today's appeal presents a somewhat unusual circumstance any decision by this court directly affects every member of not only the federal circuit but of the entire federal judiciary some of us this is more than unusual it's a little uncomfortable yet the supreme court has stated that under the rule of necessity we have a duty to decide cases involving two additional compensation in spite of any potential personal interests the role  necessity states quote although a judge had better not if it can be avoided take part in a decision of a case in which he has any personal interests yet he not only of inaction when faced with difficult decisions whatever difficulties a case may bring quote we have no more right to decline the exercise of jurisdiction which is given then to use sir that which is not given close quote is under this mandate that we sit and it needs to keep its promises of compensation to article three judges the compensation clause of article three provides that a judge is compensation shall not be diminished during his continuance in office that means as hamilton said that congress can change the judge's condition for the worse when congress makes a deafening and precise promise of future compensation to federal judges it can't thereafter diminish that compensation eleven years ago however a dividing panel of this court held in williams versus united states that the compensation protected by articles for you is strictly limited to a mounts do and payable to a judge and doesn't extend under any circumstances to future judicial pay promised by law no matter how precise and definite the promise  firm and definite promise to give rise to reasonable expectations of the promise will be fulfilled and that's the real critical point that with all respect we think that the williams panel mess that the way they believe that can all madame majority there that the result in this case or the result in the williams case which involves the same statutory regime as this case was dictated by the result of the in will the supreme court's choir decision the fundamental difference between the but that doesn't mean that every single day that you have to over read their cases and i guess the roadmap the key point here is that in when when the williams case went to the supreme court there was a dissent from  proposition that i think you all judges realize you have to do every day which is even though you can't build a rule of supreme court cases you have to use as a judge to exercise your judgment to try to figure out how broad or one error the holding is and you supreme court has tried and feels for departing from the reasoning of the case and looking only to the facts and finding a factual difference and telling us that that's not an appropriate way to  again but i think it's important when you're looking at the reasoning to look at the context in which the reasoning was set forth and if at the question there were actually presented to the court in that case and again you know this is somewhat of a metaphysical question i guess what and i think we  have guidance from from the three members of the supreme court at least and i realize that that's not a majority but when you also have a very significant and it seems to me and it is from a majority of the supreme court isn't the fact that the court remanded this very case i mean this case as you know was in the supreme court and our previously the court remanded the case for consideration of the preclusion issue well that would have been a very strange thing if the if this was hands were absolutely bound and we were bound to lose as a matter of we're absolutely bound by the view you reading will get such a way to have from reading consequences that would be very strange to think that the supreme court would have done unanimously in that opinion by chief justice berger for instance with respect to retirement pay as we've question about a formula and this is a question about a promise in other words this is much more than a formula this is something when you put together the night meeting on act section twenty twenty four sixty one which is about judicial case with to the g s pay under the steps of the eighty nine statute and i take it your position is that if congress should decide to reduce the formula for the g s employees and the judges were reduced to the same extent with respect to the cost of living increases there would be no compensation clause violations that run you know your own so you think that that is the time is go back to the congress year after year and they said you know something this isn't working ok just have all rube goldberg regime where you had agents who had to then have a review commission go to the president and have a white house details that's not working what we're going to do is we're going to put severe have here to foresee what is the come to enable or can congress does congress have the power to say look we don't have to do with indexing scheme for judges but we're going to do it in dixie prejudges and we're going to give it to judges in precise indefinite terms could congress repea fighting we're repealing the entire and we're that raises an interesting question whether or not congress could come up with an alternative regimes that the senate didn't wind up lowering the real compensation to judges and you know i think that's a very interesting question about i think you would certainly have to look for what you know what is the compensating mechanism for instance to go back to the earlier hypothetical less an excise an answer  what i think it had with the court sort of recognizing that the benefits of all kinds can be a form of the compensation the compensation is not strictly limited to pay and that's why i think frankly one of the things that has changed since williams