This week, the Supreme Court will once again confront controversy, probably not as highly visible as last week’s abortion rights hearing. This new controversy, though, is on the right of religious people to have access to government benefits, part of a long-running dispute under the First Amendment’s religious freedom clauses. However, that won’t be before the Court until Wednesday. That case will be discussed in this space on Tuesday.
Other cases will be heard earlier in the week. Tomorrow, the Justices will be on the bench for two hearings. The first will focus on what happens to a foreign national living illegally in the U.S. who has been accused of lying about being a citizen. The second hearing examines the rights of workers who take part in retirement plans provided by their employers. Both occur against larger legal and historical backgrounds.
The “live” audio (without video) of hearings can be found at Quick Links on the Supreme Court’s homepage – supremecourt.gov – and at c-span.org/supremecourt and C-Span Now App.
First case: Patel v. Garland (U.S. Attorney General), beginning at 10 a.m. Monday; scheduled for one hour.
Background: Most Americans who have studied civics understand that the national government in America has three branches, which are separated but interacting. Each has unique powers, but each also is checked or counter-balanced by the other two.
This case is about the authority of Congress to decide when a legal dispute can be taken to a federal court – in other words, Congress’s power to define the scope of judicial review. That is a highly significant power that the Constitution created with very few words. Article III, Section 1, directly creates the Supreme Court and then adds that Congress may also create “such inferior courts as the Congress may from time to time ordain and establish.” Article I, Section 8, uses even fewer words, saying that among laws that Congress may pass are those that “constitute tribunals inferior to the Supreme Court.”
Those words have long been understood as authorizing Congress to decide what federal courts may decide. And this power to define courts’ jurisdiction is hardly a trivial one.
Indeed, what often is considered to be the most important decision the Supreme Court has ever issued – the 1804 decision in Marbury v. Madison — involved that very power. That decision, establishing the Supreme Court as the final interpreter of the Constitution, struck down a congressional law giving the Justices the authority to order a lower court to give William Marbury his seat on a local Washington, D.C., court. That law, according to the ruling, went beyond what the Supreme Court was allowed to decide.
The Supreme Court case being heard first on Monday involves congressional authority to decide which disputes over U.S. immigration law can be challenged in federal courts. The Constitution is very clear that it is Congress, not the other branches, that controls who can enter and live in this country. That, too, exists in only a few words in Article I, Section 8, assigning to Congress the authority to “establish uniform rules of naturalization.” Although naturalization itself is the process of gaining U.S. citizenship, it has long been clear that these few words extend widely Congress’s power to control all aspects of immigration – that is, who may cross the borders and live within the United States.
Maybe an over-zealous Congress might some day think it could set up federal agencies and let them decide every legal question about immigration, shutting out the courts entirely from second-guessing what those agencies do. However, the fact that another part of the Constitution (Article III) assigns to the court system all of the “judicial power” of the national government has long been understood to mean that – unless Congress speaks very clearly in denying judicial review of agency action – judicial review is presumed to exist.
This case is about a family — Pankajkumar S. Patel and his wife, Jyotsnaben P. Patel – who came to the U.S. illegally in 1992 from India, and thus they had no legal right to remain. They stayed, however, and the husband later sought to take advantage of a federal law that allows an illegal entrant to apply to change status to become a “lawful permanent resident.” His wife’s status and that of their son now depends upon the husband’s.
He ran into trouble with immigration officials, however, after they discovered that when he had applied for a renewal of his driver’s license in Georgia in 2008, he had marked the box on the form indicating that he was a U.S. citizen. Immigration officials pointed to a provision in federal law that says a non-citizen cannot get a change in status if he or she has falsely claimed to be a citizen, in order to gain a benefit from federal or state government. So, officials refused to adjust the family’s status and moved to deport them to India.
As the case developed after the husband sued, there are several disputes over the facts regarding the citizenship claim and whether it was an innocent mistake. The husband relied on those factual disputes in asking a federal court to overturn the deportation order. The court refused, and found that it had no authority to hear the challenge. It relied on another part of immigration law that says that final orders to deport cannot be challenged in court. It ruled that this also ruled out any power for a court to assess the facts leading to such an order.
The husband and wife appealed to the Supreme Court, arguing that the lower court went too far in closing the courthouse door even for a review of factual controversies in cases like theirs. They have the support of the Biden Administration and of several immigrant rights organizations. Because the government is siding with the family, the Court named an independent private lawyer to argue on the other side.
