek employment. It's a case

that's been going on for nearly a decade. And Leon, how often does the H one B visa have to be renewed?

Speaker 1

It has to be renewed every three years. And if they want to change employers, they actually have to get a new employer to file a whole new petition. So a lot of people, you know, compare this program to some form of indentured servitude because these people are literally only allowed to remain in America so long as they're useful to an employer. So when these folks turn seventy or eighty, who knows what's going to happen to them?

Will they be allowed to say or not? Because if they're not tied to an employer where they're currently working, it's going to be bad luck for them. And so this whole program is careening toward human tragedies, but we're not quite there yet, but we're getting there as each year progresses.

Speaker 2

Well, have these visas been caught up in the debate over immigration.

Speaker 1

Absolutely, there's a huge debate over what to do with this population because this population keeps getting older and older. One of the debate topics is, well, just get rid of the per country limit so that at least everybody has the same weight tign there isn't a two hundred year weight time for Indians and a one year weight

time for everybody else. That bill has passed the House and the Senate, but never in the same year, So that's been a human disaster there, and then there's bills that try to increase the total amount of green cards per year, but those bills have never passed because at the moment there's been restrictionists, mostly in the Republican Party, who have said they don't want to increase the levels

of legal immigration. But there's also been opposition in the Democratic Party saying you can't just do something unemployment based immigration if you're not going to to do something on the compassionate side of immigration. And so this is just one of these huge messas that exists in the immigration system, Leeann.

Speaker 2

I know that the Czech giants like Apple and Amazon and business groups support these visa programs, but the claim is that these visa holders take jobs away from Americans. Is that right grounded in fact?

Speaker 1

Well, I mean, it just depends because here's what happens. So oddly enough, the h one B immigrant is a person who's tied to a specific employer, but the work permit that this person's house gets is actually not tied to any employer. So they're just people who go into the labor market. And so let's say that right now there's about three hundred thousand of these people in the

workforce depending on what they're doing. If they're doing mostly high skilled jobs, the job openings in the high skilled area are still much more, much higher than the unemployment in that area. If you go on the lower end, it might be an argument, but the people who are actually making this lawsuit are people who claim to be

representing people on the higher end. And so that's where also this claim didn't really make sense from the perspective of the organization challenging the regulation because they were claiming that the higher end jobs were being taken away. So they were assuming couples where both spouses were doing high

skilled labor. But the point is, if that were the scenario, then three hundred thousand people is a drop in the bucket compared to the several million job openings that still exist in the high tech area.

Speaker 2

So now let's switch to something that I can't believe is still going on, the battle over Texas having put those floating buoys in the Rio Grant and the US government is suing to have the barriers removed. Didn't the Supreme Court already decide this in part? Or is that another border dispute with chexas well.

Speaker 1

Was actually brought back? What happened was here's the background. So Texas began employing these things and these booies. In June of twenty twenty three, Texas spends one hundred and fifty thousand dollars on the barrier. They put one thousand

feet buoys. Then in twenty twenty three, the Justice Department sues in federal court and they actually win in the case, and then the case goes up to the Fifth Circuit, and then it actually does go up to the Supreme Court, and it goes back down saying here's some things you need to consider. So there wasn't an actual final resolution there, and then it goes back down to the district court. And in the district court they issue an injunction saying that at the end of the day, this is a

threat to public safety. It needed to be done by the Army Corps engineer. It wasn't approved by the Army Corps engineer, so they issued an injunction. And then the Fifth Circuit had actually also in a panel decision, had affirmed that injunction and said you can't have the barriers. But now the full unbank Fifth Circuit came back in and said, while this case is going to be decided

on the merit of the federal government's claim. We don't think that when this case gets decided on the merits that it's likely that the federal government is going to win because we don't think that these booies are actually in the navigable stretch of the Rio Grand River. So that's basically their decision is. They said, had these booies been in a navigable stretch of the Rio Grand River,

then yes, it might have violated federal law. But we think that when there's a trial on this, we're going to find that the federal government is not likely to prove that the barriers are placed in the navigable stretch of the Rio grand and hence there's no violation of the federal law here. Now we're going to go back to the trial and we're going to try to figure out who wins on the issue of whether these buoys are actually in navigable waters along the Rio Grande.

Speaker 2

There was a hearing and the lawyer for Texas appeared by videos, and the judge demanded that Texas send a high ranking lawyer in person to the hearing and not try to attend remotely. Quote it is clear to this court that the State of Texas misunderstands the substance of the status conference held in this matter. I mean, does it really make a difference if a lawyer appears by Zoom for hearings.

