Tag: amicus briefs

Employers Aren’t Mind-Readers and Shouldn’t Be Forced to Pry Into Employees’ Religious Beliefs

The Equal Employment Opportunity Commission (EEOC) is responsible for enforcing federal laws against employment discrimination. Along with enforcing these laws—most notably, Title VII of the Civil Rights Act, which outlaws discrimination on the basis of race, color, religion, sex, or national origin—the EEOC tells employers how not to discriminate. For example, the EEOC’s Best Practices for Eradicating Religious Discrimination in the Workplace instructs that an employer should “avoid assumptions or stereotypes about what constitutes a religious belief” and that managers “should be trained not to engage in stereotyping based on religious dress and grooming practices.” 

It’s passing strange, then, that the government is now arguing before the Supreme Court not only that employers can do these things, but that they must, or face liability under Title VII, in the context of reasonable accommodations that companies have to make for religious practice. Discerning when such accommodations are necessary can be difficult because people practice religion differently—and often in their own personal, non-obvious way. 

Title VII has thus traditionally been understood to leave it to the employee to determine when a company policy conflicts with his or her religious practice and then to request an accommodation. This interpretation leaves employers free to pursue neutral policies up to the point that they have actual knowledge of such a conflict. 

In the last several years, however, the EEOC has apparently taken the position that employers must pry into their employees’ religious practices whenever they have an inkling of suspicion that an accommodation may be needed. Abercrombie & Fitch is one company that has found out just how impossible a situation this puts employers into. When Abercrombie decided not to hire Samantha Elauf as a sales associate based on her violation of the company’s “Look Policy”—a branding guide that, among other things, prohibits the wearing of clothing generally not sold by the store, like Elauf’s black headscarf—the company found itself on the wrong end of a government lawsuit. 

A federal district court ruled for the EEOC even though Elauf never informed them that she would need a religious accommodation.  The U.S. Court of Appeals for the Tenth Circuit reversed, holding that an employer must actually know about a religious practice before it can be held liable for discriminating on that basis. The Supreme Court took the case at the EEOC’s request and Cato has now filed a brief in support of Abercrombie. 

We argue that employers must have actual knowledge of the potential need for a religious accommodation before they can be held liable for violating Title VII because the EEOC hasn’t offered any coherent alternative and because employers already know how to use this tried-and-true actual-knowledge standard. In addition, the burden of identifying the need for accommodations has to be on the employee because, after all, it’s their religion, and thus they are in a significantly better position to identify conflicts than employers—who aren’t mind-readers and shouldn’t have to rely on crude stereotypes or pry into employees’ personal lives. 

An opposite rule would create an awkward and uncomfortable scenario all-around. The EEOC’s position is short-sighted; if the agency somehow prevails, it will have done what federal agencies do best: turn minimal burdens for some people into heavy burdens for everyone.

The Supreme Court will hear argument in EEOC v. Abercrombie & Fitch Stores, Inc. on February 25.

Uncle Sam’s Vestigial Feudalism

In the feudal era, rulers funded their households by taking a share of the crops farmers in their territory produced. The lords called this tribute and the peasants would’ve called it extortion.

We like to think that we’ve come quite a ways since then. After all, taxes are now paid withmoney—or even a digital abstraction of money—and forms, not cartloads of grain. We can even feel good (well, sanguine) about paying taxes, because we know that we’re funding the government of our own choosing—a democratically elected leadership restrained by the Constitution—not just feeding the avarice of a local warlord.

Except if you’re a raisin farmer in California, a state responsible for 40% of the world’s and 99% of America’s raisins. If you’re a California serf raisin farmer, you’re required by federal law to hand over up to 47% of each year’s crop to the U.S. government so the government can control the supply and price of raisins under a New Deal-era regulatory scheme.

The Fifth Amendment says that “private property [shall not] be taken for public use, without just compensation,” however, so it’s hard to see how it would be constitutional for the government to take nearly half a farmer’s harvest without any payment—let alone “just compensation.” (To be clear, if you grow grapes for use in wine or juice, you’re fine. It’s only if you dry out those grapes that you have to watch your property rights evaporate.)

Yet the U.S. Court of Appeals for the Ninth Circuit has done just that, repeatedly. In 2012, the en banc court held that nobody could challenge this taking in federal court. The Supreme Court unanimously disagreed. (For more background and to read Cato’s merits brief in that case go here.)

Failing to take the hint, the Ninth Circuit has now held that the Fifth Amendment’s protection against state expropriation simply doesn’t apply to personal property (as opposed to real estate). To put it bluntly, that’s an arbitrary, unprecedented, and ahistorical distinction, so raisin farmers are once again forced to ask the Supreme Court to correct lower court’s failure to protect their rights.

