Earl Warren: Number 396, Hugo DeGregory, Appellant, versus Attorney General of the State of New Hampshire. Mr. Whiteside.
Howard S. Whiteside: Mr. Chief Justice, may it please the Court. This case arises on an appeal from a decision of the Supreme Court of New Hampshire which affirmed a decision of the Superior Court of New Hampshire, ordering the appellant in this case committed to jail for one year or until he purge himself for a civil contempt. Involved is a statute of New Hampshire which is quoted on page 2 of my brief, Chapter 588, Section 8 (a) which is part of the New Hampshire Subversive Activities Act. And the first sentence says, “At any time when the Attorney General has information which he deems reasonable or reliable relating to violations of the provisions of this Chapter, he shall make full and complete investigation thereof and shall report to the general court for results of this investigation together with his recommendations, if any, for legislation.” This case originated in November of 1963. You recall the statute, I just read says, if the Attorney General has information -- reasonable and reliable information concerning violations of the statute. Now, what triggered the start of this investigation in November of 1963 was no new evidence of subversive activities in New Hampshire. No sudden reappearance of the Communist Party of New Hampshire. What triggered it was that Hugo DeGregory, the appellant in this case came into the Superior Court in New Hampshire and purged himself of contempt in a previous proceeding by answering in the negative the question, “Are you presently a member of the Communist Party?” So, he left the court a freeman and two days later, the Attorney General issued a subpoena to have him appear for further investigation. I have referred to the previous proceeding here. The New Hampshire Subversive Activities Act was passed in 1951. In 1953, a temporary statute permitting investigation by the Attorney General was adopted which not only provided that he might investigate as to violations of the chapter but provided that he might investigate as to the presence of subversive persons within the State of New Hampshire. This was continued in 1955. In 1957, the legislature adopted the present statute which dropped the clause about the presence of subversive persons in New Hampshire and reads as I read it to this Court. The previous statute was involved in the cases of Sweezy versus New Hampshire and Wyman versus Uphaus both of which came to this Court. The present statute was involved in the previous DeGregory case, DeGregory versus the Attorney General of New Hampshire which was decided without argument per curiam by this Court, 368 U.S. 19 with four justices dissenting. Now -- and thereby upheld a New Hampshire decision saying that the Act was constitutional on its face and constitutional as applied to the facts in that case. So as a result, I did not argue below the constitutionality of the statute on its face, although, it would be open to this Court to reconsider it if it so wanted. My argument was based on whether the construction court on the statute by the New Hampshire courts went so far as to deny to appellant his rights under the United States Constitution, the First Amendment, the Fourth Amendment as guaranteed by the Fourteenth Amendment. And so when he was summoned or let me interject this. This case depends very much on the facts, the law has been cited, the cases have been cited which are very familiar to you, Sweezy, Uphaus, Watkins, Wilkinson, Braden, Barenblatt. They're all cited in the briefs and it seems to me that it is more profitable to determine on the facts of this case, what is the applicable law? Now, I might also advert to the fact that I have cited cases and among the cases which I already spoke off, some of those also say it but on page 13 of my brief, I've quoted two recent United States Supreme Court cases. Where there is a significant encroachment upon personal liberty, the State may prevail only upon showing a subordinating interest which is compelling, Bates versus Little Rock. And again, the decisions of this Court have consistently held that only a compelling state interest in the regulation of the subject in justified limiting First Amendment freedoms. So, I turn to the start of this proceeding before the Attorney General and --
Potter Stewart: The -- those quotations you read by the duty of this Court to balance, is that right? Balance the (Voice Overlap).
Howard S. Whiteside: Yes. On the -- on the majority decisions of this Court, that is true. They balance the rights of the individual against the rights of the State under the circumstances to see whether the State as such urgent reason for action as to warrant infringement of what otherwise would be the individual's rights under the Constitution. You will find that --
Potter Stewart: But the individual has rights under the Constitution he hasn't, doesn't he --
Howard S. Whiteside: Well, there is the view -- there is the view Mr. Justice that the First Amendment is exactly what it says and cannot be limited but that is not then the majority view of this Court. The majority view of this Court as said that the rights of the individual under the First Amendment or the Fourth Amendment maybe infringed only when the State shows an urgent necessity or compelling reason for doing so.
William J. Brennan, Jr.: I didn't know that the Court had ever held that. I decide--
Howard S. Whiteside: Well, maybe limited. Did I say infringed?
William J. Brennan, Jr.: If you have a right under the Constitution, it can't be infringed at all, isn't that right?
Howard S. Whiteside: I think I get what Your Honor is driving at. The right of the individual is limited under certain emergency circumstances so that the use of the word 'infringed' is wrong, I should have used the word 'limited'. Now, the record of the hearing before the Attorney General under this summons is found on page 26 of the record and it goes on for some pages. And the appellant through his attorney inquired immediately as to what the foundation of the Attorney General was for this new proceeding, what he was investigating. And the Attorney General said that first of all, he didn't admit that he had to show any basis for investigation. He have to show a form of probable cause and then he -- on page 28, he referred to -- in very general terms, the Communist Party as it existed in the late 1940s nationally and internationally. And then he said, there is extensive documentary -- documented sworn testimony to the effect that Hugo DeGregory has been for a long active within the Communist Party of the state and on the later page, he said that -- no, I'll leave it with that. And with that, the attorney for the appellant said, when, where, what is this sworn testimony? What year does it applied to? Where was it? And the Attorney General went no further. And so the appellant made the following sworn statement in this proceeding and I may interject. He later repeated that under oath in the Court when the proceeding got to the court. “I would like to state Mr. Gall that I am not now a member of the Communist Party and have not been at any time since the authority you have cited for Revised Statutes Annotated Chapter 588, Section 8 (a) that I have no knowledge of any Communist activities in New Hampshire during this period or of any violations RSA 588 during this period of six and one-half years. In fact, I am not even aware of the existence of a Communist Party in the State of New Hampshire at any time the authority you have cited, Section 8 (a) has been on the statute. And in view of the foregoing, I do not understand what it is I have to face here today.” And the only reply of the Assistant Attorney General was, “Well, we have some questions to ask you.” And so, proceeding from there, he asked questions such as, “Have you ever been a member of the Communist Party? Have you ever been an officer of Communist Party?” And each time the appellant would say, “When? What period are you talking about?” And the Attorney General would say, “Any period.” And so the appellant under those circumstances and in view of the sworn statement that he gave declined to answer those questions. And then we came to the next stage before the Superior Court. The Attorney General filed a petition in the Superior Court under the appropriate New Hampshire statute to have the appellant ordered to answer the questions or held in contempt. The appellant filed an answer which among other things set up the unconstitutionality of the proceeding as so applied. In the court, there was a long discussion as to foundation. The Attorney General again said that he didn't really feel that he needed to establish it. And then he went on to mention again the sworn testimony in the file and he was challenged repeatedly on that. “Produce it. What year does it refer to? Where is it?” And the court never ordered him to produce it or spends part of the year and he never did. And in fact, the court's decision later was not based on this statement of unknown sworn statements in the file. It was based solely on a report which I will get to shortly. It developed that the Attorney General really was relying on the 1955 Report of the Attorney General of New Hampshire to the legislature. That report was attached as an exhibit in the Uphaus case in 360 U.S. here and is on file, a number of copies in this Court. In view of that, the parties in this case have stipulated that we would not file the whole document. It's about 250 pages and it's getting very scarce and I say, there are so many cases on file in the courts among other things. And so, I named pages 204 to 206 of that document as part of the record because they had been referred to in the court hearing and because they deal specifically with the appellant. The appellee, Attorney General, asked me to stipulate that he would have the right to refer to other parts of the document and argument and I so stipulated. And in appendices to his brief, he has referred to other parts of the document which he does not give a page number on so I don't know where they are. I don't even have a copy of that document at this point. But I do have some notes as to certain references he made.
William J. Brennan, Jr.: Do we have the full report?
Howard S. Whiteside: You have the full report in the files of the Uphaus case. Wyman versus --
William J. Brennan, Jr.: That's what we had before us in Uphaus.
Howard S. Whiteside: I beg your pardon?
William J. Brennan, Jr.: It seems to me I remember reading a very big thing.
Howard S. Whiteside: Exactly, Your Honor. You field a dissenting opinion in the Uphaus case in which you went in at length to this very same document. You analyzed it at length.
William J. Brennan, Jr.: (Voice Overlap) about the section.
Howard S. Whiteside: It was that below any bigger. So the court determined that on the basis of that 1955 Report that adequate foundation had been laid that under the statute that provided the reasonable and reliable information as to violations of the statute.
William J. Brennan, Jr.: Now, how old was that at the time of the --
Howard S. Whiteside: That report was dated January 4, 1955 and its content referred chiefly to earlier years going back to the 1930s and in no case running beyond 1954.
William J. Brennan, Jr.: And what was the date of the inquiry in court not before the Attorney General in this Court.
Howard S. Whiteside: The date of the inquiry of this inquiry in the court was May of 1964.
William J. Brennan, Jr.: That's about nine years.
Howard S. Whiteside: Over nine years, over nine years after the information in the report.
