Congressional Court Watcher: Recent Appellate Decisions of Interest to Lawmakers (Jan. 22–Jan. 29, 2023)
Legal Sidebari
Congressional Court Watcher: Recent
Appellate Decisions of Interest to Lawmakers
(Jan. 22–Jan. 29, 2023)
January 31, 2023
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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attorneys.
Decisions of the Supreme Court
The Supreme Court issued one opinion in a case in which it heard oral argument:
Veterans: The Supreme Court unanimously held that 38 U.S.C. § 5110, which governs
the effective date of an award of disability benefits to a veteran of the U.S. military, is not
subject to equitable tolling. According to § 5110(a)(1), unless an exception applies, the
effective date of an award based on an initial claim of benefits is the date the claim was
filed. The Court held that the text and structure of § 5110 provide detailed instructions for
when a veteran’s claim for benefits may enjoy an effective date earlier than the default
rule and thus indicates that Congress did not want the equitable tolling doctrine to apply
(Arellano v. McDonough).
The Supreme Court also dismissed an earlier grant of certiorari after oral argument:
Federal Courts: The Supreme Court dismissed certiorari as improvidently granted in a
case from the Ninth Circuit involving a contempt order issued against a law firm that did
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not fully comply with a grand jury subpoena for documents related to the firm’s
preparation of a client’s tax return. The firm contended that the documents were shielded
from disclosure by attorney-client privilege, as they allegedly had the dual purpose of
communicating information related to preparation of the client’s tax returns and
providing legal advice to the client. The Supreme Court’s dismissal leaves in place a
Ninth Circuit ruling concluding that a primary-purpose test governs when assessing
attorney-client privilege for dual-purpose communications (In re Grand Jury).
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.
Administrative Law: The Fifth Circuit set aside a 2020 Federal Aviation Administration
(FAA) rule governing the issuance of (1) airline transport pilot (ATP) certificates, which
enable pilots to fly for airlines, and (2) type ratings, which authorize pilots to fly “type-
rated” aircraft. The FAA’s rule required flight schools to issue both an ATP and a type
rating concurrently to pilots who pass a practical test for an ATP in a type-rated plane. A
flight school challenged the rule on the basis that the FAA implemented it without the
notice-and-comment process generally required for “legislative rules” under the
Administrative Procedure Act (APA). The FAA asserted that its rule merely clarified
existing regulations and was therefore an “interpretive rule” not requiring a notice-and-
comment period, but the court disagreed and held that it was a legislative rule because it
effectively amended the existing regulations (Flight Training Int’l v. FAA).
Agriculture: The Tenth Circuit held that a plaintiff could not sue a local police
department under the Agriculture Improvement Act of 2018 (generally known as the 2018
farm bill) for preventing him from transporting hemp plants on a domestic flight.
Although the 2018 farm bill generally precludes states from interfering with the interstate
transportation of hemp, the district court dismissed the plaintiff’s claim, concluding that
the farm bill does not create a private cause of action. The Tenth Circuit agreed, holding
that the language of the statute does not suggest that Congress intended to grant hemp
farmers a right to transport freely products without interference from state officials
(Serna v. Denver Police Dep’t, et al.).
Civil Rights: A divided Ninth Circuit panel held that a plaintiff’s status as a “serial
litigant” or tester plaintiff did not, on its own, affect his standing to sue under Title III of
the Americans with Disabilities Act (ADA), which prohibits disability discrimination in
places of public accommodation. The majority held that courts should consider the
specific facts at issue when determining whether a facility is open to the public and
covered by Title III. The court held that ADA testers can have standing and that filing
multiple ADA suits does not, in and of itself, damage a plaintiff’s credibility for standing
purposes. On the merits, the court held that the actual usage of a facility, or if that is not
in evidence, the nature of the entity and the public’s reasonable expectations, determine
whether a facility is open to the public and therefore covered by Title III. Because
customers used the parking lot, even though the terms of the commercial lease restricted
its use to the business operators, the court held that Title III applied (Langer v. Kiser).