Joined by the five other organizations, Cato has filed a brief urging the Court to take this case, thus insuring that the farmers’ constitutional rights aren’t left to wither on the vine. We argue that the Ninth Circuit’s distinction between real and personal property has no basis in the text and history of the Constitution, Supreme Court precedent, or a reasonable understanding of the English language.

The Fifth Amendment embodies the notion that property rights are central to a free people and a just government. It could not be more clear that property can’t be taken without “due process,” and that when it is taken, the government must pay “just compensation.” These guarantees reflect the many values inherent in private property, such as individual achievement, privacy, and autonomy from government intrusion.

By devaluing property rights of all sorts, the Ninth Circuit weakens the values of autonomy and reliance that undergird the Takings Clause and conflicts with the very foundations of our constitutional order.

Raisin farming ain’t easy; five pounds of grapes yield only one pound of raisins. Raisin farmers shouldn’t have to hand over half of that pound to the federal government.

The Supreme Court will decide whether to take Horne v. U.S. Dept. of Agriculture later this fall.

Cato legal associate Gabriel Latner co-authored this blogpost.

Cato Maintains Opposition to IRS Lawlessness in Obamacare-Subsidies Case

To encourage the purchase of health insurance, the Affordable Care Act added a number of deductions, exemptions, and penalties to the federal tax code. As might be expected from a 2,700-page law, these new tax laws have the potential to interact in unforeseen and counterintuitive ways.

As first discovered by Michael Cannon and Jonathan Adler, one of these new tax provisions, when combined with state decision-making and IRS rule-making, has given Obamacare yet another legal problem. The legislation’s Section 1311 provides a generous tax credit for anyone who buys insurance from an insurance exchange “established by the State”—as an incentive for states to create the exchanges—but only 16 states have opted to do so. In the other states, the federal government established its own exchanges, as another section of the ACA specifies. But where § 1311 only explicitly authorized a tax credit for people who buy insurance from a state exchange, the IRS issued a rule interpreting § 1311 as also applying to purchases from federal exchanges.

This creative interpretation most obviously hurts employers, who are fined for every employee who receives such a tax credit/subsidy to buy an exchange plan when their employer fails to comply with the mandate to provide health insurance. But it also hurts some individuals, such as David Klemencic, a lead plaintiff in one of the lawsuits challenging the IRS’s tax-credit rule. Klemencic lives in a state, West Virginia, that never established an exchange, and for various reasons he doesn’t want to buy any of the insurance options available to him. Because buying insurance would cost him more than 8% of his income, he should be immune from Obamacare’s tax on the decision not to buy insurance.  After the IRS expanded § 1311 to subsidize people in states with federal exchanges, however, Klemencic could’ve bought health insurance for an amount low enough to again subject him to the tax for not buying insurance. Klemencic and his fellow plaintiffs argue that they face these costs only because the IRS exceeded the scope of its powers by extending a tax credit not authorized by Congress.

The district court rejected that argument, ruling that, under the highly deferential test courts apply to actions by administrative agencies, the IRS only had to show that its interpretation of § 1311 was reasonable—which the court was satisfied it had. On appeal, a panel of the U.S. Court of Appeals for the D.C. Circuit held that the plain language of the ACA precluded the federal government from subsidizing the premiums of insurance policies obtained through federally established exchanges. Later that same day, the Fourth Circuit in King v. Burwell took the opposite position on the same question—from which ruling there is now a cert petition pending in the Supreme Court.

This circuit split did not last long, however, as the D.C. Circuit decided to vacate the panel opinion and rehear Halbig en banc (meaning all the court’s judges, not just a three-judge panel). Federal appellate rules say that such review “is not favored” and the D.C. Circuit has a particularly high bar, on average taking only one case per year en banc. Judge Harry Edwards, who dissented in the Halbig panel ruling, has taken great pains to reduce the number of en banc hearings. Even before he served as the D.C. Circuit’s chief judge, Edwards wrote in Bartlett v. Bowen (1987) that “the institutional cost of rehearing cases en banc is extraordinary” and that it “substantially delays the case being reheard, often with no clear principle emanating from the en banc court.” Nevertheless, the court took this step, vindicating President Obama’s strategy of packing the underworked D.C. Circuit after the Senate eliminated the filibuster for judicial nominees.

Cato and the Pacific Research Institute have filed a brief continuing our support for the plaintiffs on their appeal. While it is manifestly the province of the judiciary to say “what the law is,” where the law’s text leaves no question as to its meaning—as is the case here with the phrase “established by the State”—it’s neither right nor proper for a court to replace the laws passed by Congress with those of its own invention, or the invention of civil servants.

