Circuit Split Watch: Will the Court Bury Casket Cases?

This article first appeared in the April 23, 2013, issue of the National Law Journal’s Supreme Court Brief.

The Benedictine monks of St. Joseph Abbey in southern Louisiana make and sell wooden caskets to support their monastery. State regulators are not happy about it, though, because they say the monks need a license.

The U.S. Court of Appeals for the Fifth Circuit recently ruled for the monks, adding to a circuit split on licensing for casket sales. The U.S. Supreme Court could be asked to weigh in soon.

For more than a century, St. Joseph has been making caskets to bury its monks. In response to requests and a need for more income, the monks began offering wooden caskets for sale to the public in 2007, at below the national average cost. They come in two simple designs; one is no more than a nice wooden box with handles.

“My husband really wanted to have a simple burial. He lived life simply, and he wanted to have just a simple wooden coffin. And so, the monks were able to provide that service for us,” explains a customer in an Institute for Justice (IJ) video. IJ, a libertarian public interest law firm based in Arlington, Virginia, represents the monks.

The Louisiana State Board of Embalmers and Funeral Directors ordered St. Joseph not to sell the caskets. Under Louisiana law, only a licensed funeral home with a licensed funeral director can make such sales. Violators can be fined and even jailed.

To be licensed, funeral homes must have facilities for embalming and preparing bodies, while directors must be apprentices for a year, among other requirements.

The monks admit they are not licensed, but argue that they do not embalm or provide other funeral-related services. They just want to sell caskets.

The regulating Board has nine members, eight of whom are either funeral directors or embalmers. “The State is going after the monks because licensed funeral directors want the casket market to themselves,” Jeff Rowes, an attorney for the monks, contends in an IJ video.

St. Joseph sued the Board in federal court, alleging that the requirements for casket sales are unconstitutional.

On March 20, the monks won in the Fifth Circuit. St. Joseph Abbey v. Castille said that states can regulate business. The court “insist[s] only that Louisiana’s regulation not be irrational—the outer-most limits of due process and equal protection.” The Board “offered no rational basis for their challenged rule and, try as we are required to do, we can suppose none.”

Granting funeral homes “an exclusive right of sale adds nothing to protect consumers and puts them at a greater risk of abuse including exploitative prices,” the Fifth Circuit held. The court also noted that Louisiana does not regulate the construction or design of caskets. In fact, a person can be buried with no casket.

IJ also represented casket sellers in challenges to similar laws in Tennessee and Oklahoma, winning in the Sixth Circuit in 2002 and losing in the Tenth Circuit in 2004. The sellers in those cases were not monks, but business people who, like the monks, wanted to sell caskets, but were not licensed.

In Powers v. Harris, the Tenth Circuit upheld Oklahoma’s casket-sale law, mainly out of deference to the legislature. The court was uncomfortable “substituting [its] view of the public good or the general welfare for that chosen by the states.” A bill to change the law had been introduced three times in the Oklahoma House, but not passed.

The Tenth Circuit found that sometimes states have legitimate reasons for preferring certain industries, for instance to attract business to the state. It is best to leave legislating to the legislators, the court concluded.

In March 2005, the Supreme Court declined to review the Tenth Circuit decision. Now, eight years later, with four new justices, it may have another chance with the monks’ Fifth Circuit win and a refreshed circuit split.

IJ attorneys assert in a recent op-ed that the issue goes beyond caskets to the broader question of how far states can go to favor certain businesses.

A petition for rehearing en banc in the Fifth Circuit was recently denied.

Circuit Split Watch: Former Federal Judge Seeks Restitution for Victims

This article first appeared in the October 31, 2012, issue of the National Law Journal’s Supreme Court Insider.

Paul Cassell, a former federal judge, represents child pornography victims in a series of federal appellate cases. In October alone, Cassell notched a win and a loss in two circuit courts and argued in another. The case he won created a circuit split about restitution for victims, which the U.S. Supreme Court will almost certainly be asked to review.