Consumer Protection: The Eleventh Circuit denied a defendant’s effort to dissolve a
preliminary injunction freezing his assets under the Federal Trade Commission Act (FTC
Act). The FTC alleged that the defendant orchestrated a telemarketing scheme in
violation of the FTC Act and the Telemarketing Sales Rule. The FTC obtained the
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preliminary injunction, relying on Section 13(b) of the FTC Act, but the Supreme Court’s
later decision in AMG Capital Management, LLC v. FTC narrowed the scope of relief
available under Section 13(b), excluding monetary relief. The Eleventh Circuit agreed
with the district court that, while Section 13(b) could no longer support the injunction on
its own, the FTC had properly amended its complaint to rely alternatively on Section 19
of the FTC Act and that Section 19 authorized the remedies provided for in the
preliminary injunction (FTC v. Simple Health Plans, LLC).
Employee Benefits: The Ninth Circuit largely reversed a district court’s judgment in
favor of several classes of plaintiffs against a managed healthcare organization under the
Employee Retirement Income Security Act of 1974 (ERISA). The plaintiffs alleged that
the defendant denied claims based on internal guidelines that conflicted with plan terms
and state-mandated criteria. The district court certified several classes of plaintiffs to
determine not the individualized question of whether each plaintiff was in fact entitled to
benefits, but the question of whether each class was entitled to reprocessing of their
claims based on the alleged flaws in the internal guidelines. The Ninth Circuit agreed
with the district court that the plaintiffs had Article III standing to pursue their claims, but
held that class certification was improper because ERISA does not provide for
reprocessing as a standalone remedy. The Ninth Circuit also reversed the district court’s
judgment on the merits of the guidelines issue and failure to require all plaintiffs to
comply with administrative exhaustion requirements (Wit v. United Behavioral Health).
Freedom of Information Act (FOIA): The Second Circuit reversed a district court’s
judgment in favor of United States Immigration and Customs Enforcement (ICE) and
held that ICE must provide access to certain immigration records in a person-centric
manner, so that the FOIA plaintiffs may track individual (but anonymized) aliens across
ICE records. ICE stores information in several event-centric databases from which an
individual’s records can be retrieved via an Alien Identification Number (A-number). ICE
produced database records to the plaintiffs but redacted A-numbers as exempt records and
refused the plaintiffs’ request to substitute anonymized identification numbers to permit
person-centric access. The Second Circuit concluded that FOIA’s broad disclosure policy
and strictly construed exceptions require ICE to provide such a substitution or otherwise
facilitate person-centric access (American Civil Liberties Union Immigrants’ Rights
Project v. ICE ).
*Intellectual Property: The Fourth Circuit affirmed a district court ruling that Shenzhen
Stone, a Chinese internet company, violated the Anticybersquatting Consumer Protection
Act (ACPA) by registering a domain name, PRU.COM, identical to Prudential’s
distinctive mark. The Fourth Circuit determined that Shenzhen Stone was not entitled to
the benefit of the ACPA’s safe harbor provision, as it could not have had a “reasonable
belief” that its use of the domain name was lawful. Under the ACPA, an entity that
“registers” a domain identical or confusingly similar to a distinctive trademark with a
“bad faith intent to profit” is liable to the owner of the trademark. Although Shenzhen
Stone was not the initial registrant of the domain name at issue, the Fourth Circuit
employed reasoning endorsed by the Third and Eleventh Circuits—but not the Ninth
Circuit—in holding that the term “registration” applies not only to the initial registration
of the mark but also to subsequent re-registrations (The Prudential Insurance Co. of
America v. Shenzhen Stone Network Information Ltd.).
*Labor & Employment: The Sixth Circuit reversed a district court’s dismissal of a
plaintiff’s claim for retaliation under the Family and Medical Leave Act (FMLA). The
plaintiff alleged that her employer fired her after she made a request for FMLA leave, but
did not allege that she was entitled to or took the requested leave. The Sixth Circuit,
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acknowledging inconsistent precedent within the Sixth Circuit and among other circuits,
held that FMLA retaliation claims can be brought under 29 U.S.C. § 2615(a)(1), rather
than only under § 2615(a)(2). The court further held that inquiring about and requesting
FMLA leave may be protected activity under the FMLA, and thus provide the basis of a
retaliation claim, even if an employee is not entitled to such leave (Milman v. Fieger &
Fieger, P.C.).
