Congressional Court Watcher: Recent Appellate Decisions of Interest to Lawmakers (July 11–July 17, 2022)
Legal Sidebari
Congressional Court Watcher: Recent
Appellate Decisions of Interest to Lawmakers
(July 11–July 17, 2022)
July 18, 2022
The federal courts issue hundreds of decisions every week in cases involving diverse legal disputes. This
Sidebar series selects decisions from the past week that may be of particular interest to federal lawmakers,
focusing on orders and decisions of the Supreme Court and precedential decisions of the courts of appeals
for the thirteen federal circuits. Selected cases typically involve the interpretation or validity of federal
statutes and regulations, or constitutional issues relevant to Congress’s lawmaking and oversight
functions.
Some cases identified in this Sidebar, or the legal questions they address, are examined in other CRS
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Decisions of the Supreme Court
No Supreme Court opinions or grants of certiorari were issued this week. The Supreme Court’s next term
is to begin October 3, 2022.
Decisions of the U.S. Courts of Appeals
Topic headings marked with an asterisk (*) indicate cases in which the appellate court’s controlling
opinion recognizes a split among the federal appellate courts on a key legal issue resolved in the opinion,
contributing to a non-uniform application of the law among the circuits.
*Civil Procedure: The Sixth Circuit added to a circuit split over the application of
Racketeer Influenced and Corrupt Organizations (RICO) Act provisions governing
service of process on and conferral of personal jurisdiction over out-of-state defendants.
Joining the majority view, the Sixth Circuit held that 18 U.S.C. § 1965(b) governs service
to out-of-district defendants. The statute requires at least one defendant to have minimum
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contacts with the forum state (i.e., the state where the district court is located) and
extends personal jurisdiction to an out-of-district defendant if the ends of justice require
it. The circuit court rejected the more expansive, minority view that 18 U.S.C. § 1965(d)
allows for service upon, and confers personal jurisdiction over, any out-of-state defendant
with aggregate contacts with the United States as a whole rather than with the particular
forum state. The court concluded that § 1965(d) is nonjurisdictional in nature, and only
allows for the service of process other than a summons or subpoena (e.g., notifying an
out-of-state defendant of an injunction or civil contempt order) once jurisdiction over a
party has already been established (Peters Broadcast Engineering, Inc. v. 24 Capital,
LLC).
Communications: In a case pertaining to Section 317 of the Communications Act, which
requires radio broadcasters to announce who “paid for or furnished” sponsored programs,
the D.C. Circuit vacated a portion of a Federal Communications Commission (FCC)
regulation requiring radio broadcasters to check sponsors against Department of Justice
and FCC sources of information regarding foreign agents and organizations. The
Communications Act requires broadcasters to exercise reasonable diligence to obtain
sponsorship information from employees and from other persons with whom it deals
directly in connection with the program, and the court ruled that a broadcaster’s duty to
inquire is limited to the sources specified in the statute (Nat’l Ass’n of Broads. v. FCC).
Consumer Protection: In a matter involving the Truth in Lending Act (TILA), which
gives borrowers the right to rescind certain transactions in the event that a creditor fails to
disclose certain information, the Fourth Circuit held that a creditor’s failure to fully
comply with its procedural obligations under TILA § 1635(b) following a borrower’s
rescission notice did not support the lower court’s judgment. The circuit court vacated the
district court’s judgment that the creditor had forfeited its right to loan proceeds already
paid and held that the borrower was obligated to return those proceeds to complete the
rescission (Lavis v. Reverse Mortgage Solutions, Inc.).
*Criminal Law & Procedure: The Eighth Circuit split with another circuit over the
meaning of 18 U.S.C. § 3553(f), the “safety valve” exception for mandatory minimum
sentences available for certain drug trafficking and unlawful possession offenses. Section
3553(f), as amended by the First Step Act, provides that the exception may apply to
persons convicted of covered offenses who do “not have: (A) more than 4 criminal
history points . . . ; (B) a prior 3-point offense . . . ; and (C) a prior 2-point offense . . . .”
The Eighth Circuit held that the word “and” between subsections (B) and (C) should be
read distributively, so that defendants are ineligible if they fail any of the three
conditions. The court rejected the Ninth Circuit’s interpretation under which defendants
are eligible so long as they do not meet all three conditions (United States v. Pulsifer).
Environmental Law: The First Circuit vacated a district court’s preliminary injunction
that would have halted a National Marine Fisheries Service rule imposing a seasonal bar
on certain lobstering techniques off the Maine coast. (The circuit court had already stayed
the injunction in 2021 pending this appeal.) The First Circuit held that plaintiffs were
unlikely to succeed in their arguments that the Fisheries Service did not adequately
consider alternative means of regulation and overestimated the threat that the lobstering
techniques posed to the endangered North American right whale (Dist. 4. Lodge of the
Int’l Ass’n of Machinists & Aerospace Workers, Loc. Lodge 207 v. Raimondo). (In a
separate case, a district court recently ruled that the Service did not sufficiently account
for the threat to right whales, but has not yet decided the appropriate remedy.)