The question before the Court: Do the federal courts have authority to decide preliminary issues in a deportation case, such as factual disputes, even though they are barred from reviewing final deportation orders?
Significance: It is generally hard for immigrants living illegally in the U.S. to win when they resist being deported or fail when they fail to get changes in status to allow them to remain in the country. Immigration rights activists insist that federal agencies have too much discretion under immigration law, and that, in any event, the process takes too long because the agencies are jammed with cases.
Behind those complaints, though, the main importance of this case is that it tests how far the Court will go to uphold Congress’s power to shape the dockets and the substantive law of the federal courts by stripping them of jurisdiction. It often appears that Congress uses that power because it has political objections to the way the courts second-guess government agencies that Congress has created to carry out its laws.
Second case: Hughes v. Northwestern University This hearing, scheduled for 70 minutes, will begin after the first case ends, at about 11:30 a.m. Monday.
Background: For Supreme Court Justices, one of the least appealing assignments they can get is to write the opinion in any case involving a 1974 law, the Employee Retirement Income Security Act. It is an exceedingly complex statute, and every ruling interpreting it is a laborious challenge.
As its name indicates, it is basically about pension plans – that is, retirement income. It spells out the rules for a variety of benefit plans for employees: workers at private companies (often, 401k plans) or those who work for tax-exempt organizations (often, 430b plans).
For all of its complexity, however, the law is vitally important to the financial security of millions of American workers. Benefit plans covered by the ERISA law protect nearly 150 million workers and have assets approaching $8 trillion – that is, $8,000,000,000,000.
Although the law is dense, one of its most important features is actually a very simple legal proposition: It imposes a duty on those who manage benefit plans to base every decision they make according to what is best for the plan and for the workers it protects (and their families). If the managers’ actions reduce the value of the plan, they must personally compensate for the loss. Technically, the requirement is known as a “fiduciary duty.” (“Fiduciary” means a person or officer who holds something in trust for the benefit of someone else, often described as a standard for acting “prudently.”)
Actually, this aspect is a part of the law of trusts, which traces its origins all the way back to the 11th and 12th Centuries in England, when it was used to protect the property of those who went globe-trotting to serve the Lord in the famous Crusades, so that it was there for them when they came home.
The case before the Supreme Court on Tuesday is, perhaps, a good deal less romantic. It involves decisions made by administrators of “defined contribution plans” – in this case, those who administer two 430b plans that benefit current and former employees of Northwestern University, the non-profit educational institution in Evanston, Illinois.
A defined contribution plan is a retirement savings plan to which both employees and their employer can contribute. In some such plans, the employer matches the employee’s contributions. The money is invested in various financial assets – stocks, bonds or money market funds, for examples – with an investment account for each worker. Those accounts are thus available for workers to draw from, once reaching the age of 59 ½ years. (If a worker draws from the plan earlier, there is a 10 percent penalty.)
Like all ERISA covered plans, the administrators are required to manage the investment portfolio, and decisions about it, in a prudent way for the workers’ benefit.
Three women who now work or did work for Northwestern took this case to the Supreme Court, seeking to revive their ERISA lawsuit against the university, its retirement investment committee, and nine individuals who have acted as fiduciaries for the plans.
They complained that the managers of the plans reduced significantly the value of their personal accounts by regularly investing in securities that had higher investment fees and by paying too much in fees to firms keeping the plan books. They pointed out alternatives that would have cost less. Their lawsuit was dismissed by lower courts at the outset, finding that they could not make their case. Those courts ruled that the plan managers had given sufficient proof that they had acted prudently.
The appeal to the Supreme Court argues that it is a long-standing rule that, if a lawsuit makes a well-founded claim, it should go forward in court for full review rather than being thrown out early. The Biden Administration urged the Court to hear the case and is supporting the workers’ challenge. Lower federal courts are split on the legal issue.
The question before the Court: Does the 1974 retirement income law allow a federal court to dismiss at the outset a workers’ lawsuit over how the plan was managed, if their claim is a plausible one.
Significance: Much is at stake for ERISA plans because the dispute goes to the very heart of how those plans are managed, and because the negative effect on the benefits can be so costly. What is likely to be most important to the Justices are the specific facts of what happened with the Northwestern plans.
On Tuesday, the Court will hear one case, testing whether a federal law making robbery a crime covers attempted robbery, too. That will be discussed here tomorrow.