The Most-Straightforward Path To Stay The S.B. 8 Injunction: There Is No Equitable Cause of Action

The Fifth Circuit should grant the stay based on the District Court's Ninosplaining of Grupo Mexicano

On Wednesday evening, the Western District of Texas enjoined S.B. 8 in an 113-page opinion. In time, I hope to write about the decision at some length. Here, I will focus on the most-straightforward path to stay the injunction.

The United States does not have an equitable cause of action in this case (my tenth point in this post). The most relevant precedent is Grupo Mexicano de Desarrollo, SA v. Alliance Bond Fund. In Grupo Mexicano, Justice Scalia wrote  that "the equity jurisdiction of the federal courts is the jurisdiction in equity exercised by the High Court of Chancery in England at the time of the adoption of the Constitution and the enactment of the original Judiciary Act, 1789 (1 Stat. 73)." No one can contend that the sort of lawsuit DOJ brought here would have been recognized when the Constitution was ratified.

The District Court does not even quote this passage. Instead, Judge Pitman attempts to tell us what Justice Scalia really thought:

 Relying on Grupo Mexicano de Desarrollo S.A. v. All. Bond Fund, Inc., 527 U.S. 308 (1999), the State argues for limiting equitable actions to the exact claims available at common law. (Resp., Dkt. 43, at 14). That reliance, however, is misplaced. Grupo Mexicano at most stands for the proposition that federal courts have jurisdiction over suits in equity, in which the broad equitable remedies that predate the Constitution remain available. The formal source of that jurisdiction is codified in the Judiciary Act of 1789, as discussed in Grupo Mexicano. However, the principle itself is broader and is not defined by that Act. Indeed, by the time he returned to the question in Armstrong, Justice Scalia—the author of Grupo Mexicano—had dispensed with any need to locate this power in the Judiciary Act. Nowhere in the latter case did he cite to the Judiciary Act. Rather, he wrote of general equitable powers "tracing back to England," translating to the "judge-made remedy" in the federal courts. Armstrong, 575 U.S. at 327.

Judge Pitman's Ninosplaining will not stand on appeal. As a general rule, we do not presume that a Supreme Court justice "dispensed" with a prior precedent, unless there is an express disavowal of that prior precedent. Moreover, Judge Pitman badly misreads Armstrong. That case rejected the argument that the Supremacy Clause creates a cause of action. It was such an easy case. There was no need to discuss the Court of Chancery in 1788.

Judge Pitman added:

It is the essential nature of equity that it is not subject to strict limitations, unless and until Congress acts directly to restrict it.

No! This statement gets Grupo Mexicano completely backwards. The presumption is that the courts cannot expand new equitable causes of action. The recent evisceration of novel Bivens claims is consistent with this presumption. Rather, Congress has the power to create statutory causes of action.

Finally, the court conflates equitable causes of action with equitable remedies:

The State is mistaken in searching for a blueprint of the cause of action here. For the United States' cause of action is a creature of equity, a centuries-old vehicle which eschews categorical definition. That remedy is available where no adequate remedy exists at law; any attempt to codify such situations would be futile, and likely require powers of clairvoyance which no legislator possesses.

These concepts are distinct.

Seth Barett Tillman and I discuss this all-too common conflation in our new article, forthcoming in the Georgetown Journal of Law & Public Policy:

Article III of the Constitution gave the federal courts jurisdiction over both law and equity. And in equity, there is a distinction between equitable relief and equitable jurisdiction. Litigants often conflate these concepts. Moreover, litigants likewise conflate causes of action grounded in law with equitable causes of action. In the Emoluments Clauses litigation, the plaintiffs did not assert a traditional equitable cause of action that established federal court jurisdiction. The Supreme Court has not recognized a free-floating equitable cause of action to challenge ultra vires government conduct. . . . .

In the Emoluments Clauses litigation, the plaintiffs contended that the federal courts had equitable jurisdiction to enjoin ultra vires government conduct. For example, the Maryland and D.C. Attorneys General argued that "'[t]he ability to sue to enjoin unconstitutional actions by state and federal officers'" is "'the creation of courts of equity,'" and reflects "'a long history of judicial review of illegal executive action, tracing back to England.'"239 The plaintiffs invoked the term "equity," as if seeking an equitable remedy establishes the equitable jurisdiction of the District Courts. (See p. 36, 39)

In all other contexts, the DOJ routinely advances the Grupo Mexicano argument. This argument in United States v. Texas represents yet another instance in which DOJ departed from longstanding agency precedent.

The District Court's cursory treatment of Grupo Mexicano provides a simple basis for reversal.