Today in Supreme Court History: April 6, 1938

4/6/1938: United States v. Carolene Products argued.

Comments

[Dan Schiavetta]

Ashe v. Swenson, 397 U.S. 436 (decided April 6, 1970): double jeopardy bars trial as to break-in and robbery of second poker player when acquittal as to robbery of first was based on failure to identify defendant as the robber

United States v. Barnett, 376 U.S. 681 (decided April 6, 1964): contemnors (Governor and Lt. Gov. of Mississippi who flouted court order to admit black student to state university) not entitled to jury trial; four liberal Justices dissented (i.e., principled behavior on both sides)

Kansas v. Glover, 589 U.S. --- (decided April 6, 2020): reasonable cause for stop because plates showed car belonged to driver with revoked license (and it turned out to be him; arrested for habitually driving without a license)

Corley v. United States, 556 U.S. 303 (decided April 6, 2009): 18 U.S.C. §3501, making confessions admissible if within six hours of arrest and found to be voluntary, did not replace McNabb - Mallory rule that confessions are inadmissible after “unreasonable delay” in arraignment

Jacobson v. United States, 503 U.S. 540 (decided April 6, 1992): Government kept mailing child pornography to defendant, then convicted him of possessing child pornography; conviction overturned because no showing he was “predisposed” to possess it (did they count how many days he had it before he threw it in the trash?)

Universities Research Ass’n v. Coutu, 450 U.S. 754 (decided April 6, 1981): no private right of action for back wages for federal contractor employees paid below “prevailing wage” as required by the Davis-Bacon Act because contract did not contain prevailing wage stipulations (then what’s the purpose of the Act anyway?)

Arnold v. North Carolina, 376 U.S. 773 (decided April 6, 1964): vacating murder conviction of black men because records showed that in 24 years only one black person had been selected for grand jury service

United States v. First Nat’l Bank & Trust Co. of Lexington, 376 U.S. 665 (decided April 6, 1964): merger of two major competing banks is per se violation of Sherman Act (resulting bank would be larger than all other banks in Fayette County combined)

New Jersey v. New York, 345 U.S. 369 (decided April 6, 1953): City of Philadelphia can’t intervene in interstate dispute (New Jersey and Pennsylvania objecting to New York’s diversion of Delaware River tributaries) because Pennsylvania is already a party (odd because New York City was already in the suit, as a defendant)

Pennzoil Co. v. Texaco, Inc., 481 U.S. 1 (decided April 6, 1987): When I was in law school the $11 billion found against Texaco -- the largest verdict ever -- was much discussed. I said, “Can you imagine being the law firm that lost that case?” Since then, I’ve learned that “losing big” actually helps the law firm because it makes them look like a “big player”. Anyway, the Court here exercises the Younger abstention and refuses to interfere with state enforcement proceedings, dismissing suit raising due process and Equal Protection issues which were not brought up in state suit.

[Dr. Ed 2]

As to NY v NJ, " the intervention [of Philadelphia] would permit a suit against a state by a citizen of another state in contravention of the Eleventh Amendment; (2) that the Commonwealth of Pennsylvania has the exclusive right to represent the interest of Philadelphia as parens patriae;"

NYC became a defendant because it was acting under the authority of NY State, a named party. And this is in contrast to NH v MA (circa 2021) where NH didn't have the right to sue Mass DOR on behalf of NH residents. Go figure...

As an aside, I believe this involved the air conditioning units of the day -- instead of exhausting the heat out the back as they do now, they instead were hooked up to a cold water line with the then hot water going down the drain. I remember hearing something about salt water infiltration of the aquifer and NYC actually banning these units in the mid '50s because of this.

[Dan Schiavetta]

Fondly remembered . . .
https://www.youtube.com/watch?v=R7IHSdUEbRA

[John F. Carr]

The story of salt water infiltration sounds unlikely because Manhattan aquifers have always been brackish. NYC has imported water for a long time. See https://www.smithsonianmag.com/history/how-new-york-city-found-clean-water-180973571/

Drawing water from the ground for air conditioning could have other bad effects. In the Back Bay area of Boston a drop in the water table would cause wood foundations to rot.

[Dr. Ed 2]

Brackish water would have worked for air conditioners, it may have been more a concern about lowering the water table than salt water infiltration (which would ALSO happen with a lowered water table), and it might even have been Boston (although I was told it was NYC). The exception was if you pumped the water back into the ground which does sound like concern for a lowered water table.

Perhaps people were pumping said brackish water out of their own wells and then dumping into the sewer which wasn't metered (and still largely isn't today).

[John F. Carr]

The government mailed Jacobson solicitations, not illegal porn, for a few years. He was charged for finally giving into government pressure.

They got his name from a mailing list or customer list of a business selling legal pornography, or formerly legal pornography.

[Michael P]

Regarding United States v. Barnett, for those of us who are not lawyers and thus not familiar with the rules, Wikipedia has a brief summary of the categories and process regarding contempt judgments. I thought (correctly) that juries are not generally required, although a number of Supreme Court justices -- presumably including the four dissenters who captcrisis mentioned -- have called for juries to be required in cases of criminal contempt, like the one here. Some law review article has probably expounded on the history and theory in greater detail.