If Congress wants to extend the tax credit beyond the terms of the ACA, it can do so by passing new legislation. The only reason for executive-branch officials not to go back to Congress for clarification, and instead legislate by fiat, is to bypass the democratic process, thereby undermining constitutional separation of powers.

This case ultimately isn’t about money, the wisdom of individual health care decision-making, or even political opposition to Obamacare. It’s about who gets to create the laws we live by: the democratically elected members of Congress, or the bureaucrats charged with no more than executing the laws that Congress passes and the president signs.

The en banc D.C. Circuit will hear argument in Halbig v. Burwell on December 17.

Amtrak Shouldn’t Get to Write Its Own Ticket

Article One, Section One of the Constitution vests “all legislative powers” in Congress. The sovereign power to make laws comes from the people, so their representatives—Congress—should make those laws.

It sounds simple enough, but once the federal government started ballooning in size and regulating everything under the sun, that simple understanding had to go. There was too much governing for Congress to handle on its own, so the courts adjusted, allowing a proliferation of government agencies to exercise lawmaking power, within certain guidelines.&

We’ve now apparently gotten to the point, however, that there’s so much governing to do that it’s too much for the government to handle on its own. In a case now before the Supreme Court, Amtrak—the for-profit, quasi-public entity that the federal government has deemed private for these purposes—has been given a part to play in making laws to regulate its competitors in the rail transportation industry.

The Constitutional Dimension of Your Morning Commute

Over the last few years, D.C.-area drivers may have noticed the continual increases in toll fares on the Dulles Toll Road, the highway going through the Northern Virginia suburbs past Dulles Airport.  Indeed, since 2005, the toll for the typical round-trip commuter has more than quadrupled from $1.50 to $7.00, with more increases coming. These extra toll dollars haven’t been going for upkeep or expansion of the highway, however, but instead have been funding the over-budget and under-performing construction of the Metro’s Silver Line extension.

While originally slated to fund only 25% of that cost, commuters are now looking at paying more than half of the $5.6 billion (and counting) total cost, with years of construction still to come. The entity in charge of the construction project (and of gouging the toll road’s commuters) is the Metropolitan Washington Airports Authority, a public body established to govern Dulles and Reagan National airports at the behest of the Department of Transportation. But who’s actually in charge of the MWAA, and to whom can beleaguered commuters turn for relief? Although created by an interstate compact between D.C. and Virginia, the MWAA was granted all of its authority by an act of Congress, and the highways and airports that it oversees are federal property.

In many ways, the MWAA acts like a federal agency—in nearly all ways, in fact, except one important aspect: oversight. If federal assets and lawmaking power are being delegated to the MWAA, then there must be a means for the executive branch to “take care that the laws be faithfully executed.” The MWAA, however, is governed by a board of individuals whom the president has no meaningful ability to appoint, oversee, or control. This means that the MWAA has no political accountability for its decisions.

Having no other meaningful recourse, a group of Dulles Toll Road users sued the MWAA, arguing that its decrees violate the separation of powers. (Full disclosure: my wife and I just bought a house in Falls Church and will likely be using the road every now and again, though not on my commute to Cato.) The federal district and appeals courts—two of them, in an unusual development whereby the Federal Circuit transferred the case to the Fourth Circuit—decided that the MWAA’s nature as a state-created entity required the case to be dismissed. Moreover—get this—because the MWAA has no meaningful executive-branch control, there is no separation-of-powers issue. (This despite the federal government’s appearance as an amicus to argue that the MWAA exercises federal power and is subject to separation-of-powers scrutiny.)

Undeterred, the plaintiffs have petitioned the Supreme Court to hear their case. Cato has joined the American Highway Users Alliance and the Recreation Vehicle Industry Association on a brief supporting their petition. We argue that the Court should take the case because (1) there is a critical violation of the separation of powers, (2) there are already manifest harms resulting precisely from that violation, and (3) the federal government sees and treats the MWAA as a federal agency—but one without any meaningful accountability whatsoever.

It isn’t every day that a separation-of-powers case is as squarely presented as it is here, where commuters are being railroaded, so to speak, by a runaway agency whose conductor is absent. The executive branch has to take the blame not only for the MWAA’s policies, but its corruption, incompetence, and mismanagement.

The Supreme Court will decide whether to take Corr v. Metro. Washington Airports Authority later this fall.

Supreme Court Must Resolve Obamacare Chaos

When the Affordable Care Act was being debated in Congress, former House Speaker Nancy Pelosi infamously insisted that “we have to pass the bill to find out what’s in it.”  It turns out, however, that the Obama administration—which has been making it up as it goes along with regard to ACA enforcement—doesn’t care “what’s in it.”