A former clerk to Chief Justice Warren Burger at the Supreme Court and then-Judge Antonin Scalia at the U.S. Court of Appeals for the D.C. Circuit, Cassell served as a federal district judge in Utah from 2002-2007. He is currently a professor at the University of Utah’s S.J. Quinney College of Law. With the assistance of law students in the Utah Appellate Clinic, Cassell has been involved in litigation throughout the country on behalf of victims.

Under 18 U.S.C. § 2259, child pornography victims are entitled to restitution from defendants for losses in several listed categories, among them: medical expenses, therapy costs, lost income, attorneys’ fees, and “any other losses suffered by the victim as a proximate result of the offense.”

The last phrase is the source of the circuit split.

On October 1, in a win for Cassell, the en banc 5th Circuit concluded that the “proximate result” requirement applies only to the last category, “any other losses.” The 5th Circuit acknowledged that its reading of the statute splits with “[a]ll our sister circuits that have addressed this question.”

Eight federal appellate courts have held that proximate cause applies to all losses. Put another way, there must be some direct link between the defendant’s offenses and the victim’s losses.

The split has important consequences.

Under the majority approach, it is more difficult for victims to collect. Defendants who possess or transport images may not cause a direct loss in the same way that producers of images do. The defendants in the 5th Circuit were guilty of possession, making them harder to reach for restitution.

On October 24, just weeks after the 5th Circuit decision, Cassell lost a case in the 9th Circuit, one of the courts that follows the majority rule. The 9th Circuit affirmed its precedent and expressly declined to adopt the 5th Circuit decision.

In an earlier appeal in the same matter, the 9th Circuit said that “the responsibility lies with Congress, not the courts, to develop a scheme to ensure that defendants . . . are held liable for the harms they cause through their participation in the market for child pornography.”

In its October 24 opinion, the 9th Circuit also raised the possibility of Supreme Court intervention.

Both the 5th and 9th Circuit decisions could be appealed to the Supreme Court soon. The clear split on an important, recurring issue of federal law makes them cases to watch. A former federal judge’s participation also gives the split greater visibility.

Work continues in other cases, as well.

According to the Utah College of Law website, quoting one of Cassell’s students, the 5th Circuit decision “came down in our favor about seven minutes before Professor Cassell got up to argue [on restitution before the 7th Circuit]. That decision changed the face of the argument and the feeling in the courtroom.”

The case was argued on October 1 in a special 7th Circuit sitting at the University of Notre Dame Law School and is pending.

Circuit Split Watch: Is Personal Use of a Work Computer a Federal Crime?

This article first appeared in the June 4, 2012, issue of the National Law Journal’s Supreme Court Insider.

Could the Computer Fraud and Abuse Act be used to “turn ordinary citizens into criminals”? Or is this fear based on “far-fetched” and “wacky hypotheticals”?

Yes and yes, say the majority and dissent in United States v. Nosal, a recent 9-2 decision of the U.S. Court of Appeals for the 9th Circuit, sitting en banc. Chief Judge Alex Kozinski, writing for the majority, acknowledged that its reading of the CFAA splits from other federal appellate court decisions. A petition for certiorari could be filed this summer.

Employees of an executive search firm allegedly accessed the firm’s computer database to obtain information, which they gave to David Nosal, a former employee. Nosal intended to use the information to compete with the firm.

After this came to light, Nosal was indicted on twenty counts, including trade secret theft, mail fraud, conspiracy, and CFAA violations.

At issue on appeal is the phrase “exceeds authorized access” to a computer under the CFAA.

To Chief Judge Kozinski, access and misuse of information are two separate questions. The employees who allegedly fed Nosal information were authorized to access the firm database. They had permission. The problem was subsequent misuse of firm information. The solution is to prosecute the misuse or look to Congress to amend the CFAA, not to imagine words that are not there.