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Environmental Law: Reversing the district court, the Eleventh Circuit held that a
plaintiff’s state law failure-to-warn claim concerning the alleged carcinogenic effect of
the herbicide Roundup was not preempted by the Federal Insecticide, Fungicide, and
Rodenticide Act (FIFRA) or Environmental Protection Agency (EPA) actions taken
pursuant to FIFRA. The court determined that the state law claim imposed an equal or
lesser duty than FIFRA’s labeling provisions, and thus was not preempted under FIFRA’s
uniformity statute (7 U.S.C. § 136v(b)). The court also ruled that neither the EPA’s
registration of Roundup nor EPA statements that Roundup’s primary ingredient is
unlikely to cause cancer carried the force of law necessary for preemption (Carson v.
Monsanto Co.).
Immigration: Sitting en banc, a divided Ninth Circuit held that defects in the Notice to
Appear (NTA) used to initiate removal proceedings against an alien did not deprive the
immigration court of subject-matter jurisdiction to effectuate the alien’s removal, after
the NTA’s defects were cured by a subsequent notice. Joining other circuits, the en banc
majority ruled that a regulation (8 C.F.R. § 1003.14) purporting to condition immigration
courts’ “jurisdiction” on the filing of an NTA uses “jurisdiction” colloquially. The
majority ruled that the regulation sets forth a claim-processing rule, laying out the steps
that must be taken in the removal process, but does not implicate immigration courts’
adjudicatory authority, which is governed by statute (United States v. Bastide-
Hernandez).
Immigration: The Tenth Circuit struck down 8 U.S.C. § 1324(a)(1)(A)(iv), which makes
it a criminal offense to “encourage or induce” an alien to enter or reside in the United
States unlawfully, as overbroad under the First Amendment. (The Ninth Circuit made a
similar ruling earlier in 2022.) The Tenth Circuit agreed with the government that certain
conduct falling under the provision is not protected speech under the First Amendment,
but concluded that the provision also swept in a substantial amount of protected speech,
such as expressing a desire for an unlawfully present alien to remain in the country. The
court therefore struck the provision down as overbroad, reasoning that the statute reached
a substantial amount of constitutionally protected speech (United States v. Hernandez-
Calvillo).
International Law: The Fifth Circuit considered the specificity of a provision of the
Foreign Sovereign Immunities Act, 28 U.S.C. § 1610(d), which allows for the
prejudgment attachment of a foreign state’s property if the foreign state has “explicitly
waived” immunity. The court held that such a waiver must be express, clear, and
unambiguous. Here, the court concluded that an explicit waiver was not given for
prejudgment attachment when a foreign government agency entered a contract with a
private company that included an arbitration clause waiving the agency’s immunity from
suit, but where the clause did not expressly waive the prejudgment attachment of the
agency’s property (Preble-Rish Haiti, S.A. v. Republic of Haiti).
Securities: The First Circuit held that § 1514A of the Sarbanes-Oxley Act, which
provides whistleblower protections to those who report violations of certain statutes and
“any rule or regulation of the Securities and Exchange Commission [SEC],” did not cover
claims related to the Foreign Corrupt Practices Act (FCPA). The circuit court held that
§ 1514A did not cover the FCPA because it was not a “rule or regulation” promulgated by
the SEC, but a statutory enactment of Congress (Baker v. Smith & Wesson, Inc.).
Securities: The Second Circuit held that misstatements and omissions alone cannot form
the basis for scheme liability pursuant to SEC Rule 10b-5(a) and (c), 17 C.F.R.
§ 240.10b-5, or Section 17(a)(1) and (3) of the Securities Act of 1933, 15 U.S.C. § 77q.
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The court rejected the SEC’s argument that Second Circuit precedent reaching this
conclusion was abrogated by the Supreme Court’s ruling in Lorenzo v. SEC that an
individual who disseminated, but did not make, a false statement could be liable under
the scheme provisions. The Second Circuit determined that failing to prevent misleading
statements from being disseminated by others remains insufficient to support scheme
liability (SEC v. Rio Tinto PLC).
*Torts: In a matter addressing a provision of the Equal Access to Justice Act, 28 U.S.C. §
2412(b), which provides that the United States shall be liable for “fees and expenses to
the same extent that any other party would be liable . . . under the terms of any statute
which specifically provides for such an award,” the Tenth Circuit interpreted “any
statute” as including state statutes. The circuit ruled that the reference unambiguously
applies to both federal and state statutes authorizing recovery of such fees and expenses,
rather than just a subset of federal statutes as the federal government argued and as had
been recognized by other circuits (Nelson v. United States).
Author Information
Michael John Garcia
Alexander H. Pepper
Deputy Assistant Director/ALD
Legislative Attorney
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