Speaker 1

I think that at the end of the day, the problem is they want this case to be dealt with in the level of seriousness that this case portends to be. And so when you're coming in on Zoom, you're essentially saying that the State of Texas isn't really willing to devote the resources to this case that are necessary, which is then well, why are you filing this lawsuit? Then? So I guess that's the perspective. I mean, at the end of the day, everybody can have a different take

on this. I mean, obviously you don't want the trial to be done by Zoom, but you know, it does pose an interesting question at the end of the day about where we're going as a legal profession, and is Zoom going to just be inexorably part of this going forward or do we revert back to where we were originally, which is, hey, look, when you have court hearings, you

go to court. That's the whole point of court. It is you go to court, and if you don't want to go to court, don't have a case here, And so it's an interesting question.

Speaker 2

Well, we'll see what happens. I assume that the state of Texas will send a high ranking lawyer as the judge requested. And looking at the big picture here, leon, does Kamala Harris have the same view on immigration that Biden does?

Speaker 1

Well, I do know, because I've actually been in conversations with some folks in that group that they are looking to create some policies that they are going to be rolling out during the campaign that will be sort of

prospective twenty twenty five through twenty twenty eight policies. I don't know which ones of the ideas that they were soliciting they're going to actually move forward for, but I can I guess maybe break some news I don't know whatever you would call this, that they are planning a rollout of a twenty twenty five through twenty twenty eight immigration agenda that would have different policies in it, both on the enforcement side and on what they will do

about people coming in the country, So both kinds of things, how they add to the enforcement platform and how they change the current platforms by which people come in here legally and receive benefits. And so from that perspective, they will be rolling that out, but I don't know when, and I don't know which policies specifically of the ones that were being discussed are they going to pick to do that. But yet they will plan that.

Speaker 2

Republicans are calling Harris the failed borders are. Do you think she got a bad rap over her handling of immigration?

Speaker 1

Well, so this is a tough question because the assignment was not clear that was given to her, and quite frankly, the assignment was a little bit strange always in my view, from the first place, which was she was supposed to solve the quote unquote root causes of why people from specifically Alsavador, Honduras, and Guatemala want to come to the United States. So that was technically her assignment. You know, there's this words borders are and these other things, and

there was always a dispute about the wording. But even the assignment as it is cast in a like most favorably to her, didn't seem to make a lot of sense to me from the perspective of you know, the GDPs, those three countries are much much lower than even the GDP in Mexico, much less the GDP in the United States, And so to ever get to a point where anyone in any of those countries would view remaining there as a suitable alternative rather than coming to the US, it's

just not realistic. That would have taken hundreds of billions of dollars of investment. But having said that, what can be argued, and it's not clear you know which part of who did what caused it, is that the numbers from those three countries coming across the border are now lower than they have been, so that part is good. And where the problems exist are in countries we can't deport people back to, which are Cuba, eighty, Nicaragua, Venezuela.

Those are where the numbers continue to be challenging because those countries do not accept people who're trying to deport them back to. But the numbers coming in at the moment from El Salvador, Guatemala, and Honduras are indeed lower than they were when he was first appointed to address issues related to those countries, So at LEAs from that perspective, there's that one could argue the numbers are lower. You decide whether he made them lower or not.

Speaker 2

We are going to hear a lot of talk about this until November. Thanks so much, Leon, As always, it's a pleasure to have you on. That's Leon Fresco, a partner at Hollanden Knight. Coming up next on the Bloomberg Lawn Show, we'll take a look at which circuit courts could be in play depending on who wins the presidency and some of the issues that will be coming up at the Supreme Court next term. You're listening to Bloomberg.

As we've learned by now, the presidential election will determine who sits on federal courts, and if either political party wins, both the White House and the Senate, key appellate courts could flip. Joining me to discuss which circuits are in play is Matthew Shettenhelm, Bloomberg intelligence litigation analyst. So, Matt, tell us right now, which circuits tilt Republican, which tilt democratic?

Speaker 3

So right now, there's one circuit. If you're talking about non senior judges. The first circuit is all Democrat judges, six Democrat appointed judges and zero Republican appointed judges. But it very much is the exception. A number of courts are are fairly evenly split. But then on the other extreme you have the Fifth Circuit, which has twelve Republican appointed judges and five Democrat appointed judges, and the eighth Circuit, which has ten Republican appointed judges and just one Democrat

appointed judge. And so those two circuits have really loomed large in recent litigation about regulation. Companies have been really successful in getting cases placed in those circuits, the fifth and A's circuits, and so to me, though standout is particularly significant in the election in terms of potential changes to the courts going forward.

Speaker 2

The term is flip, so which circuits might flip from Democratic to Republican if Trump wins.