The IRS in particular has been implementing Obamacare as it thinks the law should be, not as it is. The ACA encourages states to establish health insurance exchanges by offering people who get their health coverage “through an Exchange established by the State” a tax credit—a subsidy to help them pay their premium. In the event a state declines to establish an exchange, Section 1321 further empowers the Department of Health and Human Services to establish federal exchange in states that decline to establish their own exchanges (without providing for the premium subsidy).

When, contrary to the expectations of the law’s achitects, 34 states declined to establish an exchange—two more have since failed—the IRS decided that those getting their insurance on federally established exchanges should qualify for tax credits regardless of the statutory text. In conflict with the U.S. Court of Appeals for the D.C. Circuit in a similar case called Halbig v. Burwell, the Fourth Circuit in King v. Burwell found the legal text to be ambiguous and thus deferred to the IRS interpretation.

The so-called Chevron doctrine counsels that statutory text controls when Congress has spoken clearly on an issue. But where Congress is ambiguous or silent, the agency can fill the regulatory gap with its own rules and policies. The problem here is that the ACA’s text was not ambiguous and there is no evidence that Congress intended to delegate to the IRS the power to determine whether billions of taxpayer dollars should annually be dispersed to those purchasing health care coverage on federal exchanges. That the Fourth Circuit has bent over backwards to accommodate the administration’s latest Obamacare “fix shows that it, too, is not so concerned with “what’s in” the law. 

To that end, Cato joined four other organizations to support the plaintiffs’ petition for review by the Supreme Court. Our brief argues that the Court should hear the case because it offers the opportunity to reverse potentially grave harm to the separation of powers, to correct a misapplication of the Chevron doctrine, and to restore the idea that drastically altering the operation of a major legislative act belongs to the political process and not in a back rooms of an administrative agency. Just because those who voted for the ACA didn’t care what it said doesn’t mean that the executive and judicial branches should also turn a blind eye.  

To see the legal machinations now at play in these cases regarding the Obamacare-IRS-tax-credit, see my recent op-ed in the National Law Journal. Since that was published this past Monday, the government received a 30-day extension in which it has to file its response to the King cert petition. That means that the Supreme Court will be considering at some point next month whether to take the case.

For Cato’s previous briefs in Halbig and King, respectively, see here and here.

The First Amendment Protects Random Ugly Rap Lyrics

To ensure that public discussion remains “uninhibited, robust, and wide-open,” the First Amendment protects speech that is “vituperative, abusive, and inexact.” While nobody will argue that Anthony Elonis’s speech—the subject of a Supreme Court case this coming term—was anything but “vituperative, abusive, and inexact,” there is considerable disagreement over whether his speech should be protected by the First Amendment. 

Elonis’s chosen form of speech was a series of rap lyrics he posted on Facebook under the pseudonym “Tone Dougie.” Many of the lyrics were violent and lurid, and some of those violent images were made in reference to Elonis’s estranged wife, who took them as a threat to her life. As a result of his crude posts, Elonis was fired, his wife obtained a protective order against him, and he was arrested and charged with violating 18 U.S.C. § 875(c), which makes it a federal crime to transmit in interstate commerce “any communication containing any threat to injure the person of another.”

Elonis argued that his rap lyrics were an artistic expression and that because he did not intend them to be a threat, his speech should be protected. The federal district court hearing his case didn’t see it that way. The judge rejected his request that the jury be instructed to consider his actions based on whether he expressed a subjective intent to threaten and instead instructed the jury to judge his speech based on whether a reasonable person would have interpreted the lyrics as a serious expression of intent to inflict bodily injury. Elonis was thus convicted and the U.S. Court of Appeals for the Third Circuit also rejected his argument that a subjective intent to threaten is required before speech loses First Amendment protection.

Now before the Supreme Court, Cato has joined the American Civil Liberties Union, the Abrams Institute for Freedom of Expression at Yale Law School, the Center for Democracy & Technology, and the National Coalition Against Censorship on a brief supporting Elonis’s position. We argue that Supreme Court precedent shows that (1) a subjective intent to threaten is an essential element of a “true threat,” (2) requiring a finding of subjective intent is in line with First Amendment principles, and (3) drawing the line between threat and protected speech carefully is particularly important given the rise of the Internet as a forum of communication—one where it can be easy to take things out of context.

As a matter of most people’s taste, the Internet may well be better off without violent rap lyrics like Anthony Elonis’s. But that shouldn’t matter to this case or how it’s analyzed under the First Amendment, which requires a high standard of proof regarding incitement or threats of violence before individuals can be jailed for their speech. The Supreme Court should take this opportunity to speak that truth freely across all mediums.

Elonis v. United States will be argued at the Supreme Court in November or December.

This blogpost was co-authored by Cato legal associate Julio Colomba.