William J. Brennan, Jr.: Are you arguing any significance to your case and our decisions last -- it was last term, wasn't it, in the respondent case?
Howard S. Whiteside: I have cited Your Honor the American Committee for the Protection of the Foreign Born and the Veterans of the Abraham Lincoln Brigade cases in my brief.
William J. Brennan, Jr.: Well -- are you arguing staleness here.
Howard S. Whiteside: I am Your Honor. That is one of my arguments. I argue lack of foundation. I argue that the construction of the New Hampshire Court goes so far that it would permit almost any state investigation in this field, whatever foundation was laid. The foundation here is so flimsy. I want to go into the appellee's brief in which he makes certain allegations of fact which are not supported on the record. He says and he repeats it. And he repeats it time after time. He describes appellant DeGregory as Secretary-Treasurer and organizer and leader in New Hampshire of the Communist Party. Well, I refer this Court to the record that portion of the 1955 Report which I already said which is found on page -- pages 23 through 26 of the record. And there it shows, “Yes, Hugo DeGregory was in the Communist Party in 1946 in Massachusetts and there's no later showing as to that.” Yes, he was a paid functionary with Communist Party according to this report in Massachusetts and not New Hampshire in 1947 and 1948 no later record shown. Now, as to his being a leader in New Hampshire of the Communist Party, that is not shown at all and in a couple of places.
Abe Fortas: Was it '46 in -- when he was in Massachusetts?
Howard S. Whiteside: In Massachusetts.
Abe Fortas: In '46 and more or less '47.
Howard S. Whiteside: And he was alleged who have been a paid functionary in applying '47 and '48 in Massachusetts not in New Hampshire.
William J. Brennan, Jr.: Now, you say -- when you say alleged you mean that there's a larger report --
Howard S. Whiteside: It was contained in the Attorney General's report, yes.
William J. Brennan, Jr.: In other words, those are -- are they finding based on some inquiry of the Attorney General?
Howard S. Whiteside: Presumably, yes.
William J. Brennan, Jr.: Are they findings based on the evidence of DeGregory?
Howard S. Whiteside: No.
William J. Brennan, Jr.: On any evidence of anyone who knew DeGregory.
Howard S. Whiteside: That I don't know Your Honor. The report, as I recall it, states that 130 persons were summoned and examined by Attorney General Wyman before this report came out and who gave such evidence as to appellant DeGregory I couldn't say. Now, this -- the --
Potter Stewart: Well and then, in other words, there were some -- it's been said that DeGregory was a functionary of the Communist Party.
Howard S. Whiteside: Yes, sir.
Potter Stewart: It's not at all clear and I suppose that was the basis for these questions, wasn't it?
Howard S. Whiteside: Yes, but when? He has said to have been functionary of the party in 47 or 48 in Massachusetts.
Potter Stewart: That's where the questions were directed at, to finding out when at all, isn't that correct?
Howard S. Whiteside: Well, in answer to your question, it does come out on page 19 of the transcript of the record, statement of Mr. Gall near the top of the page in which inquiry was made by me as to what period he was inquiring about and he replied or has stated to the Court, Your Honor, based on the information that is in the report covering that period of years which is any period during the period that is reflected in the report. In other words, he was inquiring as to 1954 and previously. He was not inquiring as to Communist activities or subversive activities current in New Hampshire at the time he brought those summons.
Potter Stewart: I thought the question was or the following questions was, “Were you ever or have you ever?”
Howard S. Whiteside: Yes, and --
Potter Stewart: Well, that's pretty clear if you -- it's just an ordinary meaning of English words that doesn't say 1954 or previously, that says ever.
Howard S. Whiteside: That is correct and DeGregory have already testified as to the previous six and a half years and questioned the constitutional authority of the Attorney General to go into the period before unless he had some current activities which would permit him as ancillary to those current activities to go into activities that long ago passed.
Abe Fortas: Is there a period of limitations in the Subversive Activities Act?
Howard S. Whiteside: It is the general New Hampshire's statute of limitations which is six years. Now, the statement in the appellee's brief that DeGregory was the leader of the party in New Hampshire is based on the following and on page 9 of the report, quote, he cites page 9 of the report for this and this is the only thing on page 9 that I can find which would justify, “A long time Communist Party official, Hugo DeGregory, currently a functionary in New Hampshire may currently be the power behind the party in this State”. That makes him a New Hampshire leader of the party according to the appellee in its brief. Then the appellee also makes another statement in his brief which I must challenge. As one of the bases, as one of the foundations that he says he has for going forward with this investigation. He says, first of all, he has the report. Second, we have still the same airfields, military installations in New Hampshire which would be vulnerable to Communist activity and then he says, page 27 in his brief, “There are also presently residents of New Hampshire who are many of the individuals discussed in said report” and there's absolutely nothing in the record to back that up. You search the record, there is nothing there to back up that statement.
Earl Warren: Would you read that statement again please, the one you just mentioned?
Howard S. Whiteside: There are also presently residents of New Hampshire who are many of the individuals discussed in said report.
William J. Brennan, Jr.: I gather that record, that reference then is to the big red report, is that it?
Howard S. Whiteside: The record reference is obviously to the big red report of 1955.
William J. Brennan, Jr.: Not to this record.
Howard S. Whiteside: There's nothing in this record to show that there are individuals discussed in that report except for appellant. Appellant was discussed in the 1955 Report when he is still a resident of New Hampshire.
Potter Stewart: Was there people who are going to be permitted to absolutely refuse to answer any questions?I suppose you're not going to have very much in any record about anything, are you?
Howard S. Whiteside: But I --
Potter Stewart: Except if I refuse to answer.
Howard S. Whiteside: I point out Your Honor that that was not the appellant's position. He made this one statement as to the period since June of 1957 disclaiming membership, knowledge or any part in Communist Party or subversive activities and if the Attorney General had believed that he was not telling the truth, it was open to him to cross-examine on that and he never did so. That testimony of DeGregory stands uncontradicted by any cross-examination or any independent evidence.
Potter Stewart: What were -- are the questions of -- which are the subject of this contempt commitment here in the record somewhere?
Howard S. Whiteside: Yes, they are. Well, I think you can best find them in the brief of the appellee. I'm having a little trouble finding them in the brief of the appellee. Here we are at page 31. "Have you ever been a member of the Communist Party?” "When did you join the Communist Party?” "Were you a paid member of the Communist Party?" “Were you an officer?” "Did you have access to -- well and so on?” And before the Attorney General, each time the appellant asked “When? What period are you speaking of?” And he never got any specification to any period as the reply. And in that --
Potter Stewart: A question like when did you join the Communist Party like that you have answer is either to give a date or else I never did join them.
Howard S. Whiteside: Well --
Potter Stewart: That's not a matter of when because only the witness knows when.
Howard S. Whiteside: Alright, but it has been made clear by the Attorney General's own statement that he was investigating the period of 19 -- early 1950s and back rather from the present. Now, I may say the appellee has cited and cited a certain quotation from the case of Communist Party versus the Subversive Activities Control Board in which he says, “Where the current character of an organization of the nature of its connection with others is an issue, of course, past conduct is pertinent” and goes on like that, and this of course I admit. Of course, past conduct is pertinent to explain present statements or present conduct but here we don't have any present statements or present conduct. The Attorney General is not investigating it at present. He has summoned the appellant -- the appellant has testified as to the present. The Attorney General has produced nothing else as to the present which would permit him to investigate under this statute as to subversive activities.
Abe Fortas: Did the appellant answer all of those questions as to the present or current time, all the questions on page 31?
Howard S. Whiteside: It is my belief Mr. Justice that this one statement covers every one of those questions. This one statement would cover as is to every one of those questions.
Potter Stewart: Now, where is that statement in your brief?
Howard S. Whiteside: Well, I read it -- I read the statement earlier to Your Honor. It's contained twice in the transcript of the record once before the Attorney General and once before the Court. You will find it on --
Potter Stewart: Page 3 of your brief, I think.
Howard S. Whiteside: Page 30 of my brief. And -- oh, excuse me, page 30 of the record and --
Potter Stewart: Page 3 of your brief, is it, the statement of the case?
Howard S. Whiteside: Yes, as you say, page 3 of my brief. And if --
Speaker: There is no claim -- no claim of the privilege against self-incrimination --
Howard S. Whiteside: No, no such claim at all. No.
Potter Stewart: There are no claims for immunity? I think isn't there some immunity --
Howard S. Whiteside: There was a discussion as to that in the previous case but no discussion as to that in this case.
Potter Stewart: Just what -- just what constitutional rights are you relying on here?
Howard S. Whiteside: I rely on the right of privacy under the First Amendment, the right against unreasonable search and seizure under the Fourth Amendment --
Potter Stewart: Now, what --
Howard S. Whiteside: I beg your pardon?
Potter Stewart: I don't -- I have a little difficulty of (Voice Overlap).
Howard S. Whiteside: Well, it has been so mentioned Your Honor in the case for instance of -- you have a difficulty in considering an investigation of subversive activities as involving the Fourth Amendment?
Potter Stewart: Well, it might or might not. It might if there were search or seizure of a man's personal effects --
Howard S. Whiteside: Alright --
Potter Stewart: --or a house without a warrant.