This is, of course, yet another example of lawyers' true superpower.

[not guilty]

In criminal contempt proceedings, the alleged contemnor is entitled to a jury trial if the sentence actually imposed exceeds six months incarceration. In the case of post-verdict adjudications of various acts of contempt committed during trial, the Sixth Amendment requires a jury trial if the sentences imposed aggregate more than six months, even though no sentence for more than six months was imposed for any one act of contempt. Codispoti v. Pennsylvania, 418 U.S. 506 (1974).

[David Nieporent]

Universities Research Ass’n v. Coutu, 450 U.S. 754 (decided April 6, 1981): no private right of action for back wages for federal contractor employees paid below “prevailing wage” as required by the Davis-Bacon Act because contract did not contain prevailing wage stipulations (then what’s the purpose of the Act anyway?)

The federal government can bring a claim for failing to pay prevailing wages under the DBA; individual employees cannot.

[David Nieporent]

Pennzoil Co. v. Texaco, Inc., 481 U.S. 1 (decided April 6, 1987): When I was in law school the $11 billion found against Texaco — the largest verdict ever — was much discussed. I said, “Can you imagine being the law firm that lost that case?” Since then, I’ve learned that “losing big” actually helps the law firm because it makes them look like a “big player”. Anyway, the Court here exercises the Younger abstention and refuses to interfere with state enforcement proceedings, dismissing suit raising due process and Equal Protection issues which were not brought up in state suit.

Relevant to the Trump verdict in NY: Texaco argued that the massive judgment made it impossible for it to secure a supersedeas bond, and therefore that it shouldn't have to do so; a lower federal court bought that argument, but SCOTUS reversed, saying, "Too bad, so sad." There were various procedural issues — which you briefly mention — but fundamentally the Court was unsympathetic to the idea that one has a right to stay a judgment pending appeal.

[The Margrave of Azilia]

Ashe v. Swenson – Sounds like this should have been a speedy trial issue; these are technically a bunch of separate crimes, but since they’re based on the same evidence, what’s the reason for not trying all the cases simultaneously? Was there some kind of waiver by the defendant?

[The Margrave of Azilia]

[deleted]

[SRG2]

From the Wikipedia article on Jacobson:

By a 5–4 margin, the justices reversed the conviction, agreeing that Jacobson had been entrapped, on April 6, 1992. It has since been reported that this was one of the rare cases where the decision changed after arguments. The original poll of the justices showed a 7–2 majority for affirmance, with only White and Stevens holding out. But White argued persuasively for reversal to his fellow Justices, and Blackmun and Clarence Thomas, who had replaced Marshall, changed their minds. It has been suggested that Thomas, who later established a reputation for allowing wide latitude to law enforcement similar to other contemporary Republican appointees, was especially sensitive at that time to Jacobson’s situation due to the sexual harassment allegations raised by Anita Hill during his own recent confirmation hearings.

Justice David Souter later provided the swing vote, and opinions that White and Sandra Day O’Connor had already begun drafting had to be rewritten to reflect the changed outcome of the case

[Dan Schiavetta]

Thanks! Interesting.

White, about to retire, finally showed some passion and decided to be influential.

And as for Thomas, it probably wasn’t the sexual harassment he was thinking of, it was the allegations of him boasting of possessing “unacceptable” pornography.

[not guilty]

Anita Hill testified at the Clarence Thomas confirmation hearings:

"He spoke about acts that he had seen in pornographic films involving such matters as women having sex with animals and films showing group sex or rape scenes," Hill testified, according to a transcript. "He talked about pornographic materials depicting individuals with large penises or large breasts involved in various sex acts."

https://www.ibtimes.com/clarence-thomas-groping-scandal-explained-what-know-about-anita-hill-moira-smith-his-2438819

[Mr. Bumble]

Hell hath no fury like a woman scorned.

By the way, I did not read Judge McAfee's decision in the Trump dismissal case, but since you did was asking you (in your learned capacity) what "harm to the government "meant.

[not guilty]

Among other things, the false statements made by Donald Trump about having won the 2020 election and the ensuing false representations made by Trump's co-conspirators, (for which Trump is vicariously liable,) falsely holding the bogus electors out as the duly elected and qualified presidential electors from the State of Georgia, risked harm to the government in that these false statements attempted to displace the valid electors who had been chosen by Georgia voters.

[Dr. Ed 2]

As to simply throwing it in the trash, that is the LAST thing I would have done because the govt doesn't need a search warrant to go through your trash.

Burning it and flushing the ashes might have been an option except that ever since the Anthrax scare of 20 years ago, the USPS has photo of both sides of every piece of mail that they deliver to you.

Filing Form PS-1500 might be an option, but then you have to staple the kiddie porn to the form. Damn, I am not sure WHAT I would do.