Speaker 3

So it's like the Second Circuit, the Third Circuit, the Fourth Circuit, the seventh Circuit, the tenth, the eleventh Circuit, all of those circuit courts the margin is two judges. And when you're looking at appointed by Democrats or appointed by Republicans. So aside from those courts that I mentioned earlier that are tilted in one direction, a number of

our federal courts of appeals are fairly evenly split. I think most of them tilt Republican right now, but the margin is small, and so the stakes are really high for the next president because there's the potential to turn the majority on a number of those courts. And that matters because every Court of Appeals decision could potentially be petitioned for rehearing by the full panel of judges at that court on bank and so control of the court is significant.

Speaker 2

Yeah, I think people don't pay enough attention to the circuit courts. They always talk about the Supreme Court, but the Supreme Court here is only about sixty cases a term, and it's less and less as time goes on. So so major decisions are really made in these circuit courts, right has the Second Circuit, which is in New York, has that ever tilted Republican?

Speaker 3

That goes past my knowledge. I don't know the whole history of it right now, but yet that is on the list of you know, one judge separating the two party, seven judges nominated by Democrats, six nominated by Republicans. So the margin's really really thin right there. And so that's the sort of example where you could see a change going forward based on the results of who wins the presidency who wins control of the Senate, and that court is.

Speaker 2

Very important as far as business cases in Wall Street.

Speaker 3

Absolutely, yes, absolutely, a number of business cases are decided in that court.

Speaker 2

This was a year that we saw the Supreme Court basically attack the administrative state a lot of decisions on regulation. And do you see more of that continuing next year? Are they going to switch to something else?

Speaker 3

Yes, It's unlikely that the conservative majority at the Court is going to change in the next four years. Right now, we have a six to three majority of justices that were appointed by Republican presidents, and as you said, they have really been aggressive in sort of pro business decisions, very skeptical of regulatory overreach, and I really don't think that's going to change. I guess in one sense there's

a chance for slight changes. And the two oldest justices at the Supreme Court, Justice Clarence Thomas and Justice Samuel Alito, are two Republican appointed justices who are very skeptical of regulatory overreach, have supported the decisions on do the Chevron doctrine, for example. They are the two oldest and so I think both parties would be interested in replacing them. A Republican president with younger versions of themselves, a Democrat president

with very different justices. But even if you did replace those by a Democrat president, still a six to three margin. So I think you're not going to see the trend in the court's overall change. It's at least pretty unlikely over the next four years.

Speaker 2

There are several key disputes involving the financial sector that may reach the Supreme Court.

Speaker 3

Yes, my colleague Elliott Stein has really highlighted these cases. Cases involving coinbase have been percolating through the lower courts, a case involving CFPB credit card late fees. There is the potential for a number of regulatory cases to reach the High Court.

Speaker 2

Do you see many tech cases going to the Supreme Court?

Speaker 1

Yeah?

Speaker 3

I mean, we just came off a term where the Supreme Court decided a pretty significant First Amendment case about whether Texas and Florida can force social media platforms to be neutral. And the Court said no, that the First Amendment does give these companies some rights to block regulation like that, But the Court said very little about exactly

how and how broadly the First Amendment blocks regulation. And this is a huge question right now as the federal government is looking at regulating tech companies as states are looking at doing it, and the companies are responding saying no, the First Amendment blocks.

Speaker 1

All of that.

Speaker 3

The question is is that really right? And this is a question the Supreme Court didn't quite answer this term. It started to answer it, But there are so many unanswered questions about how far the first Moment goes, how much regulation is okay? And it's going to be our Supreme Court in the next four years that answers those questions and resolves how far can regulators go in addressing harms that are linked to the Internet.

Speaker 2

What about chech media and telecom regulation?

Speaker 3

Yeah, so, I mean that's another area where I think the FCC there's been a fight for the past twenty years about can the FCC regulate broadband service or not? This is the most important products that AT and T and Comcast and Verizon Charter they offer today. Is that subject to federal regulation at all? And I think with this Supreme Court, you saw the Chevron decision earlier and just building on that, it's going to be so difficult, I think for companies to be regulated in ways that

Congress hasn't clearly said are appropriate. The broadband companies are a great again example of that. And so as long as the control of the Supreme Court remains as it is with a six to three very business friendly majority, I think it's very good news for companies like these broadband companies that could otherwise face substantial federal regulation. It's just not going to happen with this Supreme Court in place.

Unless Congress stepped in and Congress really struggles to reach consensus on any sort of aggressive regulation like this.

Speaker 2

Would there be a big difference if Republicans take control of the FCC.