Howard S. Whiteside: And an investigation without --
Potter Stewart: Well, I don't think that's here, is it?
Howard S. Whiteside: Investigation without proper foundation? Well, that is one of my arguments, Your Honor.
Potter Stewart: Relying on what, Griswold against Connecticut something like that?
Howard S. Whiteside: Relying on Mapp versus Ohio which of course wasn't actually --
Potter Stewart: Like breaking into somebody's house without a warrant.
Howard S. Whiteside: Well, I know and I cannot say them to you right at the moment certain statements in the legislative investigating cases which do bear on the Fourth Amendment and I regret that I do not have those so tabbed in my brief that I can bring a citation right out now to Your Honor on that.
Potter Stewart: In the First Amendment, there is guarantees of free speech and free exercise of religion, redress --
Howard S. Whiteside: Absolutely. Yes. In Watkins --
Potter Stewart: -- the right to petition Government.
Howard S. Whiteside: In Watkins versus The United States, 354 U.S., cited on my brief at page 8. It was said, the First Amendment may be invoked against infringement of the protected freedoms by law or by lawmaking and that was the case of a legislative investigation.
Potter Stewart: How can -- this certainly, it's very possible that in the course of a legislative investigation there might be an infringement of the right of a free press or the free exercise of religion but I just wonder what the claim was here.
Howard S. Whiteside: The claim was here without a foundation to go forward or without a legal foundation that the Attorney General could not properly proceed and if I may put it in three short statements. The Attorney General can constitutionally investigate current subversive activities, if he has evidence of them. There is no evidence in this record. He can inquire at a past conduct to throw or lay down the present, if he has some evidence of the present. There is no such evidence in this record. He can inquire that the trick posted by the Communist Party in New Hampshire, if he has some evidence that there is a Communist Party in New Hampshire. There is no evidence in the record that there has been a Communist Party in New Hampshire since 1953. I cited in my brief the case of Pennsylvania versus Nelson to show the limited power of the State. The State is not defending the whole United States now reference as to as Adam spies of the Berlin Wall are not apposite here. This is the safety of the State of New Hampshire and the Attorney General is confined to his defense of that and should produce for the record what he has to justify his investigation as to that. Therefore, I submit to Your Honors that this investigation has gone beyond the grounds of the Constitution and the order of the New Hampshire Court should be reversed.
Earl Warren: Very well. Mr. Shapiro.
R. Peter Shapiro: Chief Justice, may it please the Court. The only issue before the Court that I see is the constitutionality of the application of New Hampshire, RSA 588 (a) as applied in the facts of the instant case. The constitutionality was not raised below and I believe it was decided by this Court in Wyman v. DeGregory, 368 U.S. 19. The basic --
Potter Stewart: This complicate the constitutionality as applied to the facts of this case was certainly raisable.
R. Peter Shapiro: Yes, that's correct.
Potter Stewart: Is it?
R. Peter Shapiro: That is the only issue --
Potter Stewart: You're not suggesting that the issues which have been argued by your brother are not before us, are you?
R. Peter Shapiro: No.
Potter Stewart: No, alright. Not with that respect. Now, the basic legal test to be employed by the Court is, has the interest of the State in this instance to adequately inform itself in order to protect its legitimate and vital interest, then pressed into fatal collision with the constitutionally protected rights of defendant. This was brought out in the Uphaus v. Wyman case and it was I believe restated in Gibson versus Florida Legislative Committee, 372 U.S. It's actually a balancing test between the rights and responsibilities of the Government on one hand and the constitutional rights of an individual on the other hand. Now, our courts, New Hampshire Supreme Court is very familiar as I cited on page 10 of my brief with this type of proceeding. They've been informed in the Sweezy case and the Uphaus case by this Court the proper application to be applied in this instance and they have been affirmed in the second Uphaus case and later DeGregory case as to the application of the statute. It's our contention that once the appellate court concludes that the lower court has applied the appropriate law, the proper law of the case, it's not the duty of the appellate court to substitute their judgment but that of the lower court but whether or not there is adequate evidence in the record to sustain the position of the lower court. Basically, three problems that I find involved this case, one, that has been raised would be the staleness issue which relates to the nexus between the subject under investigation and the individual witness Mr. DeGregory. The compelling interest of a state would be the second interest involved. Now, the one point which distinguishes the present case of DeGregory versus the Attorney General from the prior case is a lapse of time of roughly three years. Everything else is basically the same. Now, once the Court has determined that there is a valid fact-finding hearing and investigation has been started properly, it's the duty of the State to tie the witness into this investigation to show a proper nexus. Now, the subject under investigation here is generally communism in and affecting the State of New Hampshire. The basis being that the interest here is self-preservation -- which has been -- of the State of New Hampshire which has been long stated by this Court as a valid interest of investigation by the State. The subject of investigation is the Communist Party which has been held by this Court in the Barenblatt case specifically as a -- the Communist Party is different than any other political party. Its basic nature, its aim, the ultimate overthrow of our form of government, our democratic form of government, has been held to be a valid area of investigation. And the vehicle for the investigation has been held valid as I've cited in the cases in my brief is the legislative fact-finding committee. In this case, the Attorney General is appointed as such. And -- now with reference to the nexus involved, the following is a brief resume of the witnesses' relationship to the subject under inquiry. In Appendix K of my brief, cited at page 78, it indicates that DeGregory was a candidate in Massachusetts for Lieutenant Governor in 1940. The Daily Worker named him as a member of the Communist Political Association in '42. In '45, he was on the letterhead of the Communist Party in Massachusetts as Secretary-Treasurer. Now, this is in Massachusetts. He was active in the Communist Party in Massachusetts in 1949. He was a paid functionary in 1949. Now, in Appendix H of my brief at page 65, it describes the relationship of Massachusetts -- following New England states is for the exception of Connecticut were considered District 1 of the Communist Party and they all were tied up together. Now, in 1950, DeGregory moved to New Hampshire where he presently resides also it indicates, I'm now back to Appendix K, that he was active in New Hampshire from '46 to '48 which would tie up the relationship between Massachusetts and New Hampshire.
Potter Stewart: If you had all these information, why do you need to ask him about it?
R. Peter Shapiro: This is in the past. We have to -- we felt we have to lay a foundation in the past to build up to the future.
Potter Stewart: He has told you -- he told you in the statement appearing on page 3 of your adversary's brief of the situation as to the present and the immediate past and you have the information about the more remote past, so why do you need to ask him any question?
R. Peter Shapiro: We felt at that time, Your Honor, that he did have information. We would -- we wish to follow it up from the past to the present to tie the whole picture in. As a basis of cross-examination, you have to -- we felt we have to lay the foundation to where he was in the past to get at the present. It would be cross-examining in a vacuum. All we have at the present was the basic fact that -- the basic statement made by this individual.
Potter Stewart: You could -- he made the statement as to his present status vis-à-vis the Communist Party that is the absence of any relationship and also, the same situation for the last six and a half years and that you could have cross-examined him about that I suppose, couldn't you?
R. Peter Shapiro: Yes, we could have.
Potter Stewart: And you didn't, did you?
R. Peter Shapiro: No, we didn't.
Potter Stewart: And you are now telling us you have the other information about the more remote past and that the question appears to me is to why it was necessary to interrogate him, (Voice Overlap).
R. Peter Shapiro: We have the broad brushstroke of the past but one of the violations of our law that is only set up in there is destroying any records which belong to the Communist Party.
Potter Stewart: Did you ask him if he had done that?
R. Peter Shapiro: No, that was not asked at that time.
Potter Stewart: So?
R. Peter Shapiro: We were more or less precluded by the Court at that time.
Potter Stewart: Of course, if that's a crime, I suppose he could refuse to answer that on the basis of self-incrimination.
R. Peter Shapiro: Well, then it's the immunity provision --
Abe Fortas: But he made -- he made no claim of self-incrimination, did he?
R. Peter Shapiro: No, that question --
Potter Stewart: That question wasn't asked to him.
R. Peter Shapiro: He was asked if he wish to take the --
Potter Stewart: Immunity.
R. Peter Shapiro: -- immunity provision and he declined to with reference to each question.
Abe Fortas: After -- after the first DeGregory case, did Mr. DeGregory purge himself of the civil contempt?
R. Peter Shapiro: Yes, he did. And --
Abe Fortas: Now, what was the formal proceeding in which he purged himself?
R. Peter Shapiro: Yes, we went back to the Superior Court.
Abe Fortas: And did you ask him some questions?
R. Peter Shapiro: We attempted to ask him more questions. The justice at that time indicated that his jurisdiction had seized under the statute.
Abe Fortas: What justice?
R. Peter Shapiro: Justice of the Superior Court, Justice Marshall.
Abe Fortas: So that you asked him whatever questions were considered pertinent to that particular investigation, is that right?
R. Peter Shapiro: Well, if I might explain it.
Abe Fortas: I wish you would.
R. Peter Shapiro: We went to the Superior Court at that time. Mr. DeGregory purged himself of contempt. The proceeding then -- we asked the Court to allow us to continue at that time before this Court. He indicated to us that he had no further jurisdiction of the matter that we have to go back administratively and ask the question. Then if he brought to answering any further questions then we proceeded as we did.We came up through this period --
Abe Fortas: Well, did you go back administratively and ask questions?