Otherwise, Kozinski said, scores of unsuspecting people who are authorized to use their work computers for business only, under computer-use policies, but check sports news, send personal emails, or engage in other non-work uses, even occasionally, could be guilty of a federal crime—exceeding authorized access.

Kozinski was also concerned that violating particular sites’ terms of use could be criminalized. For instance, eHarmony’s terms of use prohibit giving “inaccurate, misleading or false information.” Saying that you are “‘tall, dark, and handsome,’ when you’re actually short and homely, will earn you a handsome orange jumpsuit,” Kozinski surmised.

Kozinski noted that the majority’s reading of the CFAA veers from 5th, 7th, and 11th Circuit decisions and invited those circuits to reconsider.

Judge Barry Silverman, in dissent, was unimpressed.

This case is not about “playing sudoku, checking email, fibbing on dating sites, or any of the other activities” the majority discussed, Judge Silverman wrote. It is about “stealing an employer’s valuable information to set up a competing business with the purloined data.” The majority’s “far-fetched” and “wacky hypotheticals” miss the point.

Nosal’s co-conspirators were authorized to be in the firm system for firm business, not to steal its information. Silverman gave this example: “A bank teller is entitled to access a bank’s money for legitimate banking purposes, but not to take the bank’s money for himself.”

Other circuits got it right, Silverman explained. Those courts found that authorized access had been exceeded under the CFAA when a Citigroup employee used information from a company database to commit fraud, a Social Security Administration employee tracked old flames and potential new ones via the SSA system, and an employee of a government contractor used her work access to view then-candidate Barack Obama’s student loan records.

The Obama student loan case, from the 8th Circuit, was not discussed in the majority opinion.

At the request of the United States, the losing party in Nosal, the 9th Circuit stayed its mandate pending filing of a petition for certiorari. The en banc decision was issued in April, so a petition could be filed with the Supreme Court as late as July.

Abortion Ultrasound Cases (Updates and Correction)

The last Circuit Split Watch article addressed pre-abortion ultrasound laws in three states and a developing circuit split. Updates and a correction:

The cases challenging the North Carolina and Oklahoma laws are still pending. As noted in the article, former acting Solicitor General Walter Dellinger is now counsel in the North Carolina case, signaling its possible Supreme Court track.

The Texas case is essentially over, though, and the ultrasound law there has gone into effect. The only ongoing dispute is about attorneys' fees.

Following the Fifth Circuit ruling discussed in the article, which vacated a preliminary injunction against the Texas law, and later, the denial of rehearing en banc, the plaintiffs did not appeal to the U.S. Supreme Court. (Their window to appeal closed earlier than reported in the original article, due to further action in the district court; see below. In any case, plaintiffs did not ask the Supreme Court to step in.)

On remand from the Fifth Circuit, the district court judge entered summary judgment for the state defendants. However, he did so unconvinced, explaining that "the legal principles articulated by the [Fifth Circuit] left little room for meaningful discussion." The plaintiffs did not appeal that summary judgment ruling to the Fifth Circuit.

The Center for Reproductive Rights represents plaintiffs in the Texas, North Carolina, and Oklahoma cases. One can only assume that it saw the North Carolina and Oklahoma cases as better vehicles.

Although the Texas case is over, it remains significant—one side of a developing circuit split that could very well end up at the Supreme Court.

Circuit Split Watch: A New Abortion Battleground

This article first appeared in the April 30, 2012, issue of the National Law Journal's Supreme Court Insider.

In a matter of days, a new battle over abortion could reach the U.S. Supreme Court. At issue is whether states can require doctors to perform ultrasounds on women seeking abortions, and to display and describe the fetal images to them. Federal courts have recently split on the question.

According to an April report from the Guttmacher Institute, a pro-choice think tank, more than twenty states regulate pre-abortion ultrasounds. But provisions vary, ranging from written information provided to mandatory ultrasounds. Three states, North Carolina, Texas, and Oklahoma, have the most stringent requirements.