was indicates that retirement pay is part of the compensation that is to the judges that doesn't make sense that tended to be true if if if will is read of the just as the government is reading in here as saying only amounts that are due and payable now are part of the compensation you're not suggesting that the outside company so you can is protected by to compensate some of them it might be your honor the for instance one could imagine the regime where congress says you know we're not going to give judges any money but the way we're going to let article three judges earn a living is that they're going to be allowed to practice law if that were the regime then that could be changed if it were they could say well you can't practice law now we're still not going to give you any money again i th interesting issues and there always are issues about what kinds of benefits are considered to be part of the compensation they had or there was a dent in from taxes but it's just a school get out of there and majority also know that you have to look at the overall package when you start to look at the overall package i think it's clear that you're no longer looking just at things that were doing payables because benefits certainly the promise of a whole lot is a benefit that you get through it is a judge in any job but that same is true for retirement disability it's my concerns i think that raises very serious questions under the compensation clause against you know that once you accept that as i think the supreme court hasn't had or at least that benefits like that can be part of the package but it would be and again if you say look the rule is now going sixty five it's the rule of eighteen out of his life was fifteen to change it to the rule of ninety and i think that would raise very serious questions under the compensation of again because what's the point of the clause we're protecting promises to to judges those are promises that that that allow the judge is going back to what you said rader said at the beginning of the real necessity judges have to make tough decisions judges shouldn't have to fear that when they make those kind of tough decisions the congress may say you know something i think that that's to the very values that applause and acted to prevent and with all respect we think that the williams scored again read more into the will decision the needed to be read and so we respectfully ask believe the promise to be and in other words i'm not sure you always would need kind of this quid pro quo but i think it underscores the whole nature of the one nine hundred eighty nine steps through regime as a fundamental departure from the previous regime and so i do think that even though it may not be necessary to have kind of that that you know bitter plus this week i think it underscores that judges are reasonably entitle to expect you know when they're sitting on the bench looking at you know should i stay on the job or should i accept the general coun offer or if you're so if you're sitting at kitchen table and you're pondering a judicial appointment you and your family should say once i should be able to figure out you know i look at what congress has said they said you know if you get a cola and unless the president declares extraordinary circumstances that's the deal is being offered to the judges and again going back to the basic point of hamilton that the congress would not be able to change that for the workers what's the point where he says that the congressional promises a the whole point of the compensation clause is to protect the judges results and patients i mean we're facing i don't know where we're faced with the word compensation so i will give you that the constitution isn't self defining terms of what the word compensation means and that the government's interpretation here is that it's only now they're actually doing payables our position is that to give effect to the to the intent of the framers and when what hamilton was trying to was talking about in federal seventy nine you have to recognize that what you're doing here is you're protecting the judges reasonable expectations so they're not chilled in terms of having something that they are entitled to expect taken away from them obviously a future salary increase that is not yet an act into law isn't a reasonable basis for thinking you're going to get that so you won't be the idea at least is that judge can be reasonably chilled from exercising his or her judgment in a case based merely on the possibility of some future pay increases not in that comes from your re forth this very point again i understand that the majority of the court but they have actually set forth the path for distinguishing will and again they didn't say would we as a supreme court need to overrule will they said rule will can be question the compensation costs and for the principle that all promises can't be broken congress has no constitutional authority to break the promise of judicial pay so if congress in fact had said you know you will get if congress has paid you i don't think the government even disputes that dip a chip that you're currently getting as part of kills jobs i think it's one hundred eighty four thousand seven hundred dollars a year that that they cannot break their promise to pay that by paying you one hundred fifty thousand dollars next year that the question is and i agree with you that there is a question of vesting but the question is is and we don't disagree with well that it certainly does that once it's become do with pails the question is is that the only circumstance when it best and this is a question that will have no occasion to address was it didn't have forty precise and definite regimes if congress says judges instead of giving you twenty thousand extra