Source: http://www.nelfonline.org/docket/category/government-regulationadministration-of-justice
Timestamp: 2019-04-21 06:30:47+00:00

Document:
This case presents the Supreme Court with an opportunity to take a first step toward clarifying, and hopefully setting some limits to, the “parcel as a whole,” a key concept in regulatory takings law. Since the phrase first appeared in the Court’s 1978 decision Penn Central Transportation Co. v. City of New York, 438 U.S. 104, the term has been adapted to a variety of circumstances. As used in Penn Central, it meant that the economic impact of a government regulation should be evaluated in terms of the entire piece of property in question and not solely in terms of the specific property right targeted by the regulation. The Court observed, “‘Taking’ jurisprudence does not divide a single parcel into discrete segments and attempt to determine whether rights in a particular segment have been entirely abrogated.” Penn Central, 438 U.S. at 130.
Since Penn Central, the concept has been extended by analogy to account for the great diversity of factual circumstances met with in regulatory takings cases. Now, when some or all of a parcel is affected by a regulation, the “parcel as a whole” concept is sometimes invoked as reason for evaluating the impact of the regulation on that parcel by grouping the parcel with other, related parcels, as if the parcels, on analogy with the situation in Penn Central, were “discrete segments” that must not be considered separately from the larger parcel of which they are part. While a wide variety of factors has been employed by courts in determining when to aggregate parcels in this manner, the most common major factors probably are: (i) common ownership, (ii) contiguity with each other, and (iii) unity of use.
This case focuses on the extended application of the concept and asks whether the mere contiguity of commonly owned parcels requires, as a rule of takings law, that such parcels be considered together as the parcel as a whole, even when unity of use or any other factor is absent. NELF has filed an amicus brief in the case, on the merits, supporting the Murrs in their contention that the proposed rule of law should be rejected because it is overly inclusive and unfair to property owners.
The petitioners in this case are the Murrs, four siblings. In 1960, their parents purchased a certain Lot F in rural St. Croix County, Wisconsin. Their father owned a plumbing business, and he placed title to Lot F in his business. Soon after the purchase, the parents built a three-bedroom recreational cabin on the lot. Recognizing the growth potential of the area, in 1963 they purchased a second parcel, Lot E, as investment property. They held the title to Lot E in their own names. Lot E is adjacent to Lot F; both are waterfront parcels approximately 100 feet wide and somewhat over one acre in size. Since its purchase, Lot E has remained vacant and undeveloped. There is no dispute that, as created and as originally purchased, the parcels were separate, distinct legal lots, and that each could have been separately developed, used, and sold.
In the 1990s, the parents made donative transfers to their children, the present petitioners, of developed Lot F and investment Lot E, and for the first time the adjacent lots came under common ownership. In 2004, when the Murr children wanted to sell Lot E and use the proceeds to finance improvements to Lot F, they discovered from officials that they could not develop or sell Lot E separately. Twenty years earlier, in 1975, while the lots were still owned separately by their parents and the plumbing business, local environmental regulations had been adopted requiring a “net project area” of at least one full acre as a prerequisite to development of any lot in that lakeside, environmentally sensitive area of the county.
Lot E has a net project area of only 0.5 acres. The regulations do contain a grandfather provision for any substandard lot created before 1976, as Lot E was, but it permits the separate development and sale of such a lot only if the lot “is in separate ownership from abutting lands.” Because Lots E and F abut and are now both owned by the Murr siblings, the grandfathering exception does not apply to Lot E; the two lots are treated as merged, and the Murrs cannot sell Lot E, although it was acquired by their parents specifically as an saleable investment.
The Wisconsin Court of Appeals rejected the Murrs’ takings claim, ruling that the “parcel as a whole” rule requires combining the two parcels for takings analysis “under a well-established rule that contiguous property under common ownership is considered as a whole regardless of the number of parcels contained therein.” Murr v. State of Wisconsin, 2014 WL 7271581, at *4 (Wis. App. Ct. Dec. 23, 2014) (per curiam) (unpublished). After the Wisconsin Supreme Court denied further review, the Murrs petitioned the U.S. Supreme Court for certiorari, and the petition was granted on January 15, 2016.
In its amicus brief supporting the Murrs, NELF argues that the Court should strike a fair and just balance when identifying the “parcel as a whole.” Invoking the principles of fairness and justice on which the Court has avowedly founded its takings jurisprudence, NELF expresses its concern that the tendency of courts to unduly expand the parcel as a whole creates an unfair risk of undercompensation to property owners. NELF then goes on to illustrate the insufficiency of the two factor rule (adjacency and common ownership) applied by the Wisconsin court. NELF argues that these factors alone are too tenuous, and that the Court should require at least “unity of use” as a third factor in deciding whether to aggregate legally separate. NELF’s argument draws a close analogy to the principles on which severance damages are awarded in eminent domain cases.