R. Peter Shapiro: Yes, we did.
Abe Fortas: Immediately?
R. Peter Shapiro: Within two days.
Abe Fortas: Within two days. Did he refuse to reply?
R. Peter Shapiro: Yes.
Abe Fortas: And what happened?
R. Peter Shapiro: We're here today. We went in the Superior -- from the --
Abe Fortas: Is that this same case?
R. Peter Shapiro: Yes, that's correct, Your Honor. We went from there to the Superior Court and at the New Hampshire Supreme Court and we're here on that very issue today.
Hugo L. Black: Why do you use the word cross-examine?
R. Peter Shapiro: I use it, I think, because my brother mentioned -- used the term cross-examination.
Hugo L. Black: Well, was this a cross-examination?
R. Peter Shapiro: Not technically so. No, Your Honor.
Hugo L. Black: It wasn't a cross-examination.
Potter Stewart: I used that word. I don't know if you did. You're point is I did?
Hugo L. Black: He used it --
R. Peter Shapiro: I think I did.
Hugo L. Black: He used it several times before that and I was going to ask you what --
R. Peter Shapiro: I would call it.
Hugo L. Black: -- what do you mean by cross-examination.
R. Peter Shapiro: Well, we asked a certain amount of -- a few questions of the witness. He then made a statement on the record under oath that he knew nothing of the Communist Party for the last six and a half years. It wouldn't be a technical cross-examination. No, it would be --
Hugo L. Black: Well, he had not been summoned as a witness and put on the stand by anybody else, had he?
R. Peter Shapiro: No, he hadn't Your Honor. That's the proper term.
Potter Stewart: The questions I gather on page 31 of your brief, are they?
R. Peter Shapiro: Yes, they are 31 and 32.
Potter Stewart: And that's appeared to be -- what might be called direct examination.
R. Peter Shapiro: Yes.
Potter Stewart: Because he hadn't testified, had he, under it?
R. Peter Shapiro: His statement was made --
Potter Stewart: You called him -- you called him and he was your witness --
R. Peter Shapiro: That's correct.
Potter Stewart: -- in an investigation and you asked him questions.
R. Peter Shapiro: That's correct.
Potter Stewart: And those questions appear on 31 of your brief.
R. Peter Shapiro: Yes, sir.
Potter Stewart: And he refused to answer him or else you covered him by asking you questions.
R. Peter Shapiro: That's correct.
Potter Stewart: When, where and so on.
R. Peter Shapiro: Yes, Your Honor. Now, I might add that Exhibit 1 which is subversive activities in New Hampshire report of the Attorney General in 1955 that all of these materials were gathered by former Attorney General Wyman and the material in there was under oath when presented to him. Now, getting back to the concept of nexus --
William J. Brennan, Jr.: Now, what you mean, I gather is, that the witnesses can be called under oath.
R. Peter Shapiro: Yes, that's correct.
William J. Brennan, Jr.: Not the material. It was the conclusions with this, weren't they? If I recall that, it seems to me, I read that pretty careful a few years ago.
R. Peter Shapiro: Yes. They are a great deal to our conclusions that somehow the --
William J. Brennan, Jr.: I think they were in good deal, largely though?
R. Peter Shapiro: With reference to the concept of nexus, there are --
Hugo L. Black: With reference to what?
R. Peter Shapiro: The concept of nexus, the relationship of the witness to the subject under investigation. I have cited in my brief roughly seven cases starting with the Gibson case and the rest of the Florida. And here, we had an investigation of Communist infiltration into organizations in the race relations area. The witness at that time was the President of the NAACP in Florida and what the State was after at that time were membership list primarily plus other information. Now, in this case, you have this Court held that there was no nexus, basically, because the president was not a Communist -- there was no Communist tie up at all, either the president or any of the members of the party. This is the far end of the gamut in nexus. Sweezy case would be the next one in line which the Court did not overturn the case on the basis of no insufficient nexus. I believe the primary thrust in this instance was the Court was not aware of whether or not the New Hampshire legislature wished to be informed on this matter. And -- but the area or the compelling interest in this case of infil -- Communist infiltration into the area of education in New Hampshire was deemed, I believe, in that instance to be a compelling interest. Now, the remaining cases starting with the Watkins case where it was a federal investigation at that time into the area of infil -- Communist infiltration and subversion, in this case, two prior witnesses pinpointed Watkins as a Communist. He is a Communist recruiter from 1942 to '47, roughly eight, nine, ten years before the case finally came before the Court. And this was considered a sufficient relationship to proceed to examine the individual and this case too was reversed but not for the reason of an insufficient nexus. It was because the witness was unable to understand the nature of the question asked to him, the pertinency aspect which I will get in to a little bit later in my argument. Now, the Wilkinson case and the Braden case also a federal case as in the federal were investigations of communism into the area of communism, this time by the Federal Government and again, this was considered a compelling interest to proceed with the investigation. In both of these cases, the witnesses were not tied up as of the present time. There was a relation back of their position in the Communist Party. And again, we have the Uphaus case which is a New Hampshire case, a state investigation into subversion in affecting security of the State of New Hampshire and Mr. Uphaus was the executive director of the World Fellowship which was a group where 19 to 20 known Communists were meeting and discussing on what we believe more than an academic level area of communism. We -- it was sufficient to trigger our investigation of this area, the Court held and it was a compelling interest. Now, the key case, I think which is almost in point with us is the Barenblatt case. In here, Mr. Barenblatt was an active member of the Communist Party from '47 to '50 while a student and a teaching fellow at the University of Michigan. Now, this was another federal investigation into the area of subversion into education. There was no major tie up from this individual, Barenblatt from '47 to '50 in that area to the present, the same position as DeGregory. The record was quite espoused in that area. Now, the Court upheld the position that there was a valid nexus between the parties in this case and this is -- this is pretty much what we have in the DeGregory case and of course --
Abe Fortas: May I ask you in that connection. Is it your position that you satisfy the first sentence of 8 (a).
R. Peter Shapiro: Yes, it is.
Abe Fortas: By reason of the evidence that you have that six and a half years prior to the term of the examination, DeGregory is connected with Communist Party or was a Communist official or whatever it might be. Is that net -- net of the position?
R. Peter Shapiro: If I might explain, I'm not -- not completely. No, Your Honor. What our position is as our Supreme Court held that taken the nature of the Communist Party and its motive and aims coupling this with the report of the Attorney General that the -- that our Attorney General, the present Attorney General at that time, had reasonable and reliable information to trigger his investigation into subversion in and effecting the State of New Hampshire.
Abe Fortas: Now, is it your position that if he can investigate subversion that he had legal authority and legal justification for investigating a subversion but he doesn't have to make any showing whatsoever with respect to any particular individual who is called to testify? That's not your position, is it?
R. Peter Shapiro: No, it's not our position that he have to show with reference with particular individual that he has specifically committed a crime or he is --
Abe Fortas: Well, do you take the position that he does not have to show that?
R. Peter Shapiro: Yes, we do.
Abe Fortas: And so from your point of view, that doesn't make any difference whether DeGregory was connected with the Communist Party or not, that is to say, if the Attorney General have general -- have some reason to believe that he is ought to invest -- he is authorized to investigate the Communist Party, he could call anybody, is that right? The Episcopalian Minister or the Baptist Minister or the Governor of the State or whatnot, is that right?
R. Peter Shapiro: He could, providing there with sufficient nexus or relationship of the individual to the subject under investigation.
Abe Fortas: That's what I was asking about.
R. Peter Shapiro: Yes.
Abe Fortas: Then you do agree that he has to make some showing of probable cause for inquiring of the particular witness, that's exactly what I'm trying to --
R. Peter Shapiro: Yes.
Abe Fortas: -- get in terms of the position.
R. Peter Shapiro: That he does.
Abe Fortas: And the only evidence here, as I understand it, is evidence that DeGregory was a Communist official or whatnot, six and a half years prior to the time that these questions were asked, am I correct?
R. Peter Shapiro: That's correct, Your Honor.
Byron R. White: Will you suggest, I suppose, that the legislature was entitled to investigate the Communist Party six and a half years ago as the basis for a continued investigation of it, don't you?
R. Peter Shapiro: I'm not sure I fully understand the question, Your Honor.
Byron R. White: Well, you asked questions having to do with six and a half years ago. You must have thought the State had a legitimate interest in finding out about the Communist Party as it existed six and a half years ago as a purview to finding out what's happened to it since that time.
R. Peter Shapiro: That's correct, Your Honor. This is why I cited the subversive activities in Court.
Byron R. White: Now, what if it -- what if you'd have information on DeGregory that he had been a member of the Communist Party of 1931 and he had said that I have not been -- you had information and he says, “I have not been a member and I'm not a member of the Communist Party now and I have not been a member in the last 30 years.” And you said -- and then you asked him, “Were you a member in 1931?” Is there some limit to this or not?