dollars this year were to give you ten thousand dollars this year and ten thousand dollars next year  then it seems to me that at least you should really man for a day for us to proceed on a claim for those two years for the colors for those two years because that is really independent of the will slash williams and therefore in the in the colors in the ninety's congress affirmatively blocked them but that's not true in two thousand and seven twenty ten so even under the language of of the two thousand and one statute even if it's not even if it is constitutional it doesn't purport to to to block anything so we should have done the cole as in two thousand and seven and twenty ten and then there's also an argument that even if you disagree with that statutory interpretation that the two thousand and one statutes are constitutional the difference isn't the reason that we respectfully submit you should reach the constitutional question that there's also a claim for damages in the earlier years of the six year statute of limitations period which in this case was about two thousand three arising from each paycheck we were getting those periods was artificially lowered as a result of the denial cola's in the one nine hundred ninety s and we obviously are not going back all the way to the one nine hundred ninety s we can't do that with respect except for the patients that this goes back to the point i think the church lurie's asked me about in terms of the reduces to a relatively simple and straightforward issue and that is whether this court in plumes correctly concluded that the best thing and well the vesting rule set forth by the court will control this can see if it does then the judgment should be a firmed and on that issue the question simply reduces to whether the plaintiffs have persuasively disturbing distinguish this case from the will and in particular the statutory pay schemes that were considered by this court in williams and the supreme court and will we would submit your honors that there is no material distinction between the two pay scheme of course the plaintiff have characterized this scheme and with adjustments future adjustments in judicial salaries were expressed in mandatory automatic terms both schemes required to use the word shall be adjusted to the rates of pay moreover under both schemes those adjustments were to be made at a date certain in the future also under both systems the increases to distil plague were kedar tied to increases in the automatic no year old book and respectfully disagree under the old scheme the gov the president page was required to be parents and made a report to make a recommendation made and it didn't say that it had to recommend any increase  well he was that if in his study and a compilation of the surveys of the bureau of labor statistics if it was called conclude excuse me concluded that there was no basis for me increase in a particular year i suppose that could be true but it could also be true under the the the modern system where the d c i and many are conceivably could could reflect no change so the essential point is that under both systems some adjustment had to be made unless the president stepped in under his special authority to reduce or deny an increase altogether based upon a national emergency or economic conditions affecting the general welfare identical in terms of the mandatory nature of the adjustments the fact that both schemes require the adjustments to be effective as of a date certain in the future the similar trait that both just pay raises and g s pay raises are tied together and finally the notion that the president could step in for the state it grounds it seems to me that under the will system that congress retained a  discretion to step in along with the president and to change it to make adjustments but that wasn't the case under the eighty nine system and seems to me that congress wrote itself out of that s decision well but under this specific provisions of the will scheme congress really didn't play a role unless and until the president stepped in and decided to present an alternative pay plan and then congress had thirty days to either house or congress could essentially veto that plan and in the case of that occurring then the president's page in with the proposal would govern so congress didn't play that up as an active role in the under the old submittals functions that you just described were not included under the eighty nine says no there's not that sort of detailed system back and forth no but again congress could always conceivably under the rule will step in and change the president and alternate pick a little bit in congress didn't include itself in under the eighty nine system with references to the automatic nature of the pay increases they are under and again replete with references to legislative history behind the blocking statutes that the court was considering which were done to prevent automatic pain creases from going into effect so automatic means automatic it means that unless some party intervenes they are required to go into effect by a date  an injunction against the could because they've taken action to keep them from going into effect well i'm not aware of any ground there would be a ground under the compensation clause for example to do so i'm asking could they that's your discussion of stand still for compensation to get you into hot water with for sex to cause why is retirement a deferred compensation or is that your position well that was solicitor general we certainly have no basis to to depart from here on the issue of was oh so you're saying that then either a change on a congressional change to the amount of retirement pay retirement in this sense being after someone leaves the judiciary right that even or a change in