Arguing that Article III’s “Case or Controversy” Requirement bars a plaintiff from suing in federal court for the technical violation of a statute that has not caused any concrete harm.
​This case was a putative consumer class action pending before the United States Supreme Court on the merits. The plaintiff and putative class representative, Thomas Robins, sought statutory damages in federal court under the Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq. (“FCRA”), for a technical violation of that statute that has not caused him any harm. (In particular, Robins alleged that the defendant, Spokeo, Inc., a website operator that provides users with information about other individuals, published false (but favorable!) information about him, such as by misstating his educational level and financial status.) FCRA permits recovery for the bare violation of a statutory right. The case thus raises a constitutional separation of powers issue long familiar to NELF: does Article III of the United States Constitution, which limits the federal judiciary’s jurisdiction to “cases” and “controversies,” confer standing on a plaintiff who alleges a violation of a federal statute but who does not allege any resulting injury? Can Congress create standing in the federal courts that otherwise would not exist by legislative fiat? The Supreme Court has interpreted Article III’s case-or-controversy requirement as mandating “injury in fact”—i.e., a “concrete” and “particularized” harm that is “actual or imminent.” Clapper v. Amnesty Internat’l USA, 133 S. Ct. 1138, 1147 (2013). Despite this clear constitutional requirement of injury in fact, the Ninth Circuit in this case denied the motion to dismiss of defendant Spokeo, Inc., a website operator that provides users with information about other individuals. The lower court concluded that, because FCRA allows a plaintiff to recover statutory damages for the bare violation of a statutory right, the statutory violation is itself an injury in fact sufficient to satisfy Article III.
Notably, NELF briefed the same standing issue in the Supreme Court in 2011, in Edwards v. First American Corp., a case also arising from the Ninth Circuit. (And the Ninth Circuit in this case has based its decision primarily on its Edwards decision.) In Edwards, the Supreme Court granted certiorari but then dismissed the case without reaching the merits, on the basis that certiorari had been improvidently granted. While the Court did not explain its decision, it may have been due to the unique procedural posture of that case. Therefore, this pressing issue of Article III standing, in the absence of any actual injury, remains unresolved. (NELF has also briefed the same issue at the state statutory level, in particular under Mass. G. L. 93A before the Massachusetts Supreme Judicial Court. See Hershenow v. Enterprise Rent–A–Car Co., 445 Mass. 790 (2006)). Moreover, there are several federal statutes, like the ones at issue here and in Edwards (the Real Estate Settlement Procedures Act, 12 U.S.C. §§ 2601 et seq.), that allow plaintiffs to recover statutory damages (and reasonable attorney’s fees) without proving any concrete harm.* Therefore, the issue of Article III standing is of great significance to businesses in our region and the country as a whole. A business’s broad exposure to liability for statutory damages and attorney’s fees under these numerous laws is compounded by the class action mechanism, which is the procedural vehicle of choice for many consumers and employees (and their attorneys) suing under such statutes. Putative class members arguably need only show the bare, classwide violation of a common statutory right to obtain class certification. Businesses are thereby exposed to potential liability for vast, aggregated sums of statutory damages and high attorney’s fees, often resulting in a large settlement on a claim in which no class member has been injured.
NELF, joined by Associated Industries of Massachusetts, argued, on behalf of Spokeo, that Article III requires dismissal of Robins’ complaint because it fails to allege any injury in fact. “Injury in law” under FCRA, based on the bare violation of a statutory right, cannot satisfy Article III’s requirement that the violation must cause some concrete harm. Congress cannot create an injury in fact. It can only provide a private remedy to redress an injury in fact. Therefore, the injury-in-fact requirement under Article III is not satisfied merely because Congress has authorized an award of statutory damages for the violation of a statutory right. A federal court must always exercise independent review of a federal statute, along with the allegations of a plaintiff’s complaint invoking that statute, to determine whether the plaintiff has identified a concrete harm resulting from the violation of a statute. In short, the Article III inquiry to determine an injury in fact “has nothing to do with the text of the statute relied upon.” Steel Co. v. Citizens for a Better Environment, 523 U.S. 83, 97 (1998). As the Court has emphasized, “[i]t is settled that Congress cannot erase Article III’s standing requirements by statutorily granting the right to sue to a plaintiff who would not otherwise have standing . . . .” Raines v. Byrd, 521 U.S. 811, 820 (1997). Simply put, statutory standing to sue in federal court does not automatically create constitutional standing under Article III. In reaching its decision, the Ninth Circuit and other federal circuit courts have apparently disregarded this key precedent and have also misinterpreted other Supreme Court precedent as equating statutory standing with Article III standing. Certiorari should therefore be granted to resolve the confusion among the lower courts on this crucial issue and clarify that injury in fact is not coextensive with injury in law.