R. Peter Shapiro: Yes, there is and I would think this might be -- very well be the limit because of a nexus factor that --
Byron R. White: When does that come? When was that -- how can you recognize it when that line comes? That they say, the -- the petitioner says it's come already, six and a half years is too long. You shouldn't have to -- they shouldn't be entitled to make inquiries at all in that stale. Would it be 10 years or 15 or what?
R. Peter Shapiro: I don't think there's any specific period. I believe that this nexus concept is a case-by-case study of the position. Now, if all you have was one sworn statement that an individual was a Communist in 1931 and you had nothing else, I think the State's position would be extremely weak.
Byron R. White: Well, now what you have is a statement when he was a member six and a half years ago?
R. Peter Shapiro: Well, I think that relates very closely to the problem at hand. The world conditions have not change very much. I think it was in the mind of the Attorney General and the mind of our court when they took this into consideration that --
Potter Stewart: Do you hear all the plans?
R. Peter Shapiro: Well, it's accelerated, I think. It hasn't abated.
Potter Stewart: Well, it's more of a change, doesn't it?
R. Peter Shapiro: Yes.
Byron R. White: What you're really -- I suppose you're really trying to find out whether you have a problem at all with the Communist Party of New Hampshire?
R. Peter Shapiro: I would think -- assume that the legislature would want to know the extent of Communist activities in and affecting the states so that they can either possibly maybe repeal this law or add new laws, change or amend it. It's our contention that the legislature just can't operate in a vacuum. They have to have a basis in fact to proceed.
Byron R. White: If you didn't -- as a fact there for this question, you didn't include any information whatsoever about whether there was or was not a Communist Party operating in New Hampshire at the time the questions were asked. You just relied on an old report. Isn't it true? There's no evidence in the record that at the time you ask these questions that are involved here that the Communist Party wasn't -- was in existence or had any activities whatsoever in New Hampshire or even had any members there. Is there?
R. Peter Shapiro: I have to answer by yes or no on this. I have to go back. I think for where starting point, with the position of our Supreme Court that it's -- its basic fundamental, I believe, the nature of the Communist movement, its ideals, its aims, its aims, its threat and I can't -- and if you take this and you couple it with the record here. Now, I'll move myself back to the prior DeGregory case which we had and the case law has always been the same. The position on the Communist Party had been the same and it hasn't change up to date. The world situation with communism was known to the courts at that time and it is -- I feel accelerated somewhat. The problem is still there.
William J. Brennan, Jr.: By the way, what is the world situation?
R. Peter Shapiro: In 1960?
William J. Brennan, Jr.: Today.
R. Peter Shapiro: Well, we have Vietnam problem. We have a Berlin Wall. Communism is --
William J. Brennan, Jr.: At the same time, we have Communist problem today as we had 10 years ago?
R. Peter Shapiro: 10 years ago, no. I'm relating to this to the (Voice Overlap) with Korea 10 years ago.
Byron R. White: Do you think things got worst?
R. Peter Shapiro: I think it is.
Potter Stewart: What about New Hampshire's interest, I mean, what's the State of New Hampshire's interest in the Vietnam problem?
R. Peter Shapiro: Directly, I would say very little, indirect. Collectively to the people it's very little. Directly to cer -- to various individuals it might be great. I'm use -- citing the Vietnam problem -- these problems that -- this is what must have been in the minds of our Attorney General. The courts I feel, our New Hampshire courts can't blind themselves to world's condition. They can't operate in a vacuum the same as the legislature there.
Hugo L. Black: I thought your argument was awhile ago which is wrong that what you have interested in was the self-preservation of New Hampshire from being destroyed and now you're going to world conditions?
R. Peter Shapiro: Well, self-preservation --
Hugo L. Black: Is there any indication for the last six and a half years that you have any Communist in New Hampshire that you know about as the record shows? I'm talking about New Hampshire.
R. Peter Shapiro: As far as the records go, there is no evidence as of that.
Hugo L. Black: Pretty hard to find and to keep the job going, isn't it?
Potter Stewart: As if the -- people are not going to be -- are going to be permitted not to refuse to answer all the questions of the subject. You're not going to have any information.
R. Peter Shapiro: But that bear in mind is the problem. We do, I might add, make a report to the legislature every year, every other year explaining what our findings are. We have not made a --
Hugo L. Black: What is the report last year about how many Communists you had last year?
R. Peter Shapiro: Pardon? I did not --
Hugo L. Black: What is the report last year about how many Communists you have been able to detect in New Hampshire last year?
R. Peter Shapiro: Quite frankly, I didn't make the report.
Hugo L. Black: What?
R. Peter Shapiro: I didn't make the report. If you allow me a moment, I would --
Hugo L. Black: Well, I imagine that it's a matter of common knowledge, if you reported that you're about to be overthrown last year by the Communists and you have to --
R. Peter Shapiro: Well, we've -- in light of Justice Brennan's opinion in the Uphaus case we have not made a formal report. The report is made basically to committee and the committee takes it from there. With the information available in our files that we would present a formal report if required.
Tom C. Clark: What's the legislature done about it?
R. Peter Shapiro: The legislature has felt that the law which we have is operating well and that they intend to keep it as such.
Tom C. Clark: And then Machiavelli in '55 of course.
R. Peter Shapiro: Yes, they did because that's when they made it a continuing operation after '55 and '57.
Tom C. Clark: You know that that's been -- you did not enact a substantive law.
R. Peter Shapiro: No. There was a bill before the House last year but it was defeated with reference to Communist speaker to state institution. Similar law which I think South Carolina has.
William J. Brennan, Jr.: Would that suggest that your legislature doesn't think there's much of a danger existing in New Hampshire?
R. Peter Shapiro: I wouldn't think so because the nature of the law that I think got blown out of proportion by political problems involved, side issues and personalities as opposed to the actual need of the law.
Tom C. Clark: For reindictment what you have said, if I understand, the purpose of you to inform a legislature --
R. Peter Shapiro: That's correct.
Tom C. Clark: Perhaps you're investigating?
R. Peter Shapiro: That's correct.
Tom C. Clark: You made in the court's term a rather comprehensive report 7 years ago and (Inaudible) probably continued by the committee. I just wonder what your accomplishments are.
R. Peter Shapiro: The prophecy would be, I feel legislatively. I feel the state is doing a proper job in this area and they are being properly informed on the present state of the record and the present state of the facts which we have that there's no necessity to change the law. Now, if I might add with reference to --
Earl Warren: How many -- may I ask this? How many other witnesses were called by the committee at or about the time Mr. DeGregory was called, if any?
R. Peter Shapiro: Possibly half a dozen witnesses or so at that time.
Abe Fortas: Was that at the time that DeGregory was called initially or later?
R. Peter Shapiro: I believe the question was directed to -- at the time of the second hearing, 1963.
Abe Fortas: That's your answer.
R. Peter Shapiro: Yes.
Earl Warren: Where we find that in the re -- where do we find that in the record?
R. Peter Shapiro: No, you will not find that.
Earl Warren: Is there any record made of that by the committee for the use of the legislature?
R. Peter Shapiro: It would be in our file.
Earl Warren: There's no report of any kind?
R. Peter Shapiro: No, there's no written report, no. The procedure has been for the Attorney General to go before the committee and orally present the basic facts at that time as requested it would be. Again, we do have a problem with gathering this information by the reluctance of the witnesses to testify and also, our files -- well we have no access to the files that any of the federal agencies with the information which they have in this area that all on our own basis, we have to go out and gather this information.
Tom C. Clark: Do you think counsel that the citation of the prosecution derived out of the other states applied here?
R. Peter Shapiro: Not to my knowledge.
Tom C. Clark: (Inaudible)
R. Peter Shapiro: I believe so.
Hugo L. Black: Would we be able to assume of the fact that nothing has been done during this last six and a half years. Legislature has done nothing. The New Hampshire is not in extreme imperative danger of being overthrown at this time?
R. Peter Shapiro: Well, I think you have to look at it from the position as I cited in my brief. The threat is not like the horse of the Mongols coming out of the woods and overthrowing our State. The problem is the nature of the Communist Party, the infiltration of the probing.
Hugo L. Black: But the problem, I suppose, was the basis of your legal right to do this is, as I understood you to say, that the right of New Hampshire to preserve itself from destruction.
R. Peter Shapiro: That's correct.
Hugo L. Black: And would we be have a right to assume that there's no immediate likelihood of that destruction by the fact that you haven't found anybody and haven't found the five witness even to ask questions during the last six and a half years.
R. Peter Shapiro: I wouldn't -- I wouldn't think so. No, Your Honor.
Earl Warren: Mr. Whiteside, do you --
Howard S. Whiteside: No, Your Honor. I think I've exhausted my time.
Earl Warren: Well, I thought you had a minute or so, if you want to respond.
Howard S. Whiteside: I -- I have no further comment.
Earl Warren: Yes. Very well.


William H. Rehnquist: We'll hear argument next in numbers oh one six fifty-one, JP Morgan Chase Bank versus Traffic Stream. [NS] Ms. Reid.