the amount of the pay or even a change in the number of years required for eligibility for ultimate retirement pay would be a compensation clause problem i don't think i can respond just generally so generally to that question because you will likely need to have the sceptics if that would help but i mean suppose that they say instead of getting what everybody else gets because you're going outside and you have an opportunity for for other income if you leave before the age of seventy you'll get half way that would be a compensation problem with perspective everyone in the that went on the fence and in their thirty's who is on the bench for thirty years but leave at age sixty four and a half and get zero because it's not doing payable until that the rule of any is satisfied so under your reading of retirement pension benefits are part of the compensation so just on that point alone it presents a different issue and of course according to hatter made that point with op by also citing to and harmonizing its decision and will so what will end hatter mean with respect to compensation and how it's protected i suppose work huge a case but are reading and essentially it's not necessarily our reading but the discords reading of will in williams doesn't pose a threat to retire paid because the court was looking to number one different statutory provisions that set out salary increases not retired behind the compensation clause and how to specific issue of pay increases was raised and addressed by the framers we don't have any similar evidence here respecting pensions for example saying that some compensation can be taken away but other complications here no no your honor i'm just saying that it's a different issue either way if you're saying due and payable is the time it's got to be doing payable right distinction that we certainly are not departing from that no you but again getting back to what we believe is the dispositive issue and that is whether the two schemes are distinguishable now as we understand it the planet simply having pointed to a particular provision and made by the eighty section four sixty one stated that rates of pay shall be adjusted but as we pointed out in our brief and if they have not responded to that language shall be adjusted the originating originated not from the one nine hundred eighty nine act but from the decision and so there is no material distinction between on the facts between this case and will and as your honor just like noted really there's no up basis  time to distinguish the two cases on the facts and in many respects this case is very similar to the hatter case in which the court was presented with existing supreme court precedents evans legal which  held with respect to income tax assessment that such diminishes were unconstitutional that was a criticised decision if was called into question in some later respects by fiscal years eighty nine and ninety and then it changed the method of calculating cola's from the old report system to the p c i system with respect to of course the first two there was no notion that it was attempting to get around or deal with will it all and even with respect to the change in that to the e c i netted there's no indication that that was a response to the cour issue that it's not really change or that it has a scope of the binge already paneling williams described congress wanted to create an automatic system of pay raises in one thousand seventy five there's no doubt about that just as method of calculating the of the the entries doesn't change the essential aspects of the scheme itself that the court will sound controlling counsel we received a lot of information especially from your response to those comments well of course in general that's true that was the purpose of the compensation fellows was created to provide a measure of security judicial pay increases of course compensation was protected against diminish and but as far as increases to that compensation that present a problem to the framers and ultimately the compromise was to judicial salaries increased when times warranted so the clause itself in bodies some some technology risk to independence there was criticisms criticisms of framers that allowing congress to pass upon increases would would cause judges to curry favor with congress of all those pay increases were being considered but nevertheless that was ultimately the compromise that was reached and that was the compromise that the court recognized and well and he drove it says mr simpson on page twenty one of your response every item you say then the compensation clause doesn't prohibit congress from changing the rate of future increase or canceling at quote before judges have performed services which for a compensation is due and payable and the problem i have with it is who gets to define what services are whatever whatever the level was if it if congress in any year says the salaries of the federal judges shall be one hundred eighty thousand dollars per year for next year of course no one is saying congress can come back and take that down and the reason can take that debt is because that salary level had become the compensation that was due and payable to the judges you can't go back of course the whole point of will is that for future in for uses as opposed to system was put in place that all of the later callers were completely automatic and they didn't constitute additional rate because they actually just constituted an automatic application of the eighty nine hour do we have a different rule of investing for the twenty seventh amendment than we do for the compensation well as this is this courtroom in williams addressed that issue yet there's a through the different issues the court was looking into when pay raises took effect for purposes of