Labor & Employment: The Ninth Circuit granted a petition for enforcement by the
National Labor Relations Board (NLRB), rejecting the respondent’s argument that the
NLRB’s General Counsel lacked proper authority to prosecute the petition for violations
of the National Labor Relations Act because her predecessor was unlawfully removed.
President Biden removed the prior General Counsel upon taking office, cutting short a
four-year term, and appointed a replacement confirmed by the Senate. The respondent
argued that the existence of the four-year term in 29 U.S.C. § 153(d) implied a
prohibition on removal without cause during that period. The Ninth Circuit disagreed and
held that the text of the statute, informed by precedent, did not restrict removal (NLRB v.
Aakash, Inc.).
Tax: The Ninth Circuit affirmed a Tax Court decision that it lacked jurisdiction to return
an offer in compromise (OIC) payment to a taxpayer. The Tax Increase Prevention and
Reconciliation Act (TIPRA) requires a taxpayer who makes an OIC to submit a payment
for twenty percent of the total value of the OIC. In executing an OIC, the taxpayer must
also acknowledge that the payment will not be refunded if the OIC is not accepted. When
plaintiff’s OIC fell through, he requested a refund of the TIPRA payment. The Ninth
Circuit agreed that the Tax Court did not have jurisdiction to refund the payment, because
Congress had not given it that power via statute (Michael Brown v. CIR).
Torts: The Eleventh Circuit held that plaintiffs stated a claim under the Computer Fraud
and Abuse Act (CFAA) by alleging that their business partner refused to grant access to
software rightfully owned by the plaintiffs absent additional payment. A provision of the
CFAA prohibits transmitting a threat to cause damage to a protected computer with intent
to extort. The Eleventh Circuit rejected the defendant’s arguments that the
communications at issue could only be construed as negotiations rather than threats and
that withholding passwords did not result in damage because the software continued to
function. The Eleventh Circuit therefore reversed the district court’s dismissal of the
plaintiffs’ claims for lack of personal jurisdiction, which had relied on a contrary
evaluation of the CFAA claim (SkyHop Technologies, Inc. v. Narra).
Veterans: The Federal Circuit affirmed a Court of Appeals for Veterans Claims (Veterans
Court) decision regarding the interpretation of 38 U.S.C. §§ 1724, 1725, and 1728. A
disabled veteran living abroad sought payment from the Department of Veterans Affairs
(VA) for emergency treatment he received at a non-VA facility for a medical condition
unrelated to his service-connected disability. The VA denied the veteran’s claim and the
Veterans Court affirmed because § 1724 prohibits the VA, absent exigent circumstances,
from “furnish[ing] hospital ... care or medical services” abroad. The Federal Circuit
agreed with the Veterans Court that “furnishing” includes payment for hospital care
abroad, and also agreed that §§ 1725 and 1728, which provide payments for emergency
treatment in certain circumstances, do not override this prohibition (Van Dermark v.
McDonough).
Veterans: The Federal Circuit affirmed a Veterans Court decision denying petitioner’s
request to exclude state unemployment compensation payments from his annual income
for purposes of calculating his non-service-connected pension. The Veterans Court held
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that unemployment compensation payments cannot be excluded from annual income
under 38 U.S.C. § 1503(a)(1), which excepts “donations from public or private relief or
welfare organizations.” The Federal Circuit affirmed on the basis that, under the plain
meaning of the statute, state unemployment compensation payments cannot be
considered “donations” (Cooper v. McDonough).
Veterans: The Federal Circuit held that a veteran was entitled to liberal consideration of
his petition to correct his military service record to reflect post-traumatic stress disorder
(PTSD) as the reason for his discharge. The government argued that 10 U.S.C. § 1552(h)
and a Department of Defense memorandum only require “liberal consideration” of
PTSD-related petitions where a veteran seeks to upgrade or modify the characterization
of service. The Court of Federal Claims disagreed, but concluded that the petitioner was
not entitled to liberal consideration because his true objective was to obtain a
determination of his fitness at discharge for disability retirement purposes, rather than to
amend the narrative reason for his discharge. The Federal Circuit disagreed with both the
government and the Court of Federal Claims, and held that the petitioner’s disability-
related goals did not affect his entitlement to liberal consideration, and remanded the case
for such consideration (Doyon v. United States).
Author Information
Hannah-Alise Rogers
Alexander H. Pepper
Legislative Attorney
Legislative Attorney
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