Sarah L. Reid: Mr. Chief Justice and may it please the Court. The alienage diversity statute provides that the Federal courts have original jurisdiction of civil actions between citizens of different States and citizens who're subjects of a foreign State where the matter in controversy exceeds seventy-five thousand dollars. The question presented today is whether respondent, Traffic Stream BVI Infrastructure Limited, a corporation incorporated under the laws of the British Virgin Islands, qualifies as a subject of the United Kingdom within the meaning of that statute. Petitioner, JP Morgan Chase Bank, submits it clearly does. It is well settled that the term, citizens and subjects, applies to corporations and not just natural persons. It is also not controversial that a subject is one who owes allegiance to and is under the protection of a foreign State.
Sandra Day O'Connor: Is this a question of Federal law?
Sarah L. Reid: In terms of looking to this matter of the...
Sarah L. Reid: subject? In determining...
Sandra Day O'Connor: who is a citizen or subject of a foreign State, or whether an in- or whether a corporation in this instance is a citizen or subject? Is that a Federal law question?
Sarah L. Reid: Yes, Your Honor, we would submit it is in the first instance, but in saying that must then look at the nature of the relationship and look at the foreign State which is asserting the sovereignty, and certainly that is a matter that we should consider ca- carefully.
William H. Rehnquist: W- When you say the United Kingdom has expressed its sovereignty, Ms. Reid, do you mean that you're looking at their statutes, or that their diplomatic representatives have made a representation?
Sarah L. Reid: Both, both the fact that they have i- intervened as an amicus in this and in other cases, but also, particularly in the case of respondent, if one looks at the BVI constitution enacted in nineteen seventy-six, it is enacted as a result of the act of parliament and the order of parliament, and it reserves expressly all power to the Crown ultimately, and it is only from the Crown that the l- the law is then delegated to the elected legislative council.
Ruth Bader Ginsburg: Ms. Reid, every corporation must be formed under some, the law of some sovereign, and if that's right, a corporation just can't generate itself.
Sarah L. Reid: I would s- say, Your Honor, in ninety-nine percent of the cases, that you're right.
Antonin Scalia: The United States would also say that that's not a corporation.
Sarah L. Reid: Right,
Antonin Scalia: [Inaudible]
Sarah L. Reid: exactly.
Antonin Scalia: So I m- I I think you you could say in a hundred percent of the cases if we acknowledge it as a corporation, it will've been formed under the law of some...
Speaker: I would...
Sarah L. Reid: agree, Your Honor.
David H. Souter: And I suppose even as to natural persons in this sort of eccentric island i- in the real world, if if we didn't recognize their claim to i- to individual sovereignty or nationality, in the real world I assume they would be subject to some other national sovereign and they'd v- by that virtue, by virtue of that be swept up under the the term, citizen or subject, wouldn't they?
Sarah L. Reid: I would agree.
David H. Souter: Yeah.
Anthony M. Kennedy: [NS] L- L- L- Let's assume a- and I'm not sure that this is an accurate proposition of international law, that a subject of a sovereign has a special duty to obey the laws of that sovereign.
Sarah L. Reid: Yes, Your Honor.
Anthony M. Kennedy: subject?
Sarah L. Reid: I- an an an analogy, though, not completely perfect, but it i- you -ow JP Morgan Chase is a corporation organized under the laws of the State of New York.
Anthony M. Kennedy: Yes.
Sarah L. Reid: Similarly, a corporation set up under the laws of of applicable oversea territories in the first instance of course, must follow the laws of their legislative district, but they must also abide by an agreed upon laws and conventions with the United Kingdom, and that is specifically an issue in the Caribbean, where there are certain financial disclosure, which is is i- mandated in part through the relationship, constitutional relationship between the United Kingdom...
Anthony M. Kennedy: Where can we what w- where can we document the proposition that you've just stated? What what do I look to t-
Sarah L. Reid: To a certain extent, the treaties, that i- for example the Narcotics Enforcement Treaty.
Anthony M. Kennedy: She cited t-
Sarah L. Reid: and the United Kingdom what the authority and sovereignty that the United Kingdom has...
Anthony M. Kennedy: No more established authority like Blackstone, or...
Sarah L. Reid: Not that i- not that we have have cited to Your Honor, though in many ways there are parliamentary debates that you can tha- a- access concerning i- which are referenced in the white papers concerning the relationship between the overseas territories and and the g- and the King, which are quite remiziscen- reminiscent of the debates before the American Revolution in terms of virtual repenta- representation and citizenship...
Sandra Day O'Connor: If we were dealing with a private individual rather than a corporation, do you think there c- could be a stateless person who wouldn't fit under this stat-?
Sarah L. Reid: In very, very rare instances, and those instances are where the individual has either renounced their citizenship, which has ye- on occasion occurred, or where they have been, you know, exiled, and have not yet acquired citizenship somewhere else, and we would submit that the cases cited by the Matimak Court deal with those kinds of statelessness.
Anthony M. Kennedy: Suppose that kind of person that Justice O'Connor and you just discussed, a true stateless person, is temporarily in a a port of Au- Australia, or San Francisco, or Monterey, Mexico, c- c- can it be said consistently with th- the statute here in question that they are at least temporarily subject to the laws of Australia while they're there, bec- because they're stateless and they have no other higher obligation, so they're th- then subject...
Sarah L. Reid: No.
Speaker: including protection.
Antonin Scalia: The phrase is, subject of, isn't it?
Speaker: Yes, subject of a foreign state.
Antonin Scalia: to the laws of that country, and presumably to the Government of that country, but they they are not necessarily a subject of that country.
Sarah L. Reid: That is true,
Speaker: Your Honor.
Anthony M. Kennedy: be stateless persons who are not within the clause.
Sarah L. Reid: Yes.
David H. Souter: And the reason you take that position, I take it, is that the the impetus for the constitutional grant was in effect to to keep countries from getting mad, rather than for purposes of extending jurisdiction as such to everyone who whom whom one might want to sue in a Federal court.
Sarah L. Reid: Right.
Antonin Scalia: I must say, I d- I didn't understand what you mean by foreign entanglements.
Sarah L. Reid: [Inaudible]
Speaker: The...
Sarah L. Reid: The The...
Antonin Scalia: me- -ike alliances with France, or things like that? What...
Sarah L. Reid: No.
Speaker: In other words, don't want to make them mad.
Antonin Scalia: well that...
Sarah L. Reid: That w- i- tha- that I think, was the entanglement that they were...
Speaker: It's a strange...
Antonin Scalia: term for it then.
Sarah L. Reid: [Inaudible]
Speaker: [Inaudible]
Antonin Scalia: some things that can also...
Sarah L. Reid: And just briefly on the issue of the promotion of commerce, I wanted t- to make the point that JP Morgan Chase Bank and the financial markets, you know, consider the Matimak decisions as ones to have potentially very deleterious effects on international commerce.
Ruth Bader Ginsburg: Well, why? i- w- Aren't New York courts fairly versus this is not a question of saying for our corporation you can't enter a US court.
Sarah L. Reid: Absolutely, and I practice before them f- frequently, but the perception on the part of foreign foreigners is that the Federal system is one with procedures are uniform across the country, and a per- predictability, perhaps, i- that i- is more a matter of perception than of reality.
Antonin Scalia: I know Alabamans who are afraid of New York courts.
Sarah L. Reid: And vice versa.
Speaker: [Inaudible]
Ruth Bader Ginsburg: But it it is a little different from what it was in the days of the post revolution, when the British creditor said State courts are simply not going to let them collect on their debts.
Sarah L. Reid: That that's true.
Ruth Bader Ginsburg: Anyway, you you I think no one has suggested a dynamic interpretation of thirteen thirty-two, so that if the original rationale is not as strong today as it was then, that somehow the meaning of thirteen thirty-two would change.
Sarah L. Reid: No.
Ruth Bader Ginsburg: No i- o- no other circuit has followed the Second Circuit, have they?
Sarah L. Reid: No.
William H. Rehnquist: -ish to reserve the rest of your time?
Sarah L. Reid: Yes, Mr. Chief Justice.
William H. Rehnquist: Thank you, Ms. Reid.
Jeffrey P. Minear: [NS] Thank you, Mr. Chief Justice, and may it please the Court.
Speaker: we we reach.
William H. Rehnquist: the say the UK takes one position and makes a representation, but the State Dep- our State Department disagrees?
Speaker: We...
William H. Rehnquist: wh- what sor- what sort of an action should our t- courts take?
Jeffrey P. Minear: We think that you should defer to the United States views on these matters.
Speaker: So then,
William H. Rehnquist: the i- i- i- if you were to submit the views of the State Department in a case like this, no matter what else there is in the record, we should accept the views of the State Department?
Jeffrey P. Minear: Your cases suggest that that's that is the result that would follow.
William H. Rehnquist: Yes, but...
Speaker: Yes, we do, yes. To answer pointedly,
Jeffrey P. Minear: yes, we we do believe that you should defer to the United States views, as because oftentimes on the question that l- let me distinguish here the question of subject is, of course, the meaning of that term is a legal question that this Court would interpret according to its normal practices, but the question of whether a foreign entity is a foreign State is a question that is properly entrusted to the political branches.
Anthony M. Kennedy: Can you comment on the stateless person problem, n- not not not a a a legal person?
Jeffrey P. Minear: But a an individual.