the twenty seventh amendments and held of that was a different issue from the issue addressed by the supreme court in will of course if there is intention or  conflict between those two cases the court's decision well of course would be controlling and could i ask you a bill two thousand and seven slash two thousand and ten claim race in the  to earlier that hold that issue entirely turns i take it on whether congress in two thousand and one when it and then did section one forty was an ending it in a way that converted the hereafter enacted in to something that had happened each year as opposed to the here after enacted referring to any active occurred after nine hundred eighty one is that a fair statement  amendment to section one forty i take it to mean that here after enacted applies each year right now the words that an act has to be passed authorizing the encrease each year twenty two right that's correct so if in fact we construe section one for you as not interfering with the williams holding that the hundred eighty nine legislation was here and after an act of legislation what's the basis for denying the culls in two thousand and seven twenty well there i guess there would not be  sorry you've just conceded a powerful victory for the judges well not necessarily are out of it if congress to get action fails to provide a pay increase required by law that's not necessarily the same as a since there was no change well this is a decision in williams didn't specifically address the question of specific authorization it held that the  that the two thousand and seven and twenty ten colors were improperly denied is not yes that you know that would be the case for if there was if there was an automatic right to them and there was no action either by the president or of this statute is it measurably somewhat murky but looking at the language of the conference committee says makes permanent a provision that prohibits the use of funds to increase the salary of a federal judge except as may be of specific barring legislation in a given year that write a well we we have argued that section one forty was effective from the date of it and that meant to this day  eighty was accepted in response to that question of the williams decision that discussed one forty four it's tempting to say well no we're going to make it permanent even though the federal circuit doesn't think it is then you think one forty would block one magic coal and even in the absence of specific year to year blocking legislation is that correct i would think that would could be that could be an interpretation because one forty provides not is interesting if you look at the us report that's the vision occupied about ten pages is incredibly complex in terms of how colas could ever come to be there has the president has to appoint an agent there's no discretion the agent's discretion it says that you know the agent shall convene the federal employees pay council there's a lot of steps but at the end of the day there is no sub there's no they are there in terms of what substantively has to have that then there's not  that just because it wound up happening that way that you were entitled to a reasonable expectation that you could have had a scheme that said you will get a whole lot if you flip a coin and it comes out a certain way it might come out that actually came out ahead right but that doesn't mean that you would have a scheme was so precise and indefinite whereas now the regime is precise in terms of we just finished the regime you had the agent then you had a commission then you had the present interesting week this is a one hundred seventy five statute a kind of shows the post watergate world that we're living in of all the pieces of this process of force that the agency commission the president and congress only presidents discretion was substantively cabin through that nine hundred seventy five legislation the president could only change the recommendations if there were a national emergency or serious economic conditions affecting general wealth or everybody else on breitling this question including congress going back to judge ramos question which could exercise a one house legislative veto under this so under that before the nine hundred eighty nine act was a repudiation of this regime there were extensive studies on the the system is broken it is not working we can't have this system where everybody has to go back to congress you have or you let's just put these restrictions in  if you interpret the nine hundred eighty nine act to be kind of discretionary open ended as as opposing counsel suggest that they know makes no sense and you have different rules regarding what the system was for members of congress versus judges and the and again that the ninety nine act is down to a precise amount it says the cia mind point five percent there was no question about this whereas under the old regime judges would get whatever pay increases the g s employees might have happened to get and to be sure by the end of the process that it sometimes produces a precise amount but that doesn't mean that x and the judges could form any reasonable expectations that that's where the process would wind up especially when you had a legislative veto the second point i wanted to move  with a fury that would say that retirement pay is constitutionally protected they're both colas in retirement pay are a form of compensation for current services but they that they're not currently doing payable yet and that's just the way all the eighty one statute which always had the reference to hereafter eighty nine is obviously after two thousand and one and exists at the pounds including williams and we agree with the williams panel on this point that that eighty one is after two thousand and nine so there