Under North Carolina law, the doctor must perform an ultrasound on a woman seeking an abortion and then display images from the ultrasound to her, noting “the presence, location, and dimensions of the unborn child” and describing “external members and internal organs, if present and viewable.”

Several North Carolina doctors and other health care providers challenged the constitutionality of the law in Stuart v. Huff.

Judge Catherine Eagles of the U.S. District Court for the Middle District of North Carolina preliminarily enjoined the “speech-and-display requirements,” as she called them.

“The First Amendment,” Judge Eagles wrote, “generally includes the right to refuse to engage in speech compelled by the government.” The North Carolina law requires speech via words and imagery, “even when the provider does not want to deliver the message and even when the patients affirmatively do not wish to see it or hear it,” she said.

Eagles also found “no medical purpose” in the speech-and-display requirements.

An order in the case, denying intervention of additional parties, is on appeal at the U.S. Court of Appeals for the 4th Circuit, but the case itself remains before the district court in North Carolina. A trial is set for January 2013.

Walter Dellinger, a prominent Supreme Court advocate with O’Melveny & Myers, who served as acting Solicitor General of the United States, recently entered an appearance in the 4th Circuit for the plaintiffs, opposing intervention. Dellinger’s involvement, in what could be considered a side issue, signals the high-profile nature of the case as a whole and its possible Supreme Court track.

Like North Carolina, Texas also has a mandatory ultrasound law with speech-and-display requirements. However, a federal appeals court has upheld the Texas law.

Writing for a unanimous three-judge panel in Texas Medical Providers Performing Abortion Services v. Lakey, Chief Judge Edith Jones of the U.S. Court of Appeals for the 5th Circuit declared that the “disclosures of a sonogram . . . and [its] medical descriptions are the epitome of truthful, non-misleadling information,” a reference to language in Planned Parenthood of Southeastern Pennsylvania v. Casey, a 1992 Supreme Court decision.

Chief Judge Jones maintained that the Texas disclosures are “more graphic and scientifically up-to-date,” but “not different in kind” than those “discussed [and approved] in Casey—probable gestational age of the fetus and printed material showing a baby’s general prenatal development stages.”

Jones rejected what she saw as the assumption that Casey is “a constitutional ceiling for regulation of informed consent to abortion, not a set of principles to be applied to the states’ legislative decisions.”

The 5th Circuit denied rehearing en banc in February. As a result, a petition for certiorari must be filed with the Supreme Court by May, absent an extension.

Although the federal circuit split is still developing, the Supreme Court may decide to review the ultrasound question, because of its nationwide importance. From the Court’s action in the coming months, whatever that action is, other states will take cues about their boundaries in the future.

A state trial court in Oklahoma recently struck down that state’s ultrasound law, which also includes speech-and-display requirements.

Fifth Circuit Issues Proposed En Banc Rule, Addressing Previous Kerfuffle

Remember the kerfuffle last year when the U.S. Court of Appeals for the Fifth Circuit granted en banc review in a global warming case, lost its quorum, and then reinstated the district court decision, sending the original Fifth Circuit panel decision, which had reversed the district court, into the ether?

The Fifth Circuit has issued a proposed rule amendment that outlines a different course for the future (comments due by July 25, 2011).  Under the proposed rule: "If, after voting a case en banc, the court lacks a quorum to act on the case for 30 consecutive days, the case is automatically returned to the panel, the panel opinion is reinstated as an unpublished (and hence nonprecedential) opinion, and the mandate is released."

Critique of the Fifth Circuit

The National Law Journal is posting an interesting critique of the Fifth Circuit, on the topic of quorums.

Fifth Circuit: No New Trial for Black Panther

The Atlanta Journal-Constitution (via AP) is reporting on a Fifth Circuit decision yesterday (not yet available from the court's website): Appeals court rejects new trial for Black Panther ajc.com.

Update (2:20 PM): The decision is linked here.  Also, ABC News coverage of the earlier district court decision is here.