NELF initially filed an amicus brief supporting the defendant, Spokoe Inc’s petition for certiorari. When certiorari was granted in April, 2015, NELF filed an amicus brief on the merits in the case. On Monday, May 23, 2016, the Supreme Court issued its decision, agreeing with NELF, 6-2, that the plaintiff lacked standing because he had not demonstrated a concrete injury. Rather than dismissing the case, however, the Supreme Court remanded the case to the lower courts for a determination whether the plaintiff could demonstrate a concrete injury resulting from the alleged breach of the FCRA.
Although the Supreme Court did not dismiss the case outright, as NELF had argued it should do, this is nonetheless this is a victory for the principles underlying NELF’s brief—namely separation of powers and the federal judiciary’s exclusive authority to determine whether standing exists. In short, Congress cannot create standing in federal court for the mere breach of a statutory requirement that Congress has enacted.
*See, e.g., the Truth in Lending Act, 15 U.S.C. § 1640(a)(2)(B)); the Fair Debt Collection Practices Act, 15 U.S.C. § 1692k(a)(2)(B); the Telephone Consumer Protection Act, 47 U.S.C. § 227(b); the Employee Retirement Income Security Act, 29 U.S.C. § 1132(a)(2); and the Video Privacy Protection Act, 18 U.S.C. § 2710(c)(1).
The issue before the United States Supreme Court in this case was whether the preemption provision of the Employee Retirement Income Security Act (“ERISA”) barred a State from imposing reporting requirements on ERISA plans beyond what ERISA itself requires.
The case arose when Liberty Mutual instructed the third-party administrator of its ERISA plan in Vermont not to comply with a subpoena from the State requiring that certain health claims information be collected pursuant to Vermont law. Vermont, like a number of other States (including the other five in New England), has a statute that requires health care providers and health care payers in Vermont to provide claims data and related information to the State’s specialized health care database. The State says that it relies on the data collected to inform its health care policy decisions in a number of ways. As the basis for its refusal to comply with this Vermont law, Liberty Mutual argued, both in the suit it brought in the Vermont federal District court and, subsequently, in the Court of Appeals for the Second Circuit, that since ERISA requires certain forms of reporting by ERISA plans, any additional form of reporting imposed by State law is preempted under ERISA’s broad preemption provision.
Liberty Mutual lost on summary judgment in the district court, but obtained a ruling its favor from the Court of Appeals in a split 2-1 decision. On June 29, 2015, the Supreme Court granted certiorari to hear the matter on the merits, and NELF filed an amicus brief in support of Liberty Mutual.
In its brief, NELF addressed recent Supreme Court ERISA decisions in which the court adopts a “presumption against preemption,” and NELF argued that there exist several reasons for the Court to abandon or limit its use of that presumption. The presumption is usually traced back to Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230 (1947), where the Court adopted a working “assumption” that the “historic police powers of the States” should not be deemed to be superseded when “Congress legislate[s] . . . in [a] field which the States have traditionally occupied” unless such preemption was “the clear and manifest purpose of Congress.” As preemption has long been declared by the Court to be a matter of congressional intention, use of the presumption is especially inapt when one is dealing with an express preemption provision, as in ERISA. Such an express provision banishes the need for any kind of presumption because it clearly establishes the fact of Congress’s intention to preempt. From that point on, the actual language, purpose, and context of the statute provide much surer guidance to Congress’s intended meaning than could be given by any presumption unmoored to the statutory text.
Not surprisingly, therefore, while the presumption formulated in Rice may have been adopted by the Court in order to assist it in discerning Congress’s intention, there has been no shortage of scholars who, however much they may disagree among themselves on other legal points, agree that the Court has signally failed to employ the presumption in a consistent methodological fashion.
Moreover, use of the presumption in instances of express preemption is bedeviled by the problem of deciding how narrowly or expansively to define the relevant field of supposed traditional State regulation. Cf. Garcia v. San Antonio Metro. Transit Auth., 469 U.S. 528, 546-47 (1985) (“We therefore now reject, as unsound in principle and unworkable in practice, a rule of state immunity from federal regulation that turns on a judicial appraisal of whether a particular governmental function is ‘integral’ or ‘traditional.’”). The present case exemplified that problem, as the two sides contended over whether the field should be viewed broadly, with the emphasis falling on traditional State health and welfare concerns, or narrowly, with the focus on the novelty of the means by which data is to be collected under the Vermont law. This disagreement was mirrored in the differing views of the majority opinion and the dissent in the appeals court.