Ruth Bader Ginsburg: But there are some US citizens who don't have access to the Federal court because they're not a citizen of any State.
Jeffrey P. Minear: That is correct.
William H. Rehnquist: Thank you, Mr. Minear.
Craig J. Albert: [NS] Mr. Chief Justice, and may it please the Court.
Speaker: You're...
William H. Rehnquist: you're you're now relying on Eng- English law, I take it.
Craig J. Albert: I'm referring to English law,
Speaker: yes.
William H. Rehnquist: I think that may create some difficulty for United States courts, particularly when the UK is is making representations here as as to one point, then you you you tell us we have to lo- read English law, which we're much less familiar with, of course, than American law.
Craig J. Albert: Yes, Mr. Chief Justice.
Speaker: where...
William H. Rehnquist: I I I I realize that.
Craig J. Albert: It would be a much more difficult inquiry had the United Kingdom actually cited to any statute or any case ever decided in any English court anywhere on the subject,
Speaker: but it has done no such...
Sandra Day O'Connor: even even if the British Nationality can be read as saying that corporations formed in the British Virgin Island are not citizens, it doesn't say they're not subjects of the United Kingdom, does it?
Craig J. Albert: Well, actually, the British Nationality Act carves out classes of citizens, and classes of subjects, and persons who are neither Bri- i- neither citizens nor subjects,
Speaker: so in fact it does...
Sandra Day O'Connor: find anything that indicated to me that a corporation formed in the British Virgin Islands was not a subject of the UK, and we are dealing here with a brief filed by the UK that says they are subjects, so what do we...
Craig J. Albert: Well, I I think that the question here is whether the deference should be unyielding to a litigation and advocacy position which the British Government puts forth in its briefs versus the substantive basis for that position which one would...
Speaker: Just looking at it...
Sandra Day O'Connor: from an American, US perspective under the statute, citizens are subjects, and the fact that it is a corporation formed in the British Virgin Islands would lead me to conclude that is a subject of a foreign nation under our own statute.
Craig J. Albert: Respectfully, Justice Honor O- O'Connor, I I think I I think that the conclusion ought to be different, because there is nothing wi- the f- the first step in the inquiry is, what would thirteen thirty-two A two have to say about corporations, and we know that thirteen thirty-two A two is a reference to citizens or subjects which is consistently wh- which before the Letson fiction was adopted had had resulted on- had resulted in severe conflict over whether there was jurisdiction for corporations at all.
Speaker: That's going back...
Ruth Bader Ginsburg: to a law that has long since become abs- obsolete.
Craig J. Albert: Respectfully, Justice Ginsburg, thirteen thirty-two C does not say that corporations are citizens of their States.
Speaker: Are you are you saying...
Ruth Bader Ginsburg: that those words cover only human individuals and not...
Speaker: corporation?
Craig J. Albert: thirteen thirty-two A two, humans, then applying the thirteen thirty-two C presumption, that would bring corporations within the scope of diversity jurisdiction.
William H. Rehnquist: Well, thirteen thirty-two A does use the term, alien at at the very end.
Craig J. Albert: Yes, i- there there is a reference to it, but not in the not in the not in the provision of thirteen thirty-two A two on the on the o- on the extension of that dispute between citizens of a State and citizens or subjects of a foreign State, and in fact, Mr. Chief Justice, Congress in fact had used the word, aliens, the broader r- the broader word, in the original enactment, in the Judiciary Act of seventeen eighty-nine, but Congress abandoned that language when it revised the statute in eighteen seventy-five.
Speaker: So...
Ruth Bader Ginsburg: corporation if I say is it is is that does that come within thirteen thirty-two jurisdiction, a corporation formed in Scotland?
Craig J. Albert: In Scotland, yes, because a because the Scottish people, the English and Welsh people, and the people of Northern Ireland all are citizens of the Metropolitan United Kingdom, the United Kingdom of Great Britain and Northern Ireland.
Ruth Bader Ginsburg: Well, my problem is if if take some the British Virgin Islands, a place that's s- still held in something like colonial status, that you say that Scotland, which has a great deal more independence, belongs to the UK in the sense that it is a subject of the UK, but the British Virgin Islands, or the Cayman Islands, that have less independence, are not subjects? That...
Craig J. Albert: [Inaudible]
Ruth Bader Ginsburg: That may be something a lawyer could understand, but I don't think it makes much sense, does it?
Craig J. Albert: I think that the distinction is, i- no one is disputing here that the British Virgin Islands is subordinate to the United Kingdom, no one is disputing that its people ultimately are answerable to the authority of the United Kingdom, but that that...
Speaker: simply goes...
Craig J. Albert: [Inaudible]
Ruth Bader Ginsburg: subjects?
Craig J. Albert: Subject to, not subject of, and that is why the British Nationality Act is so important here,
Speaker: because the British...
Stephen G. Breyer: I guess then maybe corporations incorporated in Scotland are not citizens or subjects either, because it doesn't say anything about corporations, does it?
Craig J. Albert: i- No, Justice Breyer.
Stephen G. Breyer: Wouldn't people then be surprised if it doesn't say anything, if we said that Scottish corporations weren't citizens, or in fact, would the people who live in these islands be a little surprised if the Supreme Court were to say, you're not nationals? A- how how is it work? This this is not an act that refers to corporations.
Craig J. Albert: The proper allegation in a case like this would be that a corporation is incorporated under the laws of Scotland and is therefore a citizen or subject of a subject of the United Kingdom.
Speaker: And the reason that...
Stephen G. Breyer: they are but these people aren't is?
Craig J. Albert: Is because England, Wales, Scotland, and Northern Ireland, along with the Channel Islands, are the constituent parts of the Metropolitan United Kingdom.
Speaker: As of...
Stephen G. Breyer: English law, the reason that although their Eng- their law says, I guess, that counselor law, the diplomatic manual, the thing that says you have to swear allegiance if you're in the British foreign you know, you're in the British Virgin Islands, all the laws are subject to British authority and so forth, so the reason, in your opinion, despite all those things they list in their brief, that makes it very, very similar, the reason that a corporation incorporated in Wales is a citizen of the United Kingdom or subject of the United Kingdom but these are not, because it's the British Virgin Islands, is?
Craig J. Albert: Because when parliament enacts a law of general applicability within the United Kingdom, its applicability is to those four jurisdictions that I've mentioned, England, Wales, Scotland, and Northern Ireland, along with in in some instances the Channel Islands, but it does not, of its force, extend to the British Overseas Territories, the British dependent Te- the and the what what's now known as the British Overseas Territories.
Speaker: Are they stateless...
Ruth Bader Ginsburg: people?
Craig J. Albert: They are not stateless people at all.
Ruth Bader Ginsburg: The- they are British the their State is is the UK?
Craig J. Albert: They are just a- i- they are they are very similar to what our territorial residents would have been before we...
Speaker: extended citizenship.
Ruth Bader Ginsburg: of and to the United States, I assume, the residents in the US Territories.
Craig J. Albert: residents of U.S.
Speaker: What were they...
Ruth Bader Ginsburg: before they were citizens?
Craig J. Albert: They were nationals and natives.
Speaker: They were not...
Ruth Bader Ginsburg: stateless, were they?
Craig J. Albert: No, they were not.
Ruth Bader Ginsburg: And so why isn't a corporation organized in the British Virgin Islands or the Cayman Islands why is that stateless? There's only one State it can belong to, because these are not independent sovereigns.
Craig J. Albert: I do not advocate the position that the Matimak the Matimak Court adopted that these corporations were stateless.
Speaker: But they...
Ruth Bader Ginsburg: belong to some State, and if you wh- either they belong to the UK, or they belong to something that isn't a sovereign, or they're stateless.
Craig J. Albert: i- They belong to the United Kingdom, but that does not answer the statutory question at issue here, because even if they belong to a kingdo-, e- even if they belong to the United Kingdom, that does not make them citizens or subjects of the kingdom.
Antonin Scalia: [Inaudible]
Craig J. Albert: Congress...
Antonin Scalia: Could could I ask i- the, the word subject in the statute just tracks the word subject in the Constitution, and I wasn't the status of the colonists before our Revolution precisely the same as the status of the British Virgin Islands?
Craig J. Albert: Justice Scalia...
Antonin Scalia: Which would lead me to to the inquiry whether the even the revolutionaries considered themselves subjects of the British Crown.
Craig J. Albert: The laughter from the audience in fact i- -ocuses focuses the point here, because that was the fundamental shift in the understanding of the colonists and their relationship to the British Government.
Speaker: there was a...
Antonin Scalia: been.
Craig J. Albert: Oh, we had been.
Speaker: We had been.
Antonin Scalia: occupied the same status in those days as...
Speaker: And and why wasn't...
John Paul Stevens: that status the one that's comparable to the status of citizens in the Virgin Islands here?
Speaker: Justice...
John Paul Stevens: claiming that they've been abandoned by the by the Crown here.
Craig J. Albert: Justice Stevens, there are two places in which that abandonment can come about.
Speaker: Of course,
John Paul Stevens: that hasn't happened here...