Speaker 3

I think that would sort of just speed up what the courts are already doing. So, you know, to take the net neutrality of rules for example, that the Biden FCC has tried to restore broadband regulation. Aggressive federal broadband regulation that's in the courts right now. In the Sixth Circuit is one of those conservative leaning courts. I think it's going to face a lot of trouble getting through the Sixth Circuit and then you know, probably the US

Supreme Court. But if the Republicans win the White House and thus control of the FCC, they'll just undo it themselves. They don't even have to wait for the courts, and so it's just another way that businesses that are concerned about regulation can benefit in the near term. I think if they don't win in the courts, a Republican controlled the FCC will usher in the win itself.

Speaker 2

Let's talk about TikTok because I think it's so interesting because of the difference that it might see between a democratic and a Republican president. So, first of all, explain where we stand with TikTok, the bill that Biden signed.

Speaker 3

Yeah, absolutely so. Earlier this year, both chambers of Congress passed a law that effectively bans TikTok as of January nineteenth next year, unless the company divests to someone else, and the companies saying, look, we're not going to do that,

and there's no way we can practically do that. So the only way that TikTok remains viable in the United States after January nineteenth is if Tiko wins this court case it's brought to challenge the law, and TikTok says that it's a violation of the First Amendments what Congress did to force it to divest the company, and we're going to get a decision this year from the DC Circuit and maybe from the US Supreme Court on whether TikTok's right or whether Congress can ban the company unless

it divests former President Trump.

Speaker 2

He was against TikTok when he was president, now he's for TikTok. What kind of change could his becoming president mean for TikTok outside of the court case.

Speaker 3

Yeah, it's a great question. So I think it's unlikely that President Trump, if he wins the White House, is going to convince Congress to make a new law and undo the ban that it already did. So I don't think he would change it in that sense. This law is already on the books. It passed by overwhelming majorities in both the House and the Senate with Republican and Democrats support, and so this is done, I think unless

TikTok wins in court. If TikTok wins in court by January nineteenth, and the DC Circuit or the Supreme Court sends it back to Congress and says, no, the First Amendment problems here, try again, that's when President Trump being the president really matters, because then if Congress goes to try again and fix the problems, that the courts identify, President Trump doesn't have to sign that law, and so that's where it could end up getting tripped up. Whereas

if it's the Democrats that control the White House. President Biden was a strong advocate for this TikTok bill, and it seems very likely that a President Kamala Harris would be as well. I at least have no reason to think she would depart from President Biden's view on this. So in that sense, if TikTok can win this first round of the case, having President Trump in the white House, maybe it's best chance to avoid a band in the US going forward.

Speaker 2

It seems like TikTok has some pretty good arguments in its case. Have you looked at who has the better side of that case?

Speaker 3

Yeah, it's a really fascinating case, and I think it's a really close case. TikTok says, Look, Congress has never done anything like this, spanning a popular app used by one hundred and fifty million Americans. So this is a violation of our free speech rights as a company, It's a violation of the free speech rights of all the users on our platform. And basically arguing that the Congress burdened much more speech than was necessary. It could have

done something much less disruptive than an effective ban. It could have regulated, it could have entered into an agreement with TikTok to mitigate the risk, but instead it took sort of what the company casts as a very extreme step. On the other side, that the government comes back and says, no,

this is a national security threat. TikTok's parent is located in China, and China can access anything from a company that's that's located, and this company has all sorts of data about Americans, and it can control what Americans can see. That's a national security threat. Courts don't like to get in the middle of national security issues, so both sides have really strong argument. My take on it is that I think the courts are going to force Congress to

try again on this. I think they're going to say, look, you went pretty fast on this, and I think you should take a harder look to make sure you didn't burden more speech than necessary. Ultimately, I think the government can win this case, but I think the courts are going to want to go a little more slowly here.

Even though it's a national security threat. The government admitted in its brief that there isn't evidence that China has actually surveiled this data or manipulated but there's a risk, and so I think that creates an opportunity for the court to kind of slow this down a little bit and make sure the First Amendment is honored. But I think ultimately the government can win this. I think there

are real risks to TikTok going forward. I just think it might win this first round of the case and duck this January nineteenth deadline that's coming pretty quickly.

Speaker 2

Now, a lot to watch in the upcoming months. Thanks so much, Matt. That's Bloomberg Intelligence Litigation analyst Matthew Shettenhelm. And that's it for this edition of the Bloomberg Law Podcast. Remember you can always get the latest legal news by subscribing and listening to the show on Apple Podcasts, Spotify, and at Bloomberg dot com, slash podcast, Slash Law. I'm June Grosso, and this is Bloomberg

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