Finally, because the judicially fashioned presumption against preemption necessarily works to narrow interpretation, it gives the safeguards of federalism a kind of double weight, beyond the weighting given by Congress when it composed the text of the statute.
For these reasons, the “presumption against preemption” is an entirely inappropriate tool of statutory construction, and NELF urged the Court not to adopt it in this case when determining the scope of the express preemption provision found in ERISA.
On March 1, 2016, the Supreme Court issued its decision in this case. The Court agreed with NELF, 6-2, holding that ERISA preempts Vermont’s statute as applied to ERISA plans.
Directv, Inc. v. Imburgia, et al.
Arguing that, in an Arbitration Agreement Falling Under the Federal Arbitration Act, a Reference to State Law with Respect to the Enforceability of a Class Arbitration Waiver Does Not Displace the Federal Arbitration Act’s Mandate to Enforce Such a Waiver.
At issue in this Supreme Court case was whether, in an arbitration agreement falling under the Federal Arbitration Act, 9 U.S.C. §§ 1-16 (“FAA”), a reference to state law with respect to the enforceability of a class arbitration waiver displaced the FAA’s mandate to enforce such a waiver.The arbitration provision at issue was in satellite television provider DIRECTV’s customer agreement in 2007 with Amy Imburgia. The agreement required binding arbitration of any future disputes and also prohibited class-wide procedures. However, while the arbitration provision recited that it “shall be governed by the Federal Arbitration Act,” it also stated that enforcement of the class action waiver, and indeed of the entire arbitration provision, would depend on the law of each customer’s state: “If, however, the law of your state would find this agreement to dispense with class arbitration procedures unenforceable, then this entire [arbitration agreement] is unenforceable.” Id. (emphasis added).
The California Court of Appeals interpreted “the law of your state” as referring to the law of California without regard to the preemptive force of federal law and read the 2007 contractual language as intending to oust the FAA’s mandate to enforce the class arbitration waiver, as announced four years later in AT&T Mobility LLC v. Concepcion, 131 S. Ct. 1740 (2011). On that basis, the California court invalidated the class arbitration waiver under the California law that bars class action waivers in consumer actions and, giving effect to the arbitration agreement’s so-called “jettison” clause, voided the entire arbitration agreement, in essence forcing the parties to litigate in court.
From NELF’s point of view, the case raised one central issue: Did the parties to the disputed agreement intend to elevate state law over the FAA on the subject of class arbitration waivers? NELF argued that reference to “the law of your state” in the 2008 agreement was never intended to oust the FAA in favor of state law. Rather, it reflected the understanding, current in 2007, that, under the FAA, the enforceability of class action waivers in arbitration agreements was governed by state law. That is, the 2007 agreement was intended to comply with the FAA as then understood. This understanding, however, was dispelled by the Supreme Court in 2011 in Concepcion, which held that state law cannot impede the enforcement of class arbitration waivers under the FAA. NELF argued that, since “the law of your state” was not intended to oust the FAA, and since “the law of your state” cannot, after Concepcion, impede enforcement of the class arbitration waiver, DIRECTV’s motion to compel arbitration of Imburgia’s individual claims should have been allowed.
In its decision of December 14, 2015, a six-member majority of the Court agreed with NELF and enforced the class arbitration waiver, although for slightly different but nonetheless compelling reasons. In a skillful opinion written by Justice Breyer, the Court held that the FAA preempts the lower court’s opinion, which singles out arbitration agreements for unfavorable treatment and interprets “the law of your state” as referring presumptively to invalid state law. The Court explained that, since the FAA limits the states to applying general contract law principles to arbitration agreements, “the law of your state” must be interpreted under California general contract law. The Court observed that, as an empirical matter, California cases interpreting such contract language (along with cases from every other state) read “the law of your state” as referring presumptively to the valid law of a state. This means that “the law of your state” in this pre-Concepcion agreement evolves with the times and reflects any intervening changes made by a state Legislature, a state supreme court, or, as in this case, any pronouncements of controlling federal law by the Supreme Court under the Supremacy Clause, as announced in Concepcion.
Therefore, once the Court in Concepcion held that the FAA preempted California’s Discover Bank rule (which had effectively invalidated all class arbitration waivers in California consumer form agreements and had required the availability of class arbitration), “the law of your state” no longer included the invalidated Discover Bank rule. Thus, the class arbitration waiver in the pre-Concepcion agreement at issue must be enforced under the FAA, and the jettison clause is never reached.
Notably, the Court explained that, while indeed the FAA allows parties to apply any body of law, even preempted state law, to their arbitration agreements, this is not what “the law of your state” means on its face. To override the presumptive meaning of “the law of your state,” then, parties would have to refer expressly to preempted state law in their arbitration agreements (an unlikely but nonetheless enforceable contract clause).

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