Form 1500: https://about.usps.com/forms/ps1500.pdf

[SRG2]

The Texaco case had widespread financial consequences. Up until then, in the eurobond capital markets, US corporations were able to issue bonds on relatively advantageous terms compared to sovereign issuers, because the European investors’ experience post-WW2 was that US corporations paid their debts, but many sovereign countries didn’t.

Getty’s few eurobonds in particular were much sought, because they were rated triple-A – and the classic eurobond investor, known as the “Belgian dentist”, would be familiar with the name and brand.

But after Texaco’s acquisition of Getty, which lowered Getty’s rating from triple-A to single-A – Texaco’s own rating, eurobond investors became concerned that any American company was now at risk of a takeover leading to a ratings downgrade. And so borrowing costs for US issuers rose a little.

But after the initial judgment, Texaco, and hence Getty, got downgraded to (likely) default resulting in a major price drop for Getty’s bonds, and eurobond investors reasoned that this kind of thing could happen to any American borrower, – and so yields on American corporate bonds rose en masse. You could be a perfectly respectable and well-rated corporation, but you might have to pay 1/2% p.a. or more on any new issue of bonds simply because of the original Texaco decision.

As a separate issue, it has been argued by myself and others that one of the major contributing factors to the rise of takeover activity in the 1980s in the US, of which the Getty takeover was a part, was Lotus 1-2-3. Before that, working out the economics of various scenarios, running sensitivities, and analysing the funding of the company’s pension fund (an overfunded pension fund makes a company a more interesting target) would have been a very slow process – all done by hand on paper, if they could be bothered – and it would be hard to keep the takeover plan confidential. Once 1-2-3 came along, analysing the funding of the pension fund would be trivial, and running scenarios, etc. would cease to be a challenge. And so…

[Dan Schiavetta]

Thanks! interesting information from you, as always

[Dr. Ed 2]

Were those pension funds really overfunded?

The 1980s was when the Baby Boomers were in their 30s and hence peak liability for pensions they would be paying out now, particularly when one realized that these were (a) defined benefit pensions and (b) double-digit inflation.

Look at now, where the state pensions (also defined benefit) are UNDER funded. So how, exactly, was overfunded determined?

[SRG2]

In those days, many, if not most, company pension funds were defined benefit funds and actuaries would slowly crank out estimated liabilities. The advent of the techniques of portfolio immunisation and dedication allowed companies more accurately to determine the cost of the assets that could match those liabilities.

Take the simplest possible case - an actuary determines that the fund will have a single liability of $1mm in 10 years. The fund currently has assets of $600,000. The fund can buy $1mm of a 10y US treasury zero coupon bond for $500,000, creating what would be called a dedicated portfolio. If the fund sells its existing assets and buys that UST, it will have a surplus of $100,000. In practice the process was significantly more complex but the principle still applied - if you can match your liabilities with assets, and the cost of doing so is less than the current value of assets, the fund is overfunded.

It was by no means uncommon in those days for such overfunding - there was significantly more conservatism over PF management.

Note that the fund surplus belongs to the company not the fund beneficiaries.

Also to the inflation point - when inflation is high, so too are interest rates, so the present value of liabilities is lower - or it's cheaper to buy assets to meet those liabilities, which is the same thing.

[Dr. Ed 2]

Is this what led to the GM bankruptcy?

[SRG2]

No. It was the cost of other retirement benefits

[Magister]

A downside to the Age of Big Data is that everything is precisely calculated and cut to the bone, and one disruption throws out all those just-in-time supply chains (pandemic, Suez Canal blockage, Francis Scott Key bridge, etc.), or precisely calculated engineering tolerances which would have had a generous margin of safety built in before.

[Dr. Ed 2]

The real problem with the Caroline decision is that filled milk, like Miracle Whip (a cheaper alternative to mayonnaise ) was actually a superior product. Milk in cities a century ago was iffy at best while "canned" milk -- both evaporated and filled -- had been boiled and thus was a lot safer. And Miracle Whip quickly outsold all brands of mayonnaise and does so to this day -- it tastes better.

Of course I never understood why Caroline Products couldn't simply have set up canneries in other states and then sold intrastate.

[Dan Schiavetta]

You can still buy filled milk in the supermarket, at least the one we go to.

[Dr. Ed 2]

See: Milnot Co. v. Richardson
https://www.courtlistener.com/opinion/2005230/milnot-company-v-richardson/?

As best I can tell, a Federal District Court reversed SCOTUS for these reasons:

"It is further undisputed that through technical advancements since 1944, and a proliferation of treatments, including breakdowns, buildups, and various reconstitutions of whole fluid milk, several food products have appeared on the market in competition with Milnot, which are permitted to be shipped in interstate commerce, subject to regulation by defendant, and which are commonly known as imitation milk or imitation dairy products, as distinguished from filled milk products. Content analyses reveal that certain of these products are produced in part by combining skim milk with vegetable oil, while others are made by combining sodium caseinate with water and vegetable oils. It is clear and undisputed that sodium caseinate is a soluble white powder which is produced primarily by treating skim milk with an acid."