Craig J. Albert: It certainly has not happened here, but there is another way, because when nations adopt the idea of volitional allegiance, the new idea of what a subject is, then the nation itself can change its laws to determine what the status of its people are.
Stephen G. Breyer: -ritish Nationality Act has nothing to do with corporations.
Craig J. Albert: But the British Nationality Act does have to do with what the people within the British Virgin Islands...
Speaker: And the other thing that brings up is your point,
Stephen G. Breyer: I understand your point there, but so I'm cutting you off, but they they say that in these places the Queen appoints the Governor, the Governor is responsible for internal security, public service, and court administration, but all the laws they pass in these places are subject to review by the Foreign Office, the Commonwealth Office, and then the q- the the the Queen in Council, which is a group of particular individuals, that the Legislative Council swears its allegiance to to the Crown before it takes place, and so they haven't just discarded this place at all.
Craig J. Albert: Or more particularly, as we would treat one of our territories, because the ability of Congress to legislate...
Speaker: You mean,
Stephen G. Breyer: terri- people in our Territories like Puerto Rico, let's say, which is a Commonwealth...
Craig J. Albert: Yes.
Stephen G. Breyer: or or Samoa, they are not subjects of the United Sta-
Craig J. Albert: They are not subjects...
Speaker: of the United States...
Stephen G. Breyer: to the United States, and are not subject to its laws.
Craig J. Albert: The position that that has been advocated here, and I think that the a- a- and that -as been uniformly advanced by the scholars is that citizenship versus subjectship is simply i- simply two sides of the same coin determini i- describing what the relationship is of one in either a democracy or a monarchy, and what has happened in the United Kingdom is that as the country has evolved from a strict monarchy to a constitutional monarchy with democratic principles, that the ideas of subjectship have evolved, and the idea of citizenship has been incorporated into their law.
Ruth Bader Ginsburg: Do you...
Speaker: feel some...
Ruth Bader Ginsburg: discomfort in saying, well, that's what the UK law is, and you told us that what the Companies Act means, when the UK itself is telling this Court, you've got it all wrong? er are y- you you're standing before the Court as an interpreter of UK law.
Craig J. Albert: I would have thought that had the United Kingdom had a statute on which it could rely, or any decision on which it could rely, it would cite them.
Speaker: Which which it's well go ahead.
Antonin Scalia: well go on...
Craig J. Albert: Is in the lodging at page L thirty-one, an excerpt from its diplomatic manual which describes the various categories under the British Nationality Act.
Anthony M. Kennedy: next time I'm...
Speaker: going...
Craig J. Albert: manual b- th-
Speaker: derives its basis.
John Paul Stevens: Is it a fair summary to say that th- it's a litigating position and therefore we do not owe it Chevron deference?
Craig J. Albert: I think it is a pure advocacy position,
Speaker: and...
Craig J. Albert: it does not deserve...
Speaker: Chevron deference.
Anthony M. Kennedy: arguing for what we might call a variable definition of subject, that VI residents are subjects of Great Britain in some cases and not others? That is to say, you re- said earlier that the UK could make a treaty binding on VI residents, VI citiz- so that you can be subject of th- Great Britain in some instances and not others.
Craig J. Albert: Justice Kennedy, the UK...
Speaker: itself...
Anthony M. Kennedy: If I c- characterize your argument that way, would would that be a proper characterization of your argument?
Craig J. Albert: I think that at the second level of Matimak inquiry, when th- th- that the Court would necessarily have to inquire as to whether or not a person is or is not a subject, and I think that that I would be w- I am willing to concede that Britain could change its statute for general purposes or for limited purposes so as to give to these territorial citizens the right to proceed in American courts, and we would defer to that simply by reason of simply simply for reasons of international comity.
Anthony M. Kennedy: But doesn't that potential indicate that there is sovereignty because isn't...
Speaker: Once...
Anthony M. Kennedy: the capacity to exercise power and authority?
Craig J. Albert: Sovereignty is that power.
Anthony M. Kennedy: They are subjects because of the potential of the exercise of that power.
Craig J. Albert: The land that sits in the middle of London at Leicester Square, famous Tolk versus Moxie Land, is subject to the sovereignty of the United Kingdom, but that does not make the land a subject, and so the mere fact that the United Kingdom adopts legislation which regulates behavior of its people, both within the metropolitan United Kingdom and within its territories, does not mean that the people within its territories are subjects for purposes of thirteen thirty-two, and I say that becau- i- i- especially in light of the fact that as we stand here today the United Kingdom has adopted a new statute which has not yet come into force, because a statutory instrument has not yet been signed for it, which will render the British Depedent Territories' citizens to be British citizens, giving those British citizens now the right of abode within the United Kingdom, and that will happen in the future.
Speaker: How does that affect a...
Ruth Bader Ginsburg: corporation? You're talking about what will be the status of individuals.
Craig J. Albert: I think that a that a- applying the l- that the proper way to apply the Letson principle here is that a British Virgin Islands Corporation should never be subject to diversity to to diversity grou- diveristy jurisdiction precisely because the presumption is that its shareholders have opted for British Virgin Islands status rather than opted for British status.
Speaker: And that would...
Ruth Bader Ginsburg: would be the case it would be that Congress would be immobile as well.
Craig J. Albert: The S- Second Circuit did not reach the constitutional...
Speaker: Well, that's...
Ruth Bader Ginsburg: the one I'm putting to you, because the statute uses the same term, citizens or subjects.
Craig J. Albert: I do not think that there is a presumption in this Court that the use of the same language in Article Three and in title twenty-eight means that...
Speaker: Well, tell me what...
Ruth Bader Ginsburg: subject means within Article Three that it doesn't mean within thirteen thirty-two and why a court should interpret it interpret them differently.
Craig J. Albert: Because if you look to the Judiciary Act of seventeen eighty-nine, which was adopted nearly contemporaneously, Congress used the broader language, alien, rather than the narrower language, citizen or subject, and...
Ruth Bader Ginsburg: That's not i- in the Constitution says citizen or subject, doesn't it?
Craig J. Albert: That's correct,
Speaker: it does.
Craig J. Albert: And...
Ruth Bader Ginsburg: What...
Speaker: does it...
Ruth Bader Ginsburg: mean what does subject mean within the Constitution, within Article Three, as it reads?
Craig J. Albert: It would be mere speculation on my part to suggest what it was that they meant, since this was one of the least debated provisions of the...
Speaker: Constitution.
Ruth Bader Ginsburg: you're urging a certain statutory interpretation, and then you said, well, maybe it has a different meaning, the word subject, in the Constitution, so I'm asking you to tell me what could be those different meanings.
Craig J. Albert: I think that it is entirely possible that in seventeen eighty-seven Congress i- the Convention intended to extend the grant of authority to the full measure of diversity jurisdiction over cases involving all foreigners, but the reason that I don't think that they focused on the issue was because in seventeen eighty-seven there really were not these cases of i- there there was not were not a lot of cases probably no cases in which there were people who lacked subjectship yet nevertheless were foreigners.
Antonin Scalia: What about Canadians? Unt- until Canada domesticated its constitution, I I suppose w- w- w- for for most of the nineteenth Century Canadians were not subjects of of the Crown?
Craig J. Albert: think that the Canadians were subjects of the Crown by virtue of the fact that they were in a settler colony rather than in a plantation, a plantation colony, and the W- one of the difficulties of the British law of that entire era is that it never really had a unifor- i- it never had a uniform picture of who its persons were, and what the relationship was between the Crown and each one of the different types of colonies that it created and that was very, very difficult for Bri- that was very difficult for Britain, because because because Britain had different types of colonies which promoted different types of British interests, and therefore it created different types of Governments within them, and created different statuses with respect to immigration and migration to Europe for those people.
Ruth Bader Ginsburg: So among the subjects, or well, the the entities that are under UK sovereignty, which of those are subject and which of them are not?
Craig J. Albert: The ones that are certainly not subjects right now are those which are the British Overseas Territories, which include the British Virgin Islands, the Cayman Islands, Bermuda,
Speaker: Which ones are? Which...
Ruth Bader Ginsburg: ones are?
Craig J. Albert: Pardon me?
Ruth Bader Ginsburg: Which ones are?
Craig J. Albert: The Isle of Man, the Channel Islands are British ci- are are British citizens,
Speaker: I...
Ruth Bader Ginsburg: didn't ask citizen, I said, s- subject.
Craig J. Albert: Oh, British...
Speaker: sub- I...
Craig J. Albert: sorry British British British subjects, and...
William H. Rehnquist: How about the Falklands?
Craig J. Albert: The Falklands the Falklands, i- th- those residents are not British citizen- citizens.
Anthony M. Kennedy: How about Leicester Square?
Craig J. Albert: Ha.
William H. Rehnquist: Thank you, Mr. Albert.
Sarah L. Reid: Mr. Chief Justice, and may it please this Court.
Speaker: I think his answer...
Ruth Bader Ginsburg: was that i- if they're formed under Scotland, Wales, Northern Ireland, they're okay, yes, but if they're formed under BVI, they're not.
Sarah L. Reid: Right.
William H. Rehnquist: Thank you, Ms. Reid.
The Marshal: The honorable court is now adjourned until Monday next at ten o'clock.