The Volokh Conspiracy
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An Unusual Supreme Court Split in Bittner v. United States
The Bank Secrecy Act divides the justices in an unusual way, and Justice Barrett authors her fourth opinion in an argued case.
Today the Supreme Court decided Bittner v. United States. Splitting 5-4, the Court concluded that the Bank Secrecy Act's $10,000 maximum penalty for the nonwillful failure to file a compliant report accrues on a per-report, not a per-account, basis. Justice Gorsuch wrote for the Court, joined by the Chief Justice and Justices Alito, and Kavanaugh in part, and Justice Jackson in full. Justice Barrett dissented, joined by Justices Thomas, Sotomayor and Kagan.
To say this is an unusual split among the justices is an understatement. The Court did not divide along clear ideological or methodological lines. There are conservative and liberal justices on both sides of the decision.
Justice Gorsuch's opinion for the Court begins as follows:
The Bank Secrecy Act and its implementing regulations require certain individuals to file annual reports with the federal government about their foreign bank accounts. The statute imposes a maximum $10,000 penalty for nonwillful violations of the law. But recently a question has arisen. Does someone who fails to file a timely or accurate annual report commit a single violation subject to a single $10,000 penalty? Or does that person commit separate violations and incur separate $10,000 penalties for each account not properly recorded within a single report?
The answer makes a difference, especially for immigrants who hold accounts abroad and Americans who make their lives outside the country. On one view, penalties accrue on a per-report basis. So, for example, a single late-filed report disclosing the existence of 10 accounts may yield a maximum fine of $10,000. On another view, penalties multiply on a per-account basis, so the same report can invite a fine of $100,000 even if the individual's foreign holdings or total net worth do not approach that amount. Because the Ninth Circuit read the law one way and the Fifth Circuit the other, we agreed to take this case.
His opinion concludes:
Best read, the BSA treats the failure to file a legally compliant report as one violation carrying a maximum penalty of $10,000, not a cascade of such penalties calculated on a per-account basis. Because the Fifth Circuit thought otherwise, we reverse its judgment and remand the case for further proceedings consistent with this opinion.
The Chief Justice and Justices Alito and Kavanaugh joined all of Justice Gorsuch's opinion save for a subpart of the opinion that relied upon the rule of lenity. Only Justice Jackson joined that portion of the opinion.
Justice Barrett's dissent begins:
Alexandru Bittner, an American citizen, held as much as $16 million across more than 50 bank accounts in Romania, Switzerland, and Liechtenstein. He acknowledges that the Bank Secrecy Act (BSA) and its implementing regulations required him to report his interest in these accounts to the Federal Government annually. Bittner also admits that he failed to comply with that requirement for five consecutive years. Because he failed to report 272 accounts, the Government concluded that he violated the law 272 times and assessed a penalty for each violation. Bittner, on the other hand, argued that he violated the law just five times—once for each annual form that he failed to file.
The Court agrees with Bittner and holds that the failure to file a legally compliant form is a single violation, no matter how many accounts a citizen fails to report. I respectfully disagree. The most natural reading of the statute establishes that each failure to report a qualifying foreign account constitutes a separate reporting violation, so the Government can levy penalties on a per-account basis.
This dissent is Justice Barrett's fourth opinion in an argued case so far this term. She has issued two majority opinions and two dissents in argued cases when some justices have yet to issue a single one. This is more evidence that Justice Barrett is the Court's quickest opinion writer.
It is also interesting that this is another case in which Justices Gorsuch and Barrett have authored dueling opinions. As I noted last June, these two justices have disagreed more than one might have expected, authoring opinions disagreeing with each other's analyses in a surprising number of cases. Indeed, last term, Justice Gorsuch dissented from two-thirds of Justice Barrett's majority opinions. We will